The impact of perceived innovativeness, perceived risk and perceived educational support on University student’s entrepreneurial intention

Entrepreneurial marketing is fundamental to the success of innovative ventures which contribute to a country’s economic development. This study investigates the impact of perceived innovativeness, perceived risk and perceived educational support on the university students’ entrepreneurial intentions. Data was collected from 300 university students and analysed using SmartPLS software to test the proposed structural equation model, using the partial least squares (PLS) path modelling method. In general, based on the findings from the sampled group of respondents, it appears that Commerce students may be more inclined to pursue entrepreneurial activities than are Law students. The respondents from the Commerce faculty, on average, displayed a higher likelihood to invest their earnings into risky business ventures than did the Law student respondents. The Commerce faculty also appears to foster more educational support for entrepreneurship than the Law faculty does. Acknowledgement Thank you to the School of Management Studies at the University of Cape of Cape Town for all financial assistance. The introduction Marketing and entrepreneurship are typically considered and categorised as two different or separate business activities (Hamali, Suryana, Effendi & Azis, 2016). However, successful entrepreneurship attempts to combine the two disciplines into one, concept known as entrepreneurial marketing (Hamali et al., 2016). Whilst there has been an abundance of research on the entrepreneurial intention of students in countries such as Sweden and the United States of America (USA) Yurtkoru, Acar and Teraman (2014), limited research in this area exists in the African context. Most global and local literature to date explores the impact of adult entrepreneurs on the economy of a region or country rather than the impact, or potential impact, of students who are prospective entrepreneurs (Turker & Selcuk, 2009). Given that entrepreneurial intention has the potential to predict successful entrepreneurs, a gap exists in researching students’ entrepreneurial intention (Yurtkoru, et al., 2014). Furthermore, Malebana (2014) identifies a gap existing in research linking the relationship between educational support and entrepreneurial intention. The current research study aims to fill this gap. The research question that guides this paper is: What are the factors that influence the entrepreneurial intentions of university students in the commerce and law faculty? Over 50% of South Africans who run their own businesses are youth (Seth, 2017). This is testament to the growing rate of young entrepreneurs in South Africa (Business Report, 2017). South Africa thus has a hub of young, bright minds who seek success in the entrepreneurial world (Chiloane-Tsoka, 2016). Recent research conducted by Barba-Sanchez and Atienza-Sahuquillo (2018) explored those factors of entrepreneurial education that influence entrepreneurial intention. Another study conducted by Turker and Selcuk (2009) explored the impact of personality factors on The Business and Management Review, Volume 10 Number 2 April 2019 Conference proceedings of the Academy of Business and Retail Management (ABRM) 218 entrepreneurial intentions, such as risk-taking ability, the need for achievement, and the need for control. Recent research has revealed a number of factors that influence entrepreneurial intention. Three of the most significant factors have been found to be educational support (Barba-Sanchez & Atienza-Sahuquillo, 2017), perceived risk (Van Praag & Cramer, 2001) and perceived innovativeness (Soria & Huarng, 2013). The authors of this research paper consider it to be of value as it is the first to explore in depth the specific factors influencing entrepreneurial intention relating to perceived risk, perceived innovativeness, and perceived educational support amongst two sampled student groups in the University of Cape Town’s Law and Commerce faculties respectively. 2. Literature review 2.1 Factors of entrepreneurial intentions and hypotheses development Previous research exists which has uncovered factors that motivate entrepreneurial intention amongst students. In a recent study Barba-Sanchez and Atienza-Sahuquillo (2018) explored the role that entrepreneurship-education amongst engineering students plays in these individuals' motivations to develop innovative technology-based companies. Three types of motivations were explored as being influencers of entrepreneurial intention: the need for success, the need for independence, and the need for economic motivations (Barba-Sanchez & Atienza-Sahuquillo, 2018). This research showed that the need for independence was the most critical factor in the entrepreneurial intent of future engineers in their group of respondents (Barba-Sanchez & AtienzaSahuquillo, 2018). However, the literature review for this study found little research to have been conducted regarding perceived innovativeness, perceived risk and perceived educational support as having a combined significant effect on the entrepreneurial intentions of students, specifically on commerce and law students who constituted the research population for the current study. Figure 1: The conceptual model 2.1. 1 Perceived innovativeness Innovation has been found to be a crucial strategy for any company seeking to dominate present current markets as well as develop new markets in the future, markets which are able to contribute to sustainable industry leadership (Datta, 2013). Therefore, innovation can be said to be the essence of an organisation and to contribute towards the organisation’s sustainability (Datta, 2013). Perceived Innovativeness can be described as the willingness on the part of an aspiring or existing entrepreneur to envision and/or design, and to adopt new and innovative ways of thinking and using of technology. Therefore, the concept of perceived innovation can measure the extent to which an individual is interested in developing new ideas, new and imaginative concepts, or innovative products and services (Alan, Kabadayi, Bakis, Can & Sekerin, 2017). Perceived innovativeness can be regarded as an important factor that influences the adoption by an aspiring entrepreneur of new ideas and technologies to be used in entrepreneurial activities and marketing The Business and Management Review, Volume 10 Number 2 April 2019 Conference proceedings of the Academy of Business and Retail Management (ABRM) 219 (Alan et al., 2017). Informed by this concept of perceived innovativeness from the literature, this study explores the impact of perceived innovativeness of sample groups students from the Commerce and Law faculties, respectively, of the University of Cape Town on the entrepreneurial intention of these students. Based on this concept of innovation and on its being a factor influencing entrepreneurial intention, the following hypothesis is proposed: H1: Perceived innovativeness positively influences university students’ entrepreneurial intentions. 2.1. 2 Perceived educational support If one accepts, based on various studies, that tertiary education significantly influences the career selection of students from all faculties, universities can be perceived as being potential sources of future entrepreneurs (Turker & Selcuk, 2009). According to Turker and Selcuk (2009) there exists a wide range of university courses that explore the nature, scope and structure of entrepreneurial education. Entrepreneurial education can also be viewed as a subset of general business management education (Turker & Selcuk, 2009). A recent study conducted by Barba-Sanchez and AtienzaSahuquillo (2017) explored the role that education plays in motivating a sample group of university students' intentions to become entrepreneurs. These authors raise an important question as to whether entrepreneurship can be encouraged through university education (Barba-Sanchez & Atienza-Sahuquillo, 2017). Based on these studies done which found educational support to be a factor positively influencing entrepreneurial intention, the following hypothesis is proposed: H2: Perceived educational support positively influences university students’ entrepreneurial intentions. 2.1. 3 Perceived risk Risk, in its simplest terms is described as uncertainty when the probabilities and outcomes of certain occurrences are known Paulsen, Platt, Huettel and Brannon (2012). University students are seen by many researchers and economic policy makers as a source of new entrepreneurs entering into the modern business world (Sharmajune, 2017). Thus, it is important to understand what leads students from having the intention to take a risk, to actually taking the risk. One of the core personality traits of any entrepreneur has been found to be that of risk-taking (Van Praag & Cramer, 2001). Risk dictates every decision an entrepreneur makes and in order for the outcome of the decision to be successful, the magnitude of the risk must be assessed (Paulsen et al., 2012). The concern here is finding out what factors influence students’ willingness to take risk. More specifically, this study focuses on the risk-taking propensity among two groups of student respondents in the commerce and law faculties respectively. Based on this outline of risk as being a factor of entrepreneurial intention as described in the literature, the following hypothesis is proposed: H3: Perceived risk positively influences university students’ entrepreneurial intentions. 3. Research methodology This research used a conclusive descriptive research design that seeks to investigate four constructs. These constructs include perceived educational support, perceived innovativeness, perceived risk and entrepreneurial intentions of students at the University of Cape Town. The questionnaire was distributed through an online platform named Qualtrics. The sample size was 300 respondents in total, which included students from the Law and Commerce faculties. More specific