Beyond portfolio entrepreneurship: multiple income sources in small firms

Sara Carter, Stephen Tagg, Pavlos Dimitratos

Research output: Contribution to journalArticlepeer-review

55 Citations (Scopus)


The economic activities of entrepreneurs are not confined to the ownership of a single firm, but encompass income generation from a variety of sources including wage labour, non-earned income and profit from secondary business ventures. This paper investigates the multiple income sources of a sample of 18 561 business owners in the UK. A latent class analysis revealed seven different groups of entrepreneurs differentiated by their degree of engagement in enterprise ownership and income generation. The results demonstrate the importance of multiple income sources in smaller firms and challenge previous assumptions that portfolio activities are expedited solely as a profit maximization strategy by growth-seeking entrepreneurs. While some use portfolio activities for the purpose of wealth accumulation, others use them as a survival mechanism. The results also highlight time variations in the use of portfolio activities. For some business owners, they are a long-term and relatively stable strategy contributing towards either the economic survival of marginal ventures or the development of high growth enterprises. For others, they are a time-limited strategy facilitating business entry or exit.
Original languageEnglish
Pages (from-to)481-500
Number of pages19
JournalEntrepreneurship and Regional Development
Issue number6
Publication statusPublished - 2004


  • diversification
  • growth
  • survival
  • portfolio entrepreneurship
  • latent class analysis


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