A Study of Founder-entrepreneurs from High-tech Software SMEs in China in Managing Risks and Exploring Market Opportunities

Small and medium-sized enterprises (SMEs) are the backbone of the national economy (Franco et al., 2014). And the rapid growth of the software market has brought in a lot of new opportunities for SMEs, especially in the high-tech software sector in China. However, the development of these SMEs still faces many uncertainties and competition that highly threaten their survival and sustainability (Li, 2019). In such scenarios, having good risk management strategies can be a significant factor towards the development and success of enterprises (Gourinchas et al., 2020; Bartik et al., 2020). However, limited by size and resources, SMEs commonly lack a well-developed risk management structure. In most scenarios, the founder-entrepreneurs tend to play a key role in the risk management of their SMEs (Islam and Tedford, 2012; Oláh et al., 2019). Their personal risk attitude and judgments will therefore directly decide the company's development and direction, and sometimes will even influence the company's survival (Carland et al., 1995). To understand the risk management status of Chinese high-tech software SMEs, this study adopted a qualitative research approach, using multiple case studies to deeper explore the role of the founder-entrepreneur in the risk management process. Nine founder-entrepreneurs from Chinese high-tech software SMEs have been selected as samples in this study. The findings show the important role of founder-entrepreneurs plays in the risk management of Chinese high-tech software SMEs. In this study, founder-entrepreneurs are primarily driven by 'pull motivations' to see entrepreneurship as a self-directed pursuit. Besides, the study supports that different personality traits significantly impact the founder-entrepreneurs' risk attitude and further lead the different risk strategies during the company's operation. Among them, openness and neuroticism are the two main personality traits which highly impact the founder-entrepreneurs' decision-making when facing risks. In this study, participants with a higher level of openness tended to accept new challenges and tasks, they showed a more positive attitude towards facing market uncertainties and addressing challenges. At the same time, people who scored lower in neuroticism have a better capability to manage their emotions. This quality in their personality helps them to be more objective in their decision-making, especially during crises and when facing risks and setbacks.