Entrepreneurial orientation and enterprises performance: Mediating role of sefa funding among female-owned enterprises in South Africa

Abstract

The study examines entrepreneurial orientation (EO) dimensions; namely, innovativeness, risk- taking, proactiveness, autonomy and competitive aggressiveness and their impact on access to funding from the Sefa. Additionally, the study analyses whether Sefa funding mediates the relationship between EO and enterprise performance. Despite the critical role that female entrepreneurs play in driving innovation, job creation, wealth creation, gender equality and economic growth, factors influencing their success, particularly access to finance, remain underexplored. Grounded in the entrepreneurial orientation theory, resource-based view, pecking order theory and the institutional perspective of development finance institutions (DFIs), the study adopts a cross-sectional, quantitative design with a post-positivist approach. Data were collected through self-administered online surveys from 181 female entrepreneurs funded by Sefa between 2012 and 2022. Multiple regression analysis and structural equation modelling (SEM) were used to analyse the hypothesized relationships. The results reveal that EO dimensions do not directly influence access to Sefa funding as entrepreneurial behaviours are not considered in the agency’s funding criteria. Additionally, the study finds that access to Sefa funding does not mediate the relationship between EO and enterprise performance. These findings challenge existing theoretical models that link EO to financing and performance thus highlighting gaps in DFI funding mechanisms. The study contributes to female entrepreneurship literature by advancing the theoretical understanding of EO and entrepreneurial finance in emerging markets. It recommends that DFIs should integrate EO dimensions into their funding models to drive enterprise performance. Policymakers are encouraged to enhance DFI funding mechanisms and develop policies that promote innovative financing. The practical implications highlight the need for female entrepreneurs to cultivate EO behaviours to strengthen business performance, competitiveness, and long-term sustainability