Means of Knowledge Acquisition of Entrepreneurs
and Their Success
Barbara Hvalic Erzetic
The goal of this paper is to analyze different approaches to acquir-
ing new knowledge. We analyze what means of knowledge acquisi-
tion are used by entrepreneurs, such as formal education process, one
and more day professional development workshops, professional coun-
selors, professional literature and information on the world wide web.
When making a decision on what means to use in order to increase
one's knowledge, entrepreneurs employ different assessment criteria:
time and money investment as well as pedagogical techniques used.
Time shortage is the most frequently cited reason that entrepreneurs
do not invest more personal resources into knowledge acquisition pro-
cesses. The main hypothesis we test, postulates that entrepreneurs who
invest more time and money into knowledge acquisition processes are
more successful. Success is measured with an average annual degree of
growth of sale, profits and number of employees in the last four years
and with entrepreneur's opinion concerning success of the company's
business. Finally, we develop the implication for public policy and ed-
ucational institutions on the means that need to be employed so that
entrepreneurs would invest more resources in knowledge acquisition
processes.
Key Words: entrepreneur, knowledge, success
jEL Classification: d, i, m
Introduction
Entrepreneurship and management education are important in develop-
ing knowledge and skills of entrepreneurs. In the era of globalization and
continuously changing business environments, the need for continuing
education and training is becoming ever increasing. Knowledge acqui-
sition and learning have been well emphasized as important factors to
successful entrepreneurship over the last decades. Learning involves ac-
quisition, distribution, storage and interpretation of information (Hu-
ber 1991). A qualitative study by Sexton et al. (1997) revealed that entre-
preneurs decide what they want to learn, where they want to learn and
Barbara Hvalic Erzetic is an Assistant at the Faculty of Maritime
Studies and Transportation, University of Ljubljana, Slovenia
Managing Global Transitions 6 (2): 157-175
how they want to learn. When learning, entrepreneurs are content - not
process - oriented and search for specific knowledge rather than general
information. In addition, they search for information that solves their
immediate needs while allowing them to plan for the success of an or-
ganization and upcoming problems (Sexton et al. 1997). Failure to ac-
quire new knowledge and learn can cause a firm to be unable to keep up
with technological progress in an industry and to anticipate shifts in cus-
tomer requirements since it may be incapable of producing technology
standards (Sullivan 2000). In all, several studies demonstrated that edu-
cation of entrepreneurs is a key factor of a new venture success (Postigo,
Iacobucci, and Tamborini 2003). Entrepreneurship education can be de-
fined as structured, formal conveyance of entrepreneurial knowledge;
entrepreneurial knowledge meaning the concepts, skills, and mentality
individual business owners use during the course of starting and de-
veloping their growth-oriented businesses; and entrepreneurial learning
meaning the active and cognitive processes individuals employ as they
acquire, retain and use entrepreneurial knowledge (Young 1997). Entre-
preneurs need to learn continuously through self-directed learning, as
well as through formal education and training to be able to secure the
business performance of their ventures. How are decisions on knowledge
acquisition process made? When thinking about gathering new knowl-
edge, entrepreneurs most probably consider the following factors: satis-
faction with prior knowledge development processes experience, qual-
ity perception of prior learning and training experiences (Antoncic and
Hvalic Erzetic 2004) and miscellaneous factors such as expected bene-
fits of learning, price and time investment into learning, geographical
premises, preliminary knowledge, institutional references and alike. Al-
though structural ways of knowledge acquisition processes have been
clearly given salience, evidence shows that entrepreneurs mostly tend to
rely on self-directed learning, in comparison to pre-entrepreneurs that
engage in entrepreneurial education and training. Reasons for their ap-
parent avoidance of formal education and training might be: 'perceived
immediate need for required knowledge, lack of availability of the pre-
cise class or workshop that meets their needs, lack of time to engage in
a formal learning program, the desire to structure the learning effort as
they like, the desire to keep the learning styles they use flexible, the desire
to take advantage of their own learning styles' (Young 1997).
What is the situation like in Slovenia? Slovenian firms were not pre-
pared to invest enough in education in the past decade, only one fifth of
companies invested in research and development in year 1997. The prob-
lem was not in lack of means, but in no interest of management to in-
vest in knowledge. From the point of view of demand of the economy
regarding knowledge, we must mention the period of socialism up till
1990, when the demand was for unskilled labour. After 1991 the demand
for knowledge dropped, because there was a tendency of management to
reduce the value of companies and to legally gain property in the com-
pany. Decrease in knowledge was not visible or at least not in such mea-
sure, only in explicitly export guided companies and small companies,
which were managed by their owners. A negative attitude to knowledge
in the entire society appeared because of such circumstances, especially
the attitude to learning among young people (Ostan and Hvalic Erzetic
2006). In the last years Slovenia has been quite comparable with Euro-
pean countries in primary and secondary school education, but we can
not say this for adult education, where also entrepreneurship education
and training are placed. In Slovenia only 31% of adults educate them-
selves, whereas this proportion is, for example, higher in Finland, Den-
mark, Sweden, and Norway (50%), as well as in Great Britain, Switzer-
land, and the Netherlands (40%), and lower in accession countries such
as Hungary (19%) and Poland (14%) (Gaber 2000). Also Socan is warn-
ing against this problem when he says that, although Slovenia has been
placed among developed countries from 2000 on, it invests in complete
knowledge (education, research and development and various shapes of
training employees, unemployed and business functions of companies
and institutions) only 8.5% gnp (education - 6%, research and develop-
ment -1.5% and various shapes of training employees, unemployed and
business functions of companies and institutions -1%). If Slovenia wants
to be compared with Germany, Socan thinks that it has to increase invest-
ment into training adults and business functions (+300%), research and
development (+67%) and education (from +8 to 17%) (Ostan and Hvalic
Erzetic 2006). Success of companies and society is connected with invest-
ment into education and training. Birch (1993) alleges 5 factors for in-
creasing the development of dynamic companies: in the first place there
is education infrastructure, quality of employees (it is connected with
education and training), quality of government, telecommunication and
quality of life.
In summary, the development of learning in its various guises of in-
dividual, team and organizational learning has been recognized by many
as being a critical factor for our economic prosperity (Sullivan 2000).
The hypotheses were formed on the supposition that one of the char-
acteristics of the successful entrepreneur is eagerness to learn (Wickham
in Olsen 2002). Learning and knowledge, which must be gained contin-
uously (Antoncic et al. 2002; Penrose 1995; Timmons 1999; Solymossy
and Penna 2001), is an important factor of success (Gartner 1988; Ripsas
1998). Knowledge, gained by formal education, is connected with success
(Coleman 1988; Davisson and Honig 2003; Kubr 2002; quoted in Ravasi
and Turati 2005). A positive link between formal education and success
was confirmed also by Stuart and Alberti 1990, Brush and Hisrich 1991,
Dyke, Fischer and Reuber 1992, Kolvereid 1992, Box, White and Barr 1993,
Dolinsky 1993, and Reid and Smith 2000 (quoted in Drnovšek 2002). The
positive link between training and superior firm performance was estab-
lished by different researchers (Olsen 2002; Bharadwaj, Falcone, and Os-
born 2004). Cosh, Duncan, and Huges 1998 (quoted in Kotey and Folker
2007) belive that training is a powerful agent for the development capa-
bilities and for the growth and profitability of the firm, it should greatly
improve sme survival and performance (English 2001, Lattimore et al.
1998, Jennings and Beaver 1995 quoted in Kotey and Folker 2007). Reid
and Harris (2002) noted that the most successful smes provide more em-
ployee training than average. When we formed our hypotheses we did
not find any researches which would establish a link between learning by
reading the professional literature and by browsing the world wide web,
but Mandel (2004) argued that the success of us entrepreneurs is in con-
verting ideas to products during the Internet boom in the 1990s, and the
use of networks was a feature of achieving success (McKeon, Johnston,
and Henry 2004). Kubr (2002) also thinks that today knowledge is easily
accessible for all entrepreneurs through it and the World Wide Web.
We do not engage in the content and quality of enterprise programmes
at this point, but if we draw conclusions on learning in entrepreneurship
from the existing literature we propose the following relationships:
H1 Entrepreneurs who invest more time and money into formal edu-
cation degree knowledge acquisition processes are more successful as
measured with objective and subjective indicators of entrepreneurial
performance.
H2 Entrepreneurs who invest more time and money into professional
workshop acquisition processes are more successful as measured with
objective and subjective indicators ofentrepreneurial performance.
H3 Entrepreneurs who invest more time and money into one-day semi-
nar knowledge acquisition processes are more successful as measured
with objective and subjective indicators of entrepreneurial perfor-
mance.
H 4 Entrepreneurs who invest more time and money into professional lit-
erature knowledge acquisition processes are more successful as mea-
sured with objective and subjective indicators of entrepreneurial per-
formance.
H5 Entrepreneurs who invest more time and money into world wide
web knowledge acquisition processes are more successful as measured
with objective and subjective indicators of entrepreneurial perfor-
mance.
The aim of this research, which was done among micro and small
companies in Slovenia (98,440 companies were registered in Slovenia in
the year 2006, 91,306 (93%) of them were micro (0-9 employees) and
5,597 (6%) were small (10-49 employees)), is to analyze what approaches
small entrepreneurs use in knowledge acquisition processes, what impor-
tance they ascribe to different types of knowledge acquisition processes,
and how this affects their ventures' performance.
We expect that such empirical findings will provide helpful evidence
for public policy as well as institutions in the business of entrepreneur-
ship education and provision of training programs.
The Empirical Study
In this section, the methodology (data collection, sample and analysis) is
presented.
DATA COLLECTION
The data for the empirical study were compiled in fall 2006 by a cross
sectional, mailed, self-administered questionnaire to the sample of micro
and small (less than 50 employees) privately owned Slovenian firms. We
chose Dillman's (1978) Total Design Method (tdm) as the foundation of
the survey instrument design and mail implementation.
sample
The final sample included 303 entrepreneurs from Slovenia (sample char-
acteristics are summarized in table 1 and table 2).
Responding entrepreneurs are between 30 to 50 years old: most of
them (35%) are from 30 to 40 years old. 73% of respondents are male,
table 1 Sample characteristics: entrepreneurs
Age	30-40 years old 35%, 40-50 years old 33%, 50-60 years old 19%, 20-30 years old 11%.
Gender	Male 73%, female 27%.
Civil status	Married 67%, single 19%, divorced or widowed 14%.
Education	Secondary school 62%, high school or professional 20%, university 15%, post-graduate 2%.
67% of them are married, 62% of respondents have a secondary school
certificate.
Firms included in the sample are engaged in different industries, but
their business activity is predominantly in trade and services. 60% of
respondents classified their companies as low-tech companies and the
majority of respondents (52%) have had their private businesses for more
than 10 (up to 20) years. The organization form of 51% of companies
is limited liability, 44% sole proprietorship; other respondents classified
their companies under the organization format as 'other'. The size of the
responding companies is relatively small: 28% have 3-5 employees.
Success is measured by the average annual degree of sale growth, prof-
its and number of employees in the last four years and with by en-
trepreneur's opinion concerning the business success of the company.
Most (25%) of the responding entrepreneurs have an average annual
growth rate of sales between 5 to 10% in the last four years, 31% of re-
spondents have an average annual growth rate of profits of up to 5%
in the last four years, 40% of respondents have an average annual rate
of increase in number of employees of up to 5% during the last four
years.
Altogether 54% of respondents spend approximately less than 10% of
their sales on future growth and development and most of the respond-
table 2 Sample characteristics: entrepreneur's company
Business activity	Wholesale trade 47%, business services 22%, construction
	16%, personal services 13%, transportation 8%.
Technical classification Low-tech 60%, medium-high-tech 33%, high-tech 7%.	
Age of activity	0-3 years 11%, 3-5 years 9%, 5-10 years 18%, 10-20 years 52%,
	more than 20 years 10%.
Organization form	Limited liability 51%, sole proprietorship 44%, 'other' 5%.
Number of employees	117%, 2 14%, 3-5 28%, 6-9 12%, 10-25 14%, more than 25 12%.
table 3 Sample characteristics: successfulness*
Average annual rate of growth of sales (in %) in the last four years	Negative 11%, 0-5 23%, 5-10 25%, 10-15 13%, 15-20 9%, 20-30 9%, 30-40 3%, more than 40 7%.
Average annual rate of growth of profits (in %) in last four years	Negative 12%, 0-5 31%, 5-10 26%, 10-15 12%, 15-20 10%, 20-30 4%, 30-40 1%, more than 40 4%.
Average annual rate of increase in number of employees (in %) during last four years	Negative 30%, 0-5 40%, 5-10 9%, 10-15 6%, 15-20 4%, 20-30 6%, 30-40 2%, more than 40 3%.
Percentage of sales invested for future growth and development	Not invest 33%, 0-10 54%, 11-25 11%, more than 26 2%.
Annual sales (in 000 €)	0-120 44%, 120-200 10%, 200-400 8%, 400-800 11%, 800-2,000 10%, more than 2,000 11%.
note *The rate and the portion represented by the rate (in %).
ing ventures are relatively small: 44% of entrepreneurs reported under
120,000c of annual sales (sample characteristics are summarized in ta-
ble 3). When assessing subjective indicators of venture performance, we
found the most important perceived indicators of success were the qual-
ity of products and services (mean = 4.43; min = 1; max = 5), followed by
autonomy and independence (mean = 3.92), followed by self-realization
and control over one's future (mean = 3.58).
analysis
In order to assess knowledge acquisition processes we used measures that
included types of knowledge acquisition that the entrepreneurs used,
such as formal education process, short professional development work-
shops, relying on advice of professional counselors, professional and in-
dustry specific literature and information on the world wide web. We
also measured time spent and money invested in the knowledge acquisi-
tion processes and reasons for not investing more time and money in the
different manners of obtaining knowledge.
To analyze the benefits of investment into the knowledge acquisition
process we also measured venture performance results. We assessed ven-
ture performance with the following indicators: annual degree of sales
growth; profits and increase in number of employees over the last four
years, perceived quality of products and services and a potential for fu-
ture growth. We also included subjective measures of performance from
the entrepreneur's viewpoint: autonomy and independence, a potential
for offering employment to family members and control over one's fu-
ture on a Likert-type scale following previous entrepreneurship research
practice (Welter 2001; Wiklund 2001).
The empirical data were analyzed using spss 13.0 software, employing
univariate and bivariate data analysis and cross-tabulation. We executed
several of Spearman's tests to study relationships between variables and
test significance of statistical relationships between pairs of variables.
The Results
In the following issues we sequentially report the results from our em-
pirical study: knowledge acquisition process by type of institution; time
invested into the knowledge acquisition process; financial resources in-
vested into the knowledge acquisition process; reasons that guide entre-
preneurs in assessing the time and finance needed to obtain new knowl-
edge, and contingency of relationship between resources invested into
the knowledge acquisition process and venture performance.
In order to analyze contingencies, we first assessed current growth
characteristics of responding entrepreneurs and their ventures. 18% of
entrepreneurs gain new knowledge through a degree type of education
(high school, college and university education process), 39% of them
gain new knowledge through short (2-3 days) professional development
workshops, 72% participate in one-day seminars, 40% of respondents
visit professional counselors, 79% educate themselves by reading pro-
fessional literature and 69% of respondents gain new information by
browsing the world wide web. Respondents were able to choose several
answers. The most common knowledge acquisition process seems to be
through one-day seminars.
In our sample, 9% of respondents correspondingly achieved a one de-
gree higher education during the time they were starting their company.
What is the intensity of the knowledge acquisition process? Entrepre-
neurs who participate in degree type education processes spend more
than 30 days per year doing so (17%). Those who participate in short
professional workshops (24%), spend from 1 to 5 days per year for such
purposes; 51% of respondents who participate in one day seminars spend
from 1 to 5 days for these seminars; 38% of respondents spend 1 to 5 days
per year visiting professional counselors; 35% of respondents spend more
than 30 days per year reading professional literature, and 42% of them
spend more than 30 days per year gathering information on the world
wide web.
Reading literature and gathering information from the world wide
web seems to be the most intense means of the knowledge acquisition
process. This is probably related to the fact that those techniques are the
most flexible for entrepreneurs.
We also measured money invested per month for different purposes in
the knowledge acquisition process on a scale ranging from '0€' to 'more
than 400c'. The majority spends between 20€ to 200€ per month on
all types of the knowledge acquisition process (12% for degree educa-
tion type, 27% for professional development workshop, 48% for one day
seminars, 25% for professional counselors, 39% for professional litera-
ture and 42% for information from the world wide web). 66% of those
entrepreneurs who are involved in degree type education processes do
not spend any money for short professional development workshops.
We found that, in general, entrepreneurs consider gaining new knowl-
edge a time and finance consuming process. Naturally one would expect
that entrepreneurs would dedicate more time and energy towards gain-
ing new information through reading professional literature and brows-
ing the world wide web because these are the cheapest ways of obtaining
knowledge.
In our research we want to know how significantly the investments into
knowledge education processes are related to firm performance.
We tested the main hypotheses for relationships between quantity of
time and finance invested into knowledge acquisition processes and ven-
ture performance.
Hypothesis 1 stated that the entrepreneurs who invest more time and
money into formal education degree knowledge acquisition processes
are more successful as measured with objective and subjective indica-
tors of entrepreneurial performance. We found that entrepreneurs, who
spend more time (Spearman's rho = 0.178, sig. = 0.009, sig. < 0.01) and
money (Spearman's rho = 0.139, sig. = 0.049, sig. < 0.05) for gathering
new knowledge of the degree education type, think they have a poten-
cial for growth. Entrepreneurs who spend more time in gathering new
knowledge of the degree education type think they have better oppor-
tunities for employing a family member (Spearman's rho = 0.149, sig. =
0.03, sig. < 0.05).
Hypothesis 2 stated that the entrepreneurs who invest more time
and money into professional workshop acquisition processes are more
successful as measured with objective and subjective indicators of en-
trepreneurial performance. We found that the entrepreneurs who spend
more time on gathering new knowledge by participating in a several-day
professional development workshop:
•	have a higher realization (Spearman's rho = 0.179, sig. = 0.009, sig.
<	0.01),
•	have a higher average annual degree of growth of sale in the last four
years (Spearman's rho = 0.153, sig. = 0.027, sig. < 0.05),
•	have a higher average annual degree of growth of profit in the last
four years (Spearman's rho = 0.141, sig. = 0.043, sig. < 0.05),
•	think they have a potential for growth (Spearman's rho = 0.131, sig.
= 0.047, sig. < 0.05),
•	think the firm gives them more self-control over the future (Spear-
man's rho = 0.153, sig. = 0.021, sig. < 0.05).
We also found that entrepreneurs who have a higher realization, spend
more money on gathering new knowledge by participating on several-
day professional development workshops (Spearman's rho = 0.284, sig.
= 0, sig. < 0.01).
Hypothesis 3 stated that entrepreneurs who invest more time and
money into one-day seminar knowledge acquisition processes are more
successful as measured with objective and subjective indicators of en-
trepreneurial performance. We found that entrepreneurs who spend
more time on gathering new knowledge by taking one-day seminars:
•	have a higher realization (Spearman's rho = 0.185, sig. = 0.005, sig.
<	0.01),
•	have a higher average annual degree of growth of sale in the last four
years (Spearman's rho = 0.157, sig. = 0.018, sig. < 0.05),
•	estimate (feel or mean) that they have higher sales (Spearman's rho
= 0.134, sig. = 0.033, sig. < 0.05),
•	consider that they have a greater range quality products and services
(Spearman's rho = 0.174, sig. = 0.006, sig. < 0.01).
We also found that entrepreneurs who spend more money on gather-
ing new knowledge by taking one-day seminars:
•	think that they have a profitable firm (Spearman's rho = 0.142, sig.
= 0.024, sig. < 0.05),
•	consider that they have a potential for growth (Spearman's rho =
0.192, sig. = 0.002, sig. < 0.01).
Hypothesis 4 stated that entrepreneurs who invest more time and
money into professional literature knowledge acquisition processes are
more successful as measured with objective and subjective indicators of
entrepreneurial performance. We found that entrepreneurs who spend
more money on gathering new knowledge by using professional litera-
ture:
•	have a higher realization (Spearman's rho = 0.291, sig. = 0, sig. <
0.01),
•	consider that they have a potential for growth (Spearman's rho =
0.168, sig. = 0.007, sig. < 0.01).
Hypothesis 5 stated that entrepreneurs who invest more time and
money into world wide web knowledge acquisition processes are more
successful as measured with objective and subjective indicators of en-
trepreneurial performance. We found that entrepreneurs who spend
more money on gathering new knowledge by browsing the world wide
web:
•	have a higher realization (Spearman's rho = 0.263, sig. = 0, sig. <
0.01),
•	consider that they have greater chances for employing a family
memeber (Spearman's rho = 0.135, sig. = 0.039, sig. < 0.05).
The significance of these relationships indicates that time and money in-
vested into knowledge acquisition processes in general is connected with
measures of venture performance, but the connection is small.
We also found a connection between the entrepreneur's investment
in growth and development of annual sales, and investment time and
money for different modes of obtaining knowledge. Statistically signifi-
cant relationships are reported in table 4.
We found that the entrepreneurs who invest more money in growth
and development of annual sales spend more time and money on gath-
ering new knowledge of the degree education type, by participating
in several-day professional development workshops, by taking one day
seminars, by visiting professional counselors, by reading professional lit-
erature and by gathering information on the world wide web than do the
entrepreneurs who spend less money on growth and development.
We also analyzed reasons that the entrepreneurs listed for not spend-
ing more time on different types of knowledge acquisition processes and
their performance records.
table 4 Relationship between entrepreneur's investment in growth and development
of annual sales, and investment of time and money for different modes of
obtaining of knowledge
Time spent on/money spent on	Spearman	Sign.
	coef.	
Time for university work/	0.17	0.02
money for university work	0.15	0.04
Time for professional development workshops/	0.29	0.00
money for professional development workshops	0.27	0.00
Time for one-day seminars/	0.20	0.00
money for one-day seminars	0.15	0.02
Time for professional counselors/	0.14	0.04
money for professional counselors	0.28	0.00
Time for professional literature/	0.24	0.00
money for professional literature	0.25	0.00
Time for World Wide Web/	0.19	0.00
money for World Wide Web	0.21	0.00
The most frequent reason for not spending more time on knowledge
acquisition processes was that 'it takes too much time' (62% of respon-
dents for degree type of education processes, 59% of them for short pro-
fessional development workshops, 64% of them for reading professional
literature and 69% of them for browsing the world wide web). Indeed,
41% of respondents do not spend more time on one-day seminars be-
cause they 'do not bring expected benefits', and the main reason given
by 60% of respondents for not visiting professional counselors was that
they are 'too expensive'.
We found statistically significant relationships between performance
records and the main reason for not spending more time and money to
gather new knowledge by reading professional literature and browsing
world wide web because 'it takes too much time'.
By reading professional literature: the highest percentage (31%) had an-
nual sales growth of 10% and more in the last 4 years while the lowest
percentage for this reason was up to 5% (8%) in the sales growth group.
Chi square tests were significant at 0.01.
The highest percentage (27%) had an annual profit growth of more
than 5% in the last 4 years, while the lowest percentage for this reason
was up to 5% (11%) in the profit growth group. Chi square tests were
significant at 0.05.
The highest percentage (34%) had an annual increase in the number
of employees of more than 5% in the last 4 years, while the lowest per-
centage for this reason was in the employee growth group of up to 5%
(13%). Chi square tests were significant at 0.01.
By browsing the world wide web: the highest percentage (2%) had an
annual sales growth of between 5 to 10% in the last 4 years, while the
lowest percentage for this reason was in the sales growth group of up to
5% (13%). Chi square tests were significant at 0.05.
The highest percentage (35%) had an annual increase in the number of
employees of 5% and more in the last 4 years, while the lowest percentage
for this reason was in the employees increase growth group of up to 5%
(19%). Chi square tests were significant at 0.05.
We can say that those entrepreneurs who are more successful stated
that reading professional literature and browsing the world wide web
takes too much time.
We also found statistically significant relationships between perfor-
mance records and the main reasons for not spending more time and
money on gathering new knowledge by formal degree education type,
by participating in short professional development workshops and by
attending one-day seminars because 'it is not important' and 'it does not
bring expected benefits'.
Through formal education degree: the majority (22%) of entrepreneurs
who think that 'it is not important' recorded sales of between 20,000
and 80,000c and the lowest percentage of entrepreneurs that listed the
reason as unimportant was in the group of less than 20,000c of annual
sales (11%). Chi square tests were significant at 0.05. Most entrepreneurs
(16%) were in the group of negative increase of employees. The fewest
entrepreneurs were in the group with increase of employees of more than
5%. Chi square tests were significant at 0.05.
Through professional development workshops: the highest percentage
(8%) of entrepreneurs who listed 'it does not bring expected benefits'
as the predominant reason for not being involved in professional work-
shops of knowledge acquisition had an annual sales growth of up to 5%
in the last 4 years, and the lowest percentage for this reason was in the
sales growth group of more than 10% (1%). Chi square tests were signifi-
cant at 0.05. The highest percentage (11%) of entrepreneurs who listed 'it
is not important' had annual sales growth of up to 5% in the last 4 years,
and the lowest percentage for this reason was in the sales growth group
of more than 10% (4%). Chi square tests were significant at 0.10.
Through one-day seminars: the highest percentage (27%) of entrepre-
neurs who listed 'it is not important' as the predominant reason for not
being involved in one-day workshops had an annual negative increase in
the number of employed people in the last 4 years, while the lowest per-
centage for this reason was in the employee growth group of up to 5%
(12%). Chi square tests were significant at 0.05.
We can say that those entrepreneurs who are less successful stated that
gathering new knowledge by formal degree education type, by partici-
pating in short professional development workshops and by visiting one
day seminars are not important and do not bring the expected bene-
fits.
Discussion and Conclusions
Acquiring formal education as well as professional skills is an important
input to the individual's social, professional and personal development.
It is also an important success factor. Given the ever increasing pace of
economic and societal changes we face, knowledge needs to be regularly
updated.
The empirical analysis was done on a sample of 303 small entrepre-
neurs, half of whom have limited liability companies and 45% of whom
hold sole proprietorship. One third of them have 3 to 5 employees; their
predominant industries are trade and services, and the majority of ven-
tures are low rather than high tech. One fourth of responding entrepre-
neurs have an average annual sales growth rate between 5 to 10% in the
last four years, an average annual growth rate of profits in the last four
years of up to 5%, and an average annual rate of increase in the number
of employees during the last four years of up to 5%. Half of them spend
approximately less than 10% of their sales on future growth and devel-
opment, and most of the responding ventures are relatively small: 44%
of entrepreneurs reported under 120,000c of annual sales. Two thirds of
entrepreneurs included in the sample have a high school education; more
than 70% of them are male of 30 to 50 years of age. The majority of them
have been small business owners for 10 to 20 years.
Empirical analysis indicated that the majority of entrepreneurs (72%)
use one-day seminars and reading professional literature as their prefer-
able knowledge updating processes. Most money and time is spent on
acquiring formal education degrees, yet only 18% of respondents in the
sample are involved in such processes. In general, some 1 to 5 days per
year are spent on visiting professional workshops, one day seminars and
business consultants. The majority of them spend between 20c to 200c
per month for all types of knowledge acquisition process.
We found that entrepreneurs who invest more money in growth and
development of annual sales spend more time and money on gathering
new knowledge of the degree education type, by participating in several-
day professional development workshops, by taking one-day seminars,
by visiting professional counselors, by reading professional literature and
by gathering information on the world wide web than do entrepreneurs
who spend less money on growth and development.
When we tested the main hypotheses for relationships between quan-
tity of time and finance invested into the knowledge acquisition pro-
cesses and venture performance, we found that the time and money in-
vested into knowledge acquisition processes in general is connected with
measures of venture performance, but the connection is small. The sta-
tistically most significant relationships between time and money invest-
ment in gathering new knowledge and venture performance were found
at professional workshop acquisition processes and in one-day seminar
acquisition processes.
We searched for reasons for not spending more time and money on
gathering new knowledge, if this is connected with company success.
Shortage of time is listed as the most important reason for not being
more intensely involved in such processes.
When reasons for not being involved more intensely in knowledge ac-
quisition processes were significantly related to business performance,
two interesting relationships surfaced. Entrepreneurs who have ventures
with lower performance results do not engage in knowledge acquisi-
tion processes because they do not find them relevant and do not see
any practical benefits that could be obtained from such processes. On
the other hand, more successful entrepreneurs do not spend much time
on knowledge acquisition processes through reading professional litera-
ture and browsing the world wide web because they found them to be
time consuming. Given that the internet has become the most impor-
tant channel to access new information and business opportunities, the
success of those companies could be additionally leveraged if those entre-
preneurs were more intensely involved in those processes.
The study has some limitations. In Slovenia we can speak about freer
enterprise only for the last 15 years or so - most entrepreneurs started
their own firms in this period. In our sample the largest number of entre-
preneurs have had their own business from ten to twenty years, so that
we cannot make conclusions about entrepreneurs with a long experience.
The second problem is that our sample included small firms with 3 to 5
employees, their predominant industries are trade and they are low tech.
We think that we would obtain different results if we had more high tech
companies and more with higher added value.
A potential general implication from this type of research could in-
struct institutions and influence the policy to design measures stimulat-
ing intrinsic motivation of entrepreneurs to be more intensely motivated
to acquire new knowledge and to realize the importance for their current
performance as well as future success and development in doing so. They
would have to concentrate on a group of fewer successful entrepreneurs,
that be them with help of market grips, convinced concerning meaning
of knowledge for larger success. They would have to think about a man-
ner of training more successful entrepreneurs, which would impose the
least possible time load on them. Hills et al. (1996) proposed that in or-
der for the entrepreneurs to gain new entrepreneurship knowledge with
education and training, institutions must choose a target group, train-
ers and training and proceed to an analysis of entrepreneurs' needs at
different levels. They must determine the goals and adapt teaching ap-
proaches, shapes, procedures and characteristics of entrepreneur train-
ers (Gibb 1994). Glas and Drnovsek (1999) suggest that in the field of
education and training, entrepreneurship must be included in all formal
education types, training must be adapted to a target group, society must
stimulate education for technical occupations and institutions must ed-
ucate in the entrepreneurship sense.
Developers of qualification and training programs for post-secondary
education and training of entrepreneurs and potential entrepreneurs
should (Labuschagne, Nieuwenhuizen, and Kroon 2001,17):
1.	Identify and integrate the outcomes from existing subjects in the
field of economic and management sciences that relate to the suc-
cess factors of entrepreneurs.
2.	Supplement these outcomes with case studies, experiential exer-
cises and practical activities that will enable learners to integrate
the knowledge and skills obtained in such training of entrepreneurs
and to apply these skills and knowledge in an entrepreneurial envi-
ronment.
For further research, the question is raised concerning the efficiency
of enterprise education and training in Slovenia - entrepreneurs can
invest time and money for obtaining knowledge, but the question is
whether education and training mean quality. Košir explains that Slove-
nia is above the oecd average regarding formal education, yet in relation
to functional literacy (ability in understanding a text) among the worst.
Functional literacy is important also for successful husbandry (Ostan
and Hvalic Erzetic 2006).
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