Source: Image of man in suit, female entrepreneur, images by Video Scribe, License held by Jeff Carroll; Image of storefront, Public Domain, http://bit.ly/1l51GoG; Image of runners, Public Domain, http://bit.ly/1kR5n0a; Image of crane trucks, Public Domain, http://bit.ly/1v4to6O.
Hi. I'm Jeff. And in this lesson, we'll learn about the value of small businesses and how entrepreneurs can elevate some small businesses with vision and growth. So let's begin.
What actually defines a small business? First, a small business is an organization with less than 500 employees that attempts to earn a profit through the sale of goods or services. It must also be independently owned and not a public company with stockholders. A small business doesn't dominate the market. There must be competition. And a small business can be in any industry or sector, such as construction, food, retail, or service.
Small businesses can be the lifeblood of a strong economy. While the Small Business Administration says that two-thirds of all small businesses survive for only two years, over 50% of all sales are to a small business. So those that do survive can have a significant impact.
By the way, the Small Business Administration is an organization that serves the needs of small businesses. Its website is at www.sba.gov. And some of the services provided by the SBA are financial help in the form of debt financing, a bonding program, and venture capital; organizational help through education, technical assistance, and information on business management; government contracting; and advocacy for small business with local and federal governments.
It's important for such an organization to support small businesses, since small business may not have the organizational support available in a larger business. But small businesses can impact large businesses. Their flexibility allows them to try new ideas and innovate in ways that are then adopted by large businesses.
The technology of the modern world makes it even easier to start a small business and compete within larger marketplaces. And many entrepreneurs are taking advantage of this. Entrepreneurs are often drawn to small business for the reasons that we've noted. But as we've said in a previous lesson, not all small business owners are entrepreneurs.
All small businesses attempt to make profit, whether they are run by entrepreneurs or not. But entrepreneurs will not be satisfied with only profit. An entrepreneur is a person who pursues a business venture with growth and expansion as a primary goal. And they will want to expand into new markets and innovate with new products. They will have a vision and a strategy that extends beyond just starting a business and surviving. And this can allow a small business to grow into a very large business.
For example, both Mark Zuckerberg, who started Facebook, and Sam Walton, who started Walmart, launched each of their companies as a small business. At first, Facebook was a simple website that catered only to Harvard College members. And Walmart began as a single store in Arkansas called Walton's 5 and 10. Now both owners are billionaires.
And this was a good introduction to small business for us, too. In this lesson, we learned about small businesses and their positive impact on an economy. We reviewed the role of the Small Business Administration. And we talked about the reasons entrepreneurs are drawn to a small business. Thanks for your time, and have a great day.