The role of developmentalrelationships in the transition to

entrepreneurshipA qualitative study and agenda for future

research

Siri TerjesenKelley School of Business, Indiana University, Bloomington, Indiana, USA, and

Sherry E. SullivanCollege of Business Administration, Bowling Green State University,

Bowling Green, Ohio, USA

Abstract

Purpose – The purpose of this study is to examine the under-researched subject of the role ofmentoring relationships within and outside of organizational boundaries as individuals make thecareer transition from being a corporate employee to becoming an entrepreneur.

Design/methodology/approach – Using structured interviews, the authors collected data from 24men and women in the financial services industry in the UK about their experiences in making thetransition from a corporate organization to a new venture work context. All interviews weretranscribed and systematic Nvivo coding was used.

Findings – Developmental relationships with structural, relational, and cognitive embeddednesswere most likely to transfer from the individual’s corporate workplace to their new venture. Supportfor both the recent literature on multiple mentors and for gender differences in the patterns of thesementoring relationships was also found.

Originality/value – This is the first published study to examine whether mentor relationships fromprevious corporate employment transfer to the protege’s new entrepreneurial venture and whetherother types of relationships (e.g. coworkers, clients) are transformed into mentor-protege relationshipsafter the career transition to entrepreneurship. It is also among the few studies to examine mentoringof entrepreneurs and gender differences in mentoring within the entrepreneurial work context.

Keywords Careers, Mentors, Developmental relationships, Boundaryless careers, Entrepreneurship,New ventures, Social capital, Career development, United Kingdom, Mentoring

Paper type Research paper

In 2010, 110 million individuals worldwide were actively starting a business and 140million were running a business they started less than four years ago (Kelley et al., 2011).In the UK, the context of this study, an estimated 6.4 per cent of the country’s workingpopulation is engaged in activities directed toward starting a new business (Kelley et al.,

The current issue and full text archive of this journal is available at

www.emeraldinsight.com/1362-0436.htm

The authors thank S. Gayle Baugh and Shawn Carraher for their insightful comments and expertadvice on an earlier version of this paper. Thanks are also due to editors Hetty van Emmerik andJim Jawahar and the reviewers for their suggestions which greatly helped the authors to improvethis work.

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Received 7 June 2011Revised 15 June 2011Accepted 15 June 2011

Career Development InternationalVol. 16 No. 5, 2011pp. 482-506q Emerald Group Publishing Limited1362-0436DOI 10.1108/13620431111168895

2011). A growing number of men and women around the world are opting out of thecorporate rat race to start their own business, with the popular press regularly detailingthese successful new businesses (e.g. Bloomberg BusinessWeek, 2010; Maitland, 2006).

Academic research has also examined the process by which individuals work for aperiod of time within an organization before departing to start their own firm (e.g. Carrolland Mosakowski, 1987; Mainiero and Sullivan, 2006). While working within theboundaries of a corporation, these individuals learn valuable skills and develop socialnetworks that may contribute to their ability to start and succeed in entrepreneurialendeavors (Ensher et al., 2002a; Terjesen, 2005). This growing trend of transitioning fromworking within corporate boundaries to becoming an entrepreneur has been welldocumented for both men (Dobrev and Barnett, 2005; Higgins, 2004; Ibarra, 2003) andwomen (e.g. Buttner and Moore, 1997; Mallon and Cohen, 2001; Moore, 2000). A numberof studies have also examined how governments encourage the growth of smallbusinesses (Acs et al., 2007; Elam and Terjesen, 2010; Henderson and Robertson, 2000;Terjesen and Amoros, 2010), including the sponsorship of mentoring programs (Bisk,2002). Despite the use of such government sponsored mentoring programs and thegrowth of entrepreneurship research in general (Acs and Audretsch, 2009), surprisinglylittle academic research has been completed on the mentoring of entrepreneurs.

The purpose of this study is twofold. First, this study explores the under-researchedtopic of mentoring of individuals beginning a new venture. Although the literature onmentoring and developmental relationships is well established (e.g. see CareerDevelopment International’s 2005 special issue on mentoring), we know little about howmentors may assist individuals in starting their own businesses (Bisk, 2002). Therefore,in answer to recent calls for the increased study of the mentoring of entrepreneurs(Mosey and Wright, 2007; Perren, 2003), we specifically investigate the role of mentoringin an individual’s transition from being a corporate employee to starting a new venture.

Second, this study answers calls for research on entrepreneurship within the contextof the careers theory (Dobrev and Barnett, 2005; Greene et al., 2003). While a great dealof research has been completed on personality factors (e.g. de Pillis and Reardon, 2007;Rauch and Frese, 2007) that influence the decisions of individuals to becomeentrepreneurs, relatively little research has considered the process by whichindividuals move out of the boundaries of a corporation to become successful,self-employed entrepreneurs. Thus, this study contributes to the careers literature byinvestigation patterns in developmental relationships during the career transition frombecoming an organizational employee to being an entrepreneur.

We begin by briefly reviewing the literature on mentoring and developmentalrelationships. Within this literature review, we propose three major research questionsto be addressed by this study. Next, the methods and sample used in this qualitativeinvestigation are detailed, followed by an analysis and discussion of our findings. Thearticle concludes by detailing implications for those wishing to make the transition toentrepreneurship as well as an agenda for future research.

Mentoring and developmental relationshipsMentoring has traditionally been defined as a relationship in which a more experiencedindividual takes a newer employee under his/her wing in order to guide the protegethrough the political and social aspects of organizational life (Kram, 1985; Levinsonet al., 1978; Singh et al., 2002). In the past, when individuals typically worked for one or

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two firms over their careers, people usually formed more intense, long-term dyadrelationships. Often a younger employee in the early stages of his/her career wouldenter into an organization, and a more experienced employee, in the later stages ofhis/her career, would mentor the protege as he/she progressed in his/her career withinthe same organization (Sullivan and Crocitto, 2007).

For the proteges, having a mentor provided positive benefits such as increasedsalary, career advancement, visibility, goal achievement as well as enhancedorganizational socialization, job satisfaction and well-being (Allen et al., 1997, 2004;Chao, 1997; Higgins, 2000; Nielson et al., 2001; Scandura and Viator, 1994; Wallace,2001). Within the context of a traditional organization, a mentor guided the protegethrough the firm’s political landscape and protected the protege from repercussionsfrom work errors (Perrewe and Nelson, 2004; Scandura, 1992).

Like proteges working within the boundaries of an organization, entrepreneurs alsovalue mentors for the help and support they offer (Deakins et al., 1998; McGregor andTweed, 2002). Individuals who have entrepreneurs in their social networks are morelikely themselves to participate in entrepreneurial activity (Bosma and Levie, 2010) andentrepreneurs with mentors in their industry are more alert to new businessopportunities (Ozgen and Baron, 2007).

Best-practice enterprise development programs generally include a mentoringcomponent, however most published studies of these programs do not specificallyexamine the impact of mentors on protege outcomes (e.g. Klofsten et al., 2010; Litzkyet al., 2010; Mosey et al., 2006). One exception is St-Jean and Audet’s (2008) study of thelearning outcomes of 12 male and 13 female protege participants in a formal mentoringprogram for entrepreneurs. They found the main outcome from the mentoringrelationships was cognitive learning followed by affective learning, includingattitudinal changes and increased motivation. They reported that the mentoringrelationship, however, had little impact on skill-based learning. Similarly, Petridou(2009) found that women entrepreneurs who participated in an e-mentoring initiativeperceived that their mentors helped them to achieve their personal goals.

In traditional organizations, often found in industries such as finance and banking,the mentor-protege relationship is enacted in a structured, hierarchical context, whichmay assist a protege’s ability to find a suitable mentor. Many firms also provide formalmentoring programs which match mentors and proteges or aid proteges in finding amentor (Conklin, 2002; Veale and Wachtel, 1997). These corporate structures may alsoinfluence gender differences in that previous studies have found that men, whogenerally hold most of the high level organizational positions, are more likely to mentorother men (Fitt and Newton, 1981; Thomas, 1990). Because most firms have a limitednumber of women in top positions, these women may be overwhelmed with requests toserve as a mentor to women in lower level positions making it more likely that men willengage in same-gender mentoring relationships than will women. For women who areable to establish developmental relationships with male mentors, the outcomes of malementor-female protege relationships are typically inferior to the outcomes for malementor-male protege relationships. For example, male mentor-female protegerelationships are less likely than male mentor-male protege relationship to meetboth instrumental and expressive needs (Ragins and McFarlin, 1990), to result inperceptions of similarity, especially with regard to ambition (Armstrong et al., 2002)and to provide access to mentors’ networks (Ibarra, 1993).

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In contrast to traditional organizational environments, entrepreneurialenvironments are not as highly structured. Because of the lack of organizationalstructure and formal organizational programs, individuals who move from a corporateto an entrepreneurial work environment may experience more difficulty in findingmentors. We know relatively little, however, about the mentoring of entrepreneurs andpotential gender differences in these relationships. Tynan et al. (2009) found thatfemale entrepreneurs prefer female business advisors but a male comparison groupwas not studied. Carsrud et al. (1987) reported on female entrepreneurs’ limited use ofmentors, suggesting this as an impediment to venture success. In contrast, using asample of 1,177 male and 337 female small business owners, McGregor and Tweed(2002) found that women (25 per cent) were more likely than the men (20 per cent) tohave a mentor.

Given the lack of research on the mentoring of entrepreneurs, we wanted to explorethe potential differences in mentoring relationships within and outside of corporateboundaries. We suggest that because corporations tend to be more structured andencourage the intra-firm transfer of learning and knowledge through initiatives such asformal mentoring programs (Conklin, 2002; Veale and Wachtel, 1997), that individualsare likely to have a greater number of mentoring relationships inside rather thanoutside corporate boundaries. Similarly, because organizations often institute formalprograms to increase the opportunities for women to engage in developmentalrelationships, we anticipate that women will have fewer mentoring relationships whenthey leave corporate employment to open their own small business.

Regarding the nature of these relationships, we suspect that individuals both inside(e.g. Allen et al., 1997, 2004) and outside (e.g. Deakins et al., 1998; McGregor and Tweed,2002 St-Jean and Audet, 2008) of corporate boundaries will seek out the emotionalsupport, encouragement, and knowledge from mentors. However, while in thecorporate environment proteges seek out mentors who can help them manageintra-organizational politics (Perrewe and Nelson, 2004; Scandura, 1992), nascententrepreneurs are more likely to seek out mentors who can help them make connectionsto enhance their small business’s profitability (Ozgen and Baron, 2007). Therefore, weinvestigate the following research question:

RQ1. Will individuals, especially women, have fewer mentoring relationships afterthey make the transition from corporate employee to entrepreneur and will thefocus of these mentoring relationships change from proteges seeking help inmanaging intra-firm politics to seeking help with networking?

Changes in the workplace, including increased globalization and technologicaladvancement have affected the enactment of mentor-protege relationships. Leaner andflatter organizations focus less on providing employees with job security. Whereas thetraditional mentoring relationship occurred within the boundaries of one or two firms,workers are now more mobile, moving across the boundaries of different firms,industries, occupations, and countries (Sullivan and Baruch, 2009). Whether mentoringrelationships from the corporate work environment transfer to the entrepreneurialwork environment has not been the subject of published research. We surmise,however, that mentor-protege relationships established within the confines of anemploying organization and reinforced primarily by organizational incentives andfrequent interactions at the workplace will be more likely to terminate once a member

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of the dyad leaves the firm. In contrast, we anticipate that mentor-protege relationshipsdeveloped within the boundaries of an employing organization and reinforcedprimarily by strong bonds of mutual respect and friendship are more likely to continueonce one party departs the organization. Therefore we propose the following researchquestion:

RQ2. How many and what type of developmental relationships will span corporateand entrepreneurial contexts?

Given the new dynamics in the work environment and mobility patterns, scholars havesuggested that individuals may need to have more than one mentor to help themmanage the increasing complexities of their work lives (Baugh and Fagenson-Eland,2005; Baugh and Scandura, 1999; Clawson, 1996; de Janasz et al., 2004; Higgins, 2000;Higgins and Kram, 2001). Mentoring research has evolved from a focus on a singledyadic relationship to one that involves multiple developers (Higgins and Kram, 2001;Molloy, 2005), often with different individuals performing different developmentalfunctions at different stages of the individual’s career (Carraher et al., 2008; de Janaszand Sullivan, 2004).

We could locate no published studies that focused on multiple mentoringrelationships of entrepreneurs. Therefore, following trends in corporate (e.g. Baughand Scandura, 1999; Higgins and Kram, 2001) and academic environments (e.g. deJanasz and Sullivan, 2004), we would expect that novice entrepreneurs would similarlyneed the assistance of more than one mentor to manage the complexities of operating asmall business. Moreover, novice entrepreneurs are most likely to seek the support offellow entrepreneurs who can provide them with the expertise needed to be asuccessful small business owner. We therefore suggest the following researchquestion:

RQ3. Do entrepreneurs engage in multiple mentoring relationships and how manyof these relationships will be with fellow entrepreneurs?

MethodologyThis study examines the role that mentoring relationships play in individuals’ worklives both inside and outside the boundaries of organizations. We specifically focus onthe role of mentoring as individuals make the transition from being a corporateemployee to being an entrepreneur. Because of the relatively small amount of researchon the mentoring of entrepreneurs, we chose an exploratory, qualitative approach. Byusing a qualitative approach, the study should produce rich results as well as generateoriginal directions for examining entrepreneurial ventures (Bruni et al., 2005; Bygrave,1989; Davidsson, 2004; Gartner and Birley, 2002; Hoang and Antoncic, 2003).

We used a structured interview technique; this is a widely employed approach in thestudy of entrepreneurship (Curran and Blackburn, 2001). Qualitative interviewingtechniques permit the perspectives of the interviewees to take precedence over thepotential assumptions of the researchers (Farr, 1982) and enable the use of story-telling(e.g. Mallon and Cohen, 2001). To reduce some of the potential problems commonlyassociated with this approach, questions were asked using the same order, in as similarof manner and words as possible, and by only one member of our research team.Careful records were kept at each of the research stages to enhance reliability and sothat others could audit the process (Curran and Blackburn, 2001).

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The structured interview contained questions about the individual’s previous workexperiences, his/her previous employer prior to the new venture, when and why he/shebegan the new venture, and his/her membership in community and professionalorganizations. Interviewees were asked questions which directly used the term“mentor” including: Did you have mentors in starting your new venture? Who werethey? How did these mentoring relationships develop? How would you characterizethese relationships? In other instances during the interview, questions aboutdevelopmental relationships, without specifically referring to these relationships asmentoring, were asked. These questions about developmental relationships focused oncurrent relationships in the new venture (e.g. With whom do you speak with about theventure on a regular basis? What is your relationship with this individual? What doyou talk about?) as well as relationships from previous employers (e.g. Whom fromprevious work experiences, such as colleagues, clients, suppliers, do you communicatewith at least twice a year? What is your relationship with this individual? What do youtalk about?).

Most interviews were conducted at the interviewee’s worksite, although a few of theinterviewees suggested alternative meeting places, such as a coffee shop or his/herhome. Each interview lasted an average of 80 minutes. The interviews weretranscribed and then entered into the Nvivo analysis system. The interview contentwas analyzed using the categorization and sub-categorization process outlined byLofland and Lofland (1995). All study participants were assured that their names andthe names of their past employers and new companies would be kept confidential. Allnames used in this paper are fictitious.

SampleWe found our 24 study participants through multiple strategies including using MBAalumni and local entrepreneur networks (Curran and Blackburn, 2001). We continuedto identify and interview respondents until there was no or minimal incrementalinformation obtained from additional interviews (Miles and Huberman, 1994).Additionally, because many scholars have called for closer examination of women’scareers (e.g. Sullivan, 1999; Mainiero and Sullivan, 2006) and specifically on womenentrepreneurs (Ahl, 2006; de Bruin et al., 2006; DeMartino et al., 2006; Ogbor, 2000) halfof the 24 interviewees in our study were women.

All study participants were initially employed in corporations in the UK’sfinancial industry. The UK is the world’s leading international financial servicescentre, generating over £30 billion a year in net overseas earnings and constitutingover 5 per cent of the country’s GDP (Department of Trade and Industry, 2005).Over five million people, 15 per cent of the working population, are employed in theUK’s banking, finance and insurance sector (Begum, 2004). This sector has thehighest percentage of workers with a university degree or equivalent, and thehighest pay rates in the UK (Begum, 2004). Financial services companies areconsistently rated as the most preferred employers by UK university students(Terjesen et al., 2007; Universum, 2010). Like many industries, rapid technologicalinnovations, globalization, and the rise of new competitors have changed the oncestable nature of the industry. The industry has been dramatically restructured;downsizing, delayering and outsourcing of services abroad have occurred (Evisonet al., 2004; Tempest et al., 2004).

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Findings and discussionTables I and II provide information on each respondent’s age, age of his/her newentrepreneurial venture, and previous employment. All 24 study participants workedin senior level management positions in the financial services industry prior to startingtheir own ventures. They ranged in age from 29 to 62, with an average age of 40 yearsold. Their new ventures ranged in age from 2 months to 36 months, with an averageage of 20 months.

As would be expected, most of the new ventures were similar in nature to therespondent’s previous corporate employment. For example, one of the studyparticipants, Pam, worked as an accountant for an accounting firm and her newventure was her own accounting firm. Likewise, Paul, Serge, Harris, and Tara left theirbanking positions to become financial services consultants. A few of the participants,however, started new ventures which were much different from their previouscorporate employment. For example, Caitlin transitioned from being a senior managerat an investment banking firm to owning a health spa. Nate transitioned from being acommodities trader to owning an e-commerce retailer.

Looking at Table III, there are no significant gender differences in the age of therespondents or the age of their entrepreneurial ventures. On average, the men (meanage ¼ 41:7 years) were two years older than the women (mean age ¼ 39:8 years). Themen’s businesses (20.6 months) were, on average, one month older than the women’sbusinesses (19.6 months).

Comparing mentoring in different contextsResearch question one focuses on whether there are differences in mentoringrelationships engaged in by individuals as an employee of a corporation and as anentrepreneur. As would be expected, the mentoring relationships that the respondentsparticipated in before starting their entrepreneurial venture were typical of thementoring relationships already well described in the mentoring literature. As shownin Tables IV and V, the majority of the men (75 per cent) and women (83 per cent) hadat least one mentor while working within a corporation. While the women reportedmore mentors than the men in their former employment, this difference was notsignificant.

As reported in Table III, there was a significant gender difference in the percentageof same gender mentor-proteges relationships (t ¼ 3:606, p , 0:001) in the corporatework environment. In line with previous studies on mentoring (Scandura and Viator,1994), the majority (93 per cent) of the developmental relationships that men engagedin while in the corporate work environment were with male mentors. In the corporatework environment, the women engaged in developmental relationships with both maleand female mentors, with a larger number of these relationships (57 per cent) beingwith other women. During the interviews, some of the women discussed how both theirmale and female mentors assisted them in understanding the male-dominated financeindustry in which they worked.

Comparing the mentoring in the corporate environment to that in theentrepreneurial environment shows some differences, especially for the women. Thepercentage of men who had a mentor in the entrepreneurial environment was the same(75 per cent) as in the corporate work environment. Women, however, had significantlyfewer mentors in the entrepreneurial (50 per cent) than in the corporate (83 per cent)

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Table I.Male entrepreneurs’

demographics and careertransitions

The role ofdevelopmental

relationships

489

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Table II.Female entrepreneurs’demographics and careertransitions

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environment. The difference in the percentage of men and women with mentors in theentrepreneurial environment, however, was not significant.

In both their corporate (93 per cent) and entrepreneurial (88 per cent) roles, menoverwhelmingly had male mentors, whereas this strong same-gender pattern was notpresent for the women. Within the corporate environment, women had a greaternumber of female (57 per cent) than male mentors while within the entrepreneurialenvironment, women had a greater number of male (59 per cent) than female mentors.It may be that while women have gained ground in financial corporations and a greaternumber of more experienced women are available to serve as mentors to other women,the same is not true outside the structure of a corporation. Like in the corporateenvironment (Table III), there was a significant gender difference in the percentage ofsame gender mentor-proteges relationships (t ¼ 3:711, p , 0:05) in the entrepreneurialwork environment. This finding is consistent with prior research suggesting greatergender homogeneity in men’s developmental relationships and greater genderheterogeneity in women’s developmental relationships (Ibarra, 1993).

Previous research suggests that men may naturally find themselves more likely tobe in a work relationship with other men and be more comfortable with them due toshared language (e.g. use of sports metaphors) and experiences (e.g. gendersocialization; see Maier, 1999). In contrast, women may be less able to connect withmore experienced female entrepreneurs to serve as mentors. In entrepreneurialsettings, there may be less perceived return to the mentor, with women realizing thatthey can invest time in a protege but may get very little back in return except gratitude.Because women are much more burdened than men by home responsibilities, such aschild- and elder care (Hochschild, 1989, 1997), they simply may have much less time toinvest in mentoring relationships that do not necessarily have an immediate “pay off”

TotalFormen

Forwomen t-test

Mean age of respondents in years 40.8 41.7 39.8 t ¼ 0.471; not significant;df ¼ 11

Mean age of new venture in months 20.2 20.6 19.6 t ¼ 2 0.236; not significant;df ¼ 11

Percentage who had mentors in formercorporate work environment

79 75 83 t ¼ 2 1.00; not significant;df ¼ 11

Percentage of same gender mentor-protegerelationships in former corporate workenvironment

75 93 57 t ¼ 3.606; significant atp , 0.001; df ¼ 26

Percentage of relationships which were inboth former corporate environment andnew entrepreneurial environment

19 15 22 t ¼ 2 1.000; not significant;df ¼ 26

Percentage who had mentors in newentrepreneurial environment

63 75 50 t ¼ 1.393; not significant;df ¼ 11

Percentage of same gender mentor-protegerelationships in new entrepreneurialenvironment

65 88 41 t ¼ 3.711; significant at p , 0.05;df ¼ 16

Table III.Comparison of male and

female entrepreneursacross work environment

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491

Name ofrespondent

Number ofmentors in

previous jobwith former

corporateemployer

Number ofmentors

while withformer

corporateemployer

who were ofthe samegender as

therespondent

Number ofindividuals

from previouscorporate

employer whocontinued or

became amentor for theentrepreneurial

venture

Number ofmentors

unique to theentrepreneurial

venture

Total Numberof mentors forentrepreneurial

venture

Number ofmentors for

entrepreneurialventure whoare the samegender as the

respondent

Nate 6 6 0 3 3 3Jerry 2 1 0 2 2 1Paul 0 – – 1 1 1Pete 2 2 1 0 1 1Chris 0 – – 0 0 –Rich 4 4 0 0 0 –Bob 3 3 1 2 3 3Sergei 2 2 0 1 1 1Mike 1 1 1 1 2 1Todd 5 5 1 1 2 2Harris 2 1 0 2 2 2Sam 0 – 0 0 0 –Total 27 25 4 13 17 15

Table IV.Men’s mentoringrelationships acrossdifferent workenvironments

Name ofrespondent

Number ofmentors in

previous jobwith former

corporateemployer

Number ofmentors

while withformer

corporateemployer

who were ofthe samegender as

therespondent

Number ofindividuals

from previouscorporate

employer whocontinued or

became amentor for theentrepreneurial

venture

Number ofmentors

unique to theentrepreneurial

venture

Total Numberof mentors forentrepreneurial

venture

Number ofmentors for

entrepreneurialventure whoare the samegender as the

respondent

Jenna 4 4 0 4 4 2Pam 1 1 0 0 0 –Dana 0 – – 0 0 –Lynn 6 3 1 1 2 1Lauren 2 1 0 0 0 –Dorrie 1 0 1 1 2 0Caitlin 4 3 0 0 0 –Lisa 5 0 1 4 5 3Tara 2 2 1 1 2 0Helen 0 – – 0 0 –Tina 2 1 2 0 2 1Isobel 1 1 0 0 0 –Total 28 16 6 11 17 7

Table V.Women’s mentoringrelationships acrossdifferent workenvironments

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for them. Further, men tend to engage in more “after hours” socializing (Hochschild,1989, 1997) and thus both male and female entrepreneurs are simply more likely tohave a greater number of opportunities to initiate mentoring relationships with menthan with women. Because of a number of factors, women entrepreneurs tend todevelop mentoring relationships with men or fail to find a mentor. This finding isconsistent with Godwin et al. (2006, p. 63) who suggest that female entrepreneurs, whenfaced with hurdles in securing resources and establishing legitimacy, may initiate tiesto men in order “not to fight the system, but to play by its rules.” As an increasingnumber of women become entrepreneurs, especially in traditionally male-dominatedarenas, and these women mentor women junior to them, the lower number ofdevelopmental relationships for female entrepreneurs may become less of an issue.

An examination of the type of mentoring received in both environments indicates afew differences. In the corporate environment, respondents reported receiving bothtask and emotional support from their mentoring relationships, including assistance innavigating the politics of the workplace. In the entrepreneurial environment,respondents likewise discussed receiving both task and emotional support. Instead ofdiscussing how their mentors helped them manage organizational politics, however,the respondents discussed how their mentors helped them gain important connections.Respondents talked about their mentors’ help in networking, using such language as“He links me into people when I need it.” (Lynn) and “She knows all the players” (Tina).Additionally, the novice entrepreneurs discussed how fellow entrepreneurs served asmentors. For example, Tara talked about how her mentor helped her find new businessprospects, saying:

He is one of the big investment bankers... He has been very successful in setting up banks andintegrating companies. He is basically a professional entrepreneur. That is his career. He wasmy client at the bank. But when I wanted to go out on my own, he would say that he knewmany people who had started businesses. Now that I have the business he helps me seek newopportunities and think about growing it.

Consistent with more recent thinking on developmental relationships (e.g. Baugh andScandura, 1999; Higgins, 2000), respondents discussed having developmentalrelationships with a number of individuals, rather than just one intense one-on-onementoring relationship. In the corporate environment, 75 per cent of the men and 58 percent of the women had more than one developer. In the entrepreneurial environment, alower percentage of men (58 per cent) and women (50 per cent) had more than onedeveloper. Without the structure of an organization, it may be more difficult forindividuals to find suitable mentors. Also, the availability of individuals who have thenecessary ability and knowledge as well as the willingness to mentor a noviceentrepreneur may be low. Those within corporations may be encouraged to mentor othersif firms have formal mentoring programs. Firms may have a strong organizational culturewhich supports the mentoring process or organizational policies which explicitly linkmentoring to rewards, such as the case when performance as a mentor is part of a firm’sevaluation or promotion system. The benefits of serving as a mentor may be moreapparent within a corporate than in an entrepreneurial work context.

Mentoring across work contextsOur second research question focused on whether individuals reported havingdevelopmental relationships that started within the context of their corporate work

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environment and then continued in the entrepreneurial work context. Relatively fewrespondents reported having a mentor assisting them in their entrepreneurial ventureswhom they had met through their previous organizational positions (see Tables IV andV). A total of 19 per cent of the developmental relationships were present in both thecorporate and entrepreneurial work environment, with the women (22 per cent)reporting slightly more relationships of this type than the men (15 per cent).

To examine these relationships more closely, we used a social capital framework.Social capital theory suggests that social networks are composed of three components:structural, relational and cognitive (Nahapiet and Ghoshal, 1998). The structuraldimension captures how closely individuals work together in a system, such as thefrequency and quality of interactions. The relational dimension refers to the assetsembedded in these shared personal relationships, including trust as well as commonspeech patterns, experiences, obligations, and expectations. The cognitive dimensionrefers to shared interpretations that facilitate a common understanding of values,visions, and goals.

A total of ten of the 55 developmental relationships (four for men, six for women)from the corporate environment were also present in the entrepreneurial environment.All but one of the relationships common to both environments were with maledevelopers. The developmental relationships that stemmed from previous workenvironments, however, were not always a direct transfer of a former mentor-protegerelationship. Looking at the structural dimension of the relationships, only two of theseten transferred relationships were based on a prior mentor-protege relationship.Underscoring the dynamic and changing nature of social networks, three of thetransferred relationships stemmed from former work or industry colleagues and fivestemmed from previous working relationships with clients.

One of the two direct transfer mentor-protege relationships was that of Bob and hisformer mentor, Duncan, who was also his direct supervisor at the private equity firmwhere Bob had worked. Based on their long-standing business relationship, Duncan lentBob some start-up capital, helped him develop the venture’s strategic plan, and assistedin the building of a client base for the new firm. Similarly, Dorrie retained a mentoringrelationship with her boss from her former employment in a bank. Dorrie’s mentor hadencouraged her to be proactive in her corporate job as well as in her entrepreneurialventure, telling Dorrie in both environments to “take your power and use it.”

In addition to the direct transfer of mentor-protege relationships from one workenvironment to another, two individuals, Todd and Mike, told of how relationshipswith colleagues from their previous corporate work environments evolved intomentor-protege relationships. For example, Mike spoke of how his relationship with aco-worker Trevor transformed into a mentor-protege relationship when he started hisown firm. Mike discussed how Trevor provided him with expertise, a sounding boardfor ideas, and “a tremendous amount of support and encouragement.”

Five of the ten transferred relationships involved clients of the study participants’former employers. Interestingly, all of the client relationships that transformed intomentoring relationships in the new venture environment were with the femaleentrepreneurs. Of the five former clients turned mentors, four were men. For instance,Lisa’s new venture mentor was a former client, whom she described as being “one ofthe top three men in the industry.” Lisa’s mentor helped her with the financing andstrategic development of her new venture.

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Looking at the relational dimension of the mentoring relationships, shared styles andbackgrounds as well as trust between the parties were the most important factors thatallowed the relationship to span both the corporate and entrepreneurial contexts. Forexample, Tina discussed the commonalities she shared with her mentor, saying I call onher more often than anyone else because we have similar style . . . ” Todd discussed howhis mentoring relationship developed over time and shared life experiences:

He was at [a major manufacturer]; I was at [a major manufacturer and main competitor]. Heleft a little sooner than I did . . . He ended up getting into a small business where he becamepart-owner and made a couple of acquisitions. He went into an entrepreneurial route which Ialways said to myself that works better than working in a big corporation... But he’s been oneguy that I’ve mentored a lot with. We share a lot. We have done this ever since we were in ourlate twenties. He was doing his MBA at the same time I was doing an MBA. We did our CPAstogether. He has ended up a very successful small business guy that runs four individualbusinesses today. The things that we talk about are very similar.

Both Bob and Tara discussed the feelings of trust they shared with their mentors. Bobsaid of his mentor He wouldn’t have invested if he didn’t believe in me” and Tararemarked I trust his opinion because he knows me and he knows the market.”

Examining the cognitive dimension in these relationships, the respondentsdiscussed how they shared similar values and ideas with their mentors. For example,Pete said We have similar thoughts about where things are headed, where theopportunities are . . . ”; Lisa commented He understood my vision...”; and Dorrieremarked He is a very ambitious person. I am also a very ambitious person.” Theentrepreneurs spoke about being able to really communicate with their mentors, abouttheir mentor’s ability to understand them and their plans for the new venture, andseeing “eye to eye” with their mentor on important issues.

In sum, using a social capital framework, we examined mentoring relationshipswhich transferred from corporate to new venture environments. Some of theentrepreneurs discussed how mentor-proteges relationships directly transferred acrossthe bounds of the organization to the entrepreneurial work context. Others talked ofhow relationships with co-workers and clients transformed into mentoringrelationships as they made the transition from corporate employee to entrepreneur.It appears that relationships with strong structural, relational, and cognitivecomponents were most likely to transfer from one context to the next.

Entrepreneurs and mentoringResearch question three focused on the mentoring relationships engaged in by theentrepreneurs. Sixty-three percent of the respondents indicated that they had a mentorassisting them in the entrepreneurial endeavor (see Tables IV and V). Among the men,there were a total of 17 mentoring relationships, with the majority of them (76 per cent)being unique (i.e. not transferred from their corporate employment) to theentrepreneurial endeavor. Among the women there were a total of seventeenmentoring relationships, with the majority of them (65 per cent) being unique to theentrepreneurial endeavor. The entrepreneurs reported seeking mentors based onconnections through educational settings (e.g. former professors), new businesscontacts (e.g. fellow entrepreneurs), and social networks (e.g. family and friends).

Three entrepreneurs reported reconnecting with university professors and havingthese relationships transform from teacher-student to mentor-proteges. For example,

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Mike sought out a professor whom he considered to be one of the top experts in thefield of financial security. Similarly, Harris reported reconnecting with a professor whohad worked with other entrepreneurs, had a track record of helping others start newfirms, and subsequently provided him with strong business connections. Pete alsodiscussed telephoning one of his former professors, seeking advice on business issuesas well as on personal matters. These three cases illustrate how a professor-studentrelationship evolved into a mentor-protege relationship as the novice entrepreneurssought out those with expert advice.

In addition to seeking out the expertise of former professors, the entrepreneurs alsosought out the expertise of other entrepreneurs. Paul and Harris both described howlong-term friendships evolved into mentoring relationships. For example Paulappreciated his good friend Tim’s business heritage and experience saying:

My close friend was a key support. He was my best man when I was married . . . I met him at[university], his grandfather founded [a major clothing retailer]. He knew how to run thebusiness.

Similarly, Harris reported how a long-time friendship with James, an entrepreneur withseveral businesses, transformed into a mentoring relationship. He saw James as a rolemodel and described learning by observing James’ business activities:

We’ve been friends since we were infants, really. His father was really big into accounting,property, and restaurants. My friend was always helping him out and then his Dad taughthim the ropes and now he is doing his own entrepreneurial thing in the computer business. Herings up every few days . . . I see his ups and downs.

Jerry discussed two very different mentoring relationships, one with his entrepreneurwife and one with another entrepreneur. Jerry saw his wife Jeanie as a role model; helearned by observing how she successfully manages her own venture. Jerry’s othermentor, Kurt, a charismatic entrepreneur, offered Jerry support and encouragement.Jerry described his relationship with Kurt, saying:

He is also an entrepreneur and you can spend five minutes with him and feel like everythingis right in this world, as corny as that sounds. He is the eternal optimist and . . . I make it apoint to spend some time with him because he just has a tendency to put things in perspectivewhere you just get fired up and you are so glad that you are where you are. He is the attitudementor, if you will.

Although some of the entrepreneurs we studied had mentoring relationships, three ofthe men and six of the women had no mentors for their new venture. Isobel and Richreadily acknowledged that the lack of developmental assistance could be damagingtheir business prospects. They highlighted the need to find and develop suchmentoring relationships. Isobel, not knowing how to connect with a mentor for herventure, had contacted an entrepreneurship professor about how to find such a mentor.Likewise, Rich knew he wanted a mentor who had entrepreneurial experience andbusiness connections, but had no idea how to connect with such an individual.

Study limitationsDespite the use of systematic Nvivo coding, a second coder, and transcription of all 24interviews, this study suffers from limitations common to qualitative research studies.First, the number of individuals included in this study, while consistent with similar

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qualitative studies of mentoring and careers (e.g. Gersick and Kram, 2002; Ensher et al.,2002a, b), is relatively small. We also interviewed only one partner in the mentoringdyad, the entrepreneur. Future research should use larger sample sizes which collectdata from both the entrepreneur and his/her mentor in order to empirically test thisstudy’s findings (e.g. see Hoang and Antoncic, 2003).

Second, like most of the research in careers and the behavioral sciences, this studyused a cross-sectional design, and provides only a retrospective look at theinterviewees’ mentoring relationships and career transition from corporate employee toentrepreneur. In order to more fully capture how these relationships develop andchange over time, future research should use longitudinal designs.

Third, these findings are based on a study within the financial services industry andmay not be generalizable to other contexts (Larson, 1992). Additional research needs toexamine whether mentoring relationships transfer from one workplace to anotherwithin the context of other industries, both those industries experiencing rapid changeand those operating in more stable environments.

Implications for practiceThis study suggests a number of implications for entrepreneurs as well as forgovernments wishing to encourage new venture development. First, the findingsclearly illustrate the value that entrepreneurs place on having mentors to assist themwith their new venture. Those entrepreneurs in our study without a mentor recognizedhow their lack of mentoring was probably having a negative impact on their venture’sviability. Those entrepreneurs with mentors, whether these relationships were directtransfers from a corporate mentor-protege relationship or were relationships withformer clients or co-workers which transformed into mentoring relationships, readilydescribed the value of the mentoring they received.

When departing an organization to start a new venture, entrepreneurs should becareful to leave the firm on good terms and to remain in contact with former associateswho may be helpful to their new venture. Would-be entrepreneurs should notunderestimate how various types of relationships not only from previous workplaces,but also from educational institutions and social settings, can be leveraged to providefinancial capital, information, motivation, emotional support, and business connectionsthat can enhance a new venture. Based on our findings, entrepreneurs were mostsuccessful in leveraging relationships in which they were embedded structurally,relationally and cognitively. Entrepreneurs should realize that relationships that lackthis embeddedness may not be easily transitioned to the new venture.

Second, because many of the individuals in our sample had difficulty establishingmentoring relationships unique to the new venture, novice entrepreneurs should considerattending networking events and joining relevant business associations to increase theirchances of finding more experienced entrepreneurs who can serve as mentors. Whileorganizations may have structures, cultures and programs that encouraging mentoringrelationships and underscore the benefits to a mentor (e.g. Ragins and Scandura, 1999;Scandura et al., 1996; van Emmerik et al., 2005), the entrepreneurial context typically lacksthese environmental factors that encourage mentoring relationships to develop. In oursample, six of the nine entrepreneurs who did not have a mentor for their new venture hadat least one mentor in their previous organizational employment. Thus, even thoseindividuals who were able to develop successful mentoring relationships within the

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boundaries of an organization may find that different strategies are needed to find amentor for their new venture. Entrepreneurs unable to find a mentor may benefit from theassistance of a professional coach to help them develop their networking skills. Likewise,because recent research has found that perceived potential is a major factor consideredwhen mentors select a protege, it is important that entrepreneurs demonstrate theirabilities and willingness to learn in order to increase the likelihood of connecting with amentor (Allen et al., 2000). Given the reciprocal nature of mentoring relationships,entrepreneurs must be proactive and seek out venues in which to demonstrate to potentialmentors what they will bring to a mentoring relationship in order to attract mentors.

Third, governments sponsoring initiatives to encourage new venture developmentshould consider the importance of mentoring to entrepreneurs, and incorporatementoring programs as part of these programs. Much as some organizations rewardemployees for serving as mentors to others, governments may need to offer incentivesto experienced entrepreneurs to increase their participation in such programs.Additionally, the use of technology (e.g. e-mail, Skype) to permit individuals indifferent geographic locations to engage in mentoring relationships should beconsidered as a possible means of increasing the pool of potential mentors. Given theincreasing number of individuals leaving organizations to become entrepreneurscoupled with the typically large failure rate of first-time business owners, which hasbeen estimated at 50 per cent in four years (Shane, 2008), the use of well-designedprograms which help match novice entrepreneurs to the most suitable mentor(s) andprovide both mentors and proteges with guidelines of how to be a good mentor/protegemay help to increase the success rate of new business ventures.

Implications for future researchThe findings of our exploratory, qualitative study of the mentoring relationships ofindividuals as they made the transition from corporate positions to becomeentrepreneurs suggest three major avenues for future research. First, although thisstudy was the first to examine whether mentor relationships from previous corporateemployment transfer to the protege’s new entrepreneurial venture and whether othertypes of relationships (e.g. co-workers, clients) are transformed into mentor-protegerelationships after the transition to entrepreneurship, much more research is needed.Because we found evidence with our sample of entrepreneurs of both the direct transferof mentor-protege relationships as well as the transformation of other connections intomentoring relationships, future studies of how individuals potentially leveragerelationships during other types of career transitions should be considered. Forinstance, with increasing attention focused on women and older employees opting outand then back into the workforce, it would be worthwhile to study the roles thatmentors may play in helping them re-enter the workplace. Likewise, the role mentorsplay in other transitions, such as geographic transitions within or outside nationalborders, transitions to a new occupation or industry, transitions from “regular” to“temporary” employment and back again, or from unemployment due to layoff orextended illnesses back into the workplace are also important areas for future study.Factors which may enhance or serve as barriers to the transferability ofmentor-protege relationships and the transformation of other relationships intomentoring relationships during different types of career transitions should also beinvestigated.

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Second, although the findings offer support for the premise that individuals engagein multiple mentor relationships, longitudinal research is required to examine howdevelopmental relationships unfold over time. The number of developmental partnersas well as the quality and quantity of interactions should be examined, given that it hasbeen suggested that mentoring relationships span a continuum of developmentalintensity (de Janasz and Sullivan, 2004; Higgins and Kram, 2001). Additional researchshould explore the effectiveness of different types of developmental relationships, orthe combination of relationships that form the developmental network, on theentrepreneur’s business success. For instance, are mentor-protege relationships whichare transferred from previous work contexts more or less effective in assisting the newentrepreneur than mentoring relationships with former clients and co-workers?Moreover, further study should be completed to see how multiple mentoringrelationships change as the new venture matures, examining such issues as whethersome relationships fade in importance as new relationships develop.

Third, while this study focused on mentoring relationships at the individual level,future research should examine how the turnover of organizational employees and themaintenance of their mentoring and other relationships with former organizationalcolleagues and clients affect the social network of the organizations they have departed(see Kilduff et al., 2006 for further discussion). For example, if highly visible employeesleave the organization to begin their own entrepreneurial ventures, will their actionsencourage others to consider leaving the organization to pursue different career options?

ConclusionThe purpose of this study was to address the lack of research on the mentoring ofentrepreneurs by exploring the role that mentors play as individuals make thetransition from employment within an organization to becoming an entrepreneur.While the majority of the individuals studied had developers both at their previousemployer and in their new venture, it was more problematic for them to find mentors inthe entrepreneurial environment. Our findings support previous literature whichsuggested that when individuals leave the boundaries of an organization, it may bemore difficult for them to develop and maintain mentoring relationships (Sullivan,1999). It may be that organizations encourage developmental relationships throughformal mentoring programs and a culture that encourages and rewards developmentalrelationships. Thus, when individuals leave an organization, they lose the structureand programs provided by the company and must be more proactive in developingmentoring relationships.

In addition, this study also shed some light on gender differences in the utilization ofdevelopmental relationships (Hall, 1996; Mainiero and Sullivan, 2005; Moore, 2000).Women in the sample were more likely than the men to report:

. a mentor relationship in the corporate environment; and

. a relationship from their previous employment transforming into amentor-protege relationship when they became entrepreneurs.

Women, however, were less likely than men to have a mentor unique to theentrepreneurial venture and were also less likely than men to have a mentor assistingthem with their entrepreneurial enterprise. Further study of potential genderdifferences in this type of career transition is needed.

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In conclusion, this study contributes to the literature on entrepreneurship byexamining an under-researched topic and offering some practical implications to thoseinterested in starting their own businesses. Our research may also offers insights intothe mentoring process of the growing number of individuals making other types ofcareer transitions, such as those crossing the boundaries between industries,occupations, companies, and job functions (Arthur and Rousseau, 1996; Baruch, 2004;Hall, 2002, 2004; Osterman, 1996; Sullivan and Arthur, 2006). It is hoped that thismodest exploratory study encourages further research on how individuals make thetransition from corporate employee to entrepreneur as well as encouraging moreresearch on the multiple mentoring process as individuals make other types of careertransitions.

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Further reading

Shaw, E. (2006), “Small firm networking: An insight into contents and motivating factors”,International Small Business Journal, Vol. 24 No. 1, pp. 5-29.

About the authorsSiri Terjesen is an Assistant Professor in the Kelley School of Business at Indiana University.Her research has been published in leading journals such as Career Development International,Strategic Management Journal, Strategic Entrepreneurship Journal, Journal of OperationsManagement, Small Business Economics, Journal of Business Ethics, and EntrepreneurshipTheory & Practice. She undertook a Bachelor’s in Business Administration at the University ofRichmond, Master’s at the Norwegian School of Economics and Business Administration(Norges Handelhøyskole as a US Fulbright Scholar) in Bergen, Norway, PhD at CranfieldUniversity in the UK, and a post-doc at Queensland University of Technology in Brisbane,

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Australia. She is co-author (with Anne Huff, Steve Floyd, and Hugh Sherman) of StrategicManagement: Logic and Action (Wiley, 2008). Prior to starting her academic career, she was aconsultant with Accenture in Washington, DC and Berlin, Germany. Siri Terjesen is thecorresponding author and can be contacted at: terjesen@indiana.edu

Sherry E. Sullivan (PhD, The Ohio State University) has served as Division Chair, ProgramChair, Historian, and Newsletter Editor for the Academy of Management’s Career Division. Sheis a Fellow of the Southern Management Association and has published in journals including:Journal of Applied Psychology, Journal of Vocational Behavior, Journal of Management, Groupand Organization Management, Journal of Organizational Behavior, Academy of ManagementExecutive, and Journal of International Business Studies. She was named the 2008 SouthwestAcademy of Management Distinguished Educator. She is co-author (with Lisa Mainiero) of TheOpt-Out Revolt: Why People Are Leaving Companies to Create Kaleidoscope Careers (DaviesBlack, 2006) and co-editor (with Yehuda Baruch and Hazlon Schepmyer) of Winning Reviews: AGuide for Evaluating Scholarly Writing (Palgrave, 2006). She is also the co-editor (with S. GayleBaugh) of Research in Careers (Information Age Publishing).

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