CHAPTER 2

The entrepreneur

M. van der Merwe Van Schaik Publishers

 LEARNING OUTCOMES
• Understand the effect of entrepreneurship on the
economy
• Appreciate that entrepreneurs can conduct business at
various levels based on their entrepreneurial activities
• Understand that entrepreneurs have unique
characteristics that distinguish them from other
individuals
• Know that there exist certain types of networks and
support systems available to entrepreneurs

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 LEARNING OUTCOMES
• Understand that there are challenges that entrepreneurs
and SMMEs must overcome
• Acknowledge women and emerging entrepreneurs and the
role they play in the economy
• Be aware of other upcoming industries that are excelling as
economic actors through entrepreneurship
• Understand that entrepreneurship must be initiated in
schools and universities to make the youth more aware of
entrepreneurship as a career option

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 INTRODUCTION
• Entrepreneur: a catalyst of business
• Role of entrepreneurs in the economy
• Barriers and challenges facing entrepreneurs
• Background and characteristics of
entrepreneurs
• Role models and support systems
• Push and pull factors of entrepreneurship
• Women (female) entrepreneurs
• Minority entrepreneurs
• Entrepreneurs vs investors
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 ENTREPRENEURSHIP:
CATALYST FOR ECONOMIC
ACTIVITY
• Entrepreneurship as critical solution:
– Low economic growth
– High unemployment
– An unsatisfactory level of poverty

• Choosing entrepreneurship as a career

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 ENTREPRENEURSHIP:
CATALYST FOR ECONOMIC
ACTIVITY
• Entrepreneurship and the informal sector
- If the customer does not buy, the entrepreneur does
not live
• Relationship between entrepreneurship and
economy
- Multi-faceted and complex
• Small, medium and micro enterprises (SMMEs)

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ENTREPRENEURS AT VARIOUS
LEVELS OF ENTREPRENEURIAL
SOPHISTICATION
• Basic survivalist: no economic independence
• Pre-entrepreneur: collectivism
• Subsistence entrepreneur: self-employed
• Micro-entrepreneur: zero to nine employees
• Small-scale entrepreneur:
ten to 49 employees
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 BACKGROUND AND
CHARACTERISTICS OF
ENTREPRENEURS
• Background
– Childhood family environment
– Education
– Age
– Work experience

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 BACKGROUND AND
CHARACTERISTICS OF
ENTREPRENEURS
•Characteristics
- Passion
- Locus of control
- Need for independence
- Need for achievement
- Risk taking and uncertainty
- Creativity and innovation
- Determination and persistence
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 ROLE MODELS AND
SUPPORT SYSTEMS
• Business Women’s Association
• Entrepreneurial networking
– Social networks
– Personal networks
– Extended networks
– Other

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PUSH AND PULL FACTORS OF
ENTREPRENEURSHIP
• Push factors • Pull factors
(necessity) (opportunity)
– Unemployment – Independence
– Job insecurity – Achievement
– Disagreement with – Recognition
management – Personal development
– Does not “fit into” the – Personal wealth
organisation
– No other alternatives
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Van Schaik Publishers
 CHALLENGES FACING
ENTREPRENEURS AND
SMME’S IN SOUTH AFRICA

• Access to start-up and expansion

finance
• Access to markets
• Access to appropriate technology
• Access to resources
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 WOMEN AND EMERGING
ENTREPRENEURS
• A successful women entrepreneur is one who has been in
business for longer than two years, operated an
enterprise with more than five employees and less than
30, made a profit and expanded in terms of infrastructure
and growth.

• Types of women entrepreneurs

– Traditional women business owners
– Innovative women business owners
– Domestic women business owners
– Van Schaik Publishers
Radical women business owners
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 BARRIERS FACING
WOMEN ENTREPRENEURS
• Access to financial resources
• Lack of support
• Negative prevailing socio-cultural attitude
• Sex discrimination or gender-bias
• Limited research done
• Personal difficulties
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 EMERGING
ENTREPRENEURS
• Characteristics of informal and survivalist
environment
– Mostly from rural areas
– No running water and electricity
– The level of formal education is very low
– Economic activities are very low
– Demographically, it is the most impoverished
environment
– Live in shacks and mud houses
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 ENTREPRENEURSHIP AND
OTHER UPCOMING
INDUSTRIES
• Technology entrepreneurs
(Technopreneurs)
• Social entrepreneurs
• Tourism entrepreneurs
– Opportunities: accommodation sector of industry,
transport industry and man-made attractions
• Minority entrepreneurship
– As a subject in schools
– Examples: University of Pretoria
and University of Cape Town Van Schaik Publishers
 ENTREPRENEURS VS
INVENTORS
• Role of entrepreneurs and inventors
• Ongoing relationship and process
• Inventor definition: Someone who has
developed an innovation and who has decided
to make a career out of presenting that
innovation to the market
• Entrepreneur takes over from inventor
• Inventors highly creative but relatively
few management skills
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 CONCLUSION
• Entrepreneurship: key driver of
economic growth and development in
South Africa
• Create environments where business will
thrive
• Effective internal people management
• Chinese saying: “Success depends on
good timing, a proper environment and
people in harmony.”
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