Microenterprise

AAA

DEFINITION of 'Microenterprise'

A small business that employs a small number of employees. A microenterprise will usually operate with fewer than 10 people and is started with a small amount of capital. Most microenterprises specialize in providing goods or services for their local areas.

INVESTOPEDIA EXPLAINS 'Microenterprise'

Microenterprises serve a vital purpose in improving the quality of life for people in developing countries. Microfinance seeks to help microenterprises by loaning small amounts of capital to these businesses. This allows poor individuals or families to start their own businesses, earn income and benefit their communities.

For example, a woman in a developing country may use microcredit to take out a loan and purchase a sewing machine. She could use the machine to establish a microenterprise that specializes in tailoring. The woman would increase her wealth and help her community by providing a service.

RELATED TERMS
  1. Small Office/Home Office - SOHO

    A business that is operated out of a business owner's residence ...
  2. Small And Midsize Enterprises - ...

    A business that maintains revenues or a number of employees below ...
  3. Microinsurance

    Insurance products that offer coverage to low-income households. ...
  4. Microfinance

    A type of banking service that is provided to unemployed or low-income ...
  5. Microsavings

    A branch of microfinance, consisting of a small deposit account ...
  6. Microcredit

    An extremely small loan given to impoverished people to help ...
RELATED FAQS
  1. What are the main objectives of cost accounting?

    Cost accounting is distinct and separate from general financial accounting, which is regulated by generally accepted accounting ... Read Full Answer >>
  2. Is there a way to invest in the income effect?

    Investing in the income effect consists of investing in areas that are affected when an individual's income increases. The ... Read Full Answer >>
  3. What is the best form of equity financing for a start-up company?

    Raising capital during the startup phase of a business can present challenges to an entrepreneur. Debt financing is difficult ... Read Full Answer >>
  4. What effect does the income effect have on my business?

    The income effect may have positive or negative consequences on a small business, depending on many factors. The income effect ... Read Full Answer >>
  5. What are some advantage of raising capital through private placement?

    Small businesses face the constant challenge of raising affordable capital to fund business operations. Equity financing ... Read Full Answer >>
  6. What is the best general ledger software for small businesses?

    General ledger software is available as both paid software and freeware. Some programs stand alone, while others require ... Read Full Answer >>
Related Articles
  1. Entrepreneurship

    Microfinance: What It Is And How To Get Involved

    This growing industry is full of opportunities for the socially conscious investor.
  2. Insurance

    An Introduction to Microfinance

    Is microfinance a way to help the poor, or will it just make them poorer?
  3. Entrepreneurship

    Social Finance Careers: Creating A Better World

    A financial career can be used to do more than just bring in profits. Find out how to get a career with a more social objective.
  4. Personal Finance

    Go Green With Socially Responsible Investing

    Find out how morals and ethics can bring you a surprising return.
  5. Entrepreneurship

    401(k) Plans For The Small Business Owner

    If you own a business, this may be the plan for you! Find out about its benefits and eligibility requirements.
  6. Entrepreneurship

    The Story Behind Shake Shack's Success

    A humble Madison Square Park hot dog stand grew to become a gourmet casual food powerhouse in a classic American success story.
  7. Entrepreneurship

    How Americans Can Apply For European MBA Programs

    Studying for an MBA in Europe is a great idea for Americans looking for a career boost.
  8. Entrepreneurship

    The Top 5 YouTube Millionaires

    Enterprising content creators have been able to use YouTube to rake in millions each year.
  9. Entrepreneurship

    How Many Startups Fail And Why?

    Why do so many businesses fail? And for that matter, how many of them actually do fail?
  10. Entrepreneurship

    10 Most Successful Women Entrepreneurs of the Decade

    Women entrepreneurs have been able to withstand economic and business pressures to rise to the top in a number of industries from pharma to fashion.

You May Also Like

Hot Definitions
  1. Venture-Capital-Backed IPO

    The selling to the public of shares in a company that has previously been funded primarily by private investors. The alternative ...
  2. Merger Arbitrage

    A hedge fund strategy in which the stocks of two merging companies are simultaneously bought and sold to create a riskless ...
  3. Market Failure

    An economic term that encompasses a situation where, in any given market, the quantity of a product demanded by consumers ...
  4. Unsystematic Risk

    Company or industry specific risk that is inherent in each investment. The amount of unsystematic risk can be reduced through ...
  5. Security Market Line - SML

    A line that graphs the systematic, or market, risk versus return of the whole market at a certain time and shows all risky ...
  6. Tangible Net Worth

    A measure of the physical worth of a company, which does not include any value derived from intangible assets such as copyrights, ...
Trading Center