Business takeover or new venture? How does family business affect these career paths?

Abstract

This study analyzes the determinants of entrepreneurial modes of entry by conducting a paper-based survey among 3547 students in Vietnam. The focus is to identify the influence of family business background and attitude toward risk on the intention to choose between business takeover versus new venture start-up modes. Results of hierarchical multinomial and binomial logistic model analyses show that people whose parents are self-employed tend to have higher motivation for business takeovers. Meanwhile, people who have higher levels of risk-taking tend to favor new venture start-ups. Results show that entrepreneurship is nurtured through family bonds. From that perspective, it is important to enhance social attitudes toward entrepreneurship and create an entrepreneurship culture to cultivate entrepreneurship among generations. Results also imply the importance of building an entrepreneurial-friendly environment where risk-taking action is tolerant of failing. These findings persist consistently through robustness checks by eliminating respondents who selected inheriting their family business.