Entrepreneurship and Start-Ups

It is quite contrasting to the corporate world where the employees are trained to promote their leadership qualities so that they get fit with their ranks in the organisation, on the other side leadership development happens overnight in the start-up by the entrepreneurs. Entrepreneurs sometimes go without management knowledge, training and coaching to start the business. However, 90% of the technology-based start-up fails due to the lack of knowledge of the entrepreneurs (Scarborough 2016). The entrepreneurs who do not have the knowledge of business, does not have the right people on the management and they cannot use the solid business model or they do not have the right set of marketing strategies to run the business. The success of the start-up depends on a steady pivot on the self-sufficient knowledge of the business, delegating the tasks, managing the finance, leading the people and holding the post for the betterment of the organisation. Joining the big companies helps the entrepreneurs to set the mission and communicates with people to achieve the vision.

Success factors of new ventures

According to Gielnik et al. (2017), entrepreneur sets up the business aiming to make profit and start-up concept needs to involve with the service, product, process and new technology. The main reasons of the entrepreneurship are the controlling of the business, ambition to beginning something from scratches themselves and the financial opportunity to earn money. For a successful start-up, the entrepreneurs need to have good strategies for managing the human resource, controlling the management and having the right set of entrepreneurship skills. The ability to lead the successful firm may come of the entrepreneurial training from the parents or the broader business knowledge or the entrepreneurs have the prior start-up experience. As argued by Plummer et al. (2016), some of the entrepreneurs do not have the business knowledge or they do not belong to the management background; in this scenario, the entrepreneurs need to polish themselves how to tackle the business-related issues. As stated by Fernhaber et al. (2014), the success of the entrepreneurship venture depends on the human resources, including the team, the idea of the entrepreneurship as how the business is going to exploit the market opportunity and the resources which are very significant for the establishing the business to grow in the market.

Human resources and management: Success of the business venture depends on the team members selected by the entrepreneur. Human resources are the most important and entrepreneurs see the human resources as the investment for the future business potential. As commented by Klotz et al. (2014), lack of effective human resource management can lead to the start-up venture less productive and the human resources of the new venture need to have the crucial knowledge of the business along with right experiences.

Management knowledge: The entrepreneurs sometimes do not have the business and management knowledge or they do not have the right marketing strategies to exploit the gap in the market. Therefore, the training of the entrepreneurs in a big company provides the entrepreneurs with the knowledge of the management and experience to handle the employees. As opined by Fairlie et al. (2015), knowledge of management in the new startup can provide the entrepreneur’s efficiency and productivity. Knowledge regarding the management is related to the business plan, business model and team working qualities, market needs, capital requirement and the cost control of the organisation.

Human Resources and Management

Entrepreneurial skills: The success of the entrepreneurship venture depends on the skills of the entrepreneurs. Technology-based start-ups begin with the entrepreneurs’ dream to exploit the market with new products and services; however, the entrepreneurs can be completely novice in the market knowledge. Finding the gap in the market does not make the venture successful; the entrepreneurs need to reach the customers. The entrepreneurs should have the ability to manage the money, rise the funding of the business, to be productive and to be able to identify the strengths and weaknesses of the business. The training of the entrepreneurship helps the entrepreneurs to hire the right people for the start-up and to disseminate the funding in a proper way.

Big companies must have value of the consolidated gross assets and it must control $12.5 million or the more. In Australia, the company can control the more than 50 employees at the end of the year (Ge et al. 2017). The big companies follow an organisational structure as it can be vertical organisational structure or horizontal organisational structure. Most importantly, getting the academic education helps the entrepreneurs to sharpen the theoretical as well as practical knowledge of leadership (Yang et al. 2016). The entrepreneurs get the chance to work with the leaders in the big companies and they can develop their own set of leadership skills through which helps the entrepreneurs to exploit their success. Big companies also follow the certain specialisation in which field; the organisations can excel at its best. Finally, large companies improve in technological field as large companies have resources to boost the technological sphere. Entrepreneurs work in the big companies before starting their own venture and the main purpose of the training is to development programme which helps to widen the knowledge of the business and the hungry-entrepreneurship strategies. Entrepreneurial skills are not inborn as the entrepreneurs need to polish the skills by working in the big companies where they get the motivation and entrepreneurial skills. According to Gielnik et al. (2017), the entrepreneurs take the entrepreneurship development programme which assists the individuals to strengthen the entrepreneurial motive, capabilities and acquiring more skills and knowledge in the field of the business. Most importantly, big companies provide the training ground for the aspiring entrepreneurs so that the entrepreneurs can get the chance to make network and speak to the leaders of the large companies. Big companies take the hungry-start-up strategies so that the big companies can compete with the start-ups. The aspiring entrepreneurs get the idea of doing the business and in real-life how the business works. The entrepreneurs may belong from the different background and their academic career was associated with, unlike the business they are going to open. Yang et al. (2016) commented that it is very necessary to promote the understanding of the motives and their influences on the entrepreneurial values.

Each of the entrepreneurs may possess certain characteristics of the entrepreneurship. These traits are underlying and training of the entrepreneurship under the big companies help to bring out the result in superior performance. According to Venkatesh et al. (2017), ‘Kakinada Experiment’ stated that traditional belief does not seem to inhibit the entrepreneur and the suitable training method is necessary for the motivation of the entrepreneurs. In the big companies, the entrepreneurs learn to set the goals and the entrepreneurs will learn to create a working world through being in the big companies. In order to create the vision for the entrepreneurship venture, it is very much needed to make a series of short-term goals (Cohan 2012). By achieving the short-term goals, the entrepreneurs will be motivated and confident to achieve the final goal of owning the new venture. The big companies teach the entrepreneurs to pick the right market where they can find the gap to start their own venture. Picking the right market is necessary to be successful in the business with a right set of products and services. The third stage of entrepreneurship is to raise the capital for the business. Big companies help the entrepreneurs to make a network with the investors and the entrepreneurs can meet with the angel investors or the business investors to start their business. Big companies train the employees to work in a team and team bonding is very necessary to get the work done at the right time. Entrepreneurs learn the team working and they make clear about their values and passion (Cohan 2012). Handling the team members is the priority in doing the business where the entrepreneurs have to manage large numbers of staffs. In addition, big companies take the strategies to gain the share in the market and these strategies are prepared by the PR team or by the management. The entrepreneurs get the idea of gaining the share by promoting the business. The entrepreneurs can take the guerrilla marketing technique which can produce a lot of company buzz in the market. Finally, the training of the employees in the big companies helps the entrepreneurs to adopt the change. The new business venture has to adopt the change as the new company can fall into trouble where the entrepreneurs need to adopt the change to overshadow the competitors (Nasr and Boujelbene 2014).  

Management Knowledge

Figure 1: Training of the entrepreneurs in big companies

(Source: Fairlie et al. 2015)

There is a misconception that good academic career is not needed for the entrepreneurial success. The examples of successful entrepreneurs can be Steve Jobs, Mark Zuckerberg and Bill Gates and all three entrepreneurs were not successful in the academic lives. However, as published in the article by Safin et al. (2016), 90% of the US-based tech companies, founders have the bachelor degree and MBAs get the better opportunity to start the business. However, the critics think that college education is not necessary for the start-up success; however, the alternative education is worth considering. The entrepreneurs need to have the good background in which field they are going to start the business. The educational programmes need to make able the entrepreneurs to get the skills and provide the resources to have the experience. In addition, after finishing the study, the entrepreneurs join the traditional firms and where they can create the networking with other passionate employees. Educational programmes of the employees offer the great place to learn something practical as well as theoretical skills (Covin and Miller 2014). Business education is important and the training of the entrepreneurs in the big companies provides access to the valuable relationships. The big companies help the entrepreneurs to connect with the real-life start-up resources and the entrepreneurs can get the education of start-up concept. The University of Missouri in the US allows the students to glean the industry knows where the students can get the idea of entrepreneurship at the university level. The students can get the benefits of mentorship from the entrepreneurs alongside getting the offer apprenticeship. Training in the big companies educates the entrepreneurs to grow the ability to work with the individuals of various backgrounds (Van Doom et al. 2017). Nasr and Boujelbene (2014) supported this by saying that training always provides the best education with both theoretical and practical knowledge of the relevant field. The entrepreneurs get to know the key to creating a positive environment when they will start the new venture.

Opportunist model of entrepreneurship states that entrepreneurs need to trust the corporate culture and the entrepreneurs can experiment on the diverse social network. In the opportunist model of entrepreneurs, the team members of the entrepreneurs must say ‘yes’ to the concept, otherwise, the business venture will not get the funding (Jiang et al. 2018). Emerging concept of the business entrepreneurship is feasible for the innovator and opportunist model should be followed in the bog companies where senior-level sponsorship helps the entrepreneurs in corporate entrepreneurship.

Coaching: Most of the entrepreneurs follow a mentor or their mentor’s coaching style to develop the leadership skills and management. In big companies, the leaders can coach the entrepreneurs to help them achieve and set the goals through difficult business related issues. Entrepreneurship training increases the potential activities of the entrepreneurs and it improves the maximum attainable level. In addition, the training process can improve the efficiency of the entrepreneurs and new techniques can be adopted in the training during working time in big companies. In addition, the objective of the training of an entrepreneur is to impart the idea of the marketing of the products and services and to broaden the vision of the entrepreneur through providing suitable opportunity.

Entrepreneurial Skills

Adaptability: Adaptability personality of the entrepreneurs can help to determine in responding the change of the business. High adaptability leads to business success and the entrepreneurs need to be more flexible. Adaptability nature is taught in big companies so that the employees can be more valuable for the companies. Adaptability leads the employees to be happier and the entrepreneurs can able to handle the career transition. As opined by Cuerrero et al. (2016), the main objective of the entrepreneur training is to expose the entrepreneurs to the latest development in the market and to build the skills around the new entrepreneurs. According to Lafontaine and Shaw (2016), some of the educational institutes are thinking to start the entrepreneurship as part of the education syllabus.

Problem solving: In entrepreneurship journey, the entrepreneurs face many problems. In order to solve the issues of the new venture, the entrepreneurs solve the problems that benefit the society, engaging the employees, being profitable and emotionally rewarding (Zhu et al. 2016). On the other side, as pointed out by Keith et al. (2016), training programme can provide constant motivation to boost up the confidence of the entrepreneurs where the ultimate focus is to be on the sustained growth rather than on the bubble.

Advocate model of entrepreneurship is another concept when the companies evolve in supporting the corporate entrepreneurship opportunistically and organisation assigns ownership for driving the establishment of the new business to a designed-corporate level group. As stated by Wales (2016), advocate companies play the role of innovation expert or the evangelists which facilitate the corporate entrepreneurship in conjunction with the business unit where the business can demonstrate the commitment. The primary objective of the advocate model is to come round the resistance of the business units in adopting the immature business idea (Ge et al. 2016).  

In the case of new ventures, different strategies are needed. Business life cycle faces some challenges and those challenges strengthen the base of the entrepreneurship. There are basically five stages that have to surface by a new venture and each stage has the justification of its own. The first phase is the development stage. As stated by Salamzadeh and Kawamorita Kesim (2015) the brilliant idea at the initial level helps to smoothen the path of the business. The start-up determination of the entrepreneur is tested in this stage. There are some feedbacks from family, colleagues and friends to evaluate the process but the real power persists in the thinking. On the contrary, Fisher, Kotha and Lahiri (2016) stated some challenges, in that case, may come in this business process. Business idea profitability and market acceptance of the business is significant in that case. The product need to be accepted in the market else the objective of the business will not meet. At the initial level, the legitimate business structure is important for the future handling of business. The management in accounting is important as the business has just started in that scenario.

Figure 2: Stages of new venture lifecycle

Role of Big Companies in Developing Entrepreneurial Skills

(Source: Fisher et al. 2017)

At the second stage of start-up, legal processes are maintained. The initial feedback from the customers is taken through the marketing and selling of the product. The profitability in such cases is low (Fisher et al. 2017). The objective, in that case, is the penetration process that product will be tried to hit the market. If the product fulfils customers’ expectation, then the business is on the right stage. On the other hand, Fisher, Kotha and Lahiri (2016) mentioned about some cash reserves and managing sales expectation is the major challenge that encounters in that stage. Customer base maintenance and establish a market presence for the venture are the challenges at this stage.  

Business growth and survival stage is a new phase that adds some new customers. Recurring revenue generation and open up new business opportunities is the prime aspect for that stage and business methodologies to use this business for the long-term process in the market is the major reason in that stage (Gabrielsson and Gabrielsson 2013). There are some challenges as well as effective management procedures for the business is important in that case. The venture will face some market competition as well and they have to deal with the increasing base of customers. 

The rapid growth stage is the next stage and business will spread and expand in that stage. The larger market share will be gained in that process and successful business capitalizing with different distribution channel is the major aspect in that stage (Klotz et al. 2014). The challenges like penetrating the new business market are the key challenge in that stage. Ventures sometimes add new products or services, which can be considered as the new challenges as well.

The fifth stage is the maturity stage where the business will try to maintain their sustainable growth in the market. This is the stage where the entrepreneur realise the business growth rate is as earlier. So planning for the exit strategy is the key matter in that case. The challenges like increasing market competition and moving to the new market are the challenges that make the business feeble (Fisher, Kotha and Lahiri 2016). Without a good exit strategy, strategy business may encounter a severe problem.

All these stages ensure better business positioning and provide better decision before penetrating in the business market. Five stages allow the entrepreneur to think about the business decisions and make some delivering engagement with market and customers.

Conclusions

Therefore, it can be concluded that entrepreneurship training in big companies helps the entrepreneurs to get the idea of real-life business. Before joining the big companies for the training programme, the entrepreneurs should have the mission and which must be compelling to achieve the greatness. The entrepreneurs should have long-term goals to describe the tangible way to measure the success of the business venture. In addition, entrepreneurs deliver the promise through short-term goals, like the business model, funding and the marketing strategy for the new venture. However, start-ups failure is a common concern and the reasons behind the failure of the start-ups is the lack of deep passion, the entrepreneurs may prefer to work behind the people and the entrepreneurs can think that it is not needed to talk to the customers. The students who have the desire to start their own business will get the opportunity to brush up the business acumen and they can get the chance to learn from the bigger companies the actual trick to adopt and scale up the new business strategies. The big companies will be able to make the entrepreneurs involved in the entrepreneurship process on a personal level like connecting the investors, mentorship and validation of the business concept. During the working period within big companies, the entrepreneurs can provide respectful and direct feedback to the leaders. In their own business, the entrepreneurs need to learn to deal with the experienced employees. Educational programme and training for the entrepreneurs offer the opportunity to work with the various personalities on projects and it also provides an opportunity to interact with people from different cultures.

Conclusion

Some of the entrepreneurs do not have the previous business knowledge or they just stuck with the idea of new business without having any prior experience of working. The entrepreneurs sometimes turn their hobbies into the business venture and it is the perfect thing to do as it provides an opportunity for the entrepreneurs to do the work which they like. Joining the training programme gives them the opportunity to grab the education of doing business and making a relationship with other people so that the entrepreneurs can meet the business objectives.

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