Chapter 1: Entrepreneurship in Bangladesh and globally

Course: Entrepreneurship Development and Small

Business Management
Course Code: BBA-0303
Section: 7A

S.M. Misbauddin
Lecturer of Management, NUBTK
MBA (Leipzig Uni, Germany), BBA (KU)
E-mail: misba.opu@gmail.com
Phone: 01912940961

1–1
 Agenda

01 Entrepreneurship
situation in BD and
04Entrepreneurship
Female
in BD
globally

02 Challenges faced by
entrepreneurs in BD
05 Ways to counter
challenges

Rural
03 Entrepreneurship in
BD
Entrepreneurship meaning
What Is an Entrepreneur? 
An entrepreneur is an individual who creates a new business, bearing most of the risks and
enjoying most of the rewards. The entrepreneur is commonly seen as an innovator, a source of
new ideas, goods, services, and business/or procedures.

Entrepreneurship Definitions 
Economists have never had a consistent definition of "entrepreneur" or "entrepreneurship" (the
word "entrepreneur" comes from the French verb entreprendre, meaning "to undertake"). 

Entrepreneurship refers to the process of creating a new enterprise and bearing any of its risks,
with the view of making the profit.

It is an act of seeking investment and production opportunity, developing and managing a

business venture, so as to undertake production function, arranging inputs like land, labour,
material and capital, introducing new techniques and products, identifying new sources for the
enterprise.
 A comparison of entrepreneurship Development
80000

70000

60000

50000

40000

30000

20000

10000

0
USA Sweden China United States Japan India Bangladesh
Motivations of Entrepreneurs
 Schumpeter denominates three different motivations:

(Theory of the Economic Development (1912), p. 138

and following)
 “The wish to establish a private realm”

 “The wish to triumph”

 “The wish to be successful just for being successful”,

“Pleasure by creating”

 “The essence of entrepreneurship lies in the

perception and exploration of new opportunities in
the realm of business … it always has to do with
bringing about a different use of national resources in
that they are withdrawn from their traditional employ
and subjected to new combinations.”
Entrepreneurial Rates Worldwide

Global Entrepreneurship Monitor

www.gemconsortium.com

 Total Early-Stage Entrepreneurial Activity (TEA

rate)
 Individuals who are actively involved in
business start-ups:
 in the phase in advance of the birth of the firm
(nascent entrepreneurs)
 in the phase spanning 42 months after the birth
of the firm (owner-managers of new firms)
Entrepreneurial Rates Worldwide

Source: Global
Entrepreneurship Monitor
2013.
Necessity-Driven Entrepreneurship vs Opoortunity-driven
entrepreneurship
• The necessity vs opportunity entrepreneurship classification of Reynolds et al.
(2002) is made mainly based on distinguishing between entrepreneurs motivated
by economic needs and those driven by a desire for self-realization respectively.

• The necessity-driven entrepreneurs are pushed into entrepreneurship because all

other options for work are absent or unsatisfactory.

• Opportunity driven entrepreneurs are attracted to the world of entrepreneurship

mostly out of choice to exploit some business opportunity, Williams and Round,
(2009). Entrepreneurs utilize new technology for creating start-ups.

• Opportunity entrepreneurs might stay longer in self employment than necessity

entrepreneurs. Opportunity entrepreneurs who start their venture voluntarily have
more knowledge and/or knowledge of a higher quality than necessity
entrepreneurs. Opportunity entrepreneurs are likely to have prepared more
systematically for their entry into self-employment, and are likely to have invested
more in the specific human capital necessary to succeed as a business owner;
Necessity-Driven vs Opportunity-driven entrepreneurship

Necessity-based Entrepreneurship - firms with a low growth potential

 Employment substitution and generating additional income

Opportunity-based Entrepreneurship - firms with a substantial growth

potential

 Technology-oriented enterprises and customer-oriented companies

There is a clear negative correlation between the quantity of necessity-based start-ups

and the income per capita, as well as the integration in the world market.

In the majority of developing countries predominates a necessity-based

entrepreneurship. This could establish a negative correlation between number of start-
ups and economic growth.
Entrepreneurs motivated by Necessity and Opportunity

Phase of economic development

Source: Global
Entrepreneurship Monitor
2013.
 Born Global entrepreneurship
Born globals are defined as organizations that within a few
years from being founded enter several international
markets and have a global mindset from day one.

Also Known as, Early internationalizers, international

New Ventures, High Technology Start-ups, Global Start-
ups or International Entrepreneurs.

“Business organization that, from inception, seeks to

derive significant competitive advantage from the use of
resources and the sale of outputs in multiple countries
(Oviatt & McDougall, 1994)
Born Global entrepreneur Development stages
Born Globals in the Economy
 Born globals as a share of young and all enterprises, selected EU Member
States, US and Japan

Source: Eurofound 2012.

◗ Lack of proper management, accounting, congenial industrial
relations, updated knowledge about the global market.
◗ Lack of confidence
◗ Lack of knowledge
◗ Absence of proper policy decision
◗ Lack of proper training facilities of entrepreneurs
◗ Curriculum Lacking
 Lack of legitimacy of entrepreneurship
 Lack of social mobility

 Insufficient security

 Religious problems

 Improper support from relatives, friends & teachers

Financial problem
 Lack of adequate basic facilities
 Non availability of capital

 Greater risk involved in business

 Non availability of skilled labor

 Insufficient arrangement for pre-investment advice

 Government should take the necessary initiatives to develop this sector.
 Government should have a clear policy about the small scale enterprises in
Bangladesh.
 Loan and this short of facility should be made available.
 Control the inflow of importing such product which has the
opportunities to produce in Bangladesh.
 Make the political situation stable as much as possible.
 Make the economic situation stable.
 Provide both social and economic securities to the people.
 Improve the human resources.
 Making more entrepreneurs through proper training and loan facilities.
 Make the people interested to start their own or family business.
 Provide possible support to the small scale enterprises in
Bangladesh.
 Developing small scale enterprises in Bangladesh through a
proper long term planning
◗ Entrepreneurship emerging in rural areas is
called rural entrepreneurship. Establishing
industries in rural areas refers to rural
entrepreneurship. Rural entrepreneurship is
synonymous of rural industrialization
 The reason behind this is that most of the people of the country are
living in the villages.
 The rural sectors contribute about two-thirds of the GDP.
 Encompass improved productivity.
 Employment generation
 Income generation
 Rural development
 Build up village republics
 Curbs rural-urban migration
 Development of rural industries serves as ineffective means to build up
village
republics.
 Rural industrialization fosters economic development in rural areas.
 Financial constraints.
 Lack of technical know-how.
 Lack of training and extension services.
 Management problems.
 Lack of quality control.
 High cost of production due to high input cost.
 Lack of communication and market information.
 Poor quality of raw materials. Lack of storage and warehouses.
 Obsolete and primitive technology.
 Lack of promotional strategy.
 Problem of recruitment of employees.
 Problem of promotion of employees.
 Primary Education Program
 A policy formulation for strengthening the raw material base in rural
areas
in the country.
 Training for Entrepreneurship Development
 Imparting entrepreneurial education at the school, college and universities
 Village Development
 Technology in rural development
Entrepreneurship has become an important profession among
the women of Bangladesh today at various levels of the
society, both in the urban and the rural areas. The reason for
the interest varies according to the different classes of the
society.
◗ Bangladesh is a densely populated country with limited resources and
higher social stratification. The urban areas have better prospects for
business growth expansion while rural areas lag behind.
◗ Since few women participate in the mainstream of economic
activities, the enormous potentiality of the population is unutilized
For instance, only 16% of women are self-employed out of 66% self-
employed citizen (based on entrepreneurship status).
 Her being a woman
 Responsibility towards family, society and work
 Family problems
 Lack of business training
 Lack of education
 Non-awareness of facilities provided by government
 Questions by licensing authorities
 Marketing
 Poor self-image of women
 Faulty socialization
 Role conflict
 Cultural values
 Lack of courage and self-confidence
 In order to make long-term changes in women's ability to
participate freely in the economy, the socio-cultural constraints
on women must be addressed.
 Women need to be able to access mainstream banking and

finance, and need support in this area.

 Education and awareness

 Training facility

 Family occupation

 Adequate financial facilities

 Ensure women’s easy access to markets

LOGO

THANK YOU

DANKE SCHÖN

7/10/21 25