Lecture two entrepreneurship and small business management

1. Lecture two
By: Ryan

2. Entrepreneurial ventures
This is the second lecture which will contain different types of entrepreneurial ventures,
explanation on why different types of entrepreneurial ventures relate to the typology of
entrepreneurship, the similarities and differences between different types of
entrepreneurial ventures and the critical examination on the scope, development and
growth of the entrepreneurial ventures.

3. Private companies
A limited company will have its profit, losses, assets and liabilities belonging to the
company, this means that it will be owned by the members, shareholders and will be run
by the managing directors. This will create a limited liability which means that if the
company fails personal assets will be safe (Campbell and Craig, 2005). There are two
limited companies which is public and private limited companies.

4. Private limited companies
Private companies will not give their shares publicly, these shares are held by private
individuals which will most likely work for the company. For individuals which want to
get shares they need to ask for the shares to the shareholders directly (Campbell and Craig,
2005).
The objectives of a private limited company is Profit Maximization. For a private company
profits will be restricted to the companies core set of owners which may include a small
group of stakeholders. Another objective is picking the right organizational structure. This
is because picking the right type of organizational structure will provide different benefits
for the company and stakeholders (Bradley, n.d.).

5. Example of private limited company
An example of private limited company is PT Tirta Alam Semesta which produces
products such as Air Murni Rivero. They made Rivero due to the concern for public health
regarding the importance of pure water. They started producing this purified water in the
year 2007 by PT Tirta Universe. They are a private limited business due to them not
showing up in the stock market plus not having TBK in the name which means Terbuka.

6. Public limited companies
The public limited companies will have shares that can be bought by anyone unlike the
private limited company. The shares may be freely bought and sold through stock
exchange. Becoming a public limited company will overall increase investments
(Campbell and Craig, 2005).
The public limited companies will have objectives such as gaining more market share.
They are able to do this by getting media attention by being in the stock exchange. Another
objective of a public limited company is expansion of the business, this is because public
limited companies will be able to get the money needed to expand from selling shares.

7. Example of public limited company
An example for the public limited company is PT Acset Indonusa TBK. which is a
construction company. They focus on the development of commercial, residential and
industrial buildings. It was first established in the year 1995 by Ronnie Tan and Hilarius
Arwndhi. The reason that PT Acset Indonusa TBK is private limited is that they have
foreign direct investors which means that they are in the stock exchange (Indonesia
investments, n.d.).

8. Social enterprise
A social enterprise is a business which will focus on creating social value rather than
making value, there is also a hybrid social enterprises which will make profit and social
value. Some people see social entrepreneurship as an innovation which will have a social
impact towards the society. There are also some people which see social entrepreneurship
as tools for social transformation (Rostiani, Paramita, Audita, Virgosita, Budiarto and
Purnomo, 2014).
The objective of the company law to fulfill the role of public services such as improving
health care, environmental protection, alleviate poverty and many more (Legalvision,
2016).

9. Example of social enterprise
An example of a social enterprise in Indonesia is Smart Farmer Kids In Action & AgroEdu
Jampang which was established by Heni Sri Sundan, which is concerned about the
education of agriculture in Indonesia. They sell products to benefit migrant workers,
farmers and widows and manage Bogor Agroedu Tourism agro-tourism, and EmpowerIN
Academy agribusiness tour in Jampang. They stated that they are not non profit oriented
but benefit oriented (Youngster.id, 2016).

10. Size
Size will be divided into four which is micro, small, medium and large.

11. Micro
The micro business can be described as a business which has only one owner with a total
of up to five employees. There are lots of people which are starting their own micro
business, this is due to the upward mobility and flexibility that they provide. Micro
businesses are changing the dynamics of income, wealth creation and quality of life in
America.
The objectives of a micro business is to encourage the dispersal of industries to smaller
towns, villages or economically lagging regions. The objectives of a micro business is to
allow the backward areas to join in the national development (Sinha, n.d.).

12. Example of micro
The example for a micro business is Bakso Moro Abadi. They sell different products such
as bakso besar, bakso seporsi and pangsit, their main dish is bakso (UMKM kota Jogja,
2018).

13. Small
Small businesses will be independently owned and operated. They are not the best in their
field and usually do not have any new or innovative practices. Owners of a small-medium
business might prefer a stable and less aggressive approach when running their business,
this means that the owners have an expected amount of sales, profit and growth (Kuratko,
2016).
Small business objectives is to maintain profitability which is to make sure the revenue
will stay ahead of the costs. This is done by focusing on controlling the costs of production
and operation while maintaining the profit margin on the sold products. Another objective
is to grow which can be done by carefully using of company resource such as finances and

14. Example of small
An example of a small business in Indonesia is Nasi goreng Bu Sumi (UMKM kota Jogja,
2018). Nasi goreng Bu Sumi is a small business which produces different types of products
which includes fried rice and noodles. There are five different types of fried rice which are
nasi goreng babat, nasi goreng biasa, nasi goreng istimewa, nasi goreng uritan and nasi
rames ampela. For the noodles they have two different type which is bakmi godok
istimewa and bakmi goreng uritan.

15. Medium
Medium sized businesses will have up to 250 employees, they may be family owned and
managed businesses however, they may also be complex entities in which the ownership is
separated from management. These businesses will be well established and has an
observable track record (ACCA, n.d.).
An objective of a medium sized company is to promote customer loyalty. This is done by
listening to the customer and making it easy for customers to contact the business.
Another objective is to acquire new customers to the business, this can be done by
engaging with the customers and finding what type of social platform they prefer such as
whatsapp or instagram (SAP, n.d.)

16. Example of medium
An example of a medium sized company in Indonesia is Furniture Bp. Widadi which
produces and sells furniture. Some examples of their products are wardrobes, tables and
beds.

17. Large
A large business will be businesses which have a combined turnover of of greater than
$250 million. This includes public, private and foreign owned companies, partnership,
trusts and super funds (Australian government, n.d.).
The objectives of large companies will be to gain large profit from the sales. Another
objective is to increase the demand, this is due to large companies wanting to increase
sales (Accountlearning.com, n.d.)

18. Example of large
An example of a large company is Gudang Garam, which is a well known cigarette
company in Indonesia. It was first established in the year 1958 in the town of Kediri, East
Java. Gudang Garam is known both internationally and nationally as a producer of high
quality Kretek clove cigarettes. They have Rp 66,759,930 for their total assets in the year
2017 as stated in their annual report (Gudang Garam, n.d.).

19. Public corporate
Most of the public limited companies which provide the essential goods and services to
other businesses or directly to customers. These will include electricity, water, gas and
many more. This means that without the public enterprise there will be no essential goods
and services which might lead to the economy collapsing. These public enterprises will
have shared responsibilities with the governments (Bos D, 1986).
An objective of the public enterprise is to create sustainable enterprises. Since the
government owned enterprise will be in the forefront of sustainable enterprise they must
act in and exemplary way in the area. The other objective is economic growth, if a
government owned company will have the same economic demand on operations as other
organisations, there will be an increase in the competitiveness, value development and
capital efficiency. This will also reduce risk of distorted competition (Government offices
of Sweden, n.d.).

20. Example of public corporate
An example of a public corporate in Indonesia is bank Mandiri. It was first established in
the year 1998 as part of the bank restructuring program for the Government in Indonesia .
In 1999 it was able to merge four other state owned banks. These four banks had a history
of over 140 years and the four together contributed in the beginning of the Indonesian
banking sector (Bank Mandiri, n.d.).

21. Typology
This part will discuss about three different types of entrepreneurship which is corporate,
technical and social

22. Corporate entrepreneurship
Corporate entrepreneurship is a process used for developing new businesses, products,
services or processes in an existing company to create value and generate new revenue
growth by using entrepreneurial thought and action . Corporate entrepreneurship will set
the context for innovation and growth. Corporate entrepreneurship provides a system view
of resources, processes and environment which are needed for support, motivate and
engage the organizations entrepreneurial thinking and action (corporate entrepreneurship,
n.d.).

23. Examples of corporate entrepreneurship
Adobe is a good example for a corporate entrepreneurship. Since they provide a kickbox
which is an innovation workshop in a box which contains helpful guidelines and resources
for the employees so that that can develop and refine their innovative ideas. The box has a
purpose of inspiring the creativity in the individual employees and also to assist them
when developing their creativity into an innovative project (Niekerk, n.d.).

24. Technology entrepreneurship
Technology entrepreneurship is a driving force which facilitates prosperity in individuals,
firms, regions and nations. Thus the study of technology entrepreneurship will serve as an
important function beyond satisfying the intellectual curiosity. Technology
entrepreneurship is an investment to a project which assembles and deploys specialized
individuals and diverse assets which will be intricately connected to the advances in
scientific technological knowledge with the purpose of creating and capturing value for a
firm (Bailleti, 2012).

25. Example of technological
A good example for a technology entrepreneurship is tinder. A good example of
technology entrepreneurship is tinder. Tinder is an app which uses lots of new technology
to improve their product. A recent example is when Tinder is trying new features for their
product in India, which lets the women enter the first message when there is a match.
Unlike in the past where either of the two can send the first message. This is done because
Tinder wanted to make the women feel safe and comfortable when using the app (BBC
news, 2018).

26. Social entrepreneurship
The most basic definition for social entrepreneurship is doing a business for a social cause.
Social entrepreneurs will combine commerce and social issues in a way that will benefit
the people which are connected to the cause. Success is not measured in terms of profit
alone but also the way they have improved the world. (Shopify, n.d.).

27. Example of social
Safepoint trust is a good example for social entrepreneurship. They are a good example
because Safepoint trust redesigned medical tools to make them cheaper and reusable. One
example is the reusable syringe they made, they have been able to deliver four billion safe
injections in 40 countries with their auto-disable syringes (Orlic, 2016).

28. Relationship between entrepreneurial ventures and
typology

29. Similarities and differences
This part will talk about similarities and differences of the entrepreneurial ventures.

30. Similarities and Differences between Public limited,
private limited and social enterprise
The similarities of the three is that all of them will aim for profit from their business. The
main goal of public and private limited is for profit and even though social uses the profit
to improve their social impact they still need to get profit to do it. A difference between the
three is the amount of shares they have, public limited will be able to obtain lots of shares
while private limited will have shares only from friends and families and social enterprise
will only have little or no shares.

31. Similarities and Differences based on Sizes of
Entrepreneurship
One similarity for size is that all of them have the similar goal of trying to grow as a
company. This is because no matter the size a company will want to keep on growing. A
difference is that all the different sizes have different target markets. For example, a micro
business will target a small group of people while a large business will try to target a larger
group. Another difference is the amount of assets they will have, a large business will have
a lot of assets unlike a small or micro which will most likely have a little. This is due to
micro businesses having smaller market rather than a large business which will have lots.

32. Critical evaluation
This part will contain the growth of MSME and large businesses over the past years and
discuss about it.

33. 2012-2014
Indicator
2012 2013 2014
Amount Shares Amount Shares Amount Shares
MSME 55.206.444 99,99 56.534.592 99,99 57.895.721 99,99
Micro 54.559.969 98,82 55.856.176 98,79 57.189.393 98,77
Small 602.195 1,09 629.418 1,11 654.222 1,13
Medium 44.280 0,08 48.997 0,09 52.106 0,09
Large 4.952 0,01 4.968 0,01 5.066 0,01
Table 2 MSME and Large business
growth (Depkop, n.d.)

34. 2015-2017
Table 2 MSME and Large
business growth (Depkop, n.d.)
Indicator
2015 2016 2017
Amount Shares Amount Shares Amount Shares
MSME 59.262.772 99,99 61.651.17 99,99 62.922.617 99,99
Micro 58.521.987 98,74 60.863.578 98,71 62.106.900 98,70
Small 681.522 1,15 731.047 1,19 757.090 1,20
Medium 59.263 0,10 56.551 0,09 58.627 0,09
Large 4.987 0,01 5.370 0,01 5.460 0,01

35. Critical evaluation
The table shows the growth of MSMEs and Large businesses over five years. The MSME
growth from 2012-2017 was a large amount. There was a total increase of 7.716.172 of
MSME growth from 2012-2017. However, the large businesses did not increase as much,
they only increased by 508. The micro businesses had the most increase in the five years,
however the small businesses have been gaining more shares which may lead to further
increase in the market share to the future.

36. References
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