At-start up factors Flashcards
Definition of at start up factors
4 basic business level choices made by the owner when starting their business
What are the 4 at start up factors (ILLS)
Initial size, legal form, Location, Sector
Which of the four are empirically proven to be influential on growth?
Location and legal form
what are sunset industries?
industries in decline
What are sunrise industries?
industries in rapid growth/ development
Advantages of incoporation
limited liability, tax savings (corporation tax), equity financing (shares)
Disadvantages of incorporation
filing accounts, regulatory checks, limited liability often a myth
What did Florida (2002) find?
The levels of diversity and openness to diversity (such as immigration laws and the tolerance of people) in locations attract wider pools of talent from various minorities.
What did Acs et al (2008) find?
Successful start ups are located across the US, not just specific places
What explanation of business growth is location related to?
Social networks (clusters)
Why is sector not influential?
Fast growth industries can still be found in sunset industries, not just sunrise industries
How many studies found a significant relationship between legal form and growth?
14/15 (storey and greene, 2010)
What was the overall conclusion of the 21 studies summarised by storey and greene (2010) about initial size and growth?
Mixed results across the board so inconclusive
What did Unger et al (2011) find and how is it related to location?
A significant relationship between Human Capital and Entrepreneurial Success. This means clusters are important (where you can access specialist pools of labour and thus higher levels of human capital)
