Basic characteristic of entrepreneurship is innovation. The role of innovation is as important as Peter Draker said” there is no entrepreneurship without innovation, new product or service creation, new ideas or finding new solutions for problems, difficulties and opportunities. Basically from management view innovation means process that starts from imagination and end to commercial product or service development. Most studies about innovation take place in industrial countries such as the U.S.A, Britain and Germany. Now, there exists a considerable gap in our knowledge about innovation especially in company levels in developing countries. On the other hand the innovation was first studied in big companies. Most innovations were connected to multinational companies traditionally. However, Schumpeter (1939) in his first notes recognized the role of small companies in innovation. But the attention to innovation in small companies is related to the recent decades. While the big companies have, an innovative advantage in high capital industries because of using savings resulted from scale; small companies are more successful in industries needing more expert worker force. Small companies, as important innovators in technology fields, are introduced in a higher level just like computer and biotechnology.
The purpose of writing the current paper is presenting a model for surveying the innovation in small companies as organizational entrepreneurship in developing countries. In order to achieve the above said goal, it is attempted to the advantages of innovation in small companies in developing countries are analyzed through a model. Thus, it can be a basis for further studies about a subject in real world.

Keywords: Innovation, small firms, entrepreneurship, developing countries.