Serial entrepreneurs generally do better with their subsequent businesses than first-time entrepreneurs do with their first business.This has led to the belief that serial entrepreneurs' previous business experience sets them up for greater success with their subsequent ventures. However, it is also possible that serial entrepreneurs simply have better ability at the start.
A forthcoming paper, "Selection and Serial Entrepreneurs" by Jing Chen (available online here [gated]), looks at this issue among small business owners and the self-employed and finds that natural ability of serial business owners is the dominant factor for why they do they better; that is, their success is independent of previous venture experience.
Chen looks at self-employment and serial business ownership data from the National Longitudinal Survey of Youth 1979 dataset from 1981 to 2008. There are a lot of caveats about the data used, which focus on self-employment and small businesses, so to the extent findings extrapolate to growth-oriented startups is debatable. For example, 43 percent of the serial entrepreneurs changed industries with their subsequent businesses. So when Chen finds that entrepreneurial experience does contribute to improved outcomes when those entrepreneurs start a subsequent business in a familiar industry (rather than changing industries), it casts some doubt in my mind about the degree to which experience is or isn't influential. Regardless, the study highlights the role of innate entrepreneurial ability, specifically for small business owners and the self-employed--natural ability appears to have a dominant effect on firm performance.That is, the generalized implication is that innate ability perhaps matters more than experience.
Disclosure: The Kauffman Foundation is supporting a data module being added to the National Longitudinal Survey of Youth 1979 (NLSY79), the author's source data for this study, and the special issue of the journal this paper is published.