Entrepreneurial Ventures

1. Entrepreneurial
Ventures
Authored By: Vierri Christian
Submitted to: Johan Jang

2. Public Limited Company
According to Fisher, Houghton, and Jain (2014, Pg.48), a public limited company is a company that has limited
liabilities. It is often a large company as the shareholders can sell their shares to the public. Unlike private
companies, the owners of the public limited companies bear the responsibility for its debts instead of the
shareholders (Sisk. 2018).
The objectives and role of a public limited company is to attract new investors to buy some of the shares their
company, so that the company could expand their capital. As a public limited company could sell their shares to
the public, it would be easier for them to convince people to buy their shares (Sisk, 2018). An example of public
limited company is PT. Astra International Tbk & PT. Unilever Indonesia Tbk as stated by IDN Financials
(n.d.)

3. Private Limited Company
A private limited company is a organisation that is usually created by a sole trader or partnership. These
companies are run by shareholders with limited liability, which means that the business debts are beared by the
shareholders, not the owner. Private companies are not allowed to sell their shares to the public. These types of
organisation are usually run by friends and/or families. The payments made between the shareholders are
divided by dividends, depending on the capital invested to the company (Fisher, Houghton, and Jain, 2014,
p.48).
The role of a private company is to make profit and less debts, so that their shareholders would receive a better
dividend.Whereas, a private company’s objective is to survive in the market as there are many competitors in
the market, this is done by increasing the sales of the business’ products, and by doing so, it accesses them to
have a larger market share (BBC, n.d.). One example of private limited company in Indonesia is Turner
International Indonesia LLC (Steel Indonesia, n.d.)

4. Social Enterprise
A social enterprise is a business created by usually independent groups of people who uses the public subsidies
to create them, however, they manage the business themselves without any help by the public authorities. Social
enterprises are created to benefit the community, helping out people and childrens who are poor and in need
(Defourny & Nyssens, 2006, p.22-23).
Social enterprise has an objective of delivering the profits made by the business to charities or non profit
organisations, to help achieve social objectives instead of delivering them to shareholders or owners. One way
they do this is by reinvesting to their own business for each profit they make to create a larger business which
would lead to better profit, and would then expand their social goals even bigger. (centre for social enterprise,
n.d.). An example of social enterprise in Indonesia is WeCare.id, a fundraising company who helps the people
of Indonesia into receiving a better healthcare. (WeCare.id, n.d.)

5. Entrepreneurial Ventures
Based on Size

6. Micro Business
Micro businesses are business which are usually run by a sole trader, with no more than five workers. A micro
business could create anything based on the skills and passion of the owner, which enables greater flexibility
and mobility for the business (SBB, n.d.). Micro businesses in Indonesia usually do not have any business
permit or any legal permit like NPWP, and the types of products they sell are inconsistent, or changing
constantly. Their selling locations are mostly found in sidewalks or below an office (Indonesia B, 2015, p.25).
The objectives of a micro business would be to reduce unemployment in the country and to create a big profit
with low investment and risks. While the role of micro business would be to boost the economy’s low income
per capita and poverty (SBB, n.d.). An example of micro business in Indonesia is Bakso Tito, a food shop
selling Meatballs in a soup (Bakso) (UMKM Kota Jogja, 2018).

7. Small Business
A small business is a business which are run by either sole traders or partnerships, and it could have up to 1500
employees. Unlike the micro business, a Small business has the required business permit and every legal permit
needed to create a business, and the owner of the business usually has some personal experience beforehand.
However, he/she might not have implemented any business planning for the running of the business (Formoso,
2017).
The objectives of a business is usually measured, therefore, for a small business it would be to maximize profit,
and increase growth in the market up to the point where the owner(s) are comfortable, as going higher might
risk the chance of having more competitors (Pietroluongo, 2017). Additionally, the role of a small business is to
sustain a healthy economy of the country as in most countries, most types of businesses are small sized. An
example of a small business is Pempek Bu Ratna, selling processed food pempek (UMKM Kota Jogja, 2018).

8. Medium Business
A medium business would already have a good management and organisation with equal responsibilities, salary,
and production in the business. The workers working in the business would also have training of their specific
roles beforehand. While the expense of the business would not be too worried about as it has gained the bank’s
trust, so they could ask for help to extend the budget of the business (Indonesia B, 2015, p.25).
The objective of a medium business is to maximize profit, increase market share, and also growth. However, a
medium business would want to expand more and have their growth increase by a milestone, taking over their
competitors in the market (Homework & study skills center, 2017). The role of a medium business would be to
help the economic development in the country such as the rate of employments, increase in production, and
increase in gross domestic product (GDP) (Hashi, 2017). An example of Medium Business in Indonesia is SB
Aluminium, a business focusing on ingot making (UMKM Kota Jogja, 2018).

9. Large Business
Large business are businesses that are in good managing and treats their employees equally. Large businesses
also has better sales and greater net worth than medium sized businesses, like having their own private property,
or joint ventures with other well known companies. A large business would usually have a business connection
to other countries which helps carry out economic activities in the country (Indonesia B, 2015, p.25).
The role of a large business is to deliver their products to a large market with a large scale of production, so that
their objectives which is to have great economic power, obtain the monopoly status in the market, and have long
term profitability become achievable for the business (Account learning, n.d.).
An example of large business in Indonesia is PT. Indofood Sukses Makmur Tbk, a company based in consumer
branded products like noodles, dairy foods, snacks, food seasonings, and many more (Indofood, n.d.). As of
2017, Indofood’s net sales are Rp.70,186,600,000 billion (Indofood, 2017), and the minimum sales for a large
company in Indonesia is above Rp.10,000,000,000 billion (Indonesia B, 2015, p.26).

10. Entrepreneurial Ventures
based on Ownership

11. Public Corporation
Public Company is a organization which started as a private company, but later on bought by the government.
The corporation is run by the Board of Directors and employees with the government only interfering by setting
objectives for the business. The role of a public company is to supply the goods or services to the citizens and it
would not be charged much and sometimes it could even be free of charge. On the other hand, the objective is to
help balance the economy of the country based on the salary of the society (Fisher, Houghton, and Jain, 2014,
p.55).
Most public companies have a large number of investors holding its stock, and the value of the business is
determined by daily trading within the company. A public company is also required to publish its annual reports
to the public and reveal the activities and finance of the business (Fisher, Houghton, and Jain, 2014, p.55).

12. Private Corporation
A private corporation is usually a business created by a small number of people, mostly leading it to family
business. The requirements needed to operate a private corporation is no different than any other corporation,
filing paperworks to government, creating a business name and legal permits. Private corporations stocks are
not available for the public, however, they could sell their stocks to an individual who may be interested in the
company. Unlike public corporation, private corporations do not require shareholders approval to make any
business decisions, and shareholders also have no access to the account books of the private corporation unless
it was approved in the shareholders agreement (Howell, n.d.).

13. Typologies of
Entrepreneurship

14. Corporate Entrepreneurship
Corporate entrepreneurship is a process used in a existing organisation to develop new products, services, or
processes, which creates the value of the organisation and possibly generate new revenue growth created by a
entrepreneur’s point of view. However, corporate entrepreneurship is still difficult to achieve as it could be said
that it does not fully follow the traditional practices of doing business (corporate entrepreneurs, n.d.).
One example of corporate entrepreneurship is Adobe. After Adobe has changed to a cloud-based subscription
model, the company had asked Mark Randall, a serial entrepreneur, had developed a new innovation for Adobe
which is Kickbox (Innov8rs, 2017).

15. Technical Entrepreneurship
Technical Entrepreneurship could be defined as entrepreneurs that are specialized in the technology field, which
started with a couple of physicists establishing a business venture to create a business with a technical field.
This shows that entrepreneurs who specializes in physics could open up a technology based business (Evans,
1992, p.27). A technological business generally focuses on research & development and obtaining new
technical knowledge of technologies, which is usually run down by scientists and engineers (Evans, 1992,
Quoted by Cooper, 1971, p.27).
One example of technical entrepreneurship is Toyota Motor Co. the founder Kiichiro Toyoda is a car inventor
that has invented many types of cars throughout the years, and is now known as the world’s largest automaker.
He had a background of textile machinery inherited by his father Sakichi Toyoda (History, n.d.).

16. Social Entrepreneurship
Social Entrepreneurship are businesses that try to contribute to the society either as a for-profit or non-profit
organisation. Social enterprises focuses on innovation of creating new products or services, production and
distribution methods, or new organisational models that generally leads to contributing to the society (Schwab
foundation, n.d.).
Not all social enterprises are non-profit organisations, there are also for-profit organisations and hybrid social
enterprise (non-profit, however, still collects cost from the sales of their products) which has goals to solve
social problems (Schwab foundation, n.d.).
One example of social entrepreneurship is The Big Foundation, established by John Bird and gordon Rick. the
Big Foundation has a goal of getting rid of poverty, offering employment opportunities to the society. The Big
Foundation has also helped over 92,000 vendors to earn sustainable profit (The Big Issue, n.d.).

17. Similarities and Differences between
Entrepreneurial Ventures
According to Business Structure
There holds a number of similarities and differences between the Entrepreneurial ventures which are Public,
Private, and Social Enterprise. One of the similarities is that all these enterprises help to increase employment
and career growth in the society as there are cases of high rate of unemployment in both developing and
under-developing countries. Another similarity is that all of these enterprises have a goal of attracting their
customers to purchase their products, so that they would gain better profit each year.
However, the difference of these three enterprises is that they have different sizes. Most of the public companies
are committed to large sized companies, while private and social enterprises are generally in a form of Micro,
Small, or Medium (MSME) business. Another difference is that the public company lists its shares to the public
to enable other shareholders to invest in their company, while private companies do not list their shares to the
public, and that their shareholders are either family or friends.

18. Similarities and Differences between
Entrepreneurial Ventures
According to Typologies
The types of typologies which are listed above are Corporate, Technical, and Social Entrepreneurship. One of
the similarities between these typologies are that all of these leads to one motive which is to innovation. By
creating a better product, service, production or distribution, they could motivate and also support the
organisation and environment around them.
However, the differences is that the Social entrepreneurship enterprise generally use its innovations to help the
society, by hosting charity events, creating better education, healthcare, and employments. Social enterprises
can also run in for-profit, non-profit, or both at the same time, unlike the Corporate and Technical Entreprises.

19. Similarities and Differences between
Entrepreneurial Ventures
According to Size
The similarities of micro, small, medium, and large business is that all the businesses contribute to the society,
like increasing the number of employment, increase growth in economy, and also profitable.
The differences of micro, small, medium, and large business is that each of them has a different type of
qualified workers. For micro and small business, their employees has a little or no skills of a specific role, while
for medium and large business, the employees usually has training for the specific job they have been given.
Another difference is that the assets and sales of different sizes varies.

20. Relation of Typologies to
Entrepreneurial Ventures

21. Corporate Entrepreneurship in Large
Companies
Most Corporate Entrepreneurships are applied in large companies. This is because implementing corporate
entrepreneurship in a large company would benefit the organisation to prevent them from getting lack of
innovation as most large businesses tend to stick to their established structures. With the constant changing in
the environment, innovation would be the key for a business to strive (Basso and Alain, 2010).

22. Technical Entrepreneurship in Small
Companies
Cooper (1986, p.29) states that most technical firms are based on small businesses, created by several
entrepreneurs who are an expert of science and/or engineering. The reason it only stays a small business is that
the entrepreneurs have a well defined form of entrepreneurship, and are all of high degree education, which
makes it better for the entrepreneurs to create new technologies or products in a smaller environment.

23. Social Entrepreneurship in Social Enterprise
Social enterprises are open to feedbacks from the community to improve the contribution for the society, and
most social entrepreneurs are motivated and passionate of their mission, and some even quit their profit making
business just to work for a purpose of helping the environment close to them. Not all social enterprises are
non-profit organisations, there are also for-profit organisations and hybrid social enterprise (non-profit,
however, still collects cost from the sales of their products), however, similar to the concept of social
entrepreneurship, both have the goals to solve social problems, which made social entrepreneurship suitable for
social enterprises (Schwab foundation, n.d.).

24. Critical Evaluation on Scope,
Growth and Development of
Entrepreneurial Ventures

25. Growth of UMKM and Large Business in
Indonesia 2012-2017 (Kementerian Koperasi
Dan Usaha Kecil dan Menengah Republik
Indonesia, n.d.)
Unit
2012 2013 2014 2015
Amount Share (%) Amount Share (%) Amount Share (%) Amount Share (%)
UMKM or SMEs
Business
Units 55,206,444 99.99 56,534,592 99.99 57,895,721 99.99 59,262,772 99.99
Micro Enterprise Units 54,559,969 98.82 55,856,176 98.79 57,189,393 98.77 58,521,987 98.74
Small Enterprise Units 602,195 1.09 629,418 1.11 654,222 1.13 681,522 1.15
Medium Enterprise Units 44,280 0.08 48,997 0.09 52,106 0.09 59,263 0.1
Large Enterprise Units 4,952 0.01 4,968 0.01 5,066 0.01 4,987 0.01

26. Growth of UMKM and Large Business in
Indonesia 2012-2017 (Kementerian Koperasi
Dan Usaha Kecil dan Menengah Republik
Indonesia, n.d.)
Unit
2016 2017 2012-2017 Growth
Amount Share (%) Amount Share (%) Amount Share (%)
UMKM or SMEs Business Units 61,651,177 99.99 62,922,617 99.99 7,716,173 13.98
Micro Enterprise Units 60,863,578 98.71 62,106,900 98.7 7,546,931 13.83
Small Enterprise Units 731,047 1.19 757,090 1.2 154,895 25.72
Medium Enterprise Units 56,551 0.09 58,627 0.09 14,347 32.4
Large Enterprise Units 5,370 0.01 5,460 0.01 508 10.26

27. Scope
As shown in the table above, Micro, Small, and Medium Enterprises (MSME) has an important role in building
the economy of Indonesia. It is said to dominate 99,99% of businesses in Indonesia since 2012, with most of
them being micro businesses, which leaves Large businesses to contributing 1% to the economy of Indonesia.
However, it is said by Tribun Bisnis (2016) that most MSME businesses in Indonesia are scared of growth in
their business, and that they rather stay as a micro or small business due to them not wanting to pay bigger tax
prices. Some of the small businesses in Indonesia are sole traders who use their own personal money to create
the business, which makes them short of capital. According to Indonesia B (2015, p.26), Most of the MSME
businesses are also depending on their customers order, and not from their own product designs, which proves
that the products they sell only being standard, which would not create enough profit for them to expand their
business. In the end, If MSME businesses in Indonesia continues to not improve and stay the same like it is
now, then it would be hard for the small businesses to move up the size of the business.

28. Growth and Development
As shown in table 2 above, the growth of the MSME businesses increases year by year, especially in micro
enterprises. It is shown that in 2012, the total of MSME businesses in Indonesia is 55,206,444 units, and in 2017
the data shows that the total MSME businesses in Indonesia is 62,922,617 units. It shows that there are a total
increase of 7,716,173 units in these five years, with a consistent market share throughout the years. Compared
to all the Micro, Small, and Medium enterprises in Indonesia, the large enterprise has only increased by 508
units throughout the five years from 4,952 in 2012, to 5,460 in 2017, and has the same market share throughout
the years. This shows that most of the MSME businesses have not been expanding their businesses to either
medium or large sized business.

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