Entrepreneurship: Venture Types, SMEs, and UK Economic Analysis

This report provides a comprehensive analysis of entrepreneurship, starting with a definition and exploration of its scope and typology, including corporate, private, public, social, and lifestyle entrepreneurship. It examines the similarities and differences between these types, focusing on their roles, characteristics, and objectives. The report further presents and assesses relevant data and statistics to illustrate the impact of micro and small businesses on the UK economy at local, regional, national, and international levels, highlighting their contribution to employment, GDP, and innovation. The analysis emphasizes the significant role of SMEs in driving economic growth, opening new markets, and fostering competition, while also addressing their challenges and contributions in the post-Brexit economic landscape.

Understanding entrepreneurship
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Table of Contents
Introduction......................................................................................................................................3
Part 1................................................................................................................................................4
Part 2..............................................................................................................................................14
Conclusion.....................................................................................................................................20
Reference List................................................................................................................................21
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Introduction
The term 'Entrepreneurship' came into existence in the era of 1700, referring to the starting of
the business by an individual. According to Schumpeter, entrepreneurship is a kind of creative
destruction, where innovation plays a vital role in creating new products and business (Burns,
2016). Entrepreneurship actually identifies the opportunity and makes the most out of the
opportunity, creating wealth and value in exchange. An entrepreneur develops business that
takes the shape of large-scale enterprises in future. The entrepreneurs actually take helps from
local franchise outlet, plans small retail shop and operate with self-employed service business.
Individuals cater to the needs the society, bringing in the concept of innovation in products and
processes. The entrepreneur to become successful should have the aim to earn profits from the
new business. In this report, different kinds of entrepreneurship are discussed along with the
contribution of SMEs in social economy of UK. The various skills and characteristics of an
entrepreneur are discussed in this report.
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Part 1
Introduction
This report sheds light on the different typologies of entrepreneurship identified in the market.
The difference between public, private, social and corporate entrepreneurship is illustrated in the
report. SMEs in UK economy has made great contribution and offered employment opportunity
to many individuals. SMEs though exist for shorter period but have contributed in the UK
market.
P1: Provide an introduction to the report by examining different types of entrepreneurial
ventures and explaining how they relate to the typology (different types) of
entrepreneurship. Your introduction should aim to define entrepreneurship and explore
entrepreneurship scope and typology.
Entrepreneurship helps in spurring economic growth in free markets, thereby acting as the
catalyst helping in development. Entrepreneurship is the entrepreneurial process while an
entrepreneur with skills and attributes executes the process to receive exchange and value.
Different typology of entrepreneur is discussed below:
Corporate entrepreneurship:
Corporate entrepreneurship develops innovative products in an existing market with the aim of
making maximum profit (Anderson et al., 2017). A corporate entrepreneur should possess strong
communication skills, effective teamwork ensuring coordination and have well-developed
strategic actions. In corporate entrepreneurship, entrepreneurial activities are conducted in large
corporations where the management encourages the employees to come up with new and unique
ideas and concepts. To sustain its existence, large companies require expanding their business by
creating new innovative products. The scope of the corporate entrepreneurship is to instigate
innovation in the organization, explore research activities, attempt to take calculated risks and
makes investments in new promising zones. This typology creates an environment that has the
strength to bear risks and failures and conducts experiment in business activities.
Intrapreneurs:
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Intrapreneurship is an innovative corporate management strategy that motivates the employees to
have innovation in creating new ideas and products. Once the innovative ideas suggested by the
employees are approved then the management provides finances, conducts research and
development for the product, thus sharing an equitable partnership with employees. The
entrepreneurial activities in this typology take place within an organization.
Academic Entrepreneurship:
The entrepreneurial activities take place in academic and research institutions. The research and
development of products takes place with the goal to achieve intellectual property rights and
commercialization through sales of technology licensing or creation of new ventures.
Private Entrepreneurship:
In this typology, entrepreneurial activities takes place in independent firms were the innovation
process is most prevalent. The process begins with the identification of the opportunity, setting-
up of business entity in the market with the aim to achieve the highest position and maximum
profit through harvest strategy.
Public Entrepreneurship:
The scope of innovation is less, as the organizational structure is rigid. Incentives are not offered
to the employees serving as de- motivation (Colombo et al., 2016). The entrepreneurial activities
are mainly conducted by government-linked organizations or state-owned enterprises. Majority
of public enterprises are formed with the aim to provide efficient services to the individuals.
State-owned enterprises perform through joint ventures, management buyouts and equity
participation, entrusted with the job of conducting entrepreneurship development in respective
states.
Social Entrepreneurship:
The focus of social entrepreneurs is to cater to the needs of the society, resolving social issues
with the help of products. Incentives are offered to the employees in the form of social welfare.
Social enterprises identify the social problem and entrepreneurial approach to organize, create
and manage venture with the aim of gaining social ROI.
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Lifestyle Entrepreneurship:
Lifestyle entrepreneurship is the process of creating new ventures based on an individual’s
passion and without focusing much on profit. This typology involves the combination of an
entrepreneur’s personal interest to achieve profit and wealth for long run. Proper location and
flexibility in working hours is the requirement for such entrepreneurships to develop and create
business. The enterprise enjoys kind of personal autonomy in business and the profit value is
high.
Others (Technopreneurs, Infopreneurs, Agripreneurs)
Technopreneurs are those entrepreneurs who are technology savvy in nature and earn profit
utilizing their skills and expertise in respective technologies. Some of the famous technopreneurs
are Michael Dell and Bill Gates who have achieved success in development of technology based
industries. Technopreneurs work in the field of e-commerce, biotechnology, multi-media based
technology, pharmaceuticals, thereby influencing all over the world. Agripeneurs creates
innovation in the agricultural field. The entrepreneurs in this field focus on planting and
producing agricultural products for consumption such as down streaming activities like
packaging and processing. Infopreneurs utilize information as commodity for sale. Infopreneurs
sell information’s to those who develops information as business strategy and for promotional
activities.
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Figure 1: Types of Entrepreneurship
Source: Created by learner
P2: Building on the different types of entrepreneurial ventures explored in P1, you are now
required to explore the similarities and differences between each. You could consider the
roles, characteristics and objectives of different types of ventures: private; public; social
enterprises - as well as different sized ventures: micro; small; medium.
To expand the business globally, entrepreneurs ventured into different kinds of business types.
The focus of the entrepreneurs is to earn profit and wealth for the business. Range of ventures
ranges from public to private, corporate to social ventures. However, the similarities and
differences are discussed below:
Similarity and difference between private and public entrepreneurship
Similarities
 Both the entrepreneurships adopt
customer service oriented in approach.
Though the customer base is different,
yet the operations are customer-
Difference
 Public sector enterprises are run and
controlled by the government while
private entrepreneurships are owned by
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CorporateIntrapreneurshipSocialentrepreneurshipPrivateEntrepreneurshipPublicEntrepreneurshipAcademicEntrapreneurship

focused.
 Both the entrepreneurships are open to
changes in technology and workforce.
 In both entrepreneurships, support is
given by the executive staff.
private or independent firms.
 The profits earned in public
entrepreneurships are either invested
back to the organizations or taken by
the government. In private
entrepreneurships, the profits are shared
by the owners and shareholders.
Table 1: Similarity and difference between private and public entrepreneurship
Source: Created by learner
Similarity and difference between corporate and social entrepreneurship
Social Entrepreneurship focuses on achieving social welfare of the individuals while corporate
entrepreneurships focus on achieving profits for the organization.
Similarities
 Both the entrepreneurships focus on
gaining profits either for the
organization or for social well-being.
 Both the entrepreneurship pursues
success with the help of creating value
for the organizations.
Differences
 Corporate entrepreneurship
develops business line to earn profit
while social entrepreneurships
focus on solving social issues rather
than earning profit.
 The main objectives of social
entrepreneurship are to create social
change while that of corporate is to
build a business and maximize
profits.
 Performance in corporate
entrepreneurship can be measured
based on customer satisfaction,
financial indicators while it is
impossible to measure in social
entrepreneurship due to its non-
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quantifiable approach.
Table 2: Similarity and difference between corporate and social entrepreneurship
Source: Created by Learner
SME employs individual not more than 500 employees having turnover not exceeding £100
million, while Micro business consists of maximum 10 employees 10 having turnover under £2
million. Medium size business employs about 250 employees with a turnover of £50 million.
SMEs contribute about 99% of UK business and employ over 12 million people.
P3: Present, interpret and assess relevant data and statistic to illustrate the impact micro
and small business have on the economy. You should consider local, regional, national and
international economic impacts.
The abbreviation SME (Small and Medium Size) is used in European Union and by many
international organizations. These businesses have come up with innovation thereby
outnumbering large companies in the market and providing huge employment opportunities to
individuals or residents of UK. Small businesses ranges from operating in convenience stores to
small manufacturing plants. Micro businesses are small-scale business operating with an
individual as the owner of the business. The capital invested is relatively small and employment
is minimal in this business (Freel, 2017). Micro businesses contribute by enhancing the income
levels and lower the cost of the business. Research has concluded that micro business employs
almost about 65-70% of the individuals. Small-scale business on the other hand eliminates the
issues like unemployment and poverty in UK.
Impact of SMEs on UK economy
Small businesses are the backbone of UK economy by opening new markets, employment
opportunities and driving growth factor. Small-scale business motivates competition and brings
fresh ideas to challenge the status quo. Small businesses comprises of almost 99.9% of the
business in UK. With the help of innovation, SMEs are trying to overcome the issue of low
output and low productivity post Brexit (Small Business. 2018).
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Small business has contributed in increasing the GDP of UK by 0.2%. In economy, the SMEs
contribute about 33% of employment, which resulted in having 19% turnover (Ukbaa.org.uk.
2018). Turnover has a major contribution to the social economy of UK. In the year of 2014, the
turnover was 1.6 European trillion having an overall turnover of 47% from private sector. With
regard to revenue, the government has come up with tax breaking initiatives to help SMEs in
eradicating the problem of funding by the provision of investments to small-scale enterprises.
SMEs have made extensive growth in business with the concept of innovation in the market.
Recent studies have shown that SMEs contributes about 37% of the innovative activities. The
recovery of economic state of the country, post recession has been possible with almost about
47% increase in the number of SMEs operating in UK market.
Figure 2: Impact of Micro business on Economy.
Source: (Ukbaa.org.uk. 2018).
Impact of SME on Global economy:
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SMEs have been considered as engine spurring economic growth from long time. SMEs globally
have impacted the economy by eradicating the issue of poverty in large scale. SMEs have
contributed in providing job opportunities to huge number of individuals followed by input and
output. As per report, SMEs contribute about 33% of national income globally and 45% of total
employment (Katua, 2014). In comparison to global industrial sector, SMEs have contributed to
a higher growth rate. SMEs lay a vital role in acting as service providers and traders to primary
businesses. Post recession, SMEs were largely affected according to a business reports. SMEs
have made contribution in increasing the GDP to 52% of private sectors. In developing countries,
SMEs have occupied its position to almost 90%. Recent report states that SMEs have contributed
about 33% of investment, 30% of exports and 38% of production in Morocco ().
Figure 3: Contribution of SME in global economy
(Source: Edinburgh-group.org. 2018).
According to World Bank, survey it has been reported that between the periods of 2002-2010
SMEs contributed about 67% of total employment (Edinburgh-group.org. 2018).
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Figure 4: SMEs contribution to Employment
(Source: Edinburgh-group.org. 2018).
P4: Building on the information you provided for P3, you must explain the importance that
small businesses and business start-ups on the growth of the social economy.
Social economy comprises of organizational activities primarily focusing in pursuing social
objectives and democratic values irrespective of state sector. The purpose of social economy is to
benefit the individuals and not solely to gain profit. Researchers have concluded that start-ups
have been in high demand among young and passionate entrepreneurs. Small business when
combined together contributes in higher amount of revenue. Social enterprises along with trade
have contributed in the development of social economy. Some of the contribution of SMEs and
start-ups to social economy are discussed below:
Fostering social development: SMEs have contributed in eradicating the global issue of poverty
and unemployment. SMEs have helped in fostering peace and development in social
environment. Some SMEs contributes by imparting education and awareness among the
individual. Start-ups have incorporated the concept of research-innovation system in market and
in the employees (Bocken, 2015). Individuals have developed mind-set in line with the society.
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