Indicators of entrepreneurial resilience in distressed small businesses

This study identifies entrepreneurial characteristics that function as informative indicators of resilience in Dutch small businesses. It focuses on firms facing financial distress and examines how recovery differs from persistent stagnation. Rather than equating resilience with survival, the analysis analytically distinguishes resilient recovery from persistent economic stagnation in order to isolate characteristics relevant for refining viability assessment and failure prediction models. A qualitative-led mixed-methods design is employed, combining semistructured interviews with 24 entrepreneurs, validated psychological and behavioral instruments, nonparametric statistical tests, and fuzzy-set qualitative comparative analysis. The findings indicate that higher levels of entrepreneurial self-efficacy and timely, solution-oriented responses to crisis distinguish resilient recovery trajectories from stagnation. Background characteristics, effectual behavior, and network support do not emerge as independent differentiators. Overall, the results suggest that resilience in distressed small businesses is shaped primarily by adaptive psychological and behavioral capacities rather than static attributes. These findings provide a refined basis for integrating nonfinancial indicators into small business viability assessment and failure prediction practices.