Growth is a risky but necessary task for startups to survive. Growth may be assessed in the context of employees, customers, revenue, liquidity, profit, geographic locations, and a variety of other dimensions. Regardless of the growth type, hurdles always exist. An entrepreneur who understands the risks, and knowingly takes them, will have a chance to grow; whereas one who is not willing to take risks will not.
Growth helps startups to establish legitimacy, creating new options to grow. Larger companies are statistically less likely to fail given the amount of resources they have. This is why larger companies have more potential investors and customers. It is during and right after a period of growth that companies find it easiest to acquire investment capital. Companies which are perceived as having crossed their initial startup hurdles are seen as being stable. Normally, with size comes an increase in profitability and liquidity for the company. This gives it history, which partners and investors are more willing to trust. Assets and finances will thus become more attainable than they were before. With growth, the company forms new connections and is able to access new markets. This results in an increase in sales, profitability and influence.
An entrepreneur is normally faced with different challenges and different needs at each phase of the business development process. Advisors, investors, or potential customers sometimes provide support throughout the entire business development cycle for growth. Depending on how fundraising is done, crowdfunding or traditionally investment, those are the type of support group that an entrepreneur could depend on as these people are invested in the company.
Within a neoclassical economics framework where things are produced by combining inputs in a production function, the most straight forward way is to get technological change to produce it. Research and development can be undertaken by combining land, labor, and capital to produce technological change. The successes attributable to investment in research and development are indisputable, but research and development expenditures cannot be the whole story because once the research is done, the results need to be applied to make production cheaper or in some cases, to produce goods and services that have never been produced before. This is the role of entrepreneurship.
Labor economists have highlighted that mid-level opportunities are being stripped out of today's organizations at a remarkable pace. This leaves a greater number of people with the prospect of working either in dream jobs or lousy jobs, which sit at the polar opposite of the job market. The impression here is that a lot of people are being pushed into self-employment partly because of a lack of decent job opportunities and partly because those jobs that do remain are becoming less attractive. Yet this is only one part of the story. Rather than forcing people into self employment, many of these organizational shifts should instead be seen as the 'trigger' that is pushing people toward their entrepreneurial ambitions.
One of the major drivers of the microbusiness boom existing today is a sign of an aging society that needed to be improved upon. Technological progress is not the final but a crucial ingredient behind the boom in self-employment. While the broader impact of the internet age may be questioned by some, its transformative effects on the world of business are easy to see.
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Related: 5 Ways to Get Entrepreneurship Funding