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• Freedom to use own ideas - Innovation and creativity • Unlimited income / higher retained income • Independence • Satisfaction To the Nation • Provides larger employment • Results in wider distribution of wealth • Mobilizes local resources, skills and savings • Accelerates the pace of economic development • Stimulates innovation & efficiency Barriers to entrepreneurship • • • • • • • • • • • Lack of a viable concept Lack of market knowledge Lack of technical skills Lack of seed capital/resources Lack of business know how Lack of sufficient infrastructure Complacency Restrictive effects of customs and traditions Legal constraints Monopoly Restrictions due to patents
There are 3 types of startup ventures: 1.A lifestyle firm exists primarily to support the owners and usually has little growth opportunity. 2.Foundation companies are firms created from research and development that lay the foundation for a new industry. 3.High powered ventures (“gazelles”) are new companies that receive the greatest interest and publicity. Types of start up firms : • Salary substitute firms : are small firms that afford their owner/ owners a level of similar to what they would earn in conventional job. Examples of salary substitute firms are dry cleaners, convenience stores, restaurants, accounting firms, retail stores , hairstyling salons, etc. • Lifestyle firms : firms that provide their owner or woners the opportunity to pursue a particular lifestyle and make a living at it . • Entrepreneurship firms : that bring new products and services to the market by creating and seizing opportunities regardless of the resources they currently control . Types of start up firms : Lifestyle firm Privately held; usually achieves only modest growth. Foundation company Created from research and development. Lays the foundation for a new business area. High-potential venture Receives the greatest investment interest and publicity. Starts out like a foundation company, but attains rapid growth. Also called gazelles, is integral to the economic development of an area
Some disadvantages – Will need to put in long hours – Need money to start – Have to keep up with government rules and regulations – May have to mark hard decisions (hiring, firing, etc.) – May lose money – Some advantages – You are your own boss – Enjoy the profits from your efforts – Sense of pride in your business – Flexibility in your work schedule