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What is an entrepreneur?

Entrepreneurs have been described as people who have the ability to see and evaluate
business opportunities, gather the necessary resources to take advantage of them and
initiate appropriate action to ensure success.

An entrepreneur is one who creates a new business in the face of risk and uncertainty for
the purpose of achieving profit and growth by identifying opportunities and assembling the
necessary resources to capitalize on those opportunities.

Entrepreneurs usually start with nothing more than an idea—often a simple one—and
then organize the resources necessary to transform that idea into a sustainable business.

This is the man or woman who owns a restaurant, fashion centre, boutique, bakery, tailoring
outfit, beauty centre, barbering saloon, bookshop, home catering, business centre, shoemaker,
car washing centre, photographing.

The entrepreneurs are the “dreamers”, who take hands on responsibility for creating
innovation.

An entrepreneur is the man or woman who is able to actualize his/her inherent potentials and
develop a character that is not dependent but independent.

He/She is that person who undertakes the journey of creating value in idea by pulling
together a unique package of resources to exploit an opportunity.

He or She has the capacity and capability to build something from practically nothing –
initiating, daring, doing, achieving, and building an enterprise. They genuinely believe they
have something new and special to offer, either a product or a service. To them, life will
remain a fantasy unless their dreams are actualized.

WHO IS AN ENTREPRENUER
• He is a person who develops and owns his own enterprise

• He is a moderate risk taker and works under uncertainty for achieving the goal.
 • He is innovative

• He peruses the deviant/unexpected pursuits

• Reflects strong urge to be independent.

• Persistently/tirelessly tries to do something better.

• Dissatisfied with routine activities.

• Prepared to withstand the hard life.

• Determined but patient

• Exhibits sense of leadership

• Also exhibits sense of competitiveness

• Takes personals responsibility

• Oriented towards the future.

• Tends to persist/continue in the face to adversity

• Convert a situation into opportunity.

Becoming an Entrepreneur
● Think about your priorities with looking head
● Tell People and Demo/ List your strengths
● Think of a Problem/ Determine to succeed. 
● Follow Your Passion/ Decide whether your personality is a good fit for
entrepreneurship. 
● Do the Leg Work/ Setting Your Foundations- Brainstorm a great idea,
Research your market, Talk to potential customers/clients, Determine risk,
Understand the idea of “acceptable loss, Commit to a goal, not a plan
● Writing Your Business Plan- Create a business plan, write company
description, market analysis, organization and management, information on your
service or product, Describe your marketing and sales strategies, Outline a funding
request, Outline your financial projections, Include appendices, if necessary, Write
your executive summary
● Make a Prototype/sample/
● Block the doubters
Being an entrepreneur is a high-risk, high-reward position. It's full of stressful situations,
sure, but it's also chock full of rewards and a sense of accomplishment. It's not as hard as it
seems -- as long as you have some diligence/attentive, patience, and, of course, a good idea,
you'll be your own boss sooner than you think!

Think about your priorities with looking head. Ask yourself some questions about what
you want out of life, as well as out of your business. What does achieving your goals in life
look like? What is important to you? What are you willing to sacrifice?
- Consider what you need to make these priorities and goals happen. Is it a certain
amount of money? A certain amount of free time to spend with friends and family?
 Decide whether your personality is a good fit for entrepreneurship. Becoming your own
boss is a goal for many people, but some people are better suited to this lifestyle than others.
Knowing how you are likely to react to events will help you achieve your goals.[2]
- Are you comfortable with a lot of responsibility? Entrepreneurs often have no backup
and are responsible for the success or failure of their business.
- Do you enjoy interacting with people? Almost all entrepreneurs have to do a lot of
customer service, particularly at first. If you aren’t good with people, you may have
difficulty getting your business off the ground.
- Are you able to accept uncertainty and even failure? Even the most successful
entrepreneurs -- for example, Bill Gates, Steve Jobs, and Richard Branson -- have had
businesses fail on them, often several times, before they found a formula that worked.
- Do you thrive on problem-solving and creative solutions? Entrepreneurs at all levels
face many problems that they need to find creative solutions for. A high tolerance for
frustration and the ability to think through problems will serve you well as an
entrepreneur.
List your strengths. Be honest with yourself as you consider your strengths and weaknesses.
When you talk to potential investors or sell to clients, you will need to have a very clear idea
of what your strengths are so you can communicate them to others.

Determine to succeed. Energy and determination will get you through many of the hurdles
you will face as a beginning entrepreneur. Be idealistic enough to believe in yourself, but
pragmatic enough to examine the realities of your situation

Part =2

Setting Your Foundations

1. Brainstorm a great idea. Most businesses start with one compelling idea — whether it's a
service people need, a product that would make life easier, or something that combines both.
The business world is full of great ideas (and many not-so-great ones). What will set yours
apart is whether you can find a niche need to fill.
You don’t necessarily have to do something revolutionary or brand-new to be successful. You
just have to be better at something than your competitors.
You will likely be more successful if you do something you know and love. Going into
computer programming might make your business very marketable, but if your heart’s
not in it you won’t have the energy to keep yourself going.
If you’re having trouble thinking of an idea, create a list of things about your target market,
such as places they shop and things they purchase. Narrow the list down to about
three items, keeping cost, manufacturing time, and popularity in mind. Find the
easiest, most realistic product you can offer.

1. Research your market. The key to starting a business is to know whether there is a

demand for your product or service. Is what you can offer something that is not being
 done as well as it could be? Is it a need that doesn’t have enough supply to support
demand?
There are many sources of free industry information. Search online for industry and trade
associations in your target market and read the articles and press releases they post.
You can also get valuable demographic information from census data.
The U.S. Small Business Administration has a website with excellent suggestions on how to
come up with venture ideas, conduct market research, how to write a business plan,
and how to recruit investors. It is an invaluable source of reliable information if
you’re starting a business.

2. Talk to potential customers/clients. You can have the greatest product or service in

the world, but if nobody wants to pay you for it, your business will crash and burn.
Talking to others will also help you prepare to persuade investors.
Ask for honest feedback when you talk to potential customers. Your friends may try to be
nice to you when you propose your idea, but critical feedback that points out
weaknesses or problems will be much more useful, even if it isn’t always easy to hear.

3. Determine what you can risk. Entrepreneurship is always a game of risk and reward,
but often the risk is greater (especially in the beginning). Take stock of all your assets
and figure out how much money (and time and energy) you actually have to invest.
In addition to considering your savings, credit, and other sources of capital, consider how
long you can afford to go without making a profit. Small businesses are rarely
profitable immediately; can you afford to not draw a salary for perhaps several
months or even a few years?

4. Understand the idea of “acceptable loss.” According to ‘’Forbes’’, “acceptable

loss” is the idea that you should first determine the possible downside of your
business venture and then invest only what you can actually afford to lose should your
business turn out differently than you’d hoped. This limits the scale of failure if your
venture doesn’t work out.

5. Commit to a goal, not a plan. One of the most important things in becoming an

entrepreneur is flexibility. You can’t control everything about your business, and
adaptation is vital to survival. If you’re overly committed to a plan, you may sabotage
yourself
Part 3
Writing Your Business Plan
 1. Create a business plan. A business plan typically describes what your

company does (whom does it serve? what does it provide?), provides a

market analysis, includes a detailed description of the product or service,
and projects the expected financial future of your company for the next 3-5
years. If you are hoping to attract investors, they will want to see a

detailed, thorough business plan.

2. Write a company description. This should be a brief summary of what

your business does, what needs it satisfies and how, and why it is superior
to other ventures of its kind. Be concrete and specific, but keep this short --

imagine it as an “elevator pitch”.

3. Present your market analysis. If you have done good market research,

you should be able to talk in specifics about your chosen industry or field,
your target consumer market, and your projected market share. This
section should be as detailed as possible, as it needs to convince investors
that you know what you’re doing.
One of the mistakes many beginning entrepreneurs make is failing to narrow their target
market and trying to sell to too wide an audience. While it’s tempting to
believe that everyone needs and will love your product or service, the
reality is that they won’t. It’s okay to start small.

4. Include a section on organization and management. Even if your

company is only you at this point, use this section to provide information
on who owns your company, what their responsibilities are, and how you
will structure your business as it expands. (Will you have a board of
directors? How will your employees be organized?) Investors want to see
that you have thought about the future of your company.
1.

5. Provide information on your service or product. This is where you can

get into the specifics of what exactly your business will provide your
 customers. What are you going to provide? What need will it fill? What

competitive advantages does it have over other similar products?

o Provide details from potential customers’ point of view. If you have already talked to
potential customers, you should have a good idea what their opinions of your service or
product are.
o If you are planning to sell a proprietary good or service, include any patent information or
other ways you plan to protect your intellectual property. Investors don’t want to invest in a
business only to have their product scooped by a competitor.

6. Describe your marketing and sales strategies. This section will focus on

how your business plans to attract and keep customers. How do you plan
to reach your target consumers? How will you use marketing to grow your
business? Do you already have potential customers lined up, or will you

have to start completely from scratch?

7. Outline a funding request. If you are seeking investors or a bank loan,

you will need to state exactly what you need to get your business started.
You should include any amount you are investing yourself, how much
money you need from your investors, and (most importantly) how you
plan to use this funding.
o Investors like specifics. A funding request that just says “I need a million dollars” is less
likely to be persuasive than a requests that breaks down costs and expenditures.

8. Outline your financial projections. If you’re just starting out, you won’t
have much historical financial data to work with. You should include any
collateral you have that can guarantee your loan, but only list what you can
truly afford to lose.
o You should also include information on prospective financial data. This may seem like
simply making up numbers, but it should incorporate the data from your market analysis.
How well are your competitors doing? What do their expenditures and cash flows look like?
You can use these to help you make projections for your company.
o Make sure that your financial projections match the figures in your funding request. If your
projections show that you will need $500,000 but you’ve only asked for $200,000, this could
suggest to investors that you haven’t done your homework.
9. Include appendices, if necessary. If you are just starting out, you may
want to include other documentation to boost your credibility. Items such
as letters of reference that can speak to your qualifications and skills or a
credit history may be useful.[23]

10. Write your executive summary. This actually goes at the very beginning
of the business plan, but you’ll need to wait to write this until you’ve
thought the rest of the plan out. The executive summary is a “snapshot” of
your venture as a whole: its goals, its mission statement, and an
introduction to yourself and your company. As a new entrepreneur, you
should highlight your background and experience with your chosen
product or service. It should be no longer than one page.
 Why people become entrepreneurs
An entrepreneur is someone who is prepared to sacrifice their own time, effort and money to
turn a good idea into a marketable product

A person want to be a entrepreneur for the personal satisfaction, financial benefits, work as
independence and self fulfilments.

Characteristics of an entrepreneur:
There is no such thing as a typical entrepreneur. Some entrepreneurs are quiet and
hard-working, while others are more outgoing and flamboyant. The key to being a successful
entrepreneur lies in the ability to take an idea and then, through the process of innovation,
develop it in such a way that it becomes a marketable product or service. Research indicates
that there are a number of characteristics that are quite likely to be present in high-achieving
entrepreneurs:

The ability to learn from others – entrepreneurs tend to be good at networking. They benefit
from being members of organisation like the IET where they can learn best practice ideas
from others.
● Self confidence – a belief in their own abilities and ideas.
● Independence
● Being innovative/inventive – being able to generate ideas, either for new products/services or
new ways of applying them.
● Self motivation and determination – the drive to keep going and see things through.
● Creativity /Showing initiative – it is necessary to have not only the ideas for the business, but
also the detailed plans to achieve objectives (both thinking and doing).
● Analytical abilities – capable of researching and evaluating each aspect of the business, from
development, through finance, production, to marketing and sales.
● Acceptance of risk,/The ability to make decisions and to take (considered) risks.
● Innovation,

● Vision

● A focus on results that ensures products are sold for a profit.

The combination of many of these skills and qualities, with the right support, ensures ideas
do not just remain as dreams but become real, viable businesses.

1. Business Focus: They base decisions on the potential to turn a profit.

2. Confidence: They know themselves well and can read others.
3. Creative Thinker: They know how to turn an existing product or idea into
something even better.
4. Delegator: They don’t try to do it all.
5. Determination: They battle their way through difficult obstacles.
6. Independent: They will do whatever it takes to succeed in the business.
7. Knowledge-Seeker: They constantly hunt down information that will help
them keep the business growing.
8. Promoter: They do the best job as spokesperson for the business.
9. Relationship-Builder: They have high social intelligence and an ability to
build relationships that aid their firm’s growth.
10. Risk-Taker: They have good instincts when it comes to managing
high-risk situations.

Characteristics of Entrepreneur:

2. Desire and willingness to take initiative. Entrepreneurs feel a personal responsibility

for the outcome of ventures they start. They prefer to be in control of their resources
and to use those resources to achieve self-determined goals. They are willing to step
forward and build businesses based on their creative ideas.

3. Preference for moderate risk. Entrepreneurs are not wild risk-takers but are instead
calculating risk-takers. Unlike “high-rolling, riverboat gamblers,” they rarely gamble.
 Entrepreneurs often have a different perception of the risk involve in a business
situation. The goal may appear to be high—even impossible—from others’
perspective, but entrepreneurs typically have thought through the situation and believe
that their goals are reasonable and attainable. Entrepreneurs launched many
now-famous businesses, including Burger King, Microsoft, FedEx, Disney, CNN,
MTV, HP, and others, during economic recessions when many people believed their
ideas and their timing to be foolhardy.

4. Confidence in their ability to succeed. Entrepreneurs typically have an abundance of

confidence in their ability to succeed, and they tend to be optimistic about their
chances for business success. Entrepreneurs face many barriers when starting and
running their companies, and a healthy dose of optimism can be an important
component in their ultimate success. “Entrepreneurs believe they can do anything,”
says one researcher.

5. Self-reliance. Entrepreneurs do not shy away from the responsibility for making their
businesses succeed. Perhaps that is why many entrepreneurs persist in building
businesses even when others ridicule their ideas as follies. Their views reflect those of
Ralph Waldo Emerson in his essay “Self Reliance”: You will always find those who
think they know what is your duty better than you know it. It is easy in the world to
live after the world’s opinion; it is easy in solitude to live after our own; but the great
man is he who in the midst of the crowd keeps with perfect sweetness the
independence of solitude.

6. Perseverance. Even when things don’t work out as they planned, entrepreneurs don’t
give up. They simply keep trying. Real entrepreneurs follow the advice contained in
the Japanese proverb, “Fall seven times; stand up eight.”

7. Desire for immediate feedback. Entrepreneurs like to know how they are doing and
are constantly looking for reinforcement. Tricia Fox, founder of Fox Day Schools,
Inc., claims, “I like being independent and successful. Nothing gives you feedback like
your own business.”

8. High level of energy. Entrepreneurs are more energetic than the average person. That
energy may be a critical factor given the incredible effort required to launch a start-up
company. Long hours—often 60 to 80 hours a week—and hard work are the rule rather
than the exception. Building a successful business requires a great deal of stamina.

9. Competitiveness. Entrepreneurs tend to exhibit competitive behavior, often early in

life. They enjoy competitive games and sports and always want to keep score!

10. Future orientation. Entrepreneurs tend to dream big and then formulate plans to
transform those dreams into reality. They have a well-defined sense of searching for
opportunities. They look ahead and are less concerned with what they accomplished
yesterday than what they can do tomorrow. Ever vigilant for new business
 opportunities, entrepreneurs observe the same events other people do, but they see
something different

11. Skill at organizing. Building a company “from scratch” is much like piecing together
a giant jigsaw puzzle. Entrepreneurs know how to put the right people and resources
together to accomplish a task. Effectively combining people and jobs enables
entrepreneurs to bring their visions to reality.

12. Value of achievement over money. One of the most common misconceptions about
entrepreneurs is that they are driven wholly by the desire to make money. To the
contrary, achievement seems to be the primary motivating force behind entrepreneurs;
money is simply a way of “keeping score” of accomplishments—a symbol of
achievement. “Money is not the driving motive of most entrepreneurs,”

13. High degree of commitment. Launching a company successfully requires total

commitment from the entrepreneur. Business founders often immerse themselves
completely in their businesses. “The commitment you have to make is tremendous;
entrepreneurs usually put everything on the line,” says one expert.20 That commitment
helps overcome business-threatening mistakes, obstacles, and pessimism from
naysayers, however. Entrepreneurs’ commitment to their ideas and the businesses
those ideas spawn determine how successful their companies ultimately become.

14. Tolerance for ambiguity. Entrepreneurs tend to have a high tolerance for ambiguous,
everchanging situations—the environment in which they most often operate. This
ability to handle uncertainty is critical, because these business builders constantly
make decisions using new, sometimes conflicting, information gleaned from a variety
of unfamiliar sources.

15. Flexibility. One hallmark of true entrepreneurs is their ability to adapt to the changing
demands of their customers and their businesses. In this rapidly changing world
economy, rigidity often leads to failure. As society, its people, and their tastes change,
entrepreneurs also must be willing to adapt their businesses to meet those changes.
Successful entrepreneurs are willing to allow their business models to evolve as mark
et conditions warrant. Tenacity. Obstacles, obstructions, and defeat typically do not
dissuade entrepreneurs from doggedly pursuing their visions. Successful entrepreneurs
have the willpower to conquer the barriers that stand in the way of their success.

Key elements of Entrepreneurship:

1. Motivation & Commitment:

Motivation toward the investment of money, work, convinces to the stakeholders

of business. Commitment is showing your dedication, determination to do
business and invest money, time, hard labour.
 2. Abilities & skill:

Person have ability and skills to performs work and that individual have
appropriate skills and ability to the business they’re proposing to run
operational and management perspective.

3. Resources:

The third element is resources. That’s not purely about money and equipment;
it’s also about intellectual capability. (The ability to persuade others is
important. Many entrepreneurs have been able to negotiate very
favourable deals against the odds, when establishing their business).

4. Strategy & vision:

The fourth element is strategy and vision in terms of thinking four or five years
ahead and having some idea of where that business might be in the future
and putting in place a plan to achieve that goal.

5. Planning & organisation:

The fifth element is planning and organisation. Without planning, organisation,

coordination and administration, the product won’t get to market nor will
it satisfactorily meet demand. You need to think about systems, job roles,
and quality issues, which if handed effectively, will ensure you, can satisfy
the market by delivering on time and to the right place.

6. The idea in relation to the market:

The sixth element is the idea and more specifically, the idea in relation to the
market place. What we are trying to do is to make certain that we are
customer focussed, ensuring that the individual is satisfied in their
requirements.

7. When we look at the six elements it becomes evident that you can have a
bad product with a highly motivated individual, which will produce an
acceptable business. But what you cannot have is a really good product
with a de-motivated individual. The business will not succeed because the
product will not reach the market at the right time, at the right place, or
at the right price.

TABLE 1.1 Top Five Reasons Start-up Businesses Fail

Research by the U.S. Small Business Administration shows the following top five reasons
that start-up companies fail. Make sure that your business does not fall victim to them!

1. Insufficient start-up capital. Starting a business with too little capital is a sure recipe for
failure. Experts suggest that entrepreneurs have the cash equivalent of 6 months of expenses
available.

2. Lack of managerial experience. Passion for starting a company is important, but

entrepreneurs also should have skills and experience in key business areas such as cash flow
management, marketing, financing, inventory control, and others.

3. Bad location. Selecting the proper location is a key to success for many businesses. Your
location should be convenient for your company’s target customers.

4. Poor inventory control. Entrepreneurs in businesses that carry inventory must manage it
closely. Carrying too much inventory ties up valuable cash, which can sink a new business.

5. Lack of initial planning. There is a reason that the mantra of many small business
counselors is “business plan.” As you will see in upcoming chapters, creating a
comprehensive plan allows entrepreneurs to determine whether a business idea is likely to
succeed and to identify the steps they must take to create a successful company.

Characteristics of Successful entrepreneurs

Know Your Business in Depth We have already emphasized the need for the right type of
experience in the business. Get the best education in your business area you possibly can
before you set out on your own. Read everything you can—trade journals, business
periodicals, books, Web pages—relating to your industry. Personal contact with suppliers,
customers, trade associations, and others in the same industry is another excellent way to get
important knowledge. are like sponges, soaking up as much knowledge as they can from a
variety of sources, and they continue to learn about their businesses, markets, and customers
as long as they are in business.

Prepare a Business Plan To wise entrepreneurs; a well-written business plan is a crucial

ingredient in business success. Without a sound business plan, a company merely drifts along
without any real direction and often stalls out when it faces its first challenge. Yet,
entrepreneurs, who tend to be people of action, often jump right into a business venture
without taking time to prepare a written plan outlining the essence of the business. “Most
entrepreneurs don’t have a solid business plan,” says one business owner. “But a thorough
business plan and timely financial information are critical. They help you make the important
decisions about your business; you constantly have to monitor what you’re doing against
your plan.”107 We will discuss the process of developing a business plan in Chapter 6,
“Conducting a Feasibility Analysis and Crafting a Winning Business Plan.”
 Manage Financial Resources The best defense against financial problems is developing a
practical financial information system and then using this information to make business
decisions. No entrepreneur can maintain control over a business unless he or she is able to
judge its financial health. The first step in managing financial resources effectively is to have
adequate start-up capital. Too many entrepreneurs begin their businesses with too little
capital. One experienced business owner advises, “Estimate how much capital you need to
get the business going and then double that figure.” In other words, launching a business
almost always costs more than any entrepreneur expects. Establishing a relationship early on
with at least one reliable lender who understands your business is a good way to gain access
to financing when a company needs capital for growth or expansion. The most valuable
financial resource to any small business is cash; successful entrepreneurs learn early on to
manage it carefully. Although earning a profit is essential to its long-term survival, a business
must have an adequate supply of cash to pay its bills. Some entrepreneurs count on growing
sales to supply their company’s cash needs, but it almost never happens. Growing companies
usually consume more cash than they generate; and the faster they grow, the more cash they
gobble up! We will discuss cash management techniques in Chapter 8, “Managing Cash
Flow.” Understand Financial Statements Every business owner must depend on records
and financial statements to know the condition of his or her business. All too often, these
records are used only for tax purposes rather than as vital control devices. To truly understand
what is going on in the business, an owner must have at least a basic understanding of
accounting and finance. When analyzed and interpreted properly, a company’s financial
statements are reliable indicators of its health. They can be quite helpful in signaling potential
problems. For example, declining sales or profits, rising debt, and deteriorating working
capital are all symptoms of potentially lethal problems that require immediate attention. We
will discuss financial statement analysis in Chapter 7, “Creating a Solid Financial Plan.”

Learn to Manage People Effectively No matter what kind of business you launch, you must
learn to manage people. Every business depends on a foundation of well-trained, motivated
employees. No entrepreneur can do everything alone. The people an entrepreneur hires
ultimately determine the heights to which the company can climb—or the depths to which it
can plunge. Attracting and retaining a corps of quality employees is no easy task, however; it
remains a challenge for every small business owner. One entrepreneur alienated employees
with a memo chastising them for skipping lines on interoffice envelopes (the cost of a
skipped line was two-thirds of a penny) while he continued to use a chauffeur-driven luxury
car and to stay at exclusive luxury hotels while traveling on business.108 Entrepreneurs
quickly learn that treating their employees with respect, dignity, and compassion usually
translates into their employees treating customers in the same fashion. Successful
entrepreneurs value their employees and constantly find ways to show it. We will discuss the
techniques of managing and motivating people effectively in Chapter 19, “Staffing and
Leading a Growing Company.”

Set Your Business Apart from the Competition The formula for almost certain business
failure involves becoming a “me-too business”—merely copying whatever the competition is
doing. Successful entrepreneurs find a way to convince their customers that their companies
are superior to their competitors even if they sell similar products or services. We will discuss
the strategies for creating a unique footprint in the marketplace in Chapter 2, “Strategic
Management and the Entrepreneur,” and Chapter 9, “Building a Guerrilla Marketing Plan.”

Maintain a Positive Attitude Achieving business success requires an entrepreneur to

maintain a positive mental attitude toward business and the discipline to stick with it.
Successful entrepreneurs recognize that their most valuable resource is their time, and they
learn to manage it effectively to make themselves and their companies more productive.
None of this, of course, is possible without passion—passion for their businesses, their
products or services, their customers, their communities. Passion is what enables a failed
business owner to get back up, try again, and make it to the top! One business writer says that
growing a successful business requires entrepreneurs to have great faith in themselves and
their ideas, great doubt concerning the challenges and inevitable obstacles they will face as
they build their businesses, and great effort—lots of hard work—to make their dreams
become reality.109

What is an Entrepreneurship?

Entrepreneurship is the willingness and ability of an individual to seek out investment

opportunities, establish, and run an enterprise successfully.

Entrepreneurship provides young people across the nation with valuable life skills and tools
to empower them to build sustainable and prosperous futures for themselves and their
communities.

Entrepreneurship involves the creation of value, the process of starting or developing new,
profitable business, the process of providing new product or service and intellectual creation
of value through organization of an individual or a small group of partners

Entrepreneurship is the process of identifying opportunities in the market

place/environment, arranging resources to exploit the opportunity for long term gains.

Entrepreneurship is the process and art of innovating, initiatives, risk taking and
implementing of new venture idea which is dreamed of entrepreneur.

Entrepreneurship, therefore, encompasses all the productive functions that are not rewarded
immediately by regular wages, interest and rent and non-routine human labour. It is also not
investing capital funds along. It is actually, the functions of seeking investment, production
opportunity, organizing an enterprise to undertake new production process, raising capital,
hiring labour, allocating resources, and creating new enterprises.

Features of Entrepreneurship:
 - Entrepreneurship is an economic activities- production, exchange,
distribution of goods and services for economic benefits.

- Entrepreneurship is a creative activities and exploring new opportunity

as job, new task, and new venture.

- Entrepreneurship is a purposeful activities for earning profit

- Entrepreneurship is a risk bearing capacity in uncertain environment

- Entrepreneurship is a ability to innovate something new in the

environment.

- Entrepreneurship encourages people to start business, imagine new

product in changing environment.

- Entrepreneurship is an art of knowledge based practice

- Entrepreneurship is a result oriented behaviour

- Entrepreneurship is a systematic work

- Entrepreneurship is a practical discipline

Relationship between Entrepreneur and entrepreneurship

Entrepreneur Entrepreneurship

Person Action/activities

Communicator communication

Dreamer dream

Designer design

Character Value

Believer Belief

Director direction

Delegator delegation

Facilitator Facilitating

Educator Education
Initiator Initiating , initiatives

Honest Honesty

Planner Planning

Motivator Motivation

Leader Leadership

Goal setter Goal setting

Trainer Training

Key elements of Entrepreneurship:

1. Motivation & Commitment:

Motivation toward the investment of money, work, convinces to the stakeholders

of business. Commitment is showing your dedication, determination to do
business and invest money, time, hard labour.

2. Abilities & skill:

Person have ability and skills to performs work and that individual have
appropriate skills and ability to the business they’re proposing to run
operational and management perspective.

3. Resources:

The third element is resources. That’s not purely about money and equipment;
it’s also about intellectual capability. (The ability to persuade others is
important. Many entrepreneurs have been able to negotiate very
favourable deals against the odds, when establishing their business).

4. Strategy & vision:

The fourth element is strategy and vision in terms of thinking four or five years
ahead and having some idea of where that business might be in the future
and putting in place a plan to achieve that goal.
 5. Planning & organisation:

The fifth element is planning and organisation. Without planning, organisation,

coordination and administration, the product won’t get to market nor will
it satisfactorily meet demand. You need to think about systems, job roles,
and quality issues, which if handed effectively, will ensure you, can satisfy
the market by delivering on time and to the right place.

6. The idea in relation to the market:

The sixth element is the idea and more specifically, the idea in relation to the
market place. What we are trying to do is to make certain that we are
customer focussed, ensuring that the individual is satisfied in their
requirements.

COMMON MYTHS ABOUT ENTREPRENEURS:

As an entrepreneur, we listen many myths that people tend to believe.
Somehow, entrepreneurship has built up a mythology that is founded upon
legend, anecdotes/story, movies, and who-knows-what else.

Here are few of those myths.

Myth 1: Entrepreneurs don’t quit

It may not be always true. Successful entrepreneurs need to quit sometimes.

We mostly quit the failure business and entrepreneurs too.

First, most entrepreneurs have to quit their day job in order to become an
entrepreneur.

Most entrepreneurs I know have also quit some entrepreneurial venture. If an

entrepreneur starts a crappy business and knows it, then she’s going to quit.

Elon Musk quit. Steve Jobs quit. These people are rock star entrepreneurs, but
they stepped in and out of jobs. This completely shatters the myth of the
entrepreneur who never quits.
Myth #2:  Entrepreneurs know exactly what they want, and how to get it.

Many times, entrepreneurs just don’t know what to do. They follow their gut,
but that’s hardly a plan.

Maybe some entrepreneurs have not clear -focused goal and a clear plan for
getting there.

Entrepreneurship is a process of trying, failing, trying again, and succeeding,

trying again, and trying again.

Myth #3:  Entrepreneurs are their own boss.

Nobody is their own boss. Everyone has someone they report to. Every
business owner has their own boss those are customers, investor, government
and etc.

Let’s dispense with the idea that someday you’ll be an entrepreneur in

complete charge of your entire existence.

In many cases, your business becomes your new boss. It’s ruthless,
demanding, heartless, requiring 15-hour workdays, and zero vacation time. If
you are running a consulting business, your clients are your boss. If your start
up gets funded, your investors become your boss.

So much for the no-boss paradise.

Oh, and while you’re at it, entrepreneurship is not necessarily going to

produce a utopian work-life balance, either.

Myth #4:  Entrepreneurs have to be connected.

Entrepreneurs have no time to connect to the world, development, society,

friend, family and relatives. Have you heard this saying? “It doesn’t matter
what you know; it matters who you know.”

To succeed as an entrepreneur, do not believe that.

Then how do you explain first-generation immigrants who comprise a huge

percentage of entrepreneurs? Immigrants often come to a new country with
no connections and no network. They are more likely to become successful
entrepreneurs.
Unconnected entrepreneurs formed the business-building backbone of the
United States.
Entrepreneurs Give Little Attention to Their Personal Life

Myth #5:  Entrepreneurs are usually rich.

Nope. Some entrepreneurs might become rich, but they certainly don’t start
that way.

In fact, even once the business is up and running, entrepreneurs aren’t the fat
cats that most people think they are. According to a study from American
Express in 2013, the average salary of the entrepreneur was $68,000. By
contrast, some fresh MBAs are being handed $200k salaries right after they
step off the graduation platform.
That may be rich by some standards, but it’s not enough to support the
private-jet posh lifestyle.

Entrepreneurship is not for the rich, and it might not even result in riches,
either.

Myth #6:  Entrepreneurship requires huge funding.

Some people have this idea that in order to start a business, you have to have a
pile/lot of cash. But there are more people who have no cash but being the top
riches person from business.

In order to get the pile/lot of cash, you have to wheel and deal with angel
investors, venture capitalists, and investors who ride around in chauffeured
Rolls Royces.

Some entrepreneurs will get lucky and funded, but it’s definitely not a
prerequisite for the trade.

Myth #7:  Entrepreneurship is fun!

Ha ha.

If I’m laughing, it’s my bitter laugh. There’s a true/false dichotomy to this

myth. Sure, entrepreneurship is fun. I love what I’m doing, and just about
every other entrepreneur does, too.

But let me tell you something:  Entrepreneurship is really hard, almost

unbearably so at times.

The ups and downs of entrepreneurship parallel the ups and downs of
ordinary life. There are the good times. And there are the bad times.

The difference with entrepreneurship is that the bad times are a lot badder,
and the good times are a lot better.

But fun all the time? No.

Myth #8:  Entrepreneurs always take huge risks

In order to denude/uncover this myth, I need to tell you something about risk.

In our culture, we’ve ruined the whole idea of risk. Today, “risk” is buying a
house, or stepping into an elevator, or driving to work in a car, not investing in
a 401k, or — heaven forbid — quitting your day job.
Are all those things truly risky? If so, then life is risk.

A few centuries ago, “risk” was a whole lot more. Like deciding that you were
going to go around the world in a wooden boat, and leaving life, family, riches,
and the “safe” life behind. (Hat tip to Magellan.)

Entrepreneurs are risk-takers according to our conventional jacked-up ideas

of safety. But maybe the entrepreneur’s risk-taking is nothing more than a tilt
toward the unconventional, a good idea, and dissatisfaction with the status
quo.

The entrepreneur’s risks are not the reckless actions of a devil-may-care

upstart. They are decisions that are calculated, data-driven, dream-backed,
and pursued with teeth-grinding determination.

Risk? Not hardly.

Conclusion

I believe that if someone aspires to entrepreneurship, he or she should

immediately stop believing these myths.

As much as we love to categorize and list the strengths, characteristics, or

traits of successful entrepreneurs, it’s an exercise in folly. By their very
definition, entrepreneurs are mold-breakers and disruptors.

To be a successful entrepreneur, maybe the first step is to let go of everything

you always believed about entrepreneurship.

Some Myths about Entrepreneurship:

Over the years, a few myths about entrepreneurship have developed.
These are as under:

(i) Entrepreneurs, like leaders, are born, not made:

The fact does not hold true for the simple reason that entrepreneurship is a
discipline comprising of models, processes and case studies.

One can learn about entrepreneurship by studying the discipline.

(ii) Entrepreneurs are academic and socially misfits:

Dhirubai Ambani had no formal education. Bill Gates has been a School
drop-out. Therefore, this description does not apply to everyone. Education
makes an entrepreneur a true entrepreneur. Mr Anand Mahindra, Mr Kumar
Mangalam Birla, for example, is educated entrepreneurs and that is why
they are heroes.

(iii) To be an entrepreneur, one needs money only:

Finance is the life-blood of an enterprise to survive and grow. But for a
good idea whose time has come, money is not a problem.

(iv) To be an entrepreneur, a great idea is the only

ingredient:
A good or great idea shall remain an idea unless there is proper
combination of all the resources including management.

(v) One wants to be an entrepreneur as having no boss is

great fun:
It is not only the boss who is demanding; even an entrepreneur faces
demanding vendors, investors, bankers and above all customers.

An entrepreneur’s life will be much simpler, since he works for himself. The
truth is working for others are simpler than working for oneself. One thinks
24 hours a day to make his venture successful and thus, there would be a
punishing schedule.

Entrepreneurship means much more than starting a new business.

It denotes the whole process whereby individuals become aware of the opportunities that
exist to empower themselves, develop ideas, and take personal responsibility and initiative. In
a broader sense, entrepreneurship helps young men and women develop new skills and
experiences that can be applied to many other challenges in life. Entrepreneurship is therefore
a key priority area with the potential to stimulate job and wealth creation in an innovative and
independent way

Process of New Venture Creation: Entrepreneurial

At its simplest what entrepreneurs do, can be viewed as a six-stage procedure:

They see opportunities where others don’t.

They have a ‘vision’, a clear understanding of the concept and of what they’re trying to do.

They persuade others of their vision, they can communicate the concept effectively.

They gather resources to make their vision become a reality (money, people, things).
They organize these resources to create a new venture, product or market (leadership, teams).

They constantly change/adapt themselves according to the changing demands of the market.

1. Identify an Opportunity According to Timmons (1989), entrepreneurship is about

sensing an opportunity where others see chaos, contradiction and confusion.
Identification of an opportunity is the first step towards building and running
successful business enterprise. Entrepreneurs identify opportunity where others see
obstacles and impossibility. Identification of opportunity at the right time is of utmost
importance as it gives “first mover’s advantage” and takes an enterprise ahead of
others who take time to catch up. The first mover’s advantage not only provides
product identification and higher market credibility but also provides better profits
and faster economies of scale. Example: Paul Scagnetti, an engineer at Intel came up
with the concept of handheld computer aimed at helping people do just one thing –
record and plan their fitness and nutrition. The gizmo ‘Vivovic Fitness Planner’ hit
the market successfully. LOVELY PROFESSIONAL UNIVERSITY 35 Unit 3:
Entrepreneur v/s Intrapreneur Entrepreneurs sense opportunities since they are
creative and are open to the new ideas, they Notes seek challenges even at the time of
smooth running of the operations. [Like Kushagra Bajaj of Bajaj’s Hindustan; after
coming back from US in 2000 with a master’s degree in management, he found a big
opportunity in the sugar industry in India. The demand for sugar was on rise and there
were 100 sugar mills declared sick out of a total of 553 mills in the sugar industry. He
took this problem as an opportunity and took Bajaj Hindustan to the top notch
position in 2005, in the process, becoming the leader in sugar industry in India].

2. Establish a Vision Merely seeking opportunity is not enough; an entrepreneur

further moves to establish a vision – a dream for future which can be achieved only if
opportunities are tapped at the right time. He has complete faith in his vision and it is
quite clear to him i.e. he can visualize his own optimism. Even if some market forces
change, he would readjust his vision to keep his dream viable and fruitful. And
believe it, entrepreneurs have big visions, something which others might consider as
impossible. Example: Steve Jobs and a group of 20 young engineers created the
Macintosh Computer without any adult supervision. Dhirubhai Ambani of Reliance
had dreamt that he would put a mobile phone in every individual’s hand, and the rest
is history. [We all know that today, even vegetable-sellers, farmers, milkmen,
gardeners etc. are all carrying mobile]. Dreaming this big in a poverty-stricken
country like India needs guts.

3. Persuade Others An entrepreneur does not work alone; he understands that multiple
skills are required to make business successful. Kathleen Alen, an American
academician calls this phase of entrepreneurial process ‘forming the foundation team’
i.e. an entrepreneur forms a group of individuals who would work together to realize
his dream. An entrepreneur prepares a business plan to make the vision and means of
 achieving the vision clearer to ‘the others’ who would join the team. These
individuals are not just the skilled people who would join in, but also include
financiers and even family members who put in their trust in the entrepreneur. Like
Narayan Murthy of Infosys was supported by wife for financial and psychological
backing and was joined by couple of friends – who together lead to what Infosys is
today. These trusted people are still part of Infosys and are still working together for
the further growth of business.

4. Gather Resources Identifying an opportunity, establishing a vision and persuading

others to join is not enough; a business enterprise needs resources to become
successful. This is the phase, which can convert an entrepreneur’s dream into realty.
Although we are presenting this process as it happens step by step, implying that
issues pertaining to resources are considered here, the reality is that part of the early
evaluation of the concept will inevitably involve a preliminary evaluation of whether
it can be properly resourced. Resources can be considered under four categories:
Financial

Operating

Human

Information

5. Create New Venture Once the entrepreneur has arranged for the resources
mentioned above, the next step is the creation/establishment of the new venture and
running the business venture successfully while the former task (creation of new
venture) requires lot of enthusiasm, persuasion so that he is able to gather optimum
resources. The latter task (running the business venture) requires lot of perseverance
and passion to believe in self.

6. Change/Adapt with Time As change has become the rule of the game in today’s
business environment the entrepreneur needs to continuously keep the organization
upgraded and abreast of changing times. This is not an easy task as it not only
involves availability of funds for introducing change but also (which is even more
difficult) the adaptability of human resources towards the changed environment.

What is an Enterprise?

Enterprise here is defined as resourcefulness, initiative, drive, imagination, enthusiasm, zest/

keenness, dash, ambition, energy, vitality, boldness, daring, audacity, courage, get up, and go.
 Fantasising

Incubation

Stage Model (4)

Opportunity recognition: Analysis of Environment (Political, economic, socio-cultural and

community)

Opportunity evaluation;

Opportunity development;

Opportunity commercialization

Creative activity, innovative activity, strategic activity; Preliminary evaluation (personal, commercial),
detailed situational analysis, formulation of mission and objectives, entry strategy, feasibility analysis,
and BP, resources search, operational plans, implementation plans, secure funding.