Entrepre

neurship
and
Small
Business
Manage
ment

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Table of Contents
Introduction:..........................................................................................................................................2
LO1: Explore and illustrate the range of venture types that might be considered entrepreneurial......3
P1: Examine different types of entrepreneurial ventures and explain how they relate to the
typology of entrepreneurship............................................................................................................3
P2: Explore the similarities and differences between entrepreneurial ventures...............................5
LO2: Assess the impact of small business on the economy...................................................................6
P3: Interpret and assess relevant data and statistics to illustrate how micro or small business
impact on economy...........................................................................................................................6
P4: Explain the importance of small businesses and business start-ups to the growth of social
economy............................................................................................................................................8
LO3: Determine and assess the key aspects of an entrepreneurial mind-set........................................9
P5: Determine the characteristic traits and skills of successful entrepreneurs that differentiate
them from other business managers.................................................................................................9
P6: Assess how aspects of the entrepreneurial personality reflect entrepreneurial motivation and
mind-set..........................................................................................................................................13
LO4: Examine the different environments that foster or hinder entrepreneurship............................15
P7: Examine, using relevant examples, how background and experience can hinder or foster
entrepreneurship.............................................................................................................................15
Conclusion:..........................................................................................................................................16
References:..........................................................................................................................................17

Introduction:
Entrepreneurship, which means the willingness to create and manage new business so as to
introduce unique and new products and services in the market is called entrepreneurship and

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the individual starting a new business is called entrepreneur. The following assignment will
focus on the various aspects of the entrepreneurship. In this assignment, we will discuss the
various types of entrepreneurship ventures and the similarities as well as differences between
each of them. We will also discuss the importance of the small businesses and the business
start-ups for the economic as well as social development of the country. Various
characteristics of entrepreneurs will also be discussed later in the assignment.

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LO1: Explore and illustrate the range of venture types that might be
considered entrepreneurial.
P1: Examine different types of entrepreneurial ventures and explain how they
relate to the typology of entrepreneurship.
Entrepreneurship may be defined as the process through which a new business organization is
designed, managed and owned which offers products or services. It is the willingness of an
entrepreneur to manage and own a new business with any amount of risk involved so as to
make profit (Business Dictionary, 2018). The various different types of entrepreneurship
ventures are as follows:

M1: Small Business Entrepreneurship: Small businesses refers to grocery stores, travel
agents, hairdressers, consultants, electricians, plumbers etc. Most of the small businesses are

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run by their owners and the employees hired are mostly the family members. The objective of
small businesses is to make profit so as to feed the family and not to rule over another
industry. Most of the small businesses are funded by the family or friends or by taking small
loans as the owner does not have the sufficient capital to start the business.

Scalable Start-up Entrepreneurship: The scalable entrepreneurship ventures are started

with the clear objective of bringing change in the world. Most of the finances are provided
by the financial investors and the best people are hired for the job. They operate in order to
make profit (Casnocha, 2012)

Large Company Entrepreneurship: The main objective of the large company

entrepreneurship is to bring innovative services and products in the market so as to sustain.
The changing needs as well as the trends require large companies to produce entirely new
products to be sold to new customers in new market.

Social Entrepreneurship: In order to solve the social needs and problems, social
entrepreneurship focuses on creating new products and services with the objective of making
world a better living place for society. It might be of any type for-profit, non-profit or hybrid
(Casnocha, 2018)

Lifestyle Firms: The Lifestyle entrepreneurships are referred to those businesses which are
created with the objective of supporting the lifestyle of the owner rather than just making
profits. The business operations are chosen according to the lifestyle or passion of the owner
and focus is on getting life rewards.

Growth Firms: These are generally fast growing companies that operate with the objective
of making large profits so as to survive. They focus on creating new and innovative products
as well as services for the customers so as to sustain. Their growth speed is quite good. For
example: Google can be considered as a growth firm.

Intrapreneurship Ventures: Intrapreneurship usually takes place with in a large scale

company and is mainly introduced by the managers of the company and that is why it is often
called as managerial entrepreneurship. In this, the manager of the company focuses on
bringing new products and services through innovation.

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P2: Explore the similarities and differences between entrepreneurial ventures.
As discussed above there are different types of entrepreneurial ventures and each
entrepreneurial venture has some similarities as well as differences as discussed below:

Lifestyle and Growth Firms: The main similarity between the lifestyle firms and the growth
firms is that they both aim to achieve profit and look for opportunities in order to maximise
their business operations. The main focus of the lifestyle businesses is on maximising profit
for personal income while the main focus of the growth firms is on gaining fast growth at any
cost. Growth firms creates value added products or services into the growth market to achieve
quick success while lifestyle businesses carry out business operations in order to support the
lifestyle of its owner. This is the reason why investors are more interested in growth firms
rather than investing in the lifestyle firms (Cummings, 2013)

Social and Business Entrepreneurship: The main similarity between a social entrepreneurship
and business entrepreneurship is to fulfil the needs and requirements of the market and gain
profit. However, there is a difference in the objectives of the two. While business
entrepreneurship operates with the sole objective of making money and achieve success in
the market, Social entrepreneurship focuses on making profits so as to make a positive impact
on the society and make it a better living place. They aim to satisfy the social needs from the
profits achieved though business operations.

Small business Entrepreneurship and large business Entrepreneurship: The main similarity
between the two is that both operate to generate profits for the company. However the main
objective of the small business is to generate regular income so as to fulfil family needs while
large business entrepreneurships operates with the objective of producing goods and services
so as to generate high revenues for business and increase market share (Burns, 2012)

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LO2: Assess the impact of small business on the economy.
P3: Interpret and assess relevant data and statistics to illustrate how micro or
small business impact on economy.
The rate of growth of small businesses and small business start-ups is quite significant in UK.
If take the statistics of year 2015-2016, then almost 3500 business start –ups were reported in
UK. The main reason behind such a huge number of start-ups and their growth in UK are the
political and economic conditions of UK which are favourable for small businesses. The role
of the small businesses and businesses start-ups in the national economy of UK is very
crucial and that is the reason why government of UK is favouring the growth of the small
businesses in its country (Storey, 2016)

(D2) The strong contribution to the economic development of UK because of the small
businesses and start-ups are due to many factors and these factors are also supporting the
growth and turnover of the small businesses in UK. According to reports, the total turnover of
the small business enterprises in the year 2014-15 was around 5.7 billion pounds. The amount
reported was almost 13.7 % of the total turnover. In addition to this, the small business and
start-ups also provides huge employment opportunities in UK and therefore contributes in the
economic development of the country. It is estimated that almost 27 million people were
employed by the small business enterprises in UK including both male and female
employees. This means that almost 25.7% of the total workforce of UK is employed by the
small business enterprises and start-ups. The main reason behind such a huge growth and
success of small businesses and start-ups is the innovation and creativity. Thus on the local,
national and regional level the impact of small businesses are as follows:

 Small businesses impact the local economy of UK by introducing creativity and

innovation in the community where the business operates. It also provides employment
opportunities to local people thereby contributing to local economy (Brown, n.d.)
 Small businesses and business start-ups are the main catalysts for the job creation as well
as the poverty reduction leading to the regional development of economy.
 On national level, the government of UK gets benefitted by the small businesses as they
form taxes and these taxes in return are provided for the maintenance of infrastructure,
schools, colleges and hospitals. They also create revenue which in turn contributes to the
national as well as international economic development (Hardoon, 2015)

M2:

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According to the reports, the total people employed by small as well as micro and medium
businesses is almost 15.7 million. Therefore it can be said that total employment provided by
medium and small enterprises is almost 60% of the total workforce. Almost 47% of the total
turnover i.e. around 1.8 billion pounds is generated by medium sized and small businesses.
Therefore it can be very well said that medium sized enterprises and small businesses are the
major drivers of UK’s economy by giving employment to more than 50% of the total
workforce of UK. In addition to this, they contribute through innovation. Around 11.5 million
pounds have been collected as taxes through SME’s (Hardoon, 2015)

Just like medium and small businesses, large business organizations also have a contribution
in the economic development of UK”s economy. Due to huge competition from foreign
companies, the large companies make huge investments in the research and development.
They not only provide employment opportunities on national level but also on international
level. The salaries paid by large organizations is much more as compared to small and
medium sized businesses. Therefore, they help in the reduction of poverty (Storey, 2016)

Source:
https://www.ons.gov.uk/economy/nationalaccounts/uksectoraccounts/articles/economicrevie
w/apr2017

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P4: Explain the importance of small businesses and business start-ups to the
growth of social economy.
As discussed in the above question, the growth and success of the small businesses and
business start-ups is very important for the society as well as for the economic development
of the country. They are the major drivers of the economy development of UK and are the
main contributors in the economic development. Besides, the major portion of the workforce
of UK gets employed by the small businesses and businesses start-ups. These employment in
turn creates the effective cash flow within the economy of UK. The growth of small
businesses creates a lot of opportunities for the local as well as the regional people of the
country and also contributes to the society by reducing the level of poverty. For the growth
and sustainability of the UK’s economy, the importance of small businesses and business
start-ups is very crucial. By providing employment to larger portion of population, small
businesses plays an important role in modernising the lifestyle and raising the living
standards of the people of the country. The money generated as taxes thorough small
businesses and start-ups is in turn utilized for the local police and other social services like
hospitals, schools by the government of UK. Thus, the small businesses contributes towards
the economic as well as social development of the country (Carter and Evans, 2012)

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LO3: Determine and assess the key aspects of an entrepreneurial
mind-set.
P5: Determine the characteristic traits and skills of successful entrepreneurs that
differentiate them from other business managers.
The concept of entrepreneur or entrepreneurship is not just confined to the definition of
business management. The entrepreneurship businesses and entrepreneurs need to go beyond
the traditional ways of doing just businesses and must bring creativity and newness in the
ways of managing the business by the introduction of innovation. In entrepreneurship
businesses, there should be a balance between business and innovation and both must be
carried out together. An entrepreneur needs to change the ways of doing business according
to the changings needs of business environment. In order to become an entrepreneur, an
individual requires desire, passion and willingness to take risks and come out with something
new and unique (Kirzner, 2015). Therefore, certain traits and characteristics are required by
an individual in order to become a successful entrepreneur which are as follows:

(M3) Self-Motivation: Self-motivation is the most important trait that must be possessed by
an entrepreneur in order to become successful. Pushing yourself is required to become
entrepreneurs. Entrepreneurs does not requires to ask anyone else for anything and therefore
there is no one to make you do what you are required to do. Therefore self-motivation is very
important in order to keep-going with the plan.

Understand what you offer: It is very important for an entrepreneur to understand what he
wants to offer as a product or service. This will help in identifying the needs so as to start a
new business and help in analysing the real position so as to move ahead.

Risk taking ability: In order to become a successful entrepreneur, it is must to have the risk
taking ability. An entrepreneur can never get success without having the risk taking ability as
they know the importance of takings risks in business in order to achieve success. However,
they must know which risks are worth taken and then proceed to take risks as all risks does
not result in success. Therefore, it is better for entrepreneurs to do calculation before taking
risks (Cherry, 2015)

Network Relations: An entrepreneur should have a strong network of influential

personalities in order to become successful. In order to expand your business, it is very

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important for the entrepreneurs to understand the business partnership opportunities with the
help of strong network.

Money Management Skills: Entrepreneurs need to possess good and effective money
management skills as well as knowledge in order to become successful. Having the right
money management skills and basic knowledge helps the entrepreneur in understanding how
money works for business and how it can be utilized effectively for the growth and success of
the business. However, the entrepreneurs can have a team of members to help them managing
their businesses (Cherry, 2015)

Flexibility: In order to become an entrepreneur, an individual must possess the skill of being
flexible as flexibility is very important for achieving success. They must possess the
willingness to change according to the changing needs and requirements of business
environment. The entrepreneurs must be ready to bring changes in its products and services
according to the changes taking place in the market and according to the changing needs.
Flexibility in finding alternate solutions for a business problem is also required by the
entrepreneurs.

Passion: Entrepreneurs are always passionate for their work and have the desire to do what
they want and this desire and willingness to do something new and different is what makes
them different from other business managers. They feel about their products and services. In
order to get motivated and keep going, passion to do what you do is very important. It is the
motivational factor which drives the successful entrepreneurs. The loss of passion indicates
that it’s time for the entrepreneurs to experiment something new and innovative. Creating
businesses and then selling them off to others in order to create something new is done by
many entrepreneurs (Cherry, 2015)

(D3) For example Steve Job became a successful entrepreneur because of many traits and
characteristics like his unbelievable creative thinking and imagination. The Apple Company
was built by him under the assumption that its products and services will bring change in the
world. His risk taking ability and his fearlessness made him a successful entrepreneur. In
addition to this, it was his passion for his work which made him what he is today. His
capability to push himself as well as his employees to go beyond the limits made Apple a
successful company and gain him rewards and fame. He had the unique sales techniques that
no one ever had which made him a great salesperson. Thus, it can be said that these traits are

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just few of the many that were possessed by the Steve Jobs. In order to become a great
entrepreneur, an individual needs to follow his traits (Entrepreneurs, 2013).

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P6: Assess how aspects of the entrepreneurial personality reflect entrepreneurial
motivation and mind-set.
There are various elements and skills that make up a successful entrepreneur. Those skills
includes creativity and innovativeness, risk taking ability, developing new ideas and
strategies for business, management skills as well as effective leadership skills. Therefore, in
order to become successful as well as competitive, an entrepreneur needs to reinvent things
from time to time. He should have the ability to carry out innovative activities so as to bring
new products and services in the market through new ways of doing things. Profit and
making money is not the prime focus of the entrepreneurs. They give more importance to the
realization of idea than making money to earn profits. Also there is a great connection
between the entrepreneurial personality and entrepreneurial motivation and mind-set. The
entrepreneurs are identified with something special in the personality that makes them
different from others (Schumpeter, et.al, 2012)The personality of the individual consists of
temperament and character. Therefore, in order to understand this, we will analyse few of the
personality traits of the entrepreneur that influences the entrepreneurial mind-set and
motivation which are as follows:

Extraversion: Extraversion is the ability of the person to socialise easily and build strong
relations with others. An extrovert person is very talkative, energetic, positive and active.
They generally build good and strong relationships with stakeholders. This characteristic is
very important for the entrepreneurs as they need to go to banks in order to get funds, they
need to hire employees in order to help them in managing their business, they need to make
partnerships and for all this it is very important to be extrovert (Hessinger, 2015)

Agreeableness: Agreeableness refers to the attitude of the individual towards other

individuals. Agreeableness includes characteristics like outgoing, forgiving, trusting, helping
etc. This is a very important trait of the entrepreneurs as agreeableness helps in developing
healthy and strong relations with other employees by rending them support and help. This
helps in maintaining good and healthy environment at workplace which motivates the
employees to do better.

Neuroticism: People having emotional imbalances in nature are said to be neuroticism. They
have negative emotions and suffer from problems like depression etc. But in order to become
a successful entrepreneur, an individual should have the ability to control stress and maintain
their mental peace and equilibrium as they need to carry out the business operations on their

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own and the working hours required by them by the businesses are not fixed. Therefore they
need to maintain a balance between the professional and personal lives and should have the
ability to work freely with inner and mental peace. This will motivate them and help them in
having a positive mind-set (Hessinger, 2015)

Openness: To be an entrepreneur, openness in behaviour is very important. The various

characteristics included in this are innovativeness, creativity, imaginative, curious as well as
the adventurous nature ready to take risks. Entrepreneurs need to be creative and innovative
in order to develop new ideas of managing business with their imaginative thinking.
Motivation is very important in order to bring innovation.

Conscientiousness: It refers to the ability of the entrepreneur to work hard in every situation.
In order to become successful, an entrepreneurs needs to finish his tasks on time by
organizing his work so as to leave nothing in between (Hessinger, 2015)

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LO4: Examine the different environments that foster or hinder
entrepreneurship.
P7: Examine, using relevant examples, how background and experience can
hinder or foster entrepreneurship.
The approach of every entrepreneur towards business is different and so are their decision
making abilities. This is because of the reason of different past experiences and different
personality traits of the different entrepreneurs. The personality of the entrepreneur is made
out of the experiences that they have gained throughout their lives, the kind of education that
have been imparted to them and the surroundings in which they are being brought up and
lived all their life. These are the major players in the personality of an individual. The
characteristics and behaviour of the individual depends very much on the family, friends and
culture where the person has lived (Drucker, 2014).

M4: For Example: Richard Branson is a famous entrepreneur. According to him the most
important characteristic of entrepreneur i.e. the risk taking ability has been inherited in him
from his past experiences in life. He has learn how to take challenges as opportunities from
the past experiences of his life and this has made him what he is today. His knowledge and
his surroundings has made him a positive personality (Branson, 2013)

D4: Another example of successful entrepreneur and influence of past experiences and
background is that of the Steve Jobs. Steve Jobs is one of the most famous entrepreneur. He
was the co-founder of American Company Apple. His poverty and passion led him to create
Apple Company at the place where he used to live and that was the garage with the help of
some of his friends. Throughout his life, he worked hard in order to make his dream come
true (Entrepreneurs, 2013)

However there are certain negative traits of entrepreneur’s personality which hinder their
growth such as multitasking at a time. As entrepreneurship requires working on the single
idea for hours. Therefore, the utilization of mind in various things at a time can lead to failure
in business. Also, the desire to find perfection in each and everything sometimes lead to
failures.

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Conclusion:
From the above assignment it is clear that entrepreneurs as well as entrepreneurial ventures
are very important for the economic as well as social development of the country as they
provide several benefits to society and provide employment opportunities to major workforce
of the country. The various characteristics that are required by an individual have also been
discussed in the above assignment and we have also understood the influence of the past
experiences and background on the growth of entrepreneurs.

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References:
 Business Dictionary, 2018, Entrepreneurship, [Online], Available at:
http://www.businessdictionary.com/definition/entrepreneurship.html [Accessed: 21 May
2018]
 Casnocha, B., 2012, Four types of Entrepreneurship, [Onl;ine], Available at:
http://casnocha.com/2011/02/the-four-types-of-entrepreneurship.html [Accessed: 21 May
2018]
 Cummings, D., 2013, Lifestyle vs Growth Entrepreneur, [Online], Available at:
https://davidcummings.org/2013/05/02/lifestyle-vs-growth-entrepreneur/ [Accessed: 21
May 2018]
 Burns, P., 2012. Entrepreneurship and Small business. Palgrave MacMillan.
 Brown, J.M., n.d., How important are small business to local economies, [Online],
Available at: http://smallbusiness.chron.com/important-small-businesses-local-
economies-5251.html [Accessed: 21 May 2018]
 Storey, D.J., 2016. Understanding the Small Business Sector. Routledge
 Hardoon, A., 2015. The importance of small businesses in the UK economy. [Online],
Available at: http://smallbusiness.co.uk/the-importance-of-small-businesses-in-the-uk-
economy-2492626/ [Accessed: 21 May 2018]
 Carter, S. and Evans, J.D., 2012. Enterprise and Small Business: Principles, Practice and
Policy. Pearson, London.
 Cherry, K., 2017, The Big 5 Personality Traits, [Online], Available at:
https://www.verywell.com/the-big-five-personality-dimensions-2795422 [Accessed: 22
May 2018]
 Entrepreneurs, 2013, What Personality Traits Made Steve Jobs Successful?, [Online],
Available at: https://www.entrepreneur.com/answer/226410 [Accessed: 22 May 2018]
 Branson, R., 2013. Richard Branson on Taking Risks, [Online], Available at:
https://www.entrepreneurmag.co.za/advice/business-leadership/leading/richard-branson-
on-taking-risks/ [Accessed: 22 May 2018]
 Kirzner, I.M., 2015. Competition and Entrepreneurship. University of Chicago Press.
 Schumpeter, J.A., Becker, M.C., Knudsen, T. and Swedberg, R., 2012. The Entrepreneur.
Stanford University Press.

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 Hessinger, S., 2015. 10 Mindsets of Successful Entrepreneurs. [Online], Available at:
https://smallbiztrends.com/2013/10/successful-entrepreneur-mindset.html [Accessed: 22
May 2018]
 Drucker, P., 2014. Innovation and entrepreneurship. Routledge.

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