Harvard Business School Professor Mukti Khaire says from her research the key may be in acquiring intangible resources such as legitimacy, status, and reputation.
So how do those 1 our of 10 firms grow into successful, sustained enterprises? Some of her key findings:
- Only one out of every ten newly founded firms in the United States grows to a size of more than ten employees (Aldrich, 1999).
- One revelation was the strong positive effect that mimicking older organizations had on new venture growth. Mimicry is important - for new firms in established industries, there is value to doing some non-technical, symbolic things in the manner that is widely accepted, and to adhering to industry norms and culture.
- Entrepreneurs and managers should almost never shy away from stepping out of their comfort zone and taking on large jobs, since the payoff does arrive.