Entrepreneurs and characteristics of entrepreneurial ventures

Chapter 2
Overview
LECTURE CONTENTS
Defining and Characteristics Entrepreneurs

Types of Entrepreneurs

Characteristics of entrepreneurial ventures

Cultural differences and personal motivation

Dimensions of culture
Defining Entrepreneurs
An individual creating a new enterprise and bearing the risks and the
rewards of the establishment. The process of establishing a business is
known as entrepreneurship. They play a key role in the economy as they
use their skills to study the market and bring new products according to the
market.
Characteristics of Entrepreneur

Tenacity and ability

Passion Optimism to overcome
hardship

Independent
Confidence Vision
thinking

Resourceful and
Focus Action-oriented
problem-solvers
Characteristics of Entrepreneur

• Passion: Talk to successful entrepreneurs and you'll nearly always

hear the word passion when they describe what they do. Following
your passion is one of the best predictors of success.
• Independent thinking: Entrepreneurs often think outside the box
and aren't swayed by others who might question their ideas.
• Optimism: It's difficult to succeed at anything if you don't believe in
a good outcome. Entrepreneurs are dreamers and believe their
ideas are possible, even when they seem unattainable.
Characteristics of Entrepreneur

• Confidence: This is not to say entrepreneurs never have self-

doubt, but they're able to overcome it, and believe they can
achieve their goal.
• Resourceful and problem-solvers: Lack of assets, knowledge,
and resources are common, but entrepreneurs can get what
they need or figure out how to use what they've got to reach
their business goals. They never let problems and challenges
get in the way, and instead, they find ways to achieve success
despite hardships.
Characteristics of Entrepreneur

• Tenacity and ability to overcome hardship: Entrepreneurs

don't quit at the first, second, or even hundredth obstacle. For
them, failure is not an option, so they continue to work toward
success, even when things go wrong.
• Vision: Some of the more stringent definitions of
entrepreneurship include vision as a necessary element. It
helps to know your end goal when you start. Further, vision is
the fuel that propels you forward toward your goal.
Characteristics of Entrepreneur
• Focus: It's easy to get distracted in this fast-paced world. Many start-ups get
side-tracked by the "shiny object syndrome" (products and services that
promise fast results), or they get bogged down in unimportant busywork.
Successful entrepreneurs avoid these distractions and stay focused on what
will bring results.
• Action-oriented: Entrepreneurs don't expect something to come from nothing,
and they don't wait for things to happen. They are doers. They overcome
challenges and avoid procrastination.
 Entrepreneurs – born or made?
Explore
further

This animation explains the difference between a

‘growth’ & a ‘fixed’ mindset & discusses how they
might be developed or changed
This video discusses whether entrepreneurs are
predominantly born with certain character traits or
whether these traits result from their various cultural
influences

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 Comparative Table: Entrepreneur and Entrepreneurship
Aspect Entrepreneur Entrepreneurship
An individual who initiates and operates a business The concept, mindset, and process of creating and managing a
Definition
venture business
Motivatio Driven by innovation, identifying opportunities, and solving
Driven by personal vision, passion, and ambition
n problems
Represents the collective qualities and characteristics of
Role Plays an active and hands-on role in the business
entrepreneurs
Risk- Takes calculated risks to pursue business Embraces uncertainty, takes risks, and adapts to changing
taking opportunities circumstances
Encourages and fosters creativity and innovation in business
Creativity Uses creativity and innovation to develop new ideas
ventures
Leadershi Assumes leadership and decision-making
Advocates for leadership, initiative, and taking ownership of ideas
p responsibilities
Directly influences the success or failure of the Shapes industries, economies, and societal progress through
Impact
business entrepreneurial activities
Seeks growth and scalability for the business Drives economic growth and job creation through entrepreneurial
Growth
venture endeavours
Possesses an entrepreneurial mindset and mindset
Mindset Reflects a culture of innovation, resilience, and adaptability
traits
Personal
Bears personal financial and professional risks Encourages calculated risk-taking while managing potential risks
Risk
 Small
Business

Lifestyle Home-Based
Entrepreneur Business

Types of
Entrepreneurs

Serial Online
Entrepreneur Business

Inventors
Small Business
• Some entrepreneurial pursuits end up becoming
massive businesses, but they all start out as a
small business, and many stay that way. These
include mom-and-pop shops and local business
owners. Small businesses can include partnerships,
sole proprietors. The exact definition of a small
business in the U.S. depends on its industry, but
it's determined by an employee headcount, a
revenue cap, or both.
Home-Based Business
• A home-based business could fit under the
category of small business, but the primary factor,
in this case, is that it's run from home, as opposed
to an office or other location. Just because a
business is run from home doesn't mean it can't
compete with larger businesses. Many large
corporations start at home before moving into an
office space.
Online Business
• Internet-based business can be small, home-
based, or even large corporations. The key
difference here is that the business is operated
primarily online. This includes companies like
Amazon or other e-commerce businesses,
bloggers, eBay and Etsy owners, and any other
business that does the majority of its business
online.
 Inventors
• For an inventor to be considered an entrepreneur,
they need to go beyond the idea stage to build the
product and get it to market. Good examples of
inventors who transition to entrepreneurs are the
contestants that appear on the TV show "Shark
Tank."
• Warren Buffett
• DISSCUSSION • I never attempt to
make money on
Let’s discuss the stock market.
Warren Buffett, I buy on the
life, characters assumption that
and story. they could close
the market the
next day and not
reopen it for five
years
Serial Entrepreneur
• Many entrepreneurs get the most joy out of
starting and building a business, but not in its
continued management. Those kinds of
entrepreneurs start a business, then they sell it
and pivot to launching a new idea. They are still
considered entrepreneurs because they operate
and assume risk in the business for the time they
own it. Other times, serial entrepreneurs juggle
several businesses at once, earning multiple
streams of income.
 Lifestyle Entrepreneur
• Although the idea of a lifestyle entrepreneur isn't new, it's gained in popularity with
the rise of technology like YouTube that gives everyone access to a global
audience. A lifestyle entrepreneur is one who builds a business that incorporates
their interests and passions and sustains their life goals.

• Many in this category are referred to as

digital nomads because they have
online businesses that allow them to
travel. However, travel isn't a defining
aspect of lifestyle entrepreneurs. The
key factor in a lifestyle entrepreneur is
that they've found a way to monetize
their favorite hobbies, habits, and
lifestyles.
How to become an entrepreneur?
Curiosity
• Successful entrepreneurs have a distinct personality trait that sets them
apart from other organizational leaders: a sense of curiosity. An
entrepreneur's ability to remain curious allows them to continuously seek
new opportunities. Rather than settling for what they think they know,
entrepreneurs ask challenging questions and explore different avenues.

• This is validated in the online course Entrepreneurship Essentials, where

entrepreneurship is described as a “process of discovery." Without
curiosity, entrepreneurs can’t achieve their main objective: discovering
new opportunities.

• The drive they have to continuously ask questions and challenge the status
quo can lead them to valuable discoveries easily overlooked by other
business professionals.
Willingness to Experiment
• Along with curiosity, entrepreneurs require an understanding of
structured experimentation, such as design thinking. With each new
opportunity, an entrepreneur must run tests to determine if it’s
worthwhile to pursue.

• For example, if you have an idea for a new product or service that
fulfills an underserved demand, you’ll have to ensure customers are
willing to pay for it and it meets their needs. To do so, you’ll need to
conduct thorough market research and run meaningful tests to
validate your idea and determine its potential.
 Adaptability
• Entrepreneurship is an iterative process, and new
challenges and opportunities present themselves
at every turn. It’s nearly impossible to be prepared
for every scenario, but successful business
leaders must be adaptable.
• This is especially true for entrepreneurs who need
to evaluate situations and remain flexible to
ensure their business keeps moving forward, no
matter what unexpected changes occur.
Decisiveness
• To be successful, an entrepreneur has to make difficult decisions and
stand by them. As a leader, they’re responsible for guiding the
trajectory of their business, including every aspect from funding and
strategy to resource allocation.
• Being decisive doesn’t always mean being correct. Entrepreneurs
need the confidence to make challenging decisions and see them
through to the end. If the outcome turns out to be less than
favorable, the decision to take corrective action is just as important.
Self-Awareness
• A great entrepreneur is aware of their strengths and
weaknesses. Rather than letting shortcomings hold
them back, they build well-rounded teams that
complement their abilities.

• In many cases, it’s the entrepreneurial team, rather

than an individual, that drives a business venture
toward success. When starting your own business, it’s
critical to surround yourself with teammates who have
complementary talents and contribute to a common
goal.
Risk Tolerance
• Entrepreneurship is often associated with risk. While it’s true that
launching a venture requires an entrepreneur to take risks, they also
need to take steps to minimize it.
• While many things can go wrong when launching a new venture,
many things can go right. According to Entrepreneurship Essentials,
entrepreneurs who actively manage the relationship between risk
and reward position their companies to “benefit from the upside.”
• Successful entrepreneurs are comfortable with encountering some
level of risk to reap the rewards of their efforts; however, their risk
tolerance is tightly related to their efforts to mitigate it.
Comfort with Failure
• In addition to risk-management and calculated decision-making, entrepreneurship
requires a certain level of comfort with failure.
• The reasons for failure are vast and encompass everything from a lack of business
scalability to low product-market fit. While many of these risks can be avoided, some are
inevitable.
• Despite this, entrepreneurs must prepare themselves for, and be comfortable with, failure.
Rather than let fear hold them back, they maintain a positive attitude to allow the
possibility of success to propel them forward.

• “Of startups that have more than one employee, 70 percent survive at least two years,
half last at least five years, and a quarter last 15 years,” says Harvard Business School
Professor William Sahlman in Entrepreneurship Essentials. “Even then, only a small
fraction of the survivors get to be significant employers.”
Persistence
• While many successful entrepreneurs are
comfortable with the possibility of failing, it
doesn’t mean they give up easily. Rather, they see
failure as an opportunity to learn and grow.
• Throughout the entrepreneurial process, many
hypotheses turn out to be wrong, and some
ventures fail altogether. Part of what makes an
entrepreneur successful is their willingness to
learn from mistakes, ask questions, and persist
until they reach their goal.
Innovative Thinking
• Innovation often goes hand-in-hand with entrepreneurship.
While innovation in business can be defined as an idea
that’s both novel and useful, it doesn’t always involve
creating an entirely new product or service. Some of the
most successful startups have taken existing products or
services and drastically improved them to meet the
changing needs of the market.

• Although innovation doesn’t come naturally to every

entrepreneur, it’s a type of strategic mindset that can be
cultivated. By developing your problem-solving skills, you’ll
be well-equipped to spot innovative opportunities and
position your venture for success.
Long-Term Focus
• Most people associate entrepreneurship with starting a business.
While the early stages of launching a venture, such as securing
funding, are critical to its success, the process doesn’t end once the
business is operational.

• According to Entrepreneurship Essentials, “it’s easy to start a

business, but hard to grow a sustainable and substantial one. Some
of the greatest opportunities in history were discovered well after a
venture launched.”

• Entrepreneurship is a long-term endeavor, and entrepreneurs must

focus on the process from beginning to end to ensure long-term
success.
 Dimensions of culture
Individualism v collectivism – the degree to which people
prefer to act as individuals rather than as groups
Power distance – the degree of inequality accepted by
the community
Uncertainty avoidance – the degree to which people
avoid ambiguity/uncertainty & prefer structure
Masculinity vs femininity – quality of life issues like
individual achievement & assertiveness vs relationships &
concern for others

Hofstede, 1981
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 National cultures
Low High
South America, INDIVIDUALISM USA, UK, France,
Saudi Arabia, Australia,
Pakistan Canada
USA, UK, POWER South America,
Germany, DISTANCE France, Malaysia,
Scandinavia Saudi Arabia
USA, UK, UNCERTAINTY Greece, France,
Hong Kong, AVOIDANCE Portugal, Uruguay,
Singapore Saudi Arabia
MASCULINITY USA, Austria,
North Europe UK, Japan,
Germany
Entrepreneurial cultures 34
 Meyer’s cultural influences
Communicating – simple vs nuanced
Evaluating – direct vs indirect criticism
Persuading – theory vs application
Leading – high vs low power distance
Deciding – group vs individual
Trusting – task (head) vs relationship (heart)
Disagreeing – comfortable vs uncomfortable
Scheduling – flexible vs inflexible

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 Meyer’s cultural assessment tool
Explore
further

Meyer’s cultural assessment tool

https://hbr.org/2014/08/whats-your-
cultural-profile

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Thank you for listening!