A profile of the popular entrepreneur: a value-based approach

Abstract

Purpose The purpose of this paper is to identify the personal characteristics and individual values of Venezuelan low-income entrepreneurs, according to the theoretical framework of the Schwartz model. Design/methodology/approach A stratified probabilistic sample of 416 individuals was selected from a database of Bangente’s clients, who received microcredits between 1999 and 2016, in the Capital District of Venezuela. The Portrait Value Questionnaire (Schwartz, 2003; Peiró and Palencia, 2009) was applied to measure the values of power, self-direction, stimulation and achievement. The locus of control was measured (Schjoedt and Shaver, 2012) and information was collected on some personal variables. An analysis of hierarchical clusters was conducted to group clients with similar characteristics, as well as a discriminant analysis, to characterize the groups obtained. Findings The selected Schwartz values, the locus of control and personal characteristics (such as educational level, age and gender) proved to be efficient in discriminating between four groups or profiles of low-income entrepreneurs: those “Focused on progress through effort,” “Independent and ambitious young people,” those “Focused on power and achievement” and those who were “Indifferent.” The results of the cluster analysis were validated using discriminant analysis, which identified the variables with the greatest impact for the characterization of each group. The coefficients of the discriminant functions would allow the classification of a new individual requesting a microcredit into one of the groups obtained. This is a proposal to complement the selection process mechanisms currently used to decide whether or not to grant loans, which must be validated in conclusive studies. Research limitations/implications The results cannot be generalized until the study is replicated in representative samples in other entities of the microfinance sector. Originality/value The main contribution of this work is the integration of individual values in the profile description of low-income entrepreneurs and in the use of statistical strategies such as cluster analysis and discriminant function. The nature of the study is exploratory: the development of this line of research can guide future decisions about which clients (according to their values, personal characteristics and locus of control) could receive their financial support. When considering these non-traditional variables in the banking context, the aim is to enrich our knowledge about low-income entrepreneurs.