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Jean-François Lalonde

As the world becomes more global, ethnic diversity will become a more common feature of entrepreneurial teams. This study focuses on the dynamics of these groups and examines why and how this diversity influences the firm’s performance. The business start-up process of a team of partners with different ethnic backgrounds is studied in depth and the findings reveal that heightened ethnic or cultural heterogeneity can lead to a profusion of ideas, as well as to dysfunctionality. This heterogeneity needs to be managed so as to allow the team to function in a more flexible manner. A balance needs to be struck between differences and agreement, a new optimum of diversity. The chapter will highlight that it is within this context that culture shock can play a major role: it is a central element of the process of reaching equilibrium. It obliges communication and adaptation and can enhance the entrepreneurial team performance.