“… there is little known about the initial phases of the process (of entrepreneurship). The conception, birth and early development of new ventures are very much an uncharted territory”. (Reynolds and White, 1997:1). This paper sets out to examine the process and problems encountered by new business start-ups. A didactic overview, based on past and current literature in the field, identifies the most common theoretical frameworks frequenting the academic literature and assesses their contribution to explaining and understanding the Process and Problems of New Venture Creation. The founding of a new organisation is not instantaneous and the process is a largely complex one. The nature of this process - which is characterized by spontaneity and uncertainty - makes it more difficult to pin down an exact theory. As Gartner (1985) points out, entrepreneurial firms are too diverse to permit generalization, and the process of starting up a new business has become a multidimensional phenomenon. The different approaches, suggested in literature, explaining the process of new venture creation, have attracted much academic controversy, given the lack of consistent empirical research on the process of new business creation. In this light, the author suggests that a more holistic understanding of the process may be gained through the integrated theoretical frameworks of new venture creation presented in the literature, which aim to capture the most important variables and characteristics of the new venture creation process. The second part of the paper deals with the problems facing entrepreneurs in new venture creation. Many start-ups never reach establishment, and the majority close up within one year after they have become established. Embarking on a new business is one of adventure and challenge but it brings with it high risk and uncertainty. This paper does not seek to detail each and every industry-specific problem that start-ups experience, but aims to identify and examine the most common difficulties encountered by Start-Ups in the early stages of establishment, irrespective of sector or industry.
"The Process and Problems of Business Start-Ups,"
The ITB Journal:
1, Article 3.
Available at: http://arrow.dit.ie/itbj/vol4/iss1/3