MSME and The Funding Juggernaut: Myth or Reality?
The entire narrative of the challenges confronting MSMEs (micro, small, and medium-sized enterprises) seems to always revolve around funding. Could there be a more underlying condition than this “Show me the Money” problem?
My musings here tend to point in that direction.
More Money, More Problems
A rejoinder to the “more money more problem” surely couldn’t be “no money no problem” could it? That’s perhaps a Myth.
However, entrepreneurship lexicon has something like “bootstrapping” — a term akin to making the most of a bad or difficult situation. There are also terms such as “resource constraints,” which when overcome, underpins prowess against the odds, and thereby, qualifies for the badge “entrepreneurial.”
One seminal article published in an equally instructive journal, Venture Capital, seems to highlight alternative funding sources. While that study interrogates “The use of bootstrapping by women entrepreneurs in positioning for growth,” I dare to argue that bootstrapping is a gender neutral toolkit as far as positioning for growth is concerned.
I touched upon this gender neutrality posturing in a 2008 article exploring Ugandan microenterprises, “Entrepreneurial and cultural dynamics: A gender kaleidoscope of Ugandan microenterprises.”
However, and back to the money issue, is this really the main constraint to business venturing? Before I share my view on this, let me share that of others.
In another article “Beyond environmental scarcity: Human and social capital as driving forces of bootstrapping activities,” published in a befitting Journal of Business Venturing, the message is clear.
Human and social capital seem to more than compensate for financial capital. Mind you, that’s my interpretation judging the book (article in this case) by its cover (title).
What’s the point of money in the absence of human and social capital, I dare ask?
In summing up, “bootstrapping” makes all the difference between an entrepreneur and a business owner. And yes, there differences despite the obvious similarities.
Brush, C. G., Carter, N. M., Gatewood, E. J., Greene, P. G., & Hart, M. M. (2006). The use of bootstrapping by women entrepreneurs in positioning for growth. Venture Capital, 8(1), 15–31.
Grichnik, D., Brinckmann, J., Singh, L., & Manigart, S. (2014). Beyond environmental scarcity: Human and social capital as driving forces of bootstrapping activities. Journal of Business Venturing, 29(2), 310–326.
