The correct answer to this open question is the following.
Although there are no options attached we can say the following.
Gorbachev might have chosen to allow private businesses only on a small scale because it was the first serious transition from a Communist economy to a Market economy in years. So it was such a delicate step to open the country to private and foreign investment.
After many years under the Communist regime, the Soviet Union split in December 1991. During those Communist years, the USSR never allowed private property in the Soviet United. The state was the owner of the means of production.
So when Gorbachev decided to implement glasnost and perestroika reformations, he had to carefully proceed because these involved some kind of risk.
The Soviet Union ceased to exist on December 26, 1991. Gorbachev had resigned one day before and the new leader of Russia was Boris Yeltsin.