TYPES OF ENTREPRENEURSHIP

ELE102 nur – The Entrepreneurial Mind

1st Semester, AY 2022-2023

Week 4
September 27 – 30, 2022
 Learning Objectives
At the end of the session, the students shall be able to:

✓ discuss (as a review) the characteristics of an entrepreneur

✓ differentiate types of entrepreneurship

✓ begin conceptualization of ideas for final group project

What Does It Mean to Be an Entrepreneur?
• An entrepreneur is defined as anyone
➢who founds or organizes a business
➢continues to be an active participant in the operation of that
business

• In other words, an entrepreneur is anyone who launches

and continues to run their own company
 Becoming an Entrepreneur
• Develop an idea for a unique or in-demand business.
• Learn about and gain experience in a range of business roles,
including finance and accounting, management, and marketing.
• Make a business plan and establish a source (or sources) of
funding.
• Recruit talented workers and managers with the skills needed to
develop, test, implement, support, and maintain the company’s
products.
• Devise strategies for launching the product or service, and for
attracting and retaining customers.
• Once the company is established, seek out ways to grow revenue
by expanding into new areas and product lines.
What are the 4 Types of Entrepreneurship?
• Small business

• Scalable startup

• Large company

• Social entrepreneurship
 SMALL BUSINESS
• A small business...
➢could be any company, restaurant, or retail store
➢launched by a founder, without any intention of growing the
business into a chain, franchise, or conglomerate

➢example: - opening a single grocery store falls under the small

business model
- a mini-bakery
- a barber shop or salon
- massage therapy services
 SMALL BUSINESS
• Small business entrepreneurs usually invest their own
money to get their companies off the ground.
➢ They only make money if the business succeeds.
 What Industries Do Small Business
Entrepreneurs Work In
• Hairdressers, bakers, restaurateurs, and retail store
owners
• Small business entrepreneurship can encompass
consultants and creative professionals
➢such as copywriters, marketers, or graphic designers who go
into business for themselves
➢service trades, such as electricians and plumbers, also fall
under this category
 Defining Characteristics of Small
Business Entrepreneurship
• Small business entrepreneurs focus initially on a single
product, market, or locality.
• While in the startup phase, the entrepreneurs probably do
not have plans to expand the company.
• The initial goal of small business entrepreneurs is to make
a profit, although even in its early stages, the business
may be motivated by the entrepreneur’s desire to
effect social change.
 Defining Characteristics of Small
Business Entrepreneurship
• Most small businesses are either self-funded or funded through small
business loans. Outside investors and venture capitalists are very rarely
involved.

• Greatest challenges small business entrepreneurs face:

➢ Ensuring a steady cash flow without relying on third-party investments
➢ Finding time for family and friends
➢ Staying abreast of technology and market changes that affect the
business
➢ Devising a marketing strategy to attract the company’s target audience
➢ Maintaining a solid reputation for their brand
➢ Keeping an eye on the competition
 Find Out More About Small Business
Entrepreneurship
• https://www.zenbusiness.com/blog/business-success/

• https://www.businessinsider.com/how-to-start-a-business-with-no-
money-2019-5

• https://www.inc.com/john-boitnott/5-small-business-ideas-for-
beginner-entrepreneur.html
 SCALABLE STARTUP
• Scalable startups are less common than small businesses
• These businesses begin on a very small scale, often as
just the seeds of an idea.
• According to Forbes: scaling “means that your business
has the potential to multiply revenue with minimal
incremental cost”
➢ examples: Google
Microsoft ... at the beginning
Facebook
Key Characteristics of Scalable Startup
Entrepreneurship

The scalable startup

entrepreneurship model Scalable start-up
at first resembles a entrepreneurs have a
small business, but vision for large-scale
differs in its intentions success.
for long-term evolution.
Examples of Scalable Startups
 Key Characteristics of Scalable Startup
Entrepreneurship
• Like small business entrepreneurs, scalable startup
entrepreneurs start their companies on a modest scale. But
unlike small business entrepreneurs, scalable startup
entrepreneurs have a vision for growth from the outset.
• Scalable startup entrepreneurs look not just to make profits but
also to generate revenues they can invest back into the
business, fueling growth.
• The most common way to fund a scalable startup is through the
pursuit of venture capital.
 Challenges of Scalable Startup
Entrepreneurship
• Scalable startup entrepreneurs face several unique challenges:

➢Attracting investors and raising venture capital

➢Recruiting talented managers and employees without impinging
on cash flow or incurring debt
➢Ensuring the business plan is flexible enough to accommodate
shifting markets and new technologies
➢Planning and implementing an infrastructure for the business
that is inexpensive to launch yet capable of growing
without disrupting the core business
 Learn More About Scalable Startup
Entrepreneurship
• https://smallbusiness.chron.com/examples-scalable-business-
model-25576.html

• https://www.inc.com/peter-cohan/is-your-business-model-
scalable-heres-how-to-tell.html
 LARGE COMPANY
• This refers to a “huge or large business” which runs on doing “big
things or transactions”
• Technically employs 250 or more employees
• Business expansion is a feature and there is room for innovation
since it allows employees to explore new opportunities

➢ examples: Exxon Mobil

General Motors
Apple
Google
Amazon
Examples of Large Companies (Phils.)
 Key Characteristics of Large Company
Entrepreneurship
• Large company entrepreneurs address the needs and opportunities of an
existing business through innovation. This may include a new
product line or division.
• Large company entrepreneurs look to branch into new customer markets,
broadening the reach of an established business.
• Large company entrepreneurship may entail the acquisition of new
companies and resources, or investment into research and
development.
• The key to success for large company entrepreneurs is sustaining
growth in the long term, so the major challenge to their success is to
anticipate and avoid obstacles to growth.
• Ensuring that the firm’s new and innovative products are first to market.
 Key Characteristics of Large Company
Entrepreneurship
• Protecting and growing the market share of existing
products while promoting the new offerings.
• Building a cohesive corporate culture that is easy for
newly acquired organizations to adopt.
• Overcoming the inertia that can prevent large firms from
acting on and responding to changing markets and
innovative technologies faster than the competition.
• Failing to scale sustainably (growing too much, too soon).
 Additional Resources
• https://www.sba.gov/business-guide/grow-your-business/merge-
acquire-businesses

• https://www.entrepreneur.com/article/316130
 SOCIAL ENTREPRENEURSHIP
• This involves “the willingness to take on risk/s and effort/s
to create positive changes in society through
initiatives”
• In other words, a social entrepreneur launches an
organization that is fundamentally about enacting
positive social change, not merely generating profits.
• The social change in question may pertain to
environmental conservation, racial justice, or
philanthropic activity in an underserved community.
 Key Characteristics of Social
Entrepreneurship
• Social entrepreneurship has emerged as business people
consider the effect their company has on the world,
beyond mere profits and losses.

• The primary factor that distinguishes social entrepreneurs

from the other types of entrepreneurs is their mission.
These entrepreneurs are focused on solving a problem
in their community or furthering some kind of social
change. Their objective goes beyond the bottom line.
 Key Characteristics of Social
Entrepreneurship
• Most examples of social entrepreneurship take a nonprofit
structure. Money that is generated is put toward
advancing the company’s mission and maintaining
necessary overhead but not necessarily toward
corporate growth or expansion.

• Social entrepreneurship often involves alternative forms of

fundraising, which may include grants, sponsorships,
or small-donor fundraising within the community.
 Notable Examples of Social
Entrepreneurship
• Shiza Shahid - founder of the Malala Fund
• Audrey Cheng - founder of Moringa School
• Jessica Schreiber - founder of FABSCRAP
In the Philippines...
➢Bantay Bata; Bantay Kalikasan
➢Bambike – hand-made bamboo bicycles
➢Anthill Fabric Gallery
➢Artwine – felt clothing and accessories
➢Bayani Brew – responsible iced tea
 Key Characteristics of Social
Entrepreneurship
• The World Economic Forum identifies social entrepreneurship as a powerful
way to apply market-driven approaches to address social problems.
➢ Challenges faced:
✓Innovation requires experimentation, but funding for social
entrepreneur projects focuses on results, so there’s little incentive to
pay for unproven approaches.
✓All enterprises require a steady flow of capital, but social entrepreneur
projects tend to provide investors with lower returns than other
opportunities.
✓Relations between social entrepreneurs and investors can become
strained by conflicting goals and a lack of financial
transparency.
 Additional Resources
• https://blog.hubspot.com/sales/social-entrepreneurship

• https://www.uschamber.com/co/good-company/growth-
studio/how-to-become-a-social-entrepreneur
References:
• https://onlinebusiness.northeastern.edu/blog/types-of-
entrepreneurship/

• https://www.redalyc.org/journal/4417/441762122012/html/