Topic 3

ENTREPRENEURIAL MOTIVATION
 Introduction

Several research studies have been conducted to identify the factors that
inspire entrepreneurs to venture into business. Among these factors are:-
– Educational background
– Occupational experience
– Family background
– Desire to work independently
– Assistance from government
– Assistance from financial institutions
– Availability of technology/raw materials
– Demand of a particular product
– Favourable business environment
– Staple political situation
– 
Factors which motivate people to venture into business can be grouped into
two main categories namely: Internal factors and External factors
 Internal Factors Motivating Entrepreneurs into Business

These include:
– Strong desire to do something independently in
life
– Technical knowledge and manufacturing
experience
– Business experience in the same or related line
– Heredity
 Factors External to the Entrepreneur
– Profit margin
– Unstable units available at a cheap place
– Heavy demand
– Encouragement from big business
– Financial assistance from non-government sources
– Attitude of the government to help new units
– Machinery on hire purchase
– Accommodation in industrial estates
– Financial assistance from institutional sources

Other studies have classified factors behind entrepreneurial growth into

three categories namely
– Entrepreneurial ambitions
– Compelling reasons
– Facilitating factors
Entrepreneurial Ambitions
• To make money
• To fulfill desire to self/parents
• To continue family business
• To secure self-employment/independent living
• To gain social prestige
• To make decent living
• Desire to do something creative
• To create employment

Compelling Reasons
• Unemployment
• Dissatisfaction with the job
• Making use of the funds
• Making use of technical/professional skills.
• Maintenance of a large family
• Emergency
 Facilitating Factors
– Previous association
– Previous employment in same or other lines
– Success story of other entrepreneurs
– Property inheritance
– Advice or influence from others

Other factors that contribute to entrepreneurial

motivation are embedded in the theory of
achievement motivation such as desire to
excel, strive for success etc.