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The purpose of this paper is to explore the influence of social and business context of developing counties (in this paper Iran) on developing, forming and exhibiting entrepreneurial innovative behaviour leading to entrepreneurship. The developed model illustrates the most important factors in forming such behaviour.

In this paper, networked grounded theory was used to develop a path model for entrepreneurial innovative behaviour antecedents based on Iranian entrepreneurial context.

This paper shows that in Iranian entrepreneurship context, innovation is sensitive to local conditions and levels of technological capabilities. Also, Iran’s situation brings another aspect of innovation in mind, innovative behaviour of individuals in forms of entrepreneurships to compensate the lack of technology in the firms.

Due to the research approach and the quality of grounded theory, data gathering tool and sampling process, the generalizability of this paper is limited or may be context oriented; the results of this research must be interpreted within its limitation and scope.

This paper is the first study trying to develop a model on entrepreneurial innovative behaviour in Iran which develops a model based on the realities of Iran rather than model based on developed countries with different basis and context.