ABSTRACT
Business failure is, unfortunately, a relatively common experience of entrepreneurship, which brings grief and psychological distress to entrepreneurs. It seems likely that this would then impact their future endeavors, yet there has been limited analysis of research into how business failure influences stakeholders’ relationships in subsequent venture formation. Some stakeholders terminate relationships with businesses after a failure as a way of insulating themselves from the costs of future failure and in some cases as retributive reactions to failure consequences suffered by them. For stakeholders who extend cooperation to future ventures, trust and trustworthiness, good faith, and entrepreneurial apologies appear to influence post-business-failure stakeholder management relationships. The study also finds that stakeholder salience to the business has significant sway on engagement strategies deployed by both the business and the stakeholders. The findings could benefit entrepreneurs in managing stakeholder relations in the event of business failure and consideration of further start-ups.
