Entrepreneurship and Small Business: Venture Types, Traits & Impact

This report provides an overview of entrepreneurship and small business management, focusing on different types of entrepreneurial ventures and their relationship with entrepreneurship typology. It uses Atex Digital Media as an example. The study explores survival, lifestyle, managed growth, and aggressive growth ventures, highlighting their similarities and differences. It also examines the contribution of small businesses to a country's social economy, supported by quantitative research involving a survey of small business employees to assess salaries, economic status, and overall impact on the economy. The report further discusses the traits and characteristics of successful entrepreneurs and the impact of background on fostering or hindering entrepreneurship.

ENTREPRENEURSHIP AND SMALL BUSINESS
MANAGEMENT
1

Table of Content
Introduction......................................................................................................................................3
LO1..................................................................................................................................................3
P1. Types of entrepreneurial ventures and their relation with the typology of entrepreneurship. .3
P2. Similarities and differences between this entrepreneurial ventures can be explained below in
terms of points in a table:.................................................................................................................4
LO2..................................................................................................................................................5
P4. Highlighting the basics of small businesses that will contribute to the growth of a social
economy in a country.......................................................................................................................5
P3: Impact of small business on the economy.................................................................................6
LO3................................................................................................................................................10
P5: Traits and characteristics of a successful entrepreneur...........................................................10
P6: The reflection of the aspects of entrepreneurial personality...................................................12
LO4................................................................................................................................................13
P7: The impact of background on hindrance or fostering of entrepreneurship.............................13
Conclusion.....................................................................................................................................13
Bibliography..................................................................................................................................14
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Introduction
Entrepreneurship basically refers to the setting of a new business which includes several risks
which are necessary and worth taking for getting desired profits. In today's world, this concept is
widely encouraged and several firms are emerging as small businesses which are providing
employment to a large number of people and contributing to the economy as well. In this
particular study, the scope of entrepreneurship will be studied. A mini research will be carried
out to evaluate different types of ventures. The research will also be carried to study the different
characteristic traits of entrepreneurs. This will be explained by taking example of the company
Atex Digital Media. This is a small company which is involved in software services. A detailed
study will be done for the evaluation of the contribution of small business enterprises towards the
economy of a country.
LO1
P1. Types of entrepreneurial ventures and their relation with the typology of
entrepreneurship
An Entrepreneurial ventures are those who is willing to put his or her financial security and
career at stake to take any risks on an idea, capital on an uncertain venture that is unknown to
him or her.
The selected organization Atex founded by Charles, Douglas Drane and Richard, MIT graduates,
who got the idea for a different type of electronic composition system. By 1977 they have slowly
made progress by connecting reporters and editors via a paper free system which allowed them
to work on screen instead of working on typewriters (Kuratko, 2016, p.554). By 1980’s the news
pagination for star tribune was developed by Atex. And after the continuous growth for around
two decades Atex constructed the manufacturing plant of a 1500 persons in the United States
when the company was going through difficult times at the beginning of 1990’s. In 2002 Atex
made a series of acquisition after merging with media command. In 2007 after purchasing
Vogsys which was a publishing technology company then situated in Brazil. In 2011 the
company headquarters got shifted to Castle Street , England.
The four types of entrepreneurial ventures are :
1. Survival Ventures: are the basic support for an entrepreneur and their family, in order to
allow for little better than a normal living. This type of companies exists to provide basic
financial needs for oneself and therefore their costs are covered and usually has no
capacity to put back into the same scheme. It is a necessity driven business and are
motivated by Push factors.
2. Lifestyle are those ventures which gives a proper income for the business owners based
on a manipulated based business and hence a approach of maintenance to the
management. Reinvestments are made which are medium so that one can survive the
competition in the local market. This type of ventures does not have a precise location
and employees, but does not seek meaningful expansion. The employees are limited due
to which it is difficult for the venture to achieve economical operation (York et al. 2016,
p.720).
3. Managed growth is the type of ventures that has a workable model and looks for a better
growth over the time, where new occasional items are launched to attract the customers.
Even along with items new markets expanded facility, locations and staff and better
improvement of a heavy regional and brand that is local.
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4. Aggressive Growth are those ventures also knows as gazelles. These ventures are
basically technology driven that contains heavy innovative capabilities and that urges for
growth. Such type of companies looks for opportunity where they can drive founders to
seek and make markets that are new. Their target ranges to multinational levels and they
become figures for public offerings or acquisition (Autio et al. 2014, p.1099).
P2. Similarities and differences between these entrepreneurial ventures can be
explained below in terms of points in a table:
All the entrepreneurial ventures have some types of similarities as well as differences between
them. Like for example the differences in the annual growth rate of 1. survival, 2. lifestyle , 3.
Managed and 4. aggressive ventures are nominal in case of survival, less than 5 percent for
lifestyle, 10-15 percent for managed growth and greater than 20 percent for aggressive growth
ventures. And for the similarities the finance sources will be self provided in cases of survival,
lifestyle and managed growth which is same for all the three types of ventures. Rest of the key
points are explained through the table given below.
Four types of entrepreneurial ventures with their similarities and differences (Hisrich et al. 2017,
p.12)
SurvivalLifestyleManaged
growth
Aggressive growth
Annual growth rateNominal<5 percent10-15 percent>20 percent
Time horizonDay to dayWeekly and
monthly
operations
1-2 years2-5 years
Management styleReactiveTacticalStrategicProactive and
strategic
Management focusSelling whatever
i have
Maintenance of
working business
model
Incremental
strategic
growth
Scalability
Entrepreneurial
behaviour
Very lowLowModerateHigh
Investment towards
technology
NoneLimitedModerateHigh
Finance sourcesSelfSelf, family ,
friends and bank
Self , bank and
private
investors
Bank, private
investors, venture
capital firms, public
markets
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Exit approachShut downShut down and
self transfer
Sell , merge
and transfer
Sell , merge and go
public
Management skillsMaking, sellingOperational skills,
basic management
Planning,
strategizing,
delegating,
leveraging
Planning,
innovation,
cash flow
management,
negotiation
StructureLittle to noneSimpleFunctional,
centralized
Functional; product
and market-based
Reward emphasisWeekly incomeSalary , bonusSalary,
performance,
incentives ,
equity
Equity , capital
gain
Economic motivesSustain oneself
and one’s family
Income
substitution
Wealth
creation
Wealth creation
Here we understand from the above table the main key similarities and differences between the
different types of ventures.
LO2
P4. Highlighting the basics of small businesses that will contribute to the
growth of a social economy in a country
Startup businesses are those entrepreneurial ventures that emerged newly and are rapid growing
firms that aims to meet the market needs in order to develop and offer an innovative ideas,
process, product or service so that a nations economy may rise.
As per Atkinson and Storey (2016, p.180), small or startup businesses may not give huge amount
of money as the bigger companies do, but they are a very important role for the backbone of a
country and the major contributor to the local economical growth. Small businesses provides
new employees so that unemployment may be reduced and it serves as the building block of a
country. They contribute to local economies by bringing growth and new innovations to the
community in which the business is established. They also tends to attract people who often
bring out new innovative ideas for an existing idea. Many of them respond and adapt very
quickly to changing economical climates. When customers patronize local businesses , they are
actually giving cash back to their community. Local businesses that generate very high levels of
income, which means that the business will pay higher amount of taxes, including local taxes.
This money is then used for locals like police and other public departments as well as
universities. Coming to the future growth, small businesses do not stay always small. The huge
organizations like Nike and Ben and Jerry’s are also an example. Microsoft is a an example how
it grew as a big company from a small one.
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Today, small ventures or businesses are playing an important role in local economical
development across the whole country. According to the SBA :
> There are around 28 million that constitutes to small businesses in United States accounts for
55% of total sales in US (Panwar et al. 2016, p.580)..
Small ventures are the backbone of the UK economy , driving huge growth, opening new local
markets and creating employment opportunities therefore their contribution is vital. In 2014,
there were estimated 5.2 million business in the UK - 99.9 percent of those being SME’s,
therefore this research is a concern if organizations are to continue to grow to thrive in today’s
market.
P3: Impact of small business on the economy
In order to study this, a quantitative research was done. In the case of the quantitative research, a
survey will be conducted on the employees of such companies. These will help in assessing their
salaries and economic status which ultimately contributes to the overall economy. This research
will be conducted on a total of 30 employees who will be randomly chosen from different small
firms. The research and analysis are as follows:
Q1: Do you still desire to work in a small company?
Options Total no. of respondents No. of responses received % of responses received
Yes 30 22 73%
No 30 8 26%
Table 1: No. of people willing in small enterprise
(Source: Created by self)
Yes No
0%
10%
20%
30%
40%
50%
60%
70%
80%
73%
26%
No. of people willing to wok in small
firms
Figure 1: No. of people willing in small enterprise
(Source: Created by self)
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Analysis:
The questionnaire was distributed to the employees and they were asked to provide their answers
to the questions. As per the responses received from the employees, it was found that a large
number of people who were working for the small enterprises are still willing to work for the
same. The majority of them do not feel the need of shifting to other large companies. This shows
that these companies are able to provide them adequate facilities and job satisfaction as well. The
growth of the employees of such firms takes place rapidly which helps them to bring uplift in
their overall condition.
Q2: What is your salary range?
Salary range Total of
respondents
No. of responses
received
% of responses
received
Less than 10,
000
30 2 6
10,000- 15,000 30 8 26
15,000-20,000 30 10 33
20, 000-25,000 30 8 26
More than
25,000
30 2 6
Table: Salary range
(Source: Created by self)
Less than 10,
000 10,000-
15,000 15,000-
20,000 20, 000-
25,000 More than
25,000
0
5
10
15
20
25
30
35
6
26
33
26
6
Salary range
Figure: Salary range
(Source: Created by self)
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Analysis:
A survey was done on the salary range of people working in small firms in order to evaluate the
contribution of the same to the economy. After receiving the response it was found that the
maximum of people received the salary in the range 15 to 20 K. maximum of the people were
found to be receiving a salary of more than 10,000. This is an average amount and the people
earning this range are said to be positive contributors to the economy. This is because the salary
range of an individual determines the income and expenditure made by a person. If the salary
range is optimum, the person will be able to bear the expense of several products of the market.
The payments he makes in order to purchase these products adds to the economy of the place.
Moreover, if they have a proper income, they will be able to provide adequate education to their
children. These children, if provided with proper education, will, in turn, add to the economy as
well.
Q2: How do you rate your living style?
Options Total of respondents No. of responses received % of responses received
Excellent 30 5 16
Very good 30 6 20
Good 30 9 30
Satisfactory 30 8 26
Poor 30 2 6
Table: Rating of living standard
(Source: Created by self)
Excellent Very good Good Satisfactory Poor
0
5
10
15
20
25
30
16 20
30 26
6
Rating of living standard
Figure: Rating of living standard
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(Source: Created by self)
The living style of the people provides a reflection of the economic status of the individual as
well the country as a whole. This is because if the economic status of the people is not adequate,
they will not be able to avail different facilities including education and other necessities.
Therefore an assessment was done on the living standard of the people. As per the responses
received, it was found that the number of people rating their lives as good was the maximum. A
lesser number but still a good amount of people found their lifestyle satisfactory, while a
considerable number of people rated it as good and very good. Very few people rated their lives
as poor which is an evidence of the fact that the small forms do have a positive contribution to
the economy.
Q3: To what extent are you satisfied with your economic condition?
Options Total of
respondents
No. of responses
received
% of responses
received
Highly satisfied 30 8 26
Satisfied 30 14 46
Neutral 30 3 10
Dissatisfied 30 3 10
Highly
dissatisfied
30 2 6
Table: Economic satisfaction
(Source: Created by self)
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Highly
satisfied Satisfied Neutral Dissatisfied Highly
dissatisfied
0
5
10
15
20
25
30
35
40
45
50
26
46
10 10 6
Economic satisfaction
Figure: Economic satisfaction
(Source: Created by self)
Analysis:
The next question was asked to evaluate the satisfaction level of the people regarding their own
economic condition. The economy of a country is made up of the economic condition of people
staying there. Therefore it can be said if people are satisfied with their own economic condition,
the economic condition of the country can also be considered as satisfactory. The people
working in SMEs have responded to this question and according to their responses, maximum
numbers of people are satisfied with their own conditions. A considerable number are highly
satisfied whereas there are a few people who have provided a neutral response.
LO3
P5: Traits and characteristics of a successful entrepreneur
There are several traits and characteristics of a successful entrepreneur. These characteristics
may differ from person to person. However, all entrepreneurs do have some qualities which are
responsible for their success. In order to find out these different characteristics in different
people, a research has been carried out. This research is carried out by conducting an interview in
two successful entrepreneurs. This will be a qualitative research and the results will be evaluated
to draw conclusions.
Q1: How do you manage stress?
Entrepreneur 1 Entrepreneur 2
“I find such situations very interesting as they
provide me with an opportunity to learn new
things”
“I am unable to handle stressful situations
and therefore plan my work so as to avoid
such situations”
Analysis:
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This question was put forward to both the entrepreneurs to test their resistance to stress and their
response was recorded accordingly. As per the responses provided by them, one of them said that
the situations which involve stress appear interesting to him. He considers these situations as an
opportunity where he can display his skill and patience while handling the difficult situation. He
also said that the learns a lot from these situations. The second person said that he is not capable
of handling stress and therefore believes that all the plans should be created properly so as to
avoid stress.
This establishes that all entrepreneurs do have a quality of handling difficult situations. However,
these two people have different approaches towards this context. One believes in taking itabn a
chance to grow and other believes in avoiding it through planning. However, the end result in
both cases is the same- managing the stress in work.
Q2: Do you prefer someone providing you instructions with your work?
Entrepreneur 1 Entrepreneur 2
“I prefer to be by own boss” “I consult with people and analysis their
suggestions and try to choose the best among
them.”
Analysis:
In order to evaluate their self-sufficiency, a question was put to them for assessing their dealing
with supervision. They replied to the question very enthusiastically and explained their own
preferences in the context. One of them used a one liner to say that he considered himself to be
his own boss. This depicted that he considered himself as self-sufficient and does not feel the
need of any supervisor for guiding him. On the other hand, the other one was found to follow the
democratic style of leadership and believed that the suggestions of people are important for
making decisions. However, he said that before reaching to any decisions, he considered the pros
and cons of those suggestions.
These responses help in understanding the different approaches which are used for carrying out
different tasks. The former displays a complete quality off self-sufficiency whereas the latter
displays the qualities of a successful leader who believes in the efficiency of a team work.
Q3: What opinions do you have about your destiny?
Entrepreneur 1 Entrepreneur 2
"I believe that I have the ability to mold my
own destiny"
“Well, I do believe that my destiny is only an
outcome of my own performances and
actions”
Analysis:
The quality of confidence was tested in these entrepreneurs and they were asked to provide
answers regarding the confidence level towards the new project. The first of them provided a
highly confident answer that the word impossible did not exist for him. He believed that nothing
was impossible and he could achieve everything with dedication and determination. This
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displayed the level of confidence in him was very high. The second of them said that he was
judicious in making decisions and believed that if the decisions are made efficiently, it ultimately
raises the confidence within an individual.
Hence it can be said that the first one was naturally confident whereas the second gained
confidence by making proper strategies. It is evident that confidence is an essential trait of a
businessman.
P6: The reflection of the aspects of entrepreneurial personality
Stress management:
All entrepreneurs who are successful have been through really tough times in life. It is quite
evident that they have not been able to reach to that position without having faced any
difficulties. However, the fact that they have able to manage and handle all difficulties with ease
has led to this success. There are some practices they have followed in order to get over these
difficulties. In the opinion of Navis and Ozbek (2016, p.120) the most common and important
practice is that they remain positive towards their efforts. They have a self-belief that they do
have a capability of solving all the problems which shall come into their path while enhancing
with their tasks. They are highly focused on progress and are not ignorant of the fact that nobody
is perfect. They realize the imperfections and their mistakes but do not get stressed with this
realization, instead, that takes it as an opportunity, learn from their mistakes and proceed towards
success.
Self-sufficiency:
The successful people have a quality of self-sufficiency. This is another essential quality because
if a leader is not self-sufficient, he or she will not be able to guide the team efficiently. These
people have a clear vision about their objectives and the path to achieve the same. They know
what to do and have a proper definition of success and also know the measures to be able to track
their success. In addition to this, they are also clear about the steps they need to take in order to
be successful and they are sure of the reason for carrying out any task. As stated by Yun et al.
(2016, p.9) this clarity helps them to understand and provide a better definition to their goals and
objectives. They are capable of advancing in their plans without seeking the guidance or
supervision of others. These people have the ability to measure and assess their own performance
which helps them to improve their performance on a continuous basis.
Confidence:
Confidence is the key skill of any successful individual. The entrepreneurs have a high level of
confidence which helps to deal with several situations. These people are often found to be happy
as they have a positive attitude towards life. As explained by Coogan and Kasperova (2016,
p.25) these people are experts in maintaining relationships. Be it a personal or professional
relationship, they are able to maintain them because that have the ability to add positivity to that
relationship too. These people have a high level of motivated. They are self-motivated and are
also able to motivate people to achieve their goals. They are able to assess risk and often take
some calculated risk in order to achieve the desired success.
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