A review of the impact of education and prior experience on new venture performance

The importance of education and experience to the successful performance of new firms is well recognized both by management practitioners and academics. Yet empirical research to support the significance of this relationship is inconclusive. This paper discusses theories describing the relationship between education and experience and firm performance. It also analyses and classifies the differing measures of performance, education and experience, and compares the results of multiple studies undertaken between 1977 and 2000. Possible reasons for conflicting results are identified, such as lack of sound theoretical bases that relate education and experience to performance, varying definitions of the key variables and the diversity of measures used. Finally, a framework is developed that incorporates variables that interact with experience and education to influence new venture performance.