Entrepreneurship and Small Business Management

This report covers issues such as entrepreneurial ventures and their typology, similarities and differences between entrepreneurial ventures, impact of micro and small business on the economy, importance of small business and startups to the growth of the social economy, traits and skills of entrepreneurs that helps them to differentiate from managers of the company, background and experience of entrepreneurs and how entrepreneurs stay motivated and how their mindset is different.

ENTREPRENEURSHIP
AND SMALL BUSINESS
MANAGEMENT

Table of Contents
INTRODUCTION.......................................................................................................................3
LO 1 ............................................................................................................................................3
P 1 Entrepreneurial ventures and typology of entrepreneurship.......................................3
P 2 Similarities and differences between entrepreneurial ventures....................................4
LO 2.............................................................................................................................................6
P 3 Impact of micro and small businesses on the economy...............................................6
P 4 Importance of businesses who operates on small scale and business start-ups to the
growth of the social economy.............................................................................................7
LO 3.............................................................................................................................................9
P 5 Characteristic traits and skills of successful entrepreneurs that makes them different
from other business managers............................................................................................9
P 6 Aspects of the personality of entrepreneurs reflect entrepreneurial motivation and mind-
set......................................................................................................................................10
LO 4...........................................................................................................................................11
P 7 Background and experience can hinder or foster entrepreneurship...........................11
CONCLUSION..........................................................................................................................12
REFERENCES..........................................................................................................................14

INTRODUCTION
Entrepreneurship is considered as designing, launching and running a new business, which is
often initially a small business. businesses created by the people are called entrepreneurs.
Small business management is a process entrepreneurs use when running
their business operations. Entrepreneurs may need to understand how to manage employees,
accurately report financial information, acquire economic resources or business assets, and
make various business decisions. This report covers issues such as entrepreneurial ventures
and their typology, similarities and differences between entrepreneurial ventures, impact of
micro and small business on the economy, importance of small business and start ups to the
growth of the social economy, traits and skills of entrepreneurs that helps them to differentiate
from managers of the company, background and experience of entrepreneurs and how
entrepreneurs stay motivated and how their mind set is different.
LO 1
P 1 Entrepreneurial ventures and typology of entrepreneurship.
Entrepreneurial ventures is focused on providing services related to advises and
suggestions to start ups and companies who are operating as mid stage. Role of ventures are
different and it changes according to the stage of the company.
Small Business Entrepreneurship-
Majority of the companies dealing in the market are operating on a small scale.
According to facts and figures around 80 per cent of the companies are working and maintain
their operations on the level of small enterprise but even then they are the ones who are
providing employment approximately to 50 per cent of the individuals who are dealing in the
sector of private sector. Employees hired in these companies are on the scale of around 1 to 5
people. These companies are not able to gain the attention of venture capital as they maintain
their operations on a small scale. For starting or commencing their operations they take helps
from their family, friends or ask for personal loans from banks. Usually people who are
consultants, carpenters, hairstylists, plumbers etc. starts businesses on these scale. These
businesses are started up on a low scale of investment (Campos and et.al., 2017)
Scalable start up Entrepreneurship-
When an entrepreneur is fully aware of the forces of market and has gained confidence
through their skills which make them believe that their vision can help bring change in the

market. These type of entrepreneurship is known as scalable start up. These type of businesses
approach venture capitalists in order to raise capital for maintaining the operations. It also
helps them to employ efficient and skilled employees to work with. Entrepreneurs first find
out the nature of the business then they take the use of the capital which they raised it through
venture capitalists. There is high involvement of risk in the company and the return on
investment is also not predictable. This is the reason why there are not much companies who
are operating in this sector. For instance companies such as Snapchat, whats app, Facebook
etc. which are maintained their operations successfully online are included into this sector.
Entrepreneurial ventures such as these is linked with the typology which is same that is
scalable typology. Motive of these ventures is to get repeated sales. These companies focuses
on stealing the share in the market of different companies by bringing innovation
Large Scale Entrepreneurship-
Companies operating on a large scale such as Samsung, Microsoft, Apple comes into
this scale of operations. These companies launch new products with new innovation.
Companies such as these focus on achieving growth in aggressive way by using every
available resources with them which can lead them to achieve the goal. They deal with more
no of operations and handle more clients. Also in order to maintain their operations they
require more employees. (Dunne, et.al., 2016). these type of entrepreneurship is characterized
on the basis of their dealings and clients. The scale in which they operate involves a huge risk.
The volume in which the business communicates helps to determine the nature of the
entrepreneurship. For instance- Uber, google, Amazon etc. are the ideas of large scale
entrepreneurship
Social Entrepreneurship-
These type of entrepreneurs takes initiatives for helping and providing benefits to the
welfare of the people. They work and focus on making those products which can help people
who are underprivileged. Their motive is to work for the benefit of society not to maximize
their profits. Typology of social entrepreneurs is linked with these entrepreneurs as they are
stable in making decisions, creative and have the qualities to achieve the goal. This type of
step is taken by companies who are operating as start ups so that they can develop and
contribute more to the social factors for the betterment of environment.(Gelaidan and
Abdullateef, 2017) These type of entrepreneurs use the profits generated by the activities for

the welfare of the society. For instance- students who are in college can form a group to create
an organization related to this aspect and encourage people with the aim of reducing the waste
and protect the environment which will make a contribution for the benefit of environment.
P 2 Similarities and differences between entrepreneurial ventures
Similarities Small Large enterprise Social enterprise
Innovation or unique
idea
High Risk
Usually small
companies has less
unique attributes but
they are bringing
more innovative ideas
as compared to the
companies who
operate on a large
scale.
If the company is not
able to generate
enough profits and
bring an idea which
can help them to
sustain in the market
as if they don't then
they it is a risk for
them as any
competitor can take
over their operations.
The ownership
Companies who
operate on a large
scale also needs to
bring innovation on a
continuous basis so
that they can survive
in the market and
achieve growth.
Companies operating
on a large scale
involves a high risk as
any mistake or error in
their work which
decreases the level of
satisfaction to the
consumers. This
involves a huge risk as
company may loose
their share of profits
or their position in the
market.
Companies who
operate in the social
sector also bring
innovative and unique
ideas to conduct more
charitable events and
get more donation.
Companies who
operate as a social
enterprise also has to
deal with a lot of risk.
If they are not able to
get the donations or
host a charitable event
which attracts people
to contribute a part of
their income. If they
are not able to get the
donations then they
won't be abel to work
successfully for the
welfare of the people.
The structure of social

Ownership structure structure varies
according to the form
of the structure as sole
properties requires
only one person.
Partnership requires
two or more people
etc.
Companies who
operates on a large
scale has different
types of structure
according to the
nature of the business
such as divisional,
functional, geographic
and the matrix. Many
of the companies uses
a structure which is
hybrid as it allows
them to apply a
combination of
different models into
one strategy.
companies is totally
based on the
participation or
voluntary entry by the
groups of stakeholders
such as community,
clients, users etc. or
by the trustees of the
company. Profits of
the company are
distributed and shared
to their stakeholders
with the aim of using
it for the welfare of
the community.
Differences Small enterprise Large enterprise Social enterprise
No of employees Companies which
maintains their
operations on a small
Companies which are
operating on a large
scale sector employs
Companies dealing as
social enterprise has
no fixed employees as

Objectives
Size
Profit
scale employs people
from 10 to 250
people. It depends on
the nature of the
business.
Main motive of these
companies is to earn
profits and sustain the
market so that they
can serve for a long
period of time.
These type of
companies operate on
small or medium
scale. For instance
they cover their
operations in London.
Companies operating
on a small scale
generates small
amount of profits.
more than 250 people
as it is required to
maintain the
operations.
Objectives of these
types of companies is
to earn high profits,
increase their share in
market, achieve
growth and enter into
untapped markets.
These type of
companies operates on
a large scale.
(Hechavarria, D., and
et.al., 2019) for
instance they maintain
their operations in the
country and the
overseas market such
as UK or in other
countries.
Companies operating
on a large scale
generates huge
amount of profits as it
they work with a team
who has voluntarily
choose to contribute
for the welfare of the
people.
Main motive of these
type of companies is
to earn for the welfare
of the people.
These type of
companies mostly
operate on a small
scale. For instance
these type of
companies maintains
their operations for a
specific area or town
such as Hertfordshire.
Profits earned by
these type of
companies are not too
less and not too large.

is required so that they
can achieve growth
and maintain their
operations.
Differences in different organization
Criteria Small Large Social
No of employees Small companies hire
people less than 100
workers
These firms hire
more than 1000
employees
Social firms have no
limitation for
employees because
people are engaged
on volunteer bases.
Profit These firms generate
less than 56 GBP
profit (median profit)
Hilton hotel is big
firm that has
generated 8.91 billion
profit in the year
2019
Red cross is working
as social firm and in
the year 2018 it has
generated 243.3
million profit.
Objective Their main agenda is
to sustain in market
for longer duration.
They work for
expansion and
becoming market
leaders
These firms have aim
to work for social
welfare and improve
life of people.
Size Small firms are
limited to local area
only hence operates
in limited locations
only.
Hilton hotel is
operating in 5757
locations and its
operating income in
2019 was 1.43
billion. It has around
169000 employees.
Red cross has 32500
volunteers those who
are working globally.
It has employed 3500
staff members.
Similarities

Small Large Social
Innovation and
having unique ideas
Small companies find
new ideas to generate
more sales.
Large companies
implement innovative
ideas so that profit
can be raised and
customers are
attracted.
These firms also find
out new ideas and
implement innovative
ideas so that better
services can be
provided to large
audience.
High risk Small companies are
on high financial risk
because if people do
not take interest in its
products then firm
may face huge loss.
These firm also face
risk of competition
hence they are also in
high risk situation.
Social firms may fail
to serve the needed
person on time hence
these are on high risk,
sometimes they do
not get fund to
manage operations.
Ownership structure Small companies’
owner are responsible
for all decisions and
liabilities.
In large firm
ownership structure
is handled by board
of directors but there
also if company face
loss then owner has
to face problems.
Social firms also
have ownership
structure where NGO
provide funds but
decisions are taken
by particular
authority only.
LO 2
P 3 Impact of micro and small businesses on the economy.
Micro Business and Small business-
Impact on Economy
Small business are those business who employs and work with more than 12 people and the
minimum capital required to start them is more than € 30,000 to 40,000 then it will be
considered as small business. Micro business are those which can be commenced in less than €
30,000 as the required capital then it is a micro business. Also if the owner of the company is

working as a sole trader with no employees or with less than 6 employees then also it will be
considered as micro business. Currently the economy of the country is below the level due to
Brexit which is the reason that the government is forcing an immense pressure on the
company so that they can help the economy to achieve growth, Different scale of business
contributes differently as it depends on the sector they are dealing in, the growth in the
economy etc (Burkman, Garrett and Posner, 2019). Many of the companies are deciding to
expand their operations which will help them to create more opportunities and contribute to
the economy. Inflation in the economy will reduce the disposable income in the households
which limits the spending power of people. Mostly these leave a impact on the companies
which operates on a low level of scale. (Karabulut, 2016) Businesses who deal in the line of
export and import has to keep factors in mind such as economy and currency exchange rate of
the country. There is a major role played by small and micro organizations in the economy of
UK. In Uk there are total 1155385 micro sized organizations are in UK. These organizations
are providing employment to 4206000 people in UK. The complete turnover of these business
is around 595013 Millions Euros. There are total 211295 small enterprises are their which are
providing employment to 4117000 people in UK. Total turnover of These organizations is
around 629163 Million Euros (UK SME Data, Stats & Charts, 2020). This is major part in the
Economy of Unites Kingdom. This is how the role of Small and micro organization is huge in
economy of UK
Contribution in terms of taxes
Contribution made by both micro and small business is around € 1.5 trillion and it was
approximately 50 per cent of total contribution of the private sector. The basic rate for a
business which operates on this scale is 20 per cent and it differs according to the variation in
the profit that the company earns.
Contribution in reducing unemployment
They have increased the rate of employment as compared to the companies who are operating
on a large scale. the rate of employment has been growing because of micro and small
business as they are employing over 50 per cent of people working in the private sector as
compared to the companies who are operating on a large scale. Over 16 million people has
been employed by both categories of companies which is 58 per cent of the employment
opportunities provided by the private sector. This is one of the reasons that they have been

successful in creating so many job opportunities for the people of the country. It helps to
know that micro and small business has helped them to achieve growth.
Bringing innovation
Mostly they are contributing in the economy by bringing innovation in the market. On top of
that the government of the country is also funding a hefty amount in the department of
research and development which is more than € 700 million . This will help these companies
to bring more innovation into the market which will help the economy to grow (Laukkanen
and Tornikoski, 2018)

P 4 Importance of businesses who operates on small scale and business start-ups to the growth
of the social economy
Mutuals, foundations, charities and associations are considered at a national level but it does
not help the companies who deals in social economy to compete in an effective manner
against the provision of goods and services.
Importance of Start Ups on growth of social economy
These companies require people to take their services and make them reach it to
potential customers which helps in reducing the level of unemployment in the country. This is
considered as beneficial for the people as well as the economy as it will help to bring growth
in the economy (Mallett and Wapshott, 2020). Many of the entrepreneurs raise capital either
with their money or raise capital with the help of investors. It is when the business will grow it
will help the economy to grow as the money shared is with society which is beneficial for the
economy (Masurel and Masurel, 2019). Start ups helps to increase the level of innovation
with that it brings new technologies into the market which will automatically improve the
standard of living. Apart from this many of the business who has recently commenced their
operations is focusing on working for the welfare of people in rural areas. GDP is the aspect
which is necessary when it comes to enhancing the growth of the economy. If more start ups
are supported then UK will be increase the amount of cash flow in the country and become the
fastest growing country (Niemann, Kotzé and Mannya, 2018).
Importance of Small Business on growth of social economy-
Companies who employs approximately 500 people are turned out as small business. It
is these type of companies who are helping to reduce the level of employment. According to
sources these companies employs 60 per cent of population of UK. If they are not able to
maintain their operations then many people will loose their jobs which will strike the economy
in a negative manner (Proksch, Stranz and Pinkwart, 2018). Businesses operating on small
scale are in touch with the customers which helps them to know what type of products they
want and this help them to try out new ways and methods to effectively deliver products which
keeps the customer satisfied. It is because of the small businesses local economies is able to
function. They helps the community to benefit from that as they create more opportunities of
job which helps them to increase their level of income ( Ruiz-Arroyo and et.al., 2017). They
deals with customers on a day to day basis which helps them to adapt according to the needs

and wants of people. This helps them to attain the level of consumer loyalty which will help
them in recession over companies who are operating on large scale. Companies who are
operating on a large scale won't get customers as people will remain loyal to small businesses
in the market.
LO 3
P 5 Characteristic traits and skills of successful entrepreneurs that makes them different from
other business managers
Motivated-
This is considered as one of the most important trait and characteristics of
entrepreneurs. In order to achieve big they push themselves really hard. They have to take
their own decisions and they do not have to respond to anyone else. It is necessary for them to
stay motivated and dedicated towards their goals so that they can grow forward (Sebikari,
2019).
Risk Taking-
In order to be successful it is necessary to take risks. If they keep on earning in their
comfort zone and remain safe then they will not be able to achieve big. Entrepreneur
calculates the level of risk involved so that they can assess the viability of idea so that they can
predict that if or not it is a option that will be a positive outcome.
Flexibility-
Entrepreneurs need to adapt change according to the current trends in the market. This
will help the entrepreneur to find and come up with an effective solution to their problems.
Management skills and knowledge-
Entrepreneurs have adequate skills of managing the money which helps them to reduce
the level of dependency on other people to maintain their cash flow. It gives them an insight
about the current condition of the company (Setti, 2017).
Passion-
They are passionate towards their work which keeps them motivated. This helps them
to think with new and different approach of work which helps them to be successful.
Business managers are those people who addresses and looks after the affairs of the business
so that they can achieve their operations successfully.

Difference between entrepreneurs and business managers
Characteristics Entrepreneur Business Manager
Motivation Entrepreneurs get motivated
when they achieve their goals
and objectives (Sozuer,
Altuntas and Semercioz,
2017). for instance- when
they achieve their goals they
will gain more confidence for
their next project.
Business managers of the
company gets motivated by
gaining the power they have in
the company according to their
position. For instance- by
getting a promotion they will
gain the confidence on the
decision they take for the
company.
Risk Taking Taking risk is in the nature of
entrepreneurs. They evaluate
the risk and help the
company to move forward.
For instance- any move or
decision taken by the
entrepreneur does not
guarantee that it will be
successful it also involves a
risk from suffering of losses.
Business manager do not take
any risks they just maintain
the condition of the company.
For instance- managers only
follow the decisions and plans
made by the entrepreneurs
which does not involve them
into risk.
Flexibility Entrepreneurs are flexible to
change and approach as they
remain informal. For
instance- entrepreneurs
changes their style of
leadership according to the
expectations of the situation.
Business managers of the
company remains formal in
every approach and condition.
For instance- they cannot be
flexible as they have to follow
the guidelines of the company.
Management and knowledge Managers and knowledge of
the entrepreneurs is up to an
Management and knowledge
of the managers is limited to

extent as they deal in many
lines and with many people
which increases their
knowledge. For instance-
they are the ones who
communicates outside and
grasp the details of the
market before taking a
decision.
the company. For instance-
they communicate inside the
company which limits their
knowledge to the outside
world.
P 6 Aspects of the personality of entrepreneurs reflect entrepreneurial motivation and mind-set
Mind set and motivation of entrepreneur can be understood with the help of big 5 trait model.
Openness-
This aspect helps in putting the focus on the abilities such as insight of the situation,
prediction for an outcome. This helps them to bring change for others. For instance the idea of
Harry Potter took place when the author J.K. Rowling missed her train. Entrepreneurs who
have high amount of these abilities will be useful to become more creative and trying out new
approaches at different situations. Other who do not possess these qualities may not be able to
perceive the outcome or imagining things. The imagination and insight that J.K. Rowling has
helped her to become a successful entrepreneur.
Conscientiousness-
Some entrepreneurs have decent behavior and control over their decisions which helps
them to move towards their goals and objectives. For instance- Richard Branson who owns the
Virgin Group continuously thinks as he thought in order to find out a solution to an problem
can be achieved through this. These type of people do not miss their deadline so that they
maintain a sustainable reputation in the market. Thoughts, knowledge and work with the aim
of achieving goals has helped him to be a successful entrepreneur ( Tiwari and Goel, 2017).
Extraversion-
This term can also be addressed as extroversion. Qualities such as talkative,
philanthropist and who expresses their feelings towards things in found in some entrepreneurs
which makes them relate able to this aspect. For instance J.K Rowling donated half of her

income which made her loose the title of being a billionaire and become a millionaire. Also at
many interviews she had opened up about her past life. Also these type of people enjoy to stay
with others, it makes them feel excited and energized which is the reason why they like to
donate to those people who are in need and don't have much resources.
Agreeableness-
This trait is about agreeing with someone else's point of view and work according to
their vision. For instance- when Richard Branson was young he took advises of lot of
experienced entrepreneurs which helped him to change his thought process. Also J.K. Rowling
listened to many of her co workers to develop the idea for finishing his series Harry Potter.
The nature that both the entrepreneurs has helped them to reach success as if they were of
different nature and with a high amount of attitude then they won't listen to other people and
won't be able to reach where they are.
Neuroticism-
This trait highlights the mood and feelings of entrepreneur with the stability of
handling their emotions. People who possess this trait goes through a lot of emotional
problems such as instability of emotions and those who don't have it in high amount does not
face these problems. For instance J.K. Rowling has low amount of this trait which is why she
was able to control her issues which she had to face from her husband. On the top of that there
were also financial problems but she handled them all and these things has somewhere helped
her to achieve success.
LO 4
P 7 Background and experience can hinder or foster entrepreneurship.
Richard Branson-
Full name of the entrepreneur is Richard Charles Nicholas Branson who is a British
based investor, author and philanthropist. He founded his company Virgin in the year 1970
which made him successful. With the help of that he has invested in various companies and
currently he holds shares in more than 400 companies. He dropped out school at 16 and then
started his first business which was a mail order record business. He named that as Virgin
stores and after that he started chain of record business. After that in 1980 he commenced his
airlines by Virgin Airlines, he diversified many business such as in 2004 many he started a
space tourism center by Virgin Galactic. Throughout his path he met many people who are

successful in their fields which helped him to know that every entrepreneur has different
perception and way to perceive things and everyone use approaches in a different manner
according to their set of abilities. He has many successful companies under his name and he
has also been awarded at the Buckingham Palace with the honor of knight in 2016 for his
work. The father of Branson was an attorney and the mother worked in many fields such as
flight attendant. Other than that she learned to fly the glider which was a big achievement at
that time. She trained with the Royal Air Force and serve at the time of second world war.
This has also helped Richard Branson as he was raised in a environment which was active,
brave and hearty which helped him to take big decisions on his own. There are different
factors are their which had played important role in the success of Richard Branson. These
factors are- Mr. Branson have selected the profession that he enjoy most. He is high visible to
public and this thing make him famous among other businessman's. His effective leadership
made him successful to deal with various challenges and opportunities of market place. His
innovative and creative nature also make him a great entrepreneur. This is how all these
factors have lead the success of Richard Branson in International market.
J.K. Rowling-
She is known for her novel series Harry Potter but she is a multi tasker in life as she is
a author, television producer, philanthropist, screenplay writer. Most of the fame she has
gathered is from her book Harry Potter. Her book sold more than 500 million copies which
made it the best selling among all. Before all of this she had to face a very depressing phase as
she got divorced and had no money to take care of her child until she came up with the idea of
Harry Potter and its success made her billionaire. She donated a huge part of her income in
charities and because of that she lost her title of being a billionaire. Even after that her net
worth stands at 600 million Euros which makes her 197th richest person in UK. These hefty
amount of donations has helped the company to become the president of Gingerbread charity.
Apart from this for the labor party she has donated up to 1 million Euros. The childhood of the
author was happy and she had a lot of friends which helped her to remain motivated
throughout her life and she made it as her aim to be a successful author since when she was
just 6 years old. There are different attributes in personality make J. K. Rowling as great
entrepreneur. She is a dreamer and goal oriented. This thing have made her effective in
achieving various targets in lifetime. Disciplined and resilient nature also helped her to

become a good entrepreneur. The activeness towards new ideas also have supported to become
successful entrepreneur.
Their background states that both Richard Branson and J.K. Rowling were from poor families
which means that they no opportunities in hand which could have helped them to reach the
current level of success they have achieved in life. This states that their talent and hard
working nature has helped them achieve the current success.
CONCLUSION
From the above studies it has been concluded that every entrepreneur has different type
of thought and through that they take their decisions which helps them to guide the path to
success. The basic difference between entrepreneurs and managers are that entrepreneurs
possess wide area of knowledge and has the ability to take risks whereas managers of the
company have to deal with the orders and instructions given by the entrepreneurs. Micro and
small business has left a positive impact on the economy of the UK as they are helping to
improve the standard of living by bringing innovation. Apart from that they have helped to
reduce the level of employment which has benefited the people to leave disposable income
which increases the buying power of people. Entrepreneurs such as Richard Branson and J.K.
Rowling's past life and experiences have been highlighted in this report which states that
handwork, talent and efficient working can help an entrepreneur to reach success and inspire
other people to become one. Also it is mentioned in the report that the personality has a huge
influence on the level of motivation and the thought process and the way of perceiving things
on entrepreneur.
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