Detailed Literature Review: Steps to Starting a New Business Venture

This literature review examines the process of starting a small business venture. It begins by highlighting the importance of market research to understand the target market, potential customers, and market trends. The report then emphasizes the significance of creating a detailed business plan, which includes objectives, internal and external analysis, and a competitive environment assessment. Securing funding is another crucial aspect, with discussions on various sources like bank finance and private investors. The review also covers selecting a business location, determining the business structure, and choosing a suitable business name. Finally, it addresses the legal aspects, such as registering the business and obtaining tax IDs. The literature review incorporates views from various authors and researchers, presenting a comprehensive overview of the steps and considerations involved in launching a new business venture. The conclusion underscores the need to address all these elements to achieve market success.

LITERATURE REVIEW

Table of Contents
INTRODUCTION...........................................................................................................................3
MAIN BODY...................................................................................................................................3
Aim..............................................................................................................................................3
Sources of information can be used.............................................................................................3
Literature review..........................................................................................................................3
CONCLUSION................................................................................................................................6
REFERENCES................................................................................................................................7

INTRODUCTION
New business is about to open a new venture or starting business operations in a different
sector. This report will demonstrate literature review over how to start a small business venture.
This will involve different information critically reflect the process to start a new business
venture.
MAIN BODY
Aim
Aim of the report is to demonstrate information in respect to how to start a new business
venture. With support of literature review all possible approaches and ways that can favour a
business entity to start a new business venture will project. The aim of the study is to know how
stakeholder or investor can start a new business venture.
Sources of information can be used
In order to achieve the overall objectives set for this project different sources such as
academic journal, internet sources, books and other form of literature will be use. All these
sources will favour in collecting potential information to meet the overall requirements of this
project.
Literature review
As per the views stated by Wright, Siegel and Mustar (2017), starting new business can
be understood as either to open a new company or business entity in new market sector or to
explore any existing business environment sector. The first stage of opening up a new business
venture is to conduct market research. In context to business environment market research play
significant role. The research is conducted related to products that company is aiming to deliver
in respect to business, potential customers that needs to cater by business entity, market trend
related to the respective market sector in which business entity is aiming to serve its practices.
Research is the initial point involve in process related to opening up a new business venture.
Salamzadeh and Kesim (2017), has given huge emphasis over market research related to all
different areas of business venture. Further activities' stakeholder initiate best on the research.
The key benefit related to market research is that it provide a clear view about the possible level

of market opportunities available for business entity. This involves creating perception in respect
to sales, growth rate, market demand and all other key areas.
Contradictory statements given by Ramírez‐Pasillas, Lundberg and Nordqvist (2021),
about market research is that it becomes crucial to use the reliable sources of information which
conducting research in respect to opening up new business venture. In case the stakeholder do
not explore right reliable sources this can mislead the entire business idea. Further, planning also
get demolished due to ineffective and wrong market research.
The views project by Picken (2017), over launching a new business venture denote that
formation of business plan is also among the key areas that needs to be explored before initiating
for the new business venture. Business plan will comprise the aim, objectives to set the direction
of plan, internal and external analysis of business environment, competitive environment related
to sector in which company is aiming to enter, controlling and evaluation part of monitoring and
control the market success and all such related elements are included. Business plan must be
precise and reflect all types of potential information so that further investor can get the clear
detail about the business. Peris-Ortiz, Ferreira and Fernandes (2018), in its book over opening up
a new business venture demonstrated that preparing business plan provide a competitive edge to
stakeholders. This is a clear guidance about business model and all other information associated
with the business. Business plan also provide a clear view related to the scope of the business
idea to entertain growth in respected market.
On the opther hand Neumeyer and Santos (2018), has criticised the business plan on the
ground that in most of the cases the plan set only one direction. The major emphasis of the plan
is usually over positive side of the idea. This does not indicate about the limitations attached with
the business idea. Due to the limited approach the business plan provide only restricted
information about business model and the possibility to entertain growth in market.
Funding is denoted as raising financial resources for the business idea. Morris and et.al.
(2018), has provided a huge focus over funding situation in context to new business venture.
This is the most significant element related to the business plan. Proper funding is essential to set
up the en tire venture. Funding allows business entity to allocate all resources and bring all
feasibility to the business model. Behind the success of any business resources play key role.
Mason (2020), has provided different funding sources such as bank finance, private investors,
investment bankers, private finances and many other possible sources through which business

entity can raise finances. Every new business venture when start the entire operations explore al
these possible funding sources. Initial stage of business venture is not an easy time to sustain the
entire set up as the income is limited. IN such a situation interest over the funding sources
explored can be a huge burden. It becomes essential for the business entity to only approach such
funding sources that can provide finances over easy and convenient interest rate.
Criticism has been drafted by the Kleinert, Volkmann and Grünhagen (2020), over
exploring funding sources is that there are plenty of sources available in market. Many times
business ventures take risk just because the particular source providing huge financial resources
that can suitably meet all financial requirements of business entity. It becomes important for the
business venture to properly analysis the funding sources so that interest and repayment do not
become a burden over the liquidity of business entity. Huang, Meoli and Vismara (2020),
provided its view that in the initial stage of business all the investors try to take undue advantage
as the businesses hold only limited financial sources. In such a situation if the right source did
not approach by the business venture than it can also be a reason behind the failure of business
idea.
Picking up the business location is another step part of business plan. Howell and et.al.
(2020), has mentioned in its study that business location is one of the prominent element
associated with the growth and success of business entity. Many times irrespective of the product
quality location play huge role in engaging with potential customers in market. Emphasis has
also given over the business structure in study conducted by Ghezzi (2019), regards to launch a
new business venture. The structure of the organisation play huge role for business entity to
sustain a good control over operations. Structure allows the businesses to effectively manage all
operations so that right balance can be arisen.
Frischauf and et.al. (2018), has designed some critical points associated with launching a
new business venture. It has derived a focus over the points that business structure are of
different types. It becomes very critical to choose right structure for the business. Even after
having a suitable business structure role of human resources become very significant. If the
employees of company are not performing based on expectation than such businesses will never
be able to achieve growth in market.
Choosing suitable name for business is another key area that are involved under
launching of business venture. Cacciolatti and et.al. (2020), indicated in its research over

launching a new business venture is that to put the suitable name becomes necessary as a
business entity to achieve suitable control over business operations. Registering business is
another key practice that needed to entertain business ventures. This become very necessary to
authorises the business idea. The legal regulations attached with registering business venture for
example in context to company there is a compulsion of company act to register the business. In
form of other business this is not compulsory to register the business. Cabrera and Mauricio
(2017), represented that if the business entity get register than it becomes the legal right of the
respective venture to not to let people use the similar name to initiate the business operations.
Getting federal and state tax id is also important for the business entity in order to start the
business venture. Tax is the ethical; liability of the business entity to pay.
As per the views illustrated by Adomako and et.al. (2018), it can be demonstrated that
launching new business idea become very complicated as a venture. There are plenty of legal and
other regulations which needed to meet up in context to launch a new business idea. The legal;
regulations increases the overall cost of launching a business idea which further limited the
resources for entities.
CONCLUSION
Launching new business venture comprises with multiple steps like conducting market
research, forming business plan, funding the business idea, picking up business location,
choosing right name for the business, registering business and many such formalities. If a
business entity aim to achieve success in the market than it becomes the duty of the business
venture to cope up with all fundamental need and requirements attached with launching a new
business idea.

REFERENCES
Books and Journals
Adomako, S. and et.al., 2018. Entrepreneurial alertness and new venture performance:
Facilitating roles of networking capability. International Small Business Journal. 36(5).
pp.453-472.
Cabrera, E. M. and Mauricio, D., 2017. Factors affecting the success of women’s
entrepreneurship: a review of literature. International Journal of Gender and
Entrepreneurship.
Cacciolatti, L. and et.al., 2020. Strategic alliances and firm performance in startups with a social
mission. Journal of Business Research. 106. pp.106-117.
Frischauf, N. and et.al., 2018. NewSpace: New business models at the interface of space and
digital economy: chances in an interconnected world. New Space. 6(2). pp.135-146.
Ghezzi, A., 2019. Digital startups and the adoption and implementation of Lean Startup
Approaches: Effectuation, Bricolage and Opportunity Creation in
practice. Technological Forecasting and Social Change. 146. pp.945-960.
Howell, S. T. and et.al., 2020. Financial distancing: How venture capital follows the economy
down and curtails innovation (No. w27150). National Bureau of Economic Research.
Huang, W., Meoli, M. and Vismara, S., 2020. The geography of initial coin offerings. Small
Business Economics. 55(1). pp.77-102.
Kleinert, S., Volkmann, C. and Grünhagen, M., 2020. Third-party signals in equity
crowdfunding: the role of prior financing. Small Business Economics. 54(1). pp.341-
365.
Mason, C., 2020. The coronavirus economic crisis: Its impact on venture capital and high
growth enterprises. Publications Office of the European Union.
Morris, M. H. and et.al., 2018. Distinguishing types of entrepreneurial ventures: An identity‐
based perspective. Journal of Small Business Management. 56(3). pp.453-474.

Neumeyer, X. and Santos, S. C., 2018. Sustainable business models, venture typologies, and
entrepreneurial ecosystems: A social network perspective. Journal of Cleaner
Production. 172. pp.4565-4579.
Peris-Ortiz, M., Ferreira, J. J. and Fernandes, C. I., 2018. Do Total Early-stage Entrepreneurial
Activities (TEAs) foster innovative practices in OECD countries?. Technological
Forecasting and Social Change. 129. pp.176-184.
Picken, J. C., 2017. From founder to CEO: An entrepreneur's roadmap. Business Horizons.
60(1). pp.7-14.
Ramírez‐Pasillas, M., Lundberg, H. and Nordqvist, M., 2021. Next generation external venturing
practices in family owned businesses. Journal of Management Studies. 58(1). pp.63-
103.
Salamzadeh, A. and Kesim, H. K., 2017. The enterprising communities and startup ecosystem in
Iran. Journal of Enterprising Communities: People and Places in the Global Economy.
Wright, M., Siegel, D. S. and Mustar, P., 2017. An emerging ecosystem for student start-
ups. The Journal of Technology Transfer. 42(4). pp.909-922.