A model of transformation during the evolution of an entrepreneurial opportunity via social media

Abstract

Recently, there has been a growth in digital technology use and an upward trend in the adoption and use of social media by individuals and corporations, changing the way people communicate and interact. Despite this evolution, little is known about how the adoption of online social interaction affects entrepreneurial processes, especially opportunity evaluation. This empirical study sought to fill the gap in the literature by investigating the effect of social interaction via social media on opportunity evaluation. In reviewing the studies done on opportunity evaluation as indicated in the paper by Wood and Mckelvie (2015), it would seem that the effect of online social interaction on opportunity evaluation has not been studied and hence, to the best of the researcher’s knowledge, there was no model in the literature to measure the effect. The study used a mixed-method approach. Survey questionnaires were used to collect data from a random sample of young entrepreneurs in Ghana. The questions were evaluated with SPSS and later exported to STATA for data analysis. Factor analysis and various normality tests were performed to ensure the accuracy of the data. A total of 383 questionnaires were analysed. This was then followed by key informant interviews with 13 entrepreneurs, and the analysis done using Nvivo 11. The main contribution of this research is the development of a model that measures the effect of online social interaction on opportunity evaluation. The study found that online social interaction helps entrepreneurs build networks which subsequently has an impact on opportunity evaluation either directly, or indirectly through mediation by resource availability. This study has made an important contribution to practice by showing the positive effect that basic tools that aid daily activities, like social media, has on entrepreneurial opportunity evaluation. ii It is recommended that future research understands other factors that may facilitate the opportunity evaluation process and the extent to which those factors facilitate the opportunity evaluation process, as this may lead to better insight with regards to targeting entrepreneurial training for optimum results. The use of the mediation analysis process was adopted for this study because of evidence from other disciplines that suggest the efficacy of targeting interventions at the intermediate process. Using this approach for future studies will help target interventions, taking into consideration mediation mechanisms for more impact.