Personal innovativeness as a predictor of entrepreneurial value creation

Purpose - The purpose of this paper was to determine whether innovativeness is a personal attribute that enhances entrepreneurial success and to obtain external validation for the Valuable Novelty Theory of innovation and the Innovator Mindset (IM) instrument for measuring personal innovativeness. Design/methodology/approach - This is the final paper in a series of three articles. The first article, Valuable Novelty: A Proposed General Theory of Innovation and Innovativeness, laid out the Valuable Novelty Theory and the Innovation Cycle. The second article Evaluating Mindset as a Means of Measuring Personal Innovativeness explained the design of the IM instrument. For this study, some 300 entrepreneurs were given the IM assessment and asked to provide data on their ventures' recent performance. The data were then analyzed to see whether differing IM scores reflected different business outcomes. Due to the heavily skewed nature of the business performance data, this required the development of a non-traditional approach to data analysis that combined Rasch measurement, segmentation of the data into quantiles and hypothesis testing using simulations. Findings - The findings were that there is a robust relationship between personal innovativeness and multiple measures of value creation. An unexpected finding was a Value Creation Curve, a non-linear pattern that appears to characterize the relationship between innovativeness and value creation regardless of the specific type of value. Research limitations/implications - Key limitations of this study were that it was retrospective and focused on value creation in a particular endeavor - the launching of a new business. A longitudinal study with a control group would further clarify the relationship between innovativeness and value creation. Research in other settings is needed to explore the relevance of innovativeness to other types of value creation. Originality/value - This is the first study to demonstrate and measure a relationship between personal innovativeness and entrepreneurial value creation, with effect sizes that appear to exceed any previously studied personal attributes. It confirms the role innovativeness plays in creating value, demonstrates the utility of the IM assessment as a research instrument and provides a tool that entrepreneurs and investors can use to more accurately predict the likely outcomes of business ventures.