Entrepreneurship in Family Firms

This lecture explores whether entrepreneurship in family firms represents a synonym or a contradiction. Family firms (FFs) constitute around two-thirds of all enterprises worldwide and are the cornerstone of most economies, particularly in Europe. Characterized by the overlap of ownership and management across generations, they face unique entrepreneurial challenges compared to non-family firms. While their strong focus on legacy preservation and socioemotional wealth (SEW) often leads to risk aversion and resistance to radical innovation, their long-term orientation and cohesion can also serve as key drivers of sustainable entrepreneurial success.

Building on the concept of Entrepreneurial Orientation (EO)—which encompasses innovativeness, proactiveness, and risk-taking—this lecture examines how different contextual configurations shape entrepreneurial behavior and performance in family firms. Using a fuzzy-set Qualitative Comparative Analysis (fsQCA) based on data from 149 family firm entrepreneurs and seven narrative interviews, four distinct configurations were identified that lead to higher performance: (1) Proactive but family-based, (2) Renewing and ownership-focused, (3) Open-minded but risk-averse, and (4) Maintaining and transgenerational.

These results reveal that entrepreneurship in family firms is far from homogeneous; rather, it emerges from specific combinations of family governance, strategic orientation, and generational intentions. Particularly, firms balancing innovation with continuity and clearly defined succession plans tend to perform more sustainably.

The lecture highlights the importance of adopting configurational and context-sensitive perspectives in family business research. It also provides practical implications for owners and managers regarding succession planning, governance design, and the development of an entrepreneurial mindset within the family firm context.