Small and Medium Enterprises (SMEs) are becoming more important in today’s international markets. (Oviatt and McDougall,1994, 1999). The internationalisation of SME’s can be expected to increase further due to the economy of the world becoming further harmonised with continued declines in government imposed barriers and advances in technology (Lu, Jane W, and Paul W Beamish, 2001). In 2013 there was an estimated 4.9 million private sector businesses in the UK which is an increase of 102,000 compared to that of 2012. SME’s account for over half of employment, 53.9%, and almost half of the turnover in the UK private sector, 48.1%. (Department for Business Innovations and Skills, 2013). Hence, showing that SME’s are still growing and are an integral part of the UK’s economy.

Through SME’s, this essay will discuss and critically analyse the process of creating (pre start up) and managing a new venture (post start up). It will begin with considering issues relating to the entrepreneur, and examine the challenges that they are faced with when starting up a business idea, the opportunity, and the innovation. The problems with managing a new venture are then inspected.

In French, the term entrepreneur means someone who “undertakes”, for example someone who undertakes a significant project or activity. It later came to be used to identify individuals who accelerated economic progress by finding new and better ways of doing things. The French economist most associated with giving the name is Jean Baptiste Say who was quoted saying “The entrepreneur shifts economic resources out of an area of lower and into an area of higher productivity and greater yield”. Entrepreneurs create value (Dees, J Gregory, 1998).

The sources of entrepreneurship are studied by researchers in a wide range of disciplines, the study varies per discipline. For example, an economist would look at mainly socio economic variables, whereas psychologists would look at the personality traits of the entrepreneurs to see which ones were more integral to that of an entrepreneur (Fritsch, Michael, and Alina Rusakova, 2010). The Big Five model of personality provides a framework for analysing the relationship between personality traits and the tendency to become an entrepreneur. The five dimensions of this personality model are: Extraversion, Em