This paper aims to understand in-depth, from the handicraft entrepreneurs‘ perspective how they first get involved in handicraft production, and how they make decisions about to move (or not) to formal commercialisation. The Malaysian Handicraft Development Corporation (MHDC Census, 2014) revealed that vast majority of handicraft entrepreneurs are operating as modest production, i.e. home-based and mainly part-time, which has always been regarded as low performance. The in-depth interviews therefore were conducted with 16 handicraft entrepreneurs in Kota Belud, Sabah to explore why this modest kind of production is so favoured among handicraft entrepreneurs in Malaysia, regardless of its perceived disadvantageous, and why some entrepreneurs commit to full-time production. The selection of the samples was based on two main performance criteria, which were assumed likely to provide different responses on the topic under investigation: (1)premises location (home-based and workshop-based) and (2)production status (part-time and full-time). The analysis of data was guided by initial conceptual framework relating to concept and theories on small business performance which allows similar data to be labelled under similar codes and categories. Overall, the in-depth interviews together with insights from the literature led to the identification of five sets of factors that may influence the start-up and factors that stimulated or inhibited the entrepreneurs to move to a greater level of commercialisation, namely personal background, personality traits, motivations, personal skills and support contexts. The findings of this qualitative fieldwork served as a basis for the development of a questionnaire for the largescale survey in the future.