INFLUENCE OF DEMOGRAPHIC AND SOCIAL VARIABLES ON THE CREATION OF TECHNOLOGY-ORIENTED VENTURES IN THE FREE STATE PROVINCE

Abstract

The study examines the influence of personal demographic (i.e. age and gender) institutional (i.e. family role models and family recognition of venture creation) and structural (i.e. small business owner/manager’s participation in Science, Technology, Engineering and Mathematics [STEM] disciplines and social prejudice) variables on the creation of technology-oriented ventures in the Mangaung Metropolitan Area and Matjhabeng Local Municipality. The existence of selective approaches to determinants of venture creation gave rise to this study’s focus on the joint effects of personal demographic and social variables (i.e. institutional and structural variables) on the creation of technology-oriented ventures. For instance, some technology studies emphasise personal demographic variables such as gender and age as micro level determinants of venture creation to the exclusion of social variables. Other studies, however, foreground social variables, especially the influence of institutional (e.g. family role models and family recognition of venture creation) and structural variables (e.g. participation in STEM and social prejudice) on venture creation while ignoring personal demographic factors. To the extent that the study examines the combined effects of personal demographic, institutional and structural variables on venture creation, it strives to close the gap created by the selective approaches adopted in the aforementioned studies. A discomforting feature evident in the literature on venture creation is that age and gender symmetries and social prejudices continue to undermine the venture creation process. For instance, men and mature adults tend to dominate the venture creation process in South Africa more than their women and younger counterparts. The study adopted a quantitative approach and involved the conduct of a survey on 91 internet cafés operating in the Mangaung Metropolitan Area and Mathjabeng Local Municipality. A total of 58 respondents successfully completed the structured questionnaire, representing a response rate of 63.7%. Descriptive statistics such as frequency tables and graphs as well as inferential statistics such as correlation and regression analysis were employed in the data analysis. At the personal demographic level, the findings suggest that the owner/manager’s gender is a significant factor affecting opportunity identification (t=2.511, df=56, p-value=0.015), itself a component of venture creation. Family role models B1 (Correlation=0.514, p-value=0.000), family recognition of venture creation (a) (Correlation=0.406, p-value=0.002) and family recognition of venture creation (b) (Correlation=0.368, p-value=0.004) most influenced the creation of ventures. The results also show that structural variables especially social prejudice in the marketing of SMMEs, are significantly correlated with opportunity identification (Correlation=0.305, p-value=0.020) and with risk taking (Correlation=0.260, p-value=0.049). Furthermore, the results show that the marketing of SMMEs (coefficient = 0.341, t=2.575, p-value=0.013) is the most significant factor affecting opportunity identification. Hence, it can be concluded that, collectively, the owner/managers’ gender, family role models B1, family recognition of venture creation (a), family recognition of venture creation (b), social prejudice in the marketing of SMMEs all significantly influence venture creation. Finally, the study recommended that family members must give sufficient support to the identification of opportunities as entrepreneurs’ ideas may not be readily supported by the entire family or parents of the entrepreneur. Such increased family support might reduce the failure of ventures in South Africa.