Social and Lifestyle Entrepreneurship: A Comparison and Impact on UK Economy

This article explores the different types of entrepreneurship, including social and lifestyle entrepreneurship, and their impact on the UK economy. It discusses the importance of SMEs on economic growth and the character traits and skills of successful entrepreneurs. The article also provides a comparison between social and lifestyle entrepreneurship, highlighting their similarities and differences.

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Contents
Introduction...............................................................................................................................................3
Similarities and differences between Social and Lifestyle Entrepreneurship.......................................4
SMEs Impact on UK Economy.................................................................................................................5
Importance of SMEs on economic growth of UK.......................................................................................5
Character traits and skills of the two entrepreneurs..............................................................................6
References..................................................................................................................................................8

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Introduction
According to Autio ,(2014) an entrepreneur is an individual who takes risks and creates an
enterprise with the aim of making profit. Entrepreneurship refers to the activity of taking risk and
coming up with a viable idea which eventually becomes a venture or business. The types of
entrepreneurial enterprise or ventures always have a positive impact on the community and
society by improving the economy.
There are different types of entrepreneurship in the business world which includes; small
business entrepreneurship, scalable startups entrepreneurship, large company entrepreneurship
and lastly social entrepreneurship. The number of entrepreneurs and startups in rapidly growing
in most parts of the world. The small businesses involve entrepreneurs who sell groceries, do
hairdressing, consultants, carpenters, electricians, plumbers and travel agents. In this type of
entrepreneurship, they employ local employees or the family. In most cases they are not
profitable and their aim is to feed the family and make little profit (Barringer,2010). The type of
entrepreneurship is funded through friends and family through small business loans since they
cannot access bank loans since they are small businesses. Examples of these businesses involves
restaurants, retail stores, construction firms and agriculture.
Another type of entrepreneurship is scalable startups entrepreneurship in which big
entrepreneurs like Silicon Valley and their venture invest in. These are the types of entrepreneurs
who start a business knowing that the business will eventually change the business world in the
future (Baum,2014 p.73). The business is able to attract investments from different risk takers
investors or venture capitalists who are the best in their areas. The investors then focus on
expansion of the business through innovation and creativity. This type of entrepreneurship
attracts risk capital because of the high returns. Examples involves a company manufacturing
medical devices or developing life-saving medicine; IT companies developing software or apps.
Another type of entrepreneurship venture is large company entrepreneurship or ventures. These
type of ventures are long lasting and do not fail. Most of the ventures grow through different
innovations and offer variety of new products in the market. In the current market, other small
businesses and companies require the large companies to create new products which suits the

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tastes of the customers, adheres to the changes in technology and new technologies. Lastly
another entrepreneurship is social entrepreneurship in which the innovators create the products
and services that are able to solve the social needs and problems. The goals of the social
entrepreneurship is to make the lives of the individuals better through sustainability without the
creation of wealth and or profits (Drucke,2014). This type of business aims at solving different
specific problems in the society like health problems to create a social impact.
Similarities and differences between Social and Lifestyle Entrepreneurship
According to Burns,(2016) social entrepreneurship is a type of entrepreneurship that focusses
on sustainability of the society by creating a venture. It focusses on the communal health and
well-being. Social entrepreneurs help solve the problems affecting the society by coming up with
a solution. Social entrepreneurs do not focus on making profits but serving the needs and wants
of the local community. Social entrepreneurship uses less financial help and hence bringing a
great impact on the society. The areas which the social entrepreneurs focus on involves;
economy, inequality and social life. On the other hand, leisure entrepreneurs focus on making
profit for the business.
The main reason for creating the business is to satisfy the needs of the customers, increase
the growth of the shareholders, expand their businesses and eventually increase revenue to
continuously provide the products and services to the customers. Both social and leisure
entrepreneurship aim at bringing sustainability by improving the economy through the creation
of employment, innovation and creativity and lastly the provision of goods and services to the
customers. While leisure or lifestyle entrepreneurs look for investors, social entrepreneurs do
not, social entrepreneurs have an exit strategy while the lifestyle entrepreneurs do not have an
exit strategy because of making profit. Lifestyle entrepreneurs focusses on life goals and
enjoyment of life while the social entrepreneurs focus on social life (Mason,2014).

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SMEs Impact on UK Economy
The economic growth of UK has been weak especially through the financial crisis with less
output. Entrepreneurs both of small and large enterprises has played a major role in improving
the economy of the UK. The enterprises have contributed to the economy through employment,
innovation and economic growth.UK economy has really grown due to the tremendous progress
of the enterprises due to their positive attitudes and abilities (Morris ,2010). According to studies
UK economic ranking has improved because of the enterprises which have been able to provide
products and services. UK is now ranked second in the world after US.UK government has
helped to mentor entrepreneurs through networking, provision of mentoring support, financial
resources. The government of UK has been able to provide business loans and advice to the
startups businesses and they have been around 30,000 new businesses from 2005 in UK. It
through creation of employment and improved innovation that the economy of UK has really
grown through the small and large enterprises (Pott,2012). The government need to focus more
on promoting enterprises in UK for greater performance.
Importance of SMEs on economic growth of UK
Entrepreneurship has greatly improved the economy of a country through the following
ways. First through innovation. Entrepreneurs always find a market niche and would want to get
profit from the enterprise or the businesses. The entrepreneurs engage in creativity and
innovation to generate income to satisfy their needs by generating income which is the driving
factor in the economy. The biggest contributor to the economy is the innovation and creativity
that is created by the entrepreneurs. Another contribution by the entrepreneurship to the
economy is the creation of employment. Most of the entrepreneurs are unable to look for suitable
jobs hence their focus is on entrepreneurship. They become enterprising by finding a market
niche and they try to generate incomes as they also try to employ other employees in the
business. One of the greatest contribution to the economy is the creation of employment and
reduction of unemployment level.
In the developed countries40-50% of the workers are employed in the small and medium scale
business enterprises set up by the entrepreneurs. This eventually reduces the poverty levels in the
country and therefore it can be concluded that entrepreneurship can impact on the economy

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through creation of jobs and generation of income (Santos,2012). Entrepreneurship also
contributes to the economy through increasing the level of competition as new entrepreneurs also
able to join the market. The market may be filled by many enterprises but it is important because
the enterprises will try to compete for the available resources by creating value, reduction of
costs and becoming more efficient hence improving the economy. As the entrepreneurs try to
compete in the market, they find ways of improving their activities and operations by using the
available resources efficiently leading to increased productivity driving the economy forward by
increasing the GDP (Read,2016).
Entrepreneurship helps to create new market in the existing industry because of the
increased competition which causes saturation and the entrepreneurs are forced to develop new
products and services hence providing new markets for the products. This can be considered to
bring positive impact to the economy. Entrepreneurs therefore tend to play a big role in the
improvement of the economy through employment creation, increasing competition, market
expansion and penetration and coming up with new markets in the industry. Therefore,
entrepreneurs can be considered to play a very important role in the economy.
Character traits and skills of the two entrepreneurs
There are a number of factors that motivates an individual to become a successful entrepreneur
in the given industry. Some of these factors involves; the personality or the character traits of the
individual, biological background of the individual and abilities, drivers and skills. Concerning
the background of the entrepreneurs which entails gender, age, education, experience in the
business and managerial skills (Drucker,2014). According to the case study Wang Jialin of
Wanda Group came from a strict military background from the family in which he also joined
the military. The family background helped him get a good network of doing business with the
government and also have an iron discipline. While he was still a youth he was able to scramble
and eat through hardship hence he found a way of becoming an entrepreneur. He was able to
make connections in the job ridden development by becoming a manager in different companies.
His family and job background prepared him to become a successful entrepreneur. On the other
hand, Nandan Nilekani of Infosyst came from a family background in which the family was the
manager of the company and gained knowledge and skills relating to the business that he

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developed. He wanted to become an independent entrepreneur since he had experience working
as a manager possessing soft skills like working as a team, leading people and human interaction.
Background of the individual can help him become a successful entrepreneur.
The characteristics that an entrepreneur possesses help him become a successful
entrepreneur in any business that he undertakes. One of the characteristics that the entrepreneur
should possess is the leadership capacity characteristics in the business. In the case study
examined Wang Jialin has good leadership qualities first as a military man having led employees
as a manger to increase productivity of the company by being close to the government. On the
other hand, Nandan had skills and worked for a company for 28 years having gained leadership
skills of leading people and teams. An entrepreneur needs to delegate and form good teams just
as was the case with Nandan who worked as a team and interacted well with the employees for
productivity and Wang Jialin who networked with the government for the better good of the
company. Both Nandan and Wang decided to be good risk takers by taking risks and looking for
opportunities in their respective businesses. An entrepreneur needs to look for opportunities by
taking risks and making decisions. Another characteristic that the entrepreneur should possess is
that of being ambitious and confident about the business. Both the two entrepreneurs have shown
great ambition about their businesses by expanding them and having the right drive to see the
businesses grow. The entrepreneurs also have shown that they have good management and
marketing skills as they have worked hard to change and grow their businesses through the
changes in technology and different challenges.
They have been able to select the right employees and teams to run the business through
greater experience, skills and knowledge of the products and market. Other qualities involve
discipline, creativity, people skills, confidence, open minded and competiveness. Lastly as great
entrepreneurs they have been able to have a high tolerant of ambiguity and persistent by ensuring
that their businesses prosper and have a continuity despite of the challenges that they have faced
in the market (Autio,2014 p.476).

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