Entrepreneurship is often seen as being key to the creation of wealth in society and as such, a crucial mechanism for the alleviation of poverty in the developing world. Most research however, has concentrated on the role entrepreneurship plays on small and micro entrepreneurs in the informal sector (in largely rural contexts), or in the general adult population (GEM). There has been little research on how entrepreneurship relates to larger businesses in developing countries especially those residing within urban environments. Recent work by Balunywa et al. (2009) has demonstrated that large scale portfolio entrepreneurs can play a vital role in economic development in Uganda. This study, however, whilst strong on measuring impact, has little coverage of the processes in which new business formation occurs by larger scale portfolio entrepreneurs in emerging markets in Africa. In particular because Africa is a risky environment to conduct business in, the role of risk in portfolio diversification has yet to be systematically explored.

The research addresses this gap by exploring processes of portfolio diversification (growth) by habitual entrepreneurs (portfolio entrepreneurs specifically) in a developing market context and the effects of two little studied variables, risk and the environment in this process. The market chosen was that of the country of Malawi: a poor but fast growing Southern African State evincing many of the characteristics of developing nations.