Question 1: Is Big Kev a traditional small business owner or an entrepreneurial owner? Explain the key differences between the business objectives of the traditional and entrepreneurial owner.
The ownership style of Big Kev is best described as entrepreneurial. An entrepreneurial owner is one that is focused on advancement through growth, profitability, and the use of strategic management plans (Holmes et al., 2003). In contrast, the traditional owner views the business as means to achieve personal goals, as an expression of their individuality, and as a commitment needs satisfier (Holmes et al., 2003). It is clear that Big Kev has engaged in a process of expansion, underpinned with a strategic plan to further the growth of the enterprise. Big Kev does not view the enterprise as a personal needs satisfier exemplified through his offering external stock to enable expansion. Therefore, big Kev is an example of an entrepreneurial owner.
Question 2: Do you think Big Kev can let his ‘baby’ leave his control? Is Big Kev really like most small business owners: focused on control of his operating entity? How do you think Big Kev will cope with his new equity partners? Keep in mind that the company floated is called Big Kev Ltd.
It is clear that Big Kev views his role in the enterprise as fundamental, indispensable, and similar to the typical small business owner. While the enterprise is publicly listed and ownership partially separted from Big Kev, the founder still sees the management of the new entity as fundamentally similar to prior to the listing: management decisions resides with a few individuals and the personal objectives of the owner are the motivational factors that dominate the strategic plans of the enterprise, both of which are centred on Big Kev (Holmes et al., 2003). The use of emotive phases like ‘in order to stand up against them I …’ (AAP in Holmes et al., 2003, p. 21) infer that the stock listing a means of capital acquisition rather than the gaining of equity partners, it is his personalised battle. It is clear that Big Kev believes that his strategic plan and goals are the same as those of his new partners, this may not be the case and if the stockholders disagree with Big Kev’s plan conflict is beyond question.
Question 3:What other funding option are readily available to owners like Kev McQuay, who are seeking funds to expand their business?
Liquidity issues are often a problem for growth enterprises, like those owned by Big Kev, as problems with price and cost structures as well as needing funds to maintain expansion arise. In the traditional funding methods are based upon debt leverage; however, there are alternatives like private venture capital (Holmes et al., 2003, p. 300). The key is the level of capital that is needed and if the existing enterprise can demonstrate a capability to repay, those that have issues with future cash flow need to seek capital acquisition to expand. Big Kev chose the stock exchange to raise...