Starup and

Entrepreneurs
hip:
23rd February 2023
By-Srinivaas Venkatasubramanian

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 TABLE OF CONTEXT

Introduction:-Overview about the topic……….………………………………………………………………………..….3

Small Business among Communities & Economies…………………………………………………………………….3

Capital Investment and their role………………………………………………………………………………………………4

Does Social Capital Really matters to a startup?............................................................................4

Success and failure in startups and entrepreneurship………………………………………………………………5

Conclusion…………………………………………………………………………………………………………………………..……5

Reference…………………………………………………………………………………………………………………………………6

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Introduction:- Overview about the topic:
Does every new ventures end up successful and what kind of Impact it has on the society?

First of all what determines a new ventures is said to be a failure or a success: Lack of need for the
new market and the kind of impact that the product creates in the current market and how it
happens to attract the right audience. And a new venture failure or success depends upon the time
and geographic location that they start at. Lets see how actually an entrepreneur tend to start or
come up with a new business venture or an idea. Firstly, the entrepreneur tends to keep their
knowledge up to date and they keep on searching for an opportunity in the society to find what the
environment is lacking says Cohens, Bingham and Hallen(2017). They tend to have a thinking of
bringing or creating a change not just launching and increasing their market and net worth.
Entrepreneurs identify a problem in the market and come up with a solution that meets the needs of
their target audience. They keep an eye on industry trends and new technologies, and look for
opportunities to innovate and improve on existing products or services. They identify a need or
problem in their own life and find a way to turn it into a business opportunity. They engage in
brainstorming sessions with their team, friends, or family to generate new ideas and get different
perspectives. They network with other entrepreneurs and industry experts to exchange ideas and
learn about new opportunities. They look to other industries for inspiration and ideas that can be
adapted to their field. Ultimately, the best way for an entrepreneur to come up with a successful
business idea is to stay curious, be open to new experiences, and actively seek out opportunities to
learn and grow. And more effectively in the last two decades the growth of small business venture are
better than the large corporates. And entrepreneurship isn’t all about creating a change but it also
creates more rivalry and creating competitions between ventures.

Because of such ventures most of the countries from Asia had an tremendous economic growth as
well as institutional development in the past few decades.

Small Business among Communities & Economies:

Small business ventures do have a positive impact on communities and economies. The key benefits
of small businesses includes: Small businesses are a major source of employment, providing jobs for
local residents and helping to reduce unemployment rates says Reddy(2007) . Small businesses can
drive economic growth by creating new products, services, and markets, and by generating revenue
and profits that are reinvested in the local economy. It can increase competition in markets, leading to
lower prices, improved products, and better customer service. This kind of businesses foster
entrepreneurship and innovation, encouraging individuals to start their own businesses and pursue
their passions. It contribute to the development of local communities by providing goods and
services, supporting community organizations, and participating in local events and initiatives. The
small ventures tend to diversify the economy by providing a range of goods and services, reducing the
dependence on a single industry or sector. It also helps to preserve local cultures by providing goods
and services that reflect the unique character and history of the community. So far as per my
understanding from the research the small business ventures can have a great and positive impact on
communities and economies. They play an important role in promoting economic growth Says
Leonidou (2004), job creation, and entrepreneurial spirit, and they contribute to the social, cultural,

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and economic fabric of communities.

Capital Investment and their role:

For creating a new business model it takes more than just resource for the start-up and its founder.
The capital investment plays a major role in the entrepreneurial process and for it to reach the market
and to be successful. Most of the business venture are said to have a good market but yet failed due
to lack of funds. Funding is a critical component of starting and growing a business says
Forrester(1968). Without sufficient funds, it can be difficult to develop and market products or
services, hire employees, and secure a physical location, among other things. The importance of
funding in a business venture can be summarized: Businesses need funds to cover their operating
expenses, such as rent, salaries, and materials. Without sufficient funds, a business may struggle to
pay its bills and keep its doors open. Funding can also be used to invest in growth, such as expanding
the product line, increasing marketing efforts, or opening new locations. This investment is crucial for
businesses looking to scale and increase their reach. Offering competitive salaries and benefits can
help businesses attract and retain top talent, but it requires sufficient funds to do so. Securing funding
from outside sources, such as investors or lenders, can help businesses build credibility and
legitimacy, making it easier to secure additional funding in the future. Some businesses, particularly
those in regulated industries, may be required by law to meet certain financial benchmarks in order to
operate. From the perspective we can conclude that the funding plays a crucial role in the success of a
business venture. Entrepreneurs should carefully consider their funding options and develop a
comprehensive plan to secure the funds they need to start and grow their business.

Does Social Capital Really matters to a startup?

Social capital also plays a major role in a company’s growth. Social capital is all about the relation
between the venture and the people live in that geopathic location and building links in a way to
develop the company says Bandera and Thomas (2018). Social capital refers to the networks,
norms, and trust that facilitate cooperation and coordination among individuals and organizations.

Research has shown that social capital can have a significant impact on business models and
entrepreneurship.

Social capital can enhance the network effects of a business model, increasing the value of a product
or service as more people use it. For example, social media platforms like Facebook and LinkedIn
leverage network effects to create value for their users says Khajehan(2012) . Entrepreneurs with
strong social capital networks may have easier access to valuable resources such as funding,
mentorship, and industry contacts . Trust and reputation are important components of social capital,
and they can impact the success of a business model by influencing consumer behavior and attracting
customers. Social capital can also facilitate collaboration and innovation, as individuals and
organizations are more likely to work together when there is a high level of trust and cooperation.
However, it's worth noting that social capital can also have negative effects on business models. For
example, tight-knit networks can limit the flow of information and limit the diversity of perspectives
and ideas. Additionally, a strong reputation can be a double-edged sword, as companies may feel
pressure to maintain their image and avoid taking risks. The impact of social capital on business

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models is complex and context-dependent. Entrepreneurs should consider the potential benefits and
drawbacks of social capital in their specific business context and strive to build and maintain strong
networks, norms, and trust.

Success and failure in startups and entrepreneurship:

Success and failure in startups and entrepreneurship is a topic of ongoing debate and discussion in the
business world.

Successful entrepreneurs often have a clear vision and strong leadership skills, enabling them to
effectively manage their team and achieve their goals says Duchesneau, Gartner (1990). Startups
that offer innovative products or services have a higher chance of success, as they can differentiate
themselves from the competition and appeal to customers. Entrepreneurs who create comprehensive
business plans and execute them effectively are more likely to achieve success. Building a strong
network of industry contacts and forming strategic partnerships can help entrepreneurs overcome
challenges and increase their chances of success.

On the other hand, Failing to thoroughly research the target market and assess the demand for a
product or service can lead to failure. Running out of money is a common cause of startup failure, as
entrepreneurs may underestimate the cost of starting and running a business. Ineffective leadership
and management can lead to miscommunication, disorganization, and ultimately, the failure of a
startup. Entrepreneurs who attempt to do too much too soon, or who spread themselves too thin,
may struggle to achieve success says Cantamessa, Gatteschi, Perboli and Rosano(2018). It is
important to note that success and failure in startups and entrepreneurship are not always
predictable, and that many factors can impact the outcome.

Conclusion:
Entrepreneurs play a crucial role in driving economic growth and development. They bring innovative
ideas and products to market, create jobs, and contribute to the overall well-being of society. They
also foster competition, leading to better products, services and prices for consumers. Through their
risk-taking and resourcefulness, entrepreneurs can help spur economic growth and lead to
advancements in technology, products and services. Additionally, they can create new industries,
bring fresh perspectives to existing ones, and improve overall efficiency in the marketplace. In short,
entrepreneurs have a significant and positive impact on the economy and society.

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References:
Alexy, O.T., Block, J.H., Sandner, P. et al. Social capital of venture capitalists and start-up
funding. Small Bus Econ 39, 835–851 (2012)
Schlichte, F., Junge, S. & Mammen, J. Being at the right place at the right time: does the timing
within technology waves determine new venture success?. J Bus Econ 89, 995–1021 (2019).
Khan, A. M. (1986). Entrepreneur characteristics and the prediction of new venture
success. Omega, 14(5), 365-372
Adomako, S., Opoku, R. A., & Frimpong, K. (2018). Entrepreneurs' improvisational behavior and
new venture performance: Firm-level and institutional contingencies. Journal of Business
Research, 83, 10-18.
Hallen, B. L., Bingham, C. B., & Cohen, S. (2014). Do accelerators accelerate? A study of venture
accelerators as a path to success?. In Academy of management proceedings (Vol. 2014, No. 1, p.
12955). Briarcliff Manor, NY 10510: Academy of Management.

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