Risk-taking propensity of successful and unsuccessful Hispanic female entrepreneurs
The purpose of the study was to compare how the risk-taking propensity of successful Hispanic female entrepreneurs differed from unsuccessful Hispanic female entrepreneurs. Also investigated were the dynamics of age, marital status, educational attainment, business training, amount and source of start-up financing, previous business experience, length of business ownership, and type of business owned on the risk-taking propensity of the two groups of Hispanic female entrepreneurs.
The number of women-owned small businesses has increased dramatically during the last decade, yet their businesses are more likely to fail than the national average within the first year of operation and almost half fail within the first four years of operation. Therefore, there is considerable risk in starting a new business--both financially and personally.
Risk-taking propensity has been linked to business success. The ability to identify risk-taking propensity and the characteristics affecting risk-taking propensity will provide the female entrepreneur information important to her decision to become an entrepreneur. Through these means, the female entrepreneur can increase her probability for success.
Hispanic female entrepreneurs from a tri-county area in South Central Texas were interviewed and a modified version of Kogan and Wallach's (1964) Choice Dilemma Questionnaire administered to determine risk-taking propensity. Multivariate analysis and correlations were used to analyze the data. The instrument was factor analyzed.
There were no significant differences in the risk-taking propensity of the two groups. With the successful group of entrepreneurs, risk-taking propensity was found to be significantly related to age, source of start-up financing, and informal training with insurances. With the unsuccessful group of entrepreneurs, risk-taking propensity was found to be significantly related to informal business training in credit.