Entrepreneurship and Small Business Management Study Material

This study material covers different types of entrepreneurial ventures, their impact on the economy, skills of an entrepreneur, and more. It includes an examination of different types of entrepreneurial ventures, their relation to the typology of entrepreneurship, and the differences and similarities between them. It also assesses the impact of small businesses on the economy, the importance of start-ups and small businesses to the growth of social economy, and the skills an entrepreneur has in comparison to other business managers. Additionally, it explores how aspects of entrepreneurial personality reflect mindset and motivation.

Entrepreneurship and
Small Business
Management

Contents
INTRODUCTION...........................................................................................................................3
ACTIVITY 1...................................................................................................................................3
Examine different types of entrepreneurial ventures and explain how they relate to the
typology of entrepreneurship.......................................................................................................3
Explore the differences and similarities of different entrepreneurial ventures............................5
Interpret and assess relevant data explaining how small businesses impact the economy..........6
Explain the importance of start-ups and small businesses to the growth of social economy....10
Determine the skills an entrepreneur has in comparison to other business managers...............10
Assess how aspects of entrepreneurial personality reflect mind set and motivation.................11
Examine using relevant examples how background and experience can hinder or foster
entrepreneurship........................................................................................................................12
CONCLUSION..............................................................................................................................14
REFERENCES..............................................................................................................................15

INTRODUCTION
An entrepreneur is an individual who initiates, starts up and run the business by collecting
and utilising the resources of the company and also plan it’s working. It is the sole personnel
who has responsibility to take risk and rewards that is being earned through business enterprise.
For an entrepreneur, the new business model is encompassed by offering new product and
service rather than using the existing model. There is a slight difference between the
entrepreneurial venture as well as small business wherein the former is engaged in introducing
the novel offering while the latter may use existing business model (Kulawiak, 2017). This report
will cover the various types of entrepreneurial ventures, similarity and difference between the
ventures, impact of small business on economy and importance of it in social economy. Further
it will include skills of business manager in comparison to business manager, how aspects of
entrepreneurial personality reflect motivation and how experience and background of
entrepreneur hinder or foster entrepreneurship.
ACTIVITY 1
Examine different types of entrepreneurial ventures and explain how they relate to the typology
of entrepreneurship.
An entrepreneurship can be referred to as the mind-set which allows an entrepreneur to see
the opportunity anywhere.it may be a business idea but may also include seeing possibility in
people who can help in growing the business. this ability to see different options in each situation
is very important and there shall be unending challenges which will test the hustle of
entrepreneur. There are different types of entrepreneurs, of which some of them are discussed
below-
 Social: These consist of the entrepreneur who are innovators that focus on creating such
offering which have capability to solve the social problems and needs. Their target is to
make a world a better place and not involve in taking the market share or create the
wealth for founders (Julien, 2018).
 Serial: The entrepreneur who continuously comes up with the new ideas and initiates
new business is serial entrepreneur. Unlike typical entrepreneur who comes up with new
idea, starts business and handles daily responsibility, serial entrepreneur comes up with

idea, start the business and then gives the responsibility to other and move to new venture
or idea.
Types of entrepreneurial venture:
 Small business: It comprises of limited number of employees that ranges between 0-49
and often seeks funding from friends, family or small business loans. The main aim of
this venture is the earn the livelihood by generation of profit and do not want to take over
any industry.
 Large business: It is that enterprise which involves more number of employees as
compared to small business and is involved often in offering the novel product or service
to consumers as per their needs, wants, taste, preference, competitors, etc. They are
engaged in introducing variants of their existing offering and is aimed to expand and
grow their functioning so that large market is captured.
 Social: These are the non-profit organization which has an aim to overcome or tackle the
social problem and do welfare for the society so that standard of living is raised of the
people (Tandelilin and et. al., 2020).
Typology of entrepreneurship Growth firms: It consist of those entrepreneurship which have an aim to grow and
expand the business so that it can be flourished. It is suitable for small as well as large
ventures as they have an ability to grow due to its single purpose of generating
profitability. Lifestyle firm: These include those enterprises which has an aim to enhance the living
standard of people by offering them quality products or services. It also offers
employment opportunity to people so that their livelihood earned from firm is utilised to
raise the standard of living.
Difference between-
Basis Small business Entrepreneurial venture
Innovation These often do what the
entrepreneurs are already doing as
they have the nature of being
reactive.
They are the one who are known to
develop and invent new things,
their mind is technical and are
proactive in nature.
Motive They start up the business with the They start up the business as they

main purpose of earning profits.
When risk is high, they often shut
down their businesses (Kalogera,
2017).
are very passionate about it. They
like to take risk and do things which
they love without thinking about
profits and risk.
Explore the differences and similarities of different entrepreneurial ventures.
Similarity
Basis Small Large Social
Ability to find the
opportunities
The owner of this
business scans the
environment and then
identify for the
opportunities so that
the profit can be
earned from it.
These types of firm
identify the
opportunity so that the
growth of it is
ensured.
They grabs the
opportunity in order
to solve the social
issues or problems.
Standard of living These businesses offer
the quality of products
and services to people
so that their living
standard is enhanced.
They are engaged in
providing
employment
opportunity to people
so that they can raise
living standard by
earning the livelihood
(Nakara, Messeghem
and Ramaroson,
2021).
They are aimed to
enhance the lifestyle
of people by tackling
the social problems
and issues of people.
Differences
Basis Small Large Social
Objectives They have the aim to
generate the profit.
They are aimed to
expand and grow their
business by earning
They have the aim to
create the sustainable
solution for the people

profits. by overcoming their
social causes and
problems.
Equity The equity of this is
held with owners
only.
Their equity is in the
hands of investors,
public and owner,
depending on the
nature of business.
The members of
enterprise have the
equity of this
business.
Interpret and assess relevant data explaining how small businesses impact the economy.
There are different kinds of business ventures which may affect the economy of the
country as they majorly contribute in uplifting the economy. Different types of businesses are
illustrated below-
 Micro: It is those business which is very small in nature that it has 0-9 number of
employees. Their annual turnover ranges below £2 million.
 Small: These types of enterprises are the one who have 10-49 number of employees in its
working. The annual turnover of small business is less than £10 million.
 Medium: The medium enterprises have the annual turnover less than £50 million and has
more than 50 employees but less than 250 workforces.
 Large: Under this category, the businesses who have more than 250 number of workers
are large enterprises and they have the annual turnover of more than £50 million
(Almaraz and Mendez, 2020).
Factors that may affect the economy by small business
The micro as well as small enterprises plays an important role in UK economy as they
contribute in the development of the country. According to the research being conducted, it was
figured out that the small scale enterprises have high growth rates in comparison with the other
businesses. It also gets immense support from government so that their business can grow and
flourish. These support initiatives include financial assistance in the form of funds schemes, etc.
There are various factors for SME which contribute in the economy of UK which includes the
following-

 High turnover rates: The increased turnover of the small and micro business shows that
they contribute in the significant growth of the economy as there are more revenue and
sales generations that helps in more income for the economy in the form of taxation.
Figure 1 Micro business Britain Survey, 2018 (Turnover of micro enterprises by region)
Export opportunities: There are many opportunities for the small and micro businesses such as
exports that helps in increasing the GDP of the nation as there is increased exchange of the
foreign currency in nation that directly enhances the GDP of the UK, thereby leading towards
boosting the UK economy (Fayolle, 2018).

Figure 2 Micro business Britain Survey, 2018 (Export opportunities of micro enterprises by
region)
 Employment Opportunities: As per the graph mentioned below, it can be said that the
small and micro businesses provide high employment opportunities to the people as
compared to the other forms of business such as large and medium sized enterprises.
They offer approximately 98.3% of jobs to people that results in the high per capita
income, thereby contributing to UK economy as the domestic income of people tends to
enhance.

Impact on different economies:
 Regional: The micro and small enterprises in the UK contributes in developing the
regional economy and also supports local economy in different manner, for example,
these businesses offer job opportunities to local people so that employment rates are
enhanced and their spending habits is also improved. This shows that SME has positive
impact on the regional economy of the nation.
 National: There is major contribution of the SME in the national economy of UK as it is
driven by innovation and growth which offer high employment opportunity to people so
that per capita income of the nation is enhanced, thereby resulting in increasing the GDP
of the country. It inspires innovation by creation of new technology or process so that a
new value is added to industry. Hence, expansion and innovation are key factors which
stimulate the growth (Kilenthong and Rueanthip, 2018).
 Local: The small and micro business contributes in upliftment of the local economy as
these enterprises offer the people such place which may help in socialising themselves on
other hand and on other it allows them to have the easy access to essential goods and

services. For example, the restaurant or the coffee shop allows the people to socialize and
the small shops of medical or groceries helps in fulfilling basic needs by essential
comedies so that standard of living of people is increased and local community is
boosted.
Explain the importance of start-ups and small businesses to the growth of social economy.
It is seen that the small businesses and even start-ups does not get much of the attention in
a world of business despite this, they are considered as a backbone to economy as they let the
economy function continuously. Their importance in the growth of the social economy includes
the following-
 Standard of living: The small businesses as well as start-ups offer the quality products or
services to people that helps them to increase their living standard. Moreover, there are
job or employment opportunities being open to the people in this which raises their
income, thereby resulting in raising the standard of living of the people as there is
increase in the purchasing power of the people because of new source of the income.
 Job opportunities: The employees are considered as the valuable asset to business and
the people who works in the small enterprises or start-ups are their essential asset as they
run the business. The people who do not get the job in the large businesses seeks job in
small business and turns out to be valuable asset for them. This reduces the
unemployment rates in the country (Cepec and Grajzl, 2021).
Determine the skills an entrepreneur has in comparison to other business managers.
An entrepreneur is an individual that has ability to start and initiate new business with
limited access to resources and innovative idea. It has high risk in order to start a new venture
due to innovative ideas and limited resources. There is difference between a manager and an
entrepreneur and the skills of the latter forms the distinction between them. By taking the
example of two entrepreneurs such as Bill Gates and Peter Jones, the skills of entrepreneur
include the following-
 Creative: Every entrepreneurship begins with the idea and in order to become successful,
an entrepreneur has to think of new and innovative ideas so that things can be done in
better way. It is one of the essential skill of an entrepreneur which it must possess. Bill
Gates and Peter Jones are creative as they have built their foundations through innovation

and creativity. A manager does not possess this skill as it has nothing to do with
creativity rather it is only concern with making others do things.
 Passionate: It is one of the essential trait in an entrepreneur as passion drives the business
idea and its success. The entrepreneur like to do what they love and are also dedicated
extremely to their business which they have created. In order to be successful, an
entrepreneur has to bring in its working passion so that it can drive business success. A
manager lacks the passion as it is only concerned with its individual work and makes
other work while an entrepreneur such as Bill Gates and Peter Jones become passionate
about their working and are willing to put extra efforts and hours so that their business
can reach new heights of success.
 Motivated: An entrepreneur is one of the great source if motivation for the team as it has
a motivating nature. They are often known for their strong belief, efforts and hard work
so that their venture can turn out to be successful. Both Bill Gates and Peter Jones are
hardworking and a strong motivator as they motivate others to contribute in their
milestone. This skill is missing in manager as they only get their work done and are not
concern with encouraging others (Walmsley, 2018).
Assess how aspects of entrepreneurial personality reflect mind set and motivation.
OCEAN model has five different components of personality that helps in making the
understanding of people and their respective behaviour. By using this model, the entrepreneurial
personality is reflected which shows its motivation and mindset. These components are discussed
thereunder-
 Openness: The insight as well as imagination are the characteristic of entrepreneur and
Bill Gates and Peter Jones has this which depict its dynamic personality and the wide
range of interest. They have an ability to explore the world and are very curious in order
to know the things as they like to learn new things.
 Conscientiousness: This trait or skill is important for those types of entrepreneur who are
very target oriented. The main characteristic under this is the exceptional ability of
company as well as mindfulness of details as they think constantly as to how their
behaviour might affect others. Bill Gates is very goal oriented and has exceptional ability
to take team forward.

 Extraversion; An individual can be an extravert when it can express its opinion in the
emotions and also likes to assert an idea on other people. such kind of people are
talkative and social which gives them the energy and courage to make business
successful.
 Agreeableness: The people under this category are the one who are trustable, kind, full of
empathy, affectionate. They are also helpful and generous and can also compromise with
its interest so that things can be done. Bills Gate has this ability so that it can take the
team forward with its trust and kind nature (Pistrui and et. al., 2017).
 Neuroticism: It is a trait of the personality in which the individual has the unhappiness,
emotional instability as well as sulkiness. Such type of entrepreneur easily gets irritated
and experience the frequent level of the mood swings, anxiety and the sadness. Hence,
this trait helps to counter the stress in complex or difficult situation.
Examine using relevant examples how background and experience can hinder or foster
entrepreneurship.
The experience and background helps the entrepreneur to make such decisions so that the
entrepreneurship can be fostered. The example of two entrepreneurs are illustrated below-
Peter Jones
Background
It is the British entrepreneur who was born in the year 1966 in the country of England. At
the time of its teenage, he provided tennis lessons to the people and earned money as it faced
many financial issue. In order to resolve its financial problems and with the passion towards the
business, he came up with an idea to become the entrepreneur who is focused to achieve its life
goals and objectives. he came from the middle class family and his focus and passion helped it to
become the successful entrepreneur.
Experience
Peter Jones is British entrepreneur and the famous reality television personality who has
interest in property, television and media. He has tried many of the ventures which involves in
the manufacturing of the desktops, PCs in its middle twenties. Thereafter, it started the business
of computer which did not gained much success and in order to bear the loss, it sold its house.
But he did not give up and started working again in the British based computer business which is
Siemens Nixdorf. After getting settled in this, it founded its first telecom business in the year

1998 by which it earned the profit of 42 million approximately. In present, he is the successful
entrepreneur and its reason for the success is it that it does not give up even after suffering loss.
Bill Gates
Background
He is one of the successful and innovative entrepreneur who belongs to the upper middle
class educate family and with its family support and the skills, it became successful leader. He
was widely supported from its family members which helped it to develop the entrepreneurship
venture. He initiated its own business of Microsoft from the support of its family as each of its
innovative idea was supported and its interest in the computer software programme encouraged it
to develop the career as entrepreneur in the field of computers. He was also influenced to take
admission in Harvard in the year 1973 but he did not have much interest in studies as he used to
play video games and has much interest in computers and technology which made it a successful
entrepreneur of Microsoft (Firkin, Dupuis and de Bruin, 2018).
Experience
At the time of the childhood of Bill Gates, its interest in computers contributed in
development of the great personality Bill gates. He also experienced the exposure to computers
in Lakeside school of Seattle. In such place, the local company presented him with an offer to
use their computers with an aid of the Teletype link. With the help of this, he entered to a level
and filed such machines which worked as great influencer for it. At the age of 15 years, he and
his friend earned $20000 for developing the program that contributed in higher traffic flow in
place of Seattle, namely Traf-O-Data.

CONCLUSION
It is concluded from this report that the entrepreneurs are the high risk takers who convert
their creative idea into the reality. They are passionate, creative, motivated and hardworking
personality which contributes in building such venture which can help in uplifting the economy
of the country. There are many types of entrepreneurial ventures like small, large, social, etc. and
they all relate to typology of the entrepreneurship. The small business helps in uplifting the
social economy as it contributes in job development and enhancing the living standard of the
people. Moreover, there are different skills which an entrepreneur must have which includes
motivation, passion, creativity and many others.

REFERENCES
Books and Journals
Almaraz, A. and Mendez, O.M. eds., 2020. The History of Entrepreneurship in Mexico:
Contextualizing Theory, Theorizing Context. Emerald Group Publishing.
Cepec, J. and Grajzl, P., 2021. Management turnover, ownership change, and post-bankruptcy
failure of small businesses. Small Business Economics. 57(1). pp.555-581.
Fayolle, A. ed., 2018. A research agenda for entrepreneurship education. Edward Elgar
Publishing.
Firkin, P., Dupuis, A. and de Bruin, A., 2018. Familial entrepreneurship. In Entrepreneurship:
New perspectives in a global age (pp. 92-108). Routledge.
Julien, P.A. ed., 2018. The state of the art in small business and entrepreneurship. Routledge.
Kalogera, I., 2017. Entrepreneurship for Micro and Small Businesses in Greece. Weaknesses and
threats for Micro and Small Businesses in Greece during the crisis. How to overcome
the crisis and survive.
Kilenthong, W.T. and Rueanthip, K., 2018. Entrepreneurship and family businesses in
Thailand. Asian‐Pacific Economic Literature. 32(1). pp.77-93.
Kulawiak, A., 2017. Entrepreneurship in Small Towns in the Region of Łódź in the Assessment
of Business Owners. Przedsiębiorczość-Edukacja= Entrepreneurship-Education. 13.
p.41.
Nakara, W.A., Messeghem, K. and Ramaroson, A., 2021. Innovation and entrepreneurship in a
context of poverty: a multilevel approach. Small Business Economics. 56(4). pp.1601-
1617.
Pistrui, D., and et. al., 2017. Entrepreneurship in the new Germany. In Small Firms and
Economic Development in Developed and Transition Economies: A Reader (pp. 115-
130). Routledge.
Tandelilin, E., and et. al., 2020. Collaborative entrepreneurship and group commitment as a
strategy for survival in the pandemic Covid 19: A case study of SMEs in Bogo Village-
Bojonegoro Regency-East Java.
Walmsley, A., 2018. Entrepreneurship in tourism. Routledge.