THIS article will discuss different factors that are perceived to affect the success of an immigrant entrepreneur. One of the first factors affecting the success of an immigrant entrepreneur is the ability to carve out a successful market niche.

Researchers have pointed out that the market niche concept is an essential factor that can affect the survival of necessity immigrants. The concept of market niche makes reference to a market where mainstream entrepreneurs are not engaged in business due to the host countries’ opportunity structure.

A number of reasons can be given about the low levels of interest on the part of native entrepreneurs in such markets, and these include a lack of economic reward and also the unavailability of the required skills.

Another important factor that has been identified as being of critical importance in the success of immigrant entrepreneurs is their social network.

In practical terms, a social network translates to mean a set of interconnected actors and their relations with each other. Such actors can consist of either individuals or organisations; and the relations which link them together can take a variety of forms, such as those relations between customers, suppliers, government agencies and service providers.

It can also include economic relations and can be of short or long-term nature. In precise terms, ethnic social networks can be described as an important factor that is crucial for the survival of businesses of ethnic entrepreneurs.

The third factor that affects the success of immigrant entrepreneurs is the ability to source ethnic labour. This is of great importance for the business of immigrant entrepreneurs and many researchers have recognised this fact.

It is apparent that ethnic labour can be described as an important competitive advantage for immigrant entrepreneurs. It is from the ethnic entrepreneur’s social network that they are able to get access to ethnic labour.

Many ethnic newcomers in the host country typically have problems gaining access in the job market within the host country in question because of limited abilities and qualifications.

Another important factor that affects the success of immigrant entrepreneurs is emotional support. This can be described as an essential resource that an ethnic social network is capable of providing to an ethnic entrepreneur.

Emotional support makes reference to verbal encouragement and also various other kinds of attention, which members from an ethnic social network are capable of providing to immigrant entrepreneurs.

The next essential factor that poses a significant challenge to immigrant entrepreneurs during the commencement of their entrepreneurial endeavours would be the lack of access to capital.

The fact is that many immigrant entrepreneurs simply do not have proper access to formal financial sources, and they would have to place reliance on members of their ethnic communities in order to obtain capital for the start-up business.

Start-up capital is the next factor that affects the success of immigrant entrepreneurs. The availability of start-up capital is an important factor that can dictate the success of the entrepreneur.

Researchers have found the presence of a strong link between the total size of start-up capital available to an entrepreneur and the sustainable profitability of the immigrant entrepreneur’s business.

Researchers have pointed out that immigrant entrepreneurs are known to place a lot of reliance on family loans when it comes to starting a business. Many of them have also known to take loans from friends in order to get their business moving. However, capital secured by such means would not be large in nature and as such, the businesses would be small and susceptible to high failure rates.

The following factor affecting the success of immigrant entrepreneurs is the education level. An entrepreneur’s education level is of great importance when it comes to the survival of their business.

The education level of an entrepreneur helps them to get a better understanding of the challenges they face within the host country and also the most effective approaches to address these challenges.

What can be said is that the entrepreneur’s education level plays a central role in the immigrant entrepreneur’s decision-making process.

Another all-important factor affecting the success of immigrant entrepreneurs is past experience. The past experience of the immigrant entrepreneur refers to the past work experience and business ownership experience.

The immigrant entrepreneur’s past business ownership experience is said to be an important factor that can dictate the survival of his business. Entrepreneurs who have been previously exposed to the challenges of starting up a new business are the ones capable of learning and developing relevant managerial skills that can be used in future entrepreneurships.

The next factor discussed here that affects immigrant entrepreneurs is institutional factors. A significant amount of past research has shown that institutional factors tend to have an important role in the development of immigrant entrepreneurial abilities.

In specific terms, institutional factors are said to have an important effect on the success of an immigrant’s business. Studies have shown that institutional environment of the host country that is favourable to economic growth is essential for the success of immigrant entrepreneurship.

He said this would provide a great incentive for entrepreneurs to be productive and it would also ensure greater physical and human capital investments by such entrepreneurs.

Researchers have agreed that the institutional environment of the host country is an important factor in the decision-making process of immigrant entrepreneurs.

Dr Akram Al-Khaled is a senior lecturer and head of the MBA Programme, Faculty of Business at BERJAYA University College. Comments: