Entrepreneurship Growth: Balancing Practices and Financial Strategies

This essay explores the critical components of entrepreneurship growth, emphasizing the importance of innovation, resource management, and competitive strategies. It discusses various resources essential for business development, including financial, personal, and system resources, and highlights the need for their protection through stakeholder responsibility, project teams, and clear contracts. The essay also addresses the significance of managing human and intellectual resources, balancing formal and informal practices, and overcoming challenges associated with formalization. Furthermore, it delves into financial growth, exploring sources of finance and financing strategies for expanding new ventures, along with the advantages and disadvantages of different financial sources. The role of intellectual property is also examined, underscoring its importance in maintaining a competitive edge and fostering sustainable growth within the entrepreneurial landscape. This analysis provides a comprehensive overview of the factors influencing entrepreneurship growth and offers insights into effective management practices for long-term success.

Running Head: Entrepreneurship Growth 1
Components of growth
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Entrepreneurship Growth 2
Executive summary
Entrepreneurship growth is a business aspect that determines the survival of any business.
Entrepreneurship is associated with innovation, risk-taking, and creativity. Entrepreneurship
growth is realized after the three aspects have been put in place. The growth may be measured in
various ways among them being profits, customers and geographical location. Other factors that
may determine the growth of a business include characteristics of a business, availability of
resources for growth, environmental factors and the determination for achievement.
Entrepreneurship growth can occur in two ways i.e. internal growth and external growth. Internal
growth takes place when a person in an organization takes full responsibility to develop an idea
into a profit-making venture through creativity and taking risks. The entrepreneur desires to
succeed in the field of interest thus making the development quick. The focus of an entrepreneur
is to find a solution for problems within the organization. On the other hand, external growth is
focused on the growth of an organization. The entrepreneur in this category focuses on the
organization’s growth by finding solutions to factors affecting the organization field as a whole.
In both, the growth results from innovation and the availability of resources to develop the
innovations. The resources may be evaluated in terms of the finances, strengths and the growth
of any organization.

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Table of Contents
Executive summary.....................................................................................................................................2
Components of Growth...............................................................................................................................4
1.0 Introduction...........................................................................................................................................4
2.0 Resources for the growth of a company................................................................................................4
3.0 How to protect the resources and to remain competitive....................................................................5
4.0 Management of human and intellectual resources...............................................................................7
5.0 Balancing of formal and informal practices...........................................................................................7
6.0 Difficulties involved with being more formalized..................................................................................8
7.0 Financial growth....................................................................................................................................8
7.1 Sources of finances and financing strategies for expanding new ventures.......................................8
7.2 Advantages and disadvantages of different sources of finance in relation to stages of development
of a business............................................................................................................................................9
7.3 Incentives and logic of investors, value, and the trade-off of outside investors................................9
8.0 Attracting and managing people..........................................................................................................10
8.1 How human resources can emerge over time.................................................................................10
8.2 Importance of human resource practice.........................................................................................10
9.0 Role of intellectual property................................................................................................................11
10.0 Conclusion.........................................................................................................................................11
References.................................................................................................................................................12

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Components of Growth
1.0 Introduction
The main component that leads to growth is innovation. Innovation provides all the necessities
for development. Innovation brings about technology development, attracts capital and helps in
building the resources needed for the development of an idea. As a result of the innovation,
profits are realized that result in the growth of the business (Graham & Sichelman, 2016). The
development of any innovation is based on various factors. Some of the factors are the
availability of resources for the development, the environmental factors and the competitiveness
of the innovation i.e. innovation characteristics. The complexity of the innovation determines the
competition offered in the market field. Less complex innovations do offer less competition since
other firms can easily develop them. On the contrary complex, innovations do offer tough
competition since they take time to develop. The paper reviews the aspect of growth in an
organization; the factors that lead to the development of an organization and the ways to
maintaining the factors so as to maintain the growth.
2.0 Resources for the growth of a company
The resources for a business growth determine its success or failure. The resources do change as
the business changes by either enlarging or shrinking. The various resources necessary for a
business development are as follows first, financial resources. This includes the business
financial status and its borrowing power. Whenever a business has enough funds to cater for its
development it tends to develop first compared to those with a low economic power. Also, the
business is able to access funds to fund its projects since it enough assets to give secure a loan.
As a result, the business makes tremendous development to the expense of those with little funds
to propel their developments. Secondly, personal resources are also a necessary factor for a

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company’s development. The qualification of the workers in any organization does determine the
quality of services delivered. This in return affects the demand for the business goods and
services. System resources do also play a great role in determining the development of an
organization. The system of a business determines the quality of communication and planning
that is undertaken in the organization. Planning and communication do affect the business
performance either positively or negatively depending on the way they are executed. The
business managerial ability and responsibility is a vital player in the success of a business. Good
management ensures that all the business stakeholders play their part towards the realization of a
business goal. In return, the business realizes profits as a result of big sales. The success is
contributed by the willingness of the consumers to use products from the given company. Lastly,
business development does rely on the business strategies. In organizations where the managerial
team is responsible, they do develop strategies that aim to develop the company. As a result, the
business has a set target that should be achieved within a given period of time. This creates
motivation among the stakeholders who work towards achieving the goal. Also, entrepreneurship
ideas are included in the strategies.
3.0 How to protect the resources and to remain competitive
Following the big role that the business resources play in the development of a business, there is
a need to protect and manage the resources. Among the key ways through which resource
management can take place are discussed below. There should be overall responsibilities of the
resources both within and outside the organization. All the stakeholders in the business should
take the responsibility of taking care of the business resources. This will help reduce the
destruction and wastage of business resources. Secondly, project teams should be formed where
each group’s role and responsibility will be drafted with respect to the resources in their project.

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In these groups, the gaps in the business should be realized and solutions to the problems disused
so as to realize new business opportunities. Lastly, in cases where third parties get involved a
clear contract should be developed that will ensure that the company’s resources are properly
utilized. The contract should also include the repercussions that would result along with failure
to abiding by the contract terms. Also, there is the need to arrange the workforce so as to avoid
time and resources wastage (Charles Sturt University, 2008). Through proper workforce
management, the workers are able to focus on particular tasks. This results in business
development since each sector in the business is able to deliver as expected. In addition, in any
business, there is the need to cope up with the competitive market so as to realize more profit and
growth. Among the ways through which a business can remain competitive include; the
relationship between the various stakeholder is very sensitive and do often show itself in the
business results. It determines the competitiveness and the credibility of a business. This is
usually the delivery of services to the consumers. In the existence of good relationship, the
business realizes significant growth to the high demand for its services. This results from the
efficiency in services delivery. A business can also become more competitive by producing high
quality services (Priority Metrics Group, 2016). The quality of the product helps create
confidence to the consumer since their needs are met by using the service. As a result, the
company gains a larger market share receiving more profits in return. The business also opens
new branches in order to meet the high demand realizing growth. Lastly, the pricing of
commodities by a company is vital in determining the company’s position in the market.
Companies that do allocate affordable prices to their commodities do receive more demand. On
the contrary, companies who overprice their commodities do receive low demand since most of

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the consumers do prefer the alternative product that may be cheaper. As a result, the company
results in to a stunted growth.
4.0 Management of human and intellectual resources
In organizations, there is the need to manage the people in order to ensure that they offer the best
to the organization. The stakeholders of any business organization have the responsibility to;
balance the formal and informal practices, make transitions in an organization and build an
efficient communication system within the organization. Fairness is recommended when dealing
with various people in the business organization. This creates satisfaction among the people
motivating them to give their best (Hellerstedt, 2018). Also, there should be a clear set procedure
through which the concerns of the employees can be catered for. The rules help to avoid conflicts
between the administration and the workers. Intellectual property is anything that has been
developed by a human and has a significant effect on the business market. There are several
ways of protecting intellectual properties which include trademarks, trade secrets, copyright
internet domain ad patent among others (Abraham, 2015).
5.0 Balancing of formal and informal practices
Formal practices are usually provided by learning institutions. They are structured according to
the practice objectives and the time allocated for the practice. There are certificates or validations
awarded after the end of the practice. On the other hand, informal learning involves learning
from the daily activities that are performed in the workplace, at home or when having leisure.
This form of practice does not have any set objective for their undertaking. As a result, there are
no qualifications awarded after the practice. According to statistics, most employees do prefer
informal learning since it is easily available and less costly (Radacovic & Antonijevic, 2012).
Organizations are therefore encouraged to embrace both practices so that they can realize the full

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benefit from the practices. By considering the informal practice the company will cut on the cost
while as by considering the formal the company will enhance knowledge creation in the
organization.
6.0 Difficulties involved with being more formalized
In a business field where the formal practice has been embraced to the expense of the informal,
there are problems that arise in the field. The problems include; one there is low demand for
goods produced by the unskilled since they involve less technology and are of low quality in
comparison to those produced by skilled personnel. This leads to unemployment to the unskilled.
Second entrepreneurs do seek to upgrade their technology of production so as to increase the
quality of their goods. As a result, they replace the unskilled with the skilled making them
jobless. Lastly, due to flooding of the skilled workers, some workers will start migrating to other
countries which are more developed for a better pay and better working conditions (Aghion,
Boustan, Hoxby & Vandenbussche, 2009). The migration may lead to lack or insufficient skilled
labor in a country affecting the country production.
7.0 Financial growth
7.1 Sources of finances and financing strategies for expanding new ventures
Finance is a necessity for the development of an idea into a profit-generating project. It’s,
therefore, necessary for an investor to decide on the source of funds for developing his idea.
Among the key sources, finances include; bank loans where the investor is given money by the
bank to develop his or her idea. The investor is given time to pay back the money. He is also
expected to pay the interest that the money will have accumulated during the period of
investment. The entrepreneur can also use personal saving (Markova & Mirkevsca, 2009). This
is the most preferred source of income since it exposes the investor to less risk. The

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entrepreneur can also seek support from friends and family members who might be willing to
give a hand. He can use the amount given to boost his personal saving. Other ways through
which an entrepreneur can raise funds include; bootstrapping, business alliances, angles, and
venture capitalist.
7.2 Advantages and disadvantages of different sources of finance in relation to
stages of development of a business
The various sources of funding do come with their merits and demerits as well as discussed
below. In the case of bank loans, the investor is able to secure the future of his dream since the
bank offers the funds needed for its implementation. On the other hand, the investor is expected
to pay interest earned during the investment. The funding also poses a risk since there is no
guaranteed successes for the investment. In case of a failure, the investor will have to give his
own saving. On the case where the entrepreneur uses his or her own savings, he is considered to
be advantaged since he has no interests to pay. Use of one's savings also creates independency in
the investment. Lastly, in the case where funding is made by friends and family members, the
investor may not raise enough money to fund the project. In addition, they might not be willing
to help and the entrepreneur ends up not reaching his or her dreams. In case he or she raises
enough money, there is an advantage since no interests will be paid.
7.3 Incentives and logic of investors, value, and the trade-off of outside investors
In most cases, investors do ignore the incentives put in place because they do turn out to be
oppressive on them. As a result, they do against the law but the flaw could have been avoided
had the government and the banks provided rules that were supportive. The incentives also do
prevent many investors from making their investments. The decision is usually reached at after
some logical thinking where an investor lacks hope in the success of a business. This, in turn,
lowers the economic growth since there is no entry of new firms in the market. It also lowers the

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levels of employment because there is no creation of job opportunities. Banks have been the
worst field in the execution of incentives that do entrepreneurship. As a result, business analysts
have recommended for the regulation of bank activities by enacting laws that will confine them
(Berk, 2008). By doing so the economists see that many investments will be made which will
lead to the growth of the economy.
8.0 Attracting and managing people
8.1 How human resources can emerge over time
Human resource is termed as the talent within the employees of any organization. The talents
are developed in a process described below. The first process includes the recruitment and
selection. The organization categorizes the employees with respect to their talents. Secondly, the
company sets the compensation and benefits to be enjoyed by the employees in their respective
groups (Haslinda, 2009). The organization then places the employees in their respective
industries and labor areas based on their talents. Lastly, management is developed for the various
groups and for the organization as a whole. By doing so the company realizes the human
resource management.
8.2 Importance of human resource practice
Human resource practice is aimed at enhancing innovation within a company. As a result, there
is development in the organization. They also aid in proper time management within an
organization. In addition, they are used to determine the payment schemes of various groups
within the organization (Arvanitis, Seliger & Stucki, 2013). This is mostly done based on the
innovation made and its impact on the organization.

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9.0 Role of intellectual property
Intellectual property (IP) is a product of a human imagination that is intangible but has market
value. IP has several advantages to the business organization as discussed below. IP provides the
business with a competitive advantage (Abraham, 2015). Since IP is an asset that is intangible
its significance is only realized in terms of its business worth. The more worth the IP is the more
the competitive advantage of the company. IP also provides security to the innovative product of
an organization. This is mostly done by creating designs and brands that are only specific to the
company. Lastly, IP adds value to innovations and commercialization. The measure of the IP in
terms of the business determines the value of a product in the market.
10.0 Conclusion
Business entrepreneurship is a venture that should be given the necessary focus since it holds the
destiny of many economies. It is also responsible for the growth of the countries economy. The
concept of business growth in the vital field of study in the developing world economy. Investors
should focus on the field so as to realize the necessary needs that need to be catered for in the
development of a business idea. The fields give insight into the source of funds and the ways
through which one can promote the products developed from the idea. Investors should also
develop a burning desire to achieve their desires and to compute their ideas.

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