An elementary dynamic model of a small start-up firm

摘要

A system dynamics model of a small start-up firm has been built. It includesassumptions, key variables and causal relations as described in business economicsliterature. The main motivation for building this model is to bring a dynamic perspectiveto university education in the field of business economics, especially managementaccounting and control systems. Some special assumptions and parameters reflect thespecifics of a particular start-up firm in an attempt to get the simulation results close toreal financial performance. The results of the simulation runs mirror the same growthpatterns observed during the first three years of the firm’s existence. The model canthus help an entrepreneur to understand growth paths in subsequent years.