Submitted by: Submitted by lazovskaia
Views: 496
Words: 2287
Pages: 10
Category: Business and Industry
Date Submitted: 02/07/2012 04:12 AM
Why do such a large proportion of founding entrepreneurs fail to grow their businesses? And what does the literature and evidence tell us about entrepreneurs who are able to achieve fast-growth? Explain and summarise the main reasons why such a large proportion of nascent firms fail to grow and what defines entrepreneurs who are able to grow quickly?
Introduction
Entrepreneurs are often regarded as founders of enterprises and owner-managers of both small and medium-sized businesses. They are the originators of viable ideas out of which new businesses come into being. It is sad, however, that a large proportion of nascent firms fail to grow even after entrepreneurs spend too many resources to start up these enterprises. Some entrepreneurs are always keen on persisting even when their start-up businesses are recording sub-standard performance. For others, especially those with a low propensity for entrepreneurial behavior, the first major setback is enough to make them abandon the nascent business.
Meanwhile, not all success factors in entrepreneurship are fundamentally person-based; they may also be situational. The availability of human, financial, and social capital plays a key role in determining whether nascent businesses will continue recording long-term growth. This paper explores the reasons why many nascent entrepreneurs fail to grow their businesses. It also assesses the need for high quality entrepreneurship, the role of management strategies and characteristics of the economy in determining the level of success of start-up businesses.
Entrepreneurship Theories
People who engage in entrepreneurial behavior must have the propensity for taking risks. In order to be able to take risks, they need to act in a competitively aggressive manner, while maintaining a proactive stance all along. They also have to rely on extensive and frequent product innovation.
One of the most common theoretical perspectives for explaining...