May Business Mentors Act as Opportunity Brokers and Enablers Among University Students?

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May Business Mentors Act as Opportunity Brokers and Enablers Among University
Students?
Étienne St-Jean1, Ph.D., Professor, Research Institute on SMEs, University of Québec at
Trois-Rivières,, 3351, boul. des Forges, Trois-Rivières (Québec), Canada, G9A 5H7. Email:
etienne.st-jean@uqtr.ca, Tel: 1-819-376-5011 #4293.
Maripier Tremblay, DBA, Professor, Université Laval, Faculté des sciences de
l'administration, Pavillon Palasis-Prince, local 1523, Québec (Québec), G1V 0A6. Email:
Maripier.Tremblay@fsa.ulaval.ca, Tel: 1-418-656-2131, # 4961.
Frank Janssen, Ph.D., Professor, Louvain School of Management, Université Catholique de
Louvain, Place des Doyens, 1, 1348 Louvain-La-Neuve, Belgium. Email:
frank.janssen@uclouvain.be, Tel.: +32 (0)10 47 84 28.
Jacques Baronet, Ph.D., Professor, Université de Sherbrooke, 2500, boul. de l'Université
Sherbrooke (Québec) Canada, J1K 2R1. Jacques.Baronet@USherbrooke.ca, Tel.: 1-819-821-
8000, # 63050. Email:
Christophe Loué, Ph.D., Professor-researcher, NOVANCIA, 3 rue Armand Moisant, Paris
(France) 15ème, Email: cloue@novancia.fr, Tel.: 06.63.60.46.18.
Aziz Nafa, Economist-researcher, Centre de Recherche en Économie Appliquée pour le
Développement (CREAD), division Firmes et Économie Industrielle, BP 187 - Rostomia -
Bouzaréah - Alger – Algeria. Email: aziznafa@gmail.com, Tel.: + 213 021941272.
Abstract
Networks are recognized as a central component of the entrepreneurial process, in particular
with regard to opportunity identification and exploitation. In this study, we more specifically
analyze the role of mentors who are entrepreneurs as opportunity brokers and enablers among
university students with entrepreneurial intentions. Our investigation on a sample of 1,810
students from 13 universities from Canada, France, Belgium and Algeria indicate that
entrepreneur mentors, contrary to other mentors, support opportunity identification and
exploitation among university students. Although gender, entrepreneurial experience and
education have a more pronounced effect than the support of an entrepreneur mentor on
opportunity identification and exploitation, mentoring is the only element that can be
controlled through the creation of formal support programs. These results call on public
authorities, and universities in particular, to implement formal mentoring programs to support
students who are interested in starting their own business, and who would not otherwise have
access to business mentors in their environment.
Keywords: opportunity identification and recognition, opportunity exploitation; mentoring;
network; university student.
1 Corresponding author.
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Introduction
Several factors have been identified as being important for opportunity recognition. These
include, in particular, the business creator’s knowledge , cognitive schemas , psychological
predispositions such as alertness to opportunities , social capital and networking . Recently,
and more specifically, it has been both suggested and demonstrated that mentors were
capable of helping novice entrepreneurs to identify business opportunities . But what about
individuals who are likely to start a business but have not already started? Clarifying the
business idea before start-up and aiming at a profitable opportunity may be crucial for
individuals who want to embrace an entrepreneurial career and succeed in it. Indeed, for
people who are starting for the first time ever, the lack of experience may reduce the
probability of being profitable or alleviate the willingness to take action . To put it
differently, the lack of experience weakens the qualities of opportunities that can be
recognized and makes people more hesitant before investing resources to exploit them .
Being supported by an experienced business person may overcome these hindrances by
enhancing the opportunity recognition process and reducing the fear of exploiting a business
idea . Could mentors also play a role in helping identify and exploit opportunities among
individuals with entrepreneurial intentions, and university students in particular? This is a
critical question from both a theoretical and practical standpoint. Knowledge about the effect
of mentors on opportunity recognition is fragmented, even though recent results show that
they have a strong positive impact on the process . From a practical point of view, such
knowledge would confirm the effect of mentoring on potential business creators and, in
particular, university students. If applicable, a strong positive effect would suggest pairing
mentors with university students who wish to start their own business after they complete
their studies in order to foster business creation by identifying promising opportunities, on
one hand, and reducing the fear of investing time and resources on these opportunities, on the
other.
1. Review of the literature
Given the importance of information to identify opportunities , some authors have suggested
that networks, that help to circulate information, could also have a positive impact on
opportunity identification . Despite the scarcity of studies on this dimension of opportunity
identification, the results show that networks appear to have a positive influence on creative
skills and vigilance, and thus also influence opportunity identification . Although the results
reported by Ozgen and Baron have shown that obtaining information, in particular through a
mentor or by participating in professional forums, can help entrepreneurs identify
opportunities, the effect of the mentor has received little attention with regard to its impact on
opportunity identification by novice entrepreneurs, and even less so by potential
entrepreneurs. It would however be reasonable to suggest that a mentoring relationship could
be of benefit to an individual who intends to start a business. We know, for example, that a
novice can obtain tacit information from a mentor, allowing him to reach beyond his lack of
experience and identify opportunities . By providing access to information and knowledge
and by helping analyze information from different angles, the mentor is likely to increase the
ability of business creators to recognize opportunities and, thus, acts as an opportunity broker.
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Weak ties are recognized to give access to financing and, more generally, to other types of
resources . It is recognized that entrepreneurs can use networks to learn and improve their
capacity to exploit business opportunities, especially if there is a high level of trust between
its members . By providing business contacts to the potential entrepreneur and occasions to
learn, a mentor may also acts as an “opportunity enabler” by facilitating access to resources
needed to exploit the identified opportunity .
These observations suggest the following hypotheses:
H1: Entrepreneur mentors act as opportunity brokers and positively influence opportunity
identification among potential entrepreneurs.
H2: Entrepreneur mentors act as opportunity enablers and positively influence opportunity
exploitation among potential entrepreneurs.
2. Methodology
This section describes the sample used to test our hypotheses. A presentation of the measures
used for the various concepts and the analysis conducted will follow.
2.1. Sample
The sample used in this study was drawn from an extensive longitudinal investigation of
entrepreneurial careers. The main objective of this investigation was to understand the factors
that determine the entrepreneurial intentions of students as well as their actions, seen through
social cognitive career theory . In total, students from 13 universities were contacted to
answer a questionnaire: ten Canadian universities, one French business school, one Belgian
university and one Algerian university. The invitation was sent by email or posted on student
Intranets or institutional journals. A total of 1,810 students agreed to take part in this first
phase of the five-year annual investigation. This is, of course, a non-probabilistic sample,
given that only the interested students agreed to participate.
2.2. Measures
Dependant variables – Business opportunities
We provided the participants in this study with the following definition of a business
opportunity:
“A business opportunity can be defined as a situation in which new products,
services, raw materials or production methods may be successfully introduced
and which we believe can be sold for a higher price than the cost of production.
In other words, it is the meeting point between current or future client needs
and the available resources to meet those needs, all in a timely fashion and in a
manner perceived as economically profitable”2.
We then asked them to indicate the number of business opportunities they had identified over
the previous five (5) years (opportunity identification) and, subsequently, for how many of
these opportunities they had invested any effort to exploit them (opportunity exploitation).
2 Our translation.
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This method of measuring opportunity identification and exploitation has been used by
several authors in the past .
Independent variable – Mentoring
We provided the respondents with the following definition of a mentor: “A mentor is defined
as a high-ranking individual who is experienced or has expertise and who teaches, advises,
inspires, guides and helps another person with their personal and professional development”.
We subsequently asked them to identify the number of persons in their lives who could be
considered as mentors (number of mentors) and, from that number, how many of them owned
a business (mentors in business).
2.3. Analysis
Since both dependent variables were distributed according to Poisson’s law, a Poisson
regression analysis was used. This type of regression enables the measurement of the
probability of occurrence of an event (dependent variable) based on a linear function of a set
of predictors (independent variables) specified in the test.
3. Results
As illustrated in Table 1, gender is a significant predictor of opportunity identification and
exploitation, with men showing a higher overall rate (β=0.369). The Exp(β) coefficient
indicates that men are 1.44 more likely to identify an opportunity and 1.226 times more likely
to exploit an opportunity where the rest of the test remains constant. Age is not significant for
either opportunity identification or exploitation. Level of education increases the probability
of identifying (β=0.107), but not of exploiting an opportunity. Work experience has a positive
effect on opportunity identification and exploitation, whereas supervision experience does
not. Entrepreneurial experience also has a significant effect on the probability of identifying
and exploiting opportunities. In fact, a lack of experience makes an individual 0.774 times
less likely to identify and 0.846 times less likely to exploit an opportunity. However, neither
having parents in business (or having been entrepreneurs), nor the number of mentors not in
business have an effect on opportunity identification or exploitation. Lastly, mentors that are
entrepreneurs positively affect the probability of students identifying and exploiting business
opportunities. These results confirm H1 and H2.
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Table 1
Poisson Regression of Opportunity Identification and Exploitation among
University Students
Opportunity
Identification
Opportunity
Exploitation
β Exp(β) β Exp(β)
(Constant) 0.897*** 2.453 0.298 1.347
Gendera0.369*** 1.446 0.204*** 1.226
Age -0.003 0.997 0.001 1.001
Education 0.107*** 1.113 -0.070 0.932
Work experience 0.030*** 1.030 0.036** 1.036
Supervision experience 0.007 1.007 0.007 1.007
Entrepreneurial exp.b-0.256*** 0.774 -0.168*0.846
Family in businessc-0.043 0.958 0.012 1.012
Mentors not in business 0.005 1.005 0.024 1.024
Mentors in business 0.079*** 1.082 0.084*** 1.087
n 1321 1311
a Reference = Men; b Reference = No past experience; c Reference = Family not in business
*=p≤0.05; **=p≤0.01; ***=p≤0.001
4. Discussion and conclusion
The results of this study show the positive effect of mentors in business (entrepreneurs) on
opportunity identification and exploitation among university students, as opposed to mentors
who are not in business who do not have such an impact. This confirms what others have
already claimed, i.e. that successful opportunity identification and exploitation depends, in
particular, on access to social networks, which include mentors . It has, for example, been
shown that social networks influence both the cognitive bias of entrepreneurs and the creation
process of a new business , where the latter element can be seen as opportunity exploitation.
Informal networks also influence the success of a newly created business . However, our
results show that simply networking in general does not necessarily impact opportunity
identification and exploitation, since mentors who are not in business showed no effect.
These results should be put into perspective since our data indicate that the effect of mentors
is less pronounced than entrepreneurial experience, level of education (for opportunity
identification) and gender, but more pronounced than full-time work experience. Contrary to
these factors, which cannot be changed, pairing university students with mentors could be a
way to help them identify and exploit business opportunities. With the knowledge that this
could be the missing link between intention and business creation, formally implementing
such programs could result in the rapid emergence of new businesses started by university
graduates, at minimal cost. For public authorities, and universities in particular, this stresses
the relevance of enhancing entrepreneurial training programs with a mentoring component,
which would enable students to operationalize the knowledge acquired in the classroom by
providing them with more tangible applications.
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