Pioneer entrepreneurs had what it takes to succeed

some insights from New Zealand's entrepreneurial past.

We studied 150 New Zealand entrepreneurs between 1880 and 1930 across a range of industries. The issues that emerge from these historical cases include the importance of commercial experience, venture failure, immigration and access to capital.

These are also issues for the present and future.

Youth is not enough for entrepreneurial success. While young entrepreneurs have started some of our most successful long-term firms, this is not the whole picture. On average, entrepreneurs at the turn of the century started their first venture aged 27, with 12 years of commercial experience. Overall 35 per cent received a trade qualification and 41 per cent held a management position before starting their first venture.

The entrepreneurs are at the point in their lives where they have not only achieved mastery of business problems and skills, but also over themselves, displaying greater self-confidence and competence.

It is during the mid-life period that entrepreneurs have established the networks, contacts, experience and credibility to establish a successful business.

Entrepreneurs are also seen as risk takers, whose businesses may fail. The rate of failure in this historical sample was 31 per cent.

But what happened next? Eighty-nine per cent of failed entrepreneurs again achieved business success.

In some cases they rebuilt the business that had failed, or took on a new partner, or pursued a completely new product/service innovation.

Whatever route was taken, failure was not the end of the line for New Zealand business entrepreneurs at the turn of the century. Rather they carried on to make a renewed contribution to economic growth.

In total numbers, the 150 entrepreneurs in this historical sample were involved in 535 business ventures. Of these ventures, 426 were entirely new start-ups.

Twenty-five per cent of the entrepreneurs in the sample were involved in five or more business ventures over their lifetime.

What this study suggests is that New Zealand entrepreneurs have a heritage of serial entrepreneurship.

In this regard, the failure of a commercial venture by an entrepreneur, though an unpleasant experience, is only a stepping-stone to a longer-term economic contribution.

Our research also underscores the importance of the migrant entrepreneur. Seventy-five per cent of the entrepreneurs that we studied were immigrants.

Over a third of the immigrants had gained trade qualifications before arriving in New Zealand. As such, they were well equipped to take advantage of opportunities in the emerging economy.

For example, William Dawson was already a fully qualified brewer by the time he came to New Zealand aged 21 and he quickly found employment at Wilsons Well Park Brewery.

Three years later, he left the firm with James Speight and Charles Greenslade, took over a redundant malt house and established James Speight & Company. Within 10 years, it dominated the local market and continued its growth to become the largest brewery in New Zealand.

What can we learn from our history? Clearly, New Zealanders have entrepreneurial traits. We applaud ingenuity and inventiveness, we have a willingness to have a go, and seem to be good all-rounders.

We also have a strong history of entrepreneurs who developed large, enduring and international enterprises. Without extensive access to venture capital, past entrepreneurs were able to use their significant business experience to develop a new firm.

Their ventures were not always successful, although the risks, then and now, are often overstated.

Those who did fail treated failure as a stepping-stone to new opportunities.

* This article is a shortened version of a feature that appeared in the University of Auckland Business Review.

* Ian Hunter is a lecturer at the University of Auckland Business School.

** Dr Marie Wilson is Associate Professor of Management at the University of Auckland Business School.