As Steve Jobs correctly quoted- "Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma – which is living with the results of other people’s thinking. Don’t let the noise of other’s opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary."
Entrepreneurship goes beyond creating one's job or creating a company. It focuses on generating income, employment and contributing to the nation’s economy. An entrepreneur acts as an agent in the progress of the economy by creating demand and supply, employment and flow of currency, adding to the gross national income resulting in social development and human progress.
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Entrepreneurship - Definition and Scope
The dictionary meaning of entrepreneurship is, “the activity of organizing, managing, and assuming the risks of a business enterprise.”
Yes, entrepreneurship is a high-risk but high-profit career. A lot of sweat and blood goes into setting up a business and running it profitably.
Entrepreneurship has existed ever since the dawn of civilisation. It is one of the major contributors to the development of human society and the economy. Innovations in the fields of consumer goods, construction, infrastructure and technology, etc. have been possible over the years due to millions of entrepreneurs who took risks.
Also Read - Importance of Entrepreneurship Development
Why Entrepreneurship is Important?
The culture of entrepreneurship makes business ideas materialize, expand and become sustainable solutions. Below are some of the reasons why entrepreneurship is important -
Improves the quality of life: Competition in the market leads the entrepreneur to look for new alternatives for his clients; improvements in the product or service offered result in innovative products. Ingenuity has led entrepreneurs to use technology.
Expansion of knowledge and possibilities: Entrepreneurship allows us to expand our knowledge about something. The more we know, the more capable we are of mastering and getting the most out of everything we do.
Related Read - What are the Different Types of Entrepreneurs?
Entrepreneurship as a sign of well-being: It is important to understand that any venture one wants to carry out requires time, patience, and dedication. This is why starting a venture, be it personal, collective, supportive, for profit, or any other cause is always conscious and long-term work in which an idea is proposed and carried out day by day.
Economic growth: Entrepreneurship makes the market evolve and grow, creating labor demand. It is the best way to grow economically and to be independent. In addition, when the new product reaches the market, it boosts the economy's growth.
Must Read – Types of Entrepreneurship: Objective and Characteristics
Types of Entrepreneurship
1. Small businesses
These are sole proprietorships, with certain exceptions where there may be one or two more partners. They are also known as micro-enterprises and are characterized by having a low initial investment. Likewise, they are considered local enterprises which seek to distribute their products or services within the limits of their city.
2. Scalable entrepreneurship
Scalable ventures seek to have exponential growth in the short and medium term. They are born to expand rapidly and become multinational companies.
They are usually companies associated with the technological world. Some examples are mobile applications such as Netflix, Facebook, and Instagram.
3. Social entrepreneurship
This type of entrepreneurship's main objective is positively impacting your community and the world.
Those who carry out social enterprises usually develop their initiatives in the education, health, and environment sectors.
Related – Small-Scale Industries in India – Types, Eligibility, Registration, Examples
4. Mirror or imitation entrepreneurship
They replicate an idea that was or is being successful in the market. You can imitate a product, service, or business model. Franchises are an example of mirror ventures.
To acquire this type of business, it is necessary to have a significant investment due to the high cost of paying for a recognized brand.
5. Opportunistic entrepreneurship
As its name indicates, this type appears suitable to solve a specific and urgent need. During the pandemic, for example, this type of company began to manufacture chinstraps in large quantities.
What characterizes these businesses is the entrepreneur's vision, creativity, and ability to execute quickly.
6. Incubator ventures
Unlike the opportunist, the incubator venture focuses on investigating the permanent needs of the market to offer an innovative solution.
This type of entrepreneurship requires a large investment to conduct the investigations that allow it to reach correct conclusions about the needs of the niche they are analyzing.
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Key Elements of Good Entrepreneurship
Below are the crucial elements that an entrepreneurial venture requires to succeed.
Executive Summary
It is a strategy with which an entrepreneur discloses the details of his business plan synthetically and quickly to capture the attention of potential investors.
According to CIO, an executive summary should describe the problem you will solve with your product or service and why this problem must be solved. Write the executive summary of your business once you have done all your research and noted it on paper.
Must Read - How to Foster an Entrepreneurial Culture in the Company?
Perseverance
Not everything is rosy at the beginning. Those who start from scratch have great challenges and often go through crises or moments of doubt. Before being successful, a company goes through the cycle of living its own market experience, getting to know its customers, and seeing how some arrive and others leave.
Throughout this process, perseverance is key. Perseverance helps you to keep trying every day, no matter if they are good or bad days. Results take time, but consistency will allow you to achieve your goals.
The results take time, but perseverance will allow you to achieve your goals. Perseverance is necessary for an entrepreneur's success. We are so involved in improving one aspect at a time that we may ignore the daily motivation that leads us to continuous effort. Being consistent and persevering through difficult times is one of the key elements of entrepreneurship.
Mathematical and Financial Training
The entrepreneur who knows nothing about his business and hands it over to someone else can find himself in quite complicated situations.
Even when the accounting is carried out by someone you trust, you must be aware as the promoter of that venture. But not only informed, but you should know how things are done, what taxes you have to pay, how the previous month fared compared to the current one, etc.
It has to be based on the study and understanding of reality and work with real goals. When setting up a company, according to the study, it is also essential that the entrepreneur have a perception of the opportunities that he can take advantage of, as well as the social context in which he will undertake or the evaluation of the possible risks to be taken.
Finance
One of the most important data your business plan should contain is the capital you need to start your company, its origin, and how it will be covered. It would help if you gave the same importance to how you will pay the capital you have to launch your new business as to how you got it. The lack of planning on acquiring capital for your business is one of the main reasons it can fail.
Whether you are going to receive financing to run an e-commerce store or a technology company, your accounts should always be clear. Keep in mind -
- The entrepreneur must manage his finances.
- The entrepreneur must constantly learn and keep up to date on his finances.
- Learn about financial management to maintain healthy finances
- Whoever starts his business must be able to manage a business's cash flow adequately.
Be Your Brand Ambassador
Your venture should have a face. When people see that image of the company or business, they know it's you. Learn to identify their needs and give more timely responses. This way, they will know that it is not just a sale of products but that someone is behind it, a person of flesh and blood like them.
Market Analysis
Every business plan should include a section in which you explain your company's target audience. There are several ways to incorporate this information into your plan. On the one hand, you must conduct in-depth data research on the industry to which your product or service belongs.
Look at your competitors to know who their target audience is. Likewise, you must include the profile of your ideal client so that you are clear as to whom you are offering your product or service.
For your business plan to be attractive to investors and potential partners, you must be able to provide real data and information that supports that both your target audience and the community to which it belongs are financially strong and growing.
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Popular Entrepreneurship Tools
| Tool |
Description |
| WordPress |
It is the tool par excellence for creating a high-quality web page in a very simple way. WordPress can be a great ally for entrepreneurs today because it will allow them to create their websites themselves. |
| |
Google Analytics is a fundamental tool for any enterprise. It provides all the information necessary to steer your business in the right direction. It is a free software created by Google for collecting data such as the total number of visits, duration of each visit, most visited pages, traffic sources, users' favorite sections, keywords data, and presenting reports to its users. |
| Hootsuite |
It is the perfect tool to manage social networks, schedule publications, and receive information about the interactions in the different social networks you manage. |
| Dropbox |
Dropbox serves as a virtual hard drive, meaning it is a place to store information in the cloud. |
| Mailchimp |
Mailchimp is a marketing automation platform that allows sharing email advertising campaigns with clients and other stakeholders and offers statistics on your emails' impact, helping you make the right decisions. |
| Trello |
It is a simple tool that helps organize any activity. It allows you to manage all tasks and work teams easily. In addition, it is possible to organize the work in virtual boards made up of task lists. In this way, all information can be accessed at a single glance. |
| Hubspot |
Hubspot is a marketing and sales tool with a customer management platform essential for running a business. This CRM stores all information about customers and their business operations. |
| SimpleMind |
This app is great for capturing and mapping your ideas, helping you keep them fresh so you can compare them later and figure out your ideal project. |
| Canva |
Canva is dedicated to graphic design, primarily to creating images, vectors, graphics, and other digital visual assets. |
| Slack |
Slack allows you to create rooms or chats between collaborators and members by projects, assignments, or departments to centralize business communication and keep everyone abreast of progress and events. |
| WhatsApp Business |
It is an essential platform to maintain communication with your customers, especially in a young company, where you can interact with them, publish your catalog and manage all your communications as a brand. |
| Asana |
Platform with digital skills that allow communication and task management of a work team, improving entrepreneurship and employee productivity. It allows us to control every detail of our project. |
| Business Plan Premier |
This application creates business plans, expectations, and objectives. It focuses on prosperous entrepreneurs who opt for the start-up modality capable of developing a reliable marketing plan. |
Also Read - Types of Entrepreneurship: Objective and Characteristics
Evolution of Entrepreneurship
Regarding the origin of the word, it comes from the French "entrepreneur," which means "pioneer," and derives from the Latin word "prenderé," which means "to undertake" and "to try." (Orrego, C. 2008). This expression represents the ability of a person to meet an objective. This term also designates innovative people who start a new organization or project.
In the 16th century, according to Cesar, C. and Viveros, H. (1996), entrepreneurship referred to travelers who crossed to the New World in search of opportunities, including Christopher Columbus, Francisco Pizarro, Blasco Núñez de Balboa, among others. Richar Cantillón, 1755, was an economist who conceptualized entrepreneurship as: "an individual who assumes risks in conditions of uncertainty" (Rodríguez, A. 2009).
It is believed that Cantillon was the first to introduce the term formally and related it to the economic factor and its growth. Years later, in 1810, Jean-Baptiste, a French economist, first coined the word “entrepreneur” and defined the entrepreneur as follows:
"The entrepreneur shifts economic resources out of an area of lower and into an area of higher productivity and greater yield."
Entrepreneurship - Challenges and Solutions
Funding:
- Problem: Starting a business requires capital, and obtaining funding can take time and effort, especially for new entrepreneurs.
- Solution: Networking: Building relationships with investors, industry experts, and other entrepreneurs can help secure funding and offer valuable insights.
Competition
- Problem: Entrepreneurs must find ways to stand out in a crowded market and compete with established businesses.
- Solution: Unique Value Proposition: Developing a unique value proposition that sets a business apart from competitors is key to success.
Marketing:
- Problem: Effective marketing is crucial for attracting customers and building brand awareness, but it can be expensive and time-consuming.
- Solution: Targeted Marketing: Entrepreneurs can target specific demographics and use cost-effective marketing strategies to reach potential customers.
Time Management
- Problem: Entrepreneurs wear many hats and must balance the business's demands with other responsibilities.
- Solution: Prioritization: Entrepreneurs must prioritize tasks and delegate responsibilities to manage their time effectively.
Hiring and Managing Employees
- Problem: Finding and retaining the right employees is essential for the success of a business, but it can also be a challenge.
- Solution: Employee Training and Development: Offering employee training and development opportunities can help attract and retain top talent.
Also Read - How to Know The Important Difference Between Entrepreneur and Businessman
List of Important Topics
In the world of entrepreneurship, the following terms are frequently used.
- Angel Investors - They fund and leverage their networks for entrepreneurs at an early stage of creating a startup.
- Independent Contractors - They are self-employed individuals who work for corporations separately. They are not so different from entrepreneurs.
- Limited Partnership - It exists when one of the partners stays in business for a short period of time, as long as their investment is fulfilled.
- Patent - To protect the rights of an invention, a patent is required.
- Networking - It is the process to expand one’s business by building necessary contacts in the same field.
Also Read - Difference Between Entrepreneur and Intrapreneur
Future of Entrepreneurship
Today entrepreneurs have access to technologies that were once only for large corporations with huge budgets. Entrepreneurs now have access to large sources of capital, such as investment funds, angel investors, or crowdfunding. The possibility of creating a business will be more simplified and cost-effective.
The crucial factors that would shape up the future of entrepreneurship include -
Access to Technology
Advances in technology have led to significant growth of industries, particularly new ventures, that too with a fraction of the investment of what it cost a few years ago. Technological advancements such as artificial intelligence, automation, and the Internet of Things are expected to provide new business opportunities for entrepreneurs.
The cost of microprocessors, the scaling of software on demand (Software as a Service), popularization of teleworking, and the massive access to broadband internet, will make any venture possible with minimal investment.
Access to Innovative Channels
This was another of the great bastions of the oligopolies that have dominated hundreds of industries for decades. Having control of the distribution channels as the only way to serve the markets was an insurmountable barrier to entry for any venture. The channels were already controlled, leaving new businesses without a "showcase" for marketing.
The rise of e-commerce and the increasing purchasing power of consumers in emerging markets are two examples of how globalization is creating new opportunities for entrepreneurship.
The future of entrepreneurship will likely be shaped by a combination of technological advancements, globalization, changing consumer behavior, and access to funding, creating new opportunities and challenges for entrepreneurs to navigate.
Anshuman Singh is an accomplished content writer with over three years of experience specializing in cybersecurity, cloud computing, networking, and software testing. Known for his clear, concise, and informative wr... Read Full Bio
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