Serial Entrepreneurship: Learning by Doing?

Francine Lafontaine, Kathryn Shaw

NBER Working Paper No. 20312
Issued in July 2014
NBER Program(s):Labor Studies, Productivity, Innovation, and Entrepreneurship

Among typical entrepreneurs, is the serial entrepreneur more likely to succeed? If so, why? We answer these two questions using a comprehensive and unique data set on all establishments started at any time between 1990 and 2011 to sell taxable goods and services in the state of Texas. An entrepreneur is defined as the owner of a new business. A serial entrepreneur is one who opens repeat businesses. The success of the business is measured by the duration over which the business is in operation. The data show that serial entrepreneurship is relatively uncommon in retail trade. Of the almost 2.3 million retail businesses of small owners of new businesses in our data, only 25 percent are started by owners who have started at least one business before, and only 8 percent are started by an owner who is still operating at least one other business started earlier. However, once one becomes an entrepreneur for a second time, the probability of becoming one a third time, or fourth time, and so on, keeps rising. Moreover, we find that an owner's prior experience at starting a business increases the longevity of the next business opened, and that controlling for person fixed effects, prior experience still matters. Finally, experience at starting retail businesses in other sectors (e.g. a clothing store versus a repair shop) is beneficial as well, though not as much as same sector experience, and not in the restaurant sector. We conclude that prior experience imparts general skills that are useful in running the new business.

download in pdf format
   (299 K)

email paper

Machine-readable bibliographic record - MARC, RIS, BibTeX

Document Object Identifier (DOI): 10.3386/w20312

Published: Francine Lafontaine & Kathryn Shaw, 2016. "Serial Entrepreneurship: Learning by Doing?," Journal of Labor Economics, University of Chicago Press, vol. 34(S2), pages S000 - S000. citation courtesy of

Users who downloaded this paper also downloaded* these:
Schorfheide, Song, and Yaron w20303 Identifying Long-Run Risks: A Bayesian Mixed-Frequency Approach
Breza, Chandrasekhar, and Larreguy w20309 Social Structure and Institutional Design: Evidence from a Lab Experiment in the Field
Arora, Cohen, and Walsh w20264 The Acquisition and Commercialization of Invention in American Manufacturing: Incidence and Impact
Murfin and Petersen w20310 Loans on sale: Credit market seasonality, borrower need, and lender rents
Kilenthong and Townsend w20275 A Market Based Solution to Price Externalities: A Generalized Framework
NBER Videos

National Bureau of Economic Research, 1050 Massachusetts Ave., Cambridge, MA 02138; 617-868-3900; email:

Contact Us