Module 1

Introduction to
Entrepreneurship

By: Shilpa. Pujar

HIMS
Entrepreneur
The word entrepreneur is derived from a French word “Entreprendre” which means to
undertake. An entrepreneur is a person who puts together capital and labour and converts his
idea into reality.
An entrepreneur is someone who takes the initiative to create a new business venture. The
entrepreneur is usually involved in finding financing, managing employees and making
strategic decisions for the business.
Entrepreneur Definition
According to the Peter .F. Drucker, “An entrepreneur is one who always searches for change,
responds to it and exploits it as an opportunity. Innovation is the specific tool of entrepreneurs,
the means by which they exploit change as an opportunity for a different business or service”.
Concept of Entrepreneurship

Entrepreneurship is the ability and readiness to develop, organize and run a

business enterprise, along with any of its uncertainties in order to make a profit. The
most prominent example of entrepreneurship is the starting of new businesses.

In economics, entrepreneurship connected with land, labour, natural resources and

capital can generate a profit. The entrepreneurial vision is defined by discovery and
risk-taking and is an indispensable part of a nation’s capacity to succeed in an ever-
changing and more competitive global marketplace.
Entrepreneurship
Entrepreneurship refers to the process of creating and managing a new business venture to achieve
financial success and make a positive impact on society.
Definitions Entrepreneurship
Entrepreneurship is the tendency of mind to take calculated risks with confidence to achieve a pre-
determined business or industrial objective. In substance it is the risk taking ability of the individual,
broadly coupled with correct decision-making.
According to A.H. Cole “Entrepreneurship is a purposeful activity of an individuals or group of
individuals undertaken to initiate, maintain and aggrandize profits by production and distribution of
associated goods and services.”
Enterprise
Enterprise simply means an economic Organization or activity. It may also be called a place of business of
an entrepreneur. Thus enterprise is an integrated whole of values, orientation.
 Importance of Entrepreneur
i. Basis of Economic Development of the Country
ii. It Helps in Establishing New Enterprises
iii. Contribution in support research and development and Expansion of Existing Enterprises
iv. Creation of Employment
v. Innovation
vi. Impact on Society and Community Development
vii.Increase Standard of Living
viii.Helps in Developing New Products and Techniques
ix. Opportunity to Get Full Human Potential
x. Promotes Capital Formation
xi. Helps in the Execution of Government Policies and Plans
 • Decision Making
Also,
• Accepting Challenges
• Making the Enterprise A Success Organization
 Characteristics Of Entrepreneur

• Visionary and Leadership quality

• Open-Minded

• Flexible

• Know your Product

• Leadership
 Qualities Of Entrepreneur
 Calculated risk taker  Business Secrecy

 Innovator  Mental Ability

 Organizer  Communication Ability

 Creative  Decision Making

 Human Relation Ability  Business Planning

 Technical Knowledge  High energy level

 Self confident  Commitment and Conviction

 Persistent problem –solver  Conceptual Ability

 Optimistic
Types of Entrepreneur
Types of Entrepreneur
Skills
Pros And Cons Of Being An Entrepreneur

(Pros):

1. Alternative to current career: Many people with entrepreneurial skills will be working for others

for reasons known or unknown to them. They are called “Intrapreneurs”. The advantage of being

that they not only get satisfaction of becoming entrepreneurs, but also their creative skill will be

used for the benefit of the society.

2. Bridge the gap between knowledge and application: Entrepreneur can bridge the gap between

knowledge and applications. Entrepreneur can convert the knowledge into an economic activity

and gain out of it. But he has to take risk. Knowledge conversion is a complicated issue.

3. Converting an idea into money: Being an entrepreneur, one may push up ones innovative ideas

into reality. He/she puts societal resources into societal use.

4. Be your own boss: Many people would like to enjoy their lives independently. They feel excited by doing

so, as being yourself as boss.

5. Better utilization of skill and knowledge: The advantage of becoming an entrepreneur is the creative skill

and knowledge of individual can be used for the society otherwise which would go wasted.

6. Competition: By adapting innovative ideas of entrepreneur the product/service can be produced at a low

cost. This facilitates the organization to face the competition in the market.

7. Originality, respected: The creative and original business ideas of an individual can be used for societal

benefit and with this the originator respected in the society. Originators feel that they can offer a new service/

product that no one has offered before.

8. Business Opportunity: People with entrepreneurial ability can seize such opportunities and have personal

gain. This also facilitates the society to tap the resources for improving the standard of living of the people.
Cons:
1. Financial Risk: Financial risk is a significant disadvantage of entrepreneurship that can pose
challenges to aspiring business owners. Entrepreneurs must either spend their funds or get outside
finance before they can launch their firm.
2. Uncertainty and Instability: Uncertainty and instability are significant disadvantages that
entrepreneurs often face. The dynamic nature of the business world can make it challenging to predict
and adapt to changes, posing risks to entrepreneurial ventures.
3. Long Working Hours: Long working hours can be a significant disadvantage of entrepreneurship.
Running your own business sometimes needs a significant time and energy commitment, which can
occasionally result in a poor work-life balance.
4. High Levels of Stress: High levels of stress can be a significant disadvantage of entrepreneurship.
Running your own business comes with a lot of pressure and responsibility, which might make you feel
stressed out more easily.
5. Limited Resources: Limited resources can be a significant disadvantage for entrepreneurs.
Entrepreneurs frequently have limitations while beginning a firm, such as a limited budget, a shortage
of staff, or restricted access to necessary equipment and technology. These restrictions may make it
difficult for an enterprise to expand and be successful.
6. Lack of Stability and Benefits: The lack of stability and benefits can be a significant disadvantage
of entrepreneurship. Unlike traditional employment where individuals often enjoy stability, predictable
income, and benefits such as healthcare coverage or retirement plans.
7. Workload and Responsibility: Workload and responsibility can be significant disadvantages of
entrepreneurship. When you operate your own business, you are in charge of many different
responsibilities and choices, which frequently leads to a hefty burden.
 Difference Between Entrepreneur and Manager
Particulars Entrepreneur Manager
It refers to persons who establish a company or They are individuals responsible for administering and
Meaning
enterprise and takes a financial risk to get profits. controlling a group of people in the company or enterprise.

Position in the They are visionaries who convert an idea into a

They are the employees of the company.
company business. They are the owners of the company.

Focus They focus on business start-ups. They focus on ongoing operations.

Risk They bear all financial and other risks. They do not bear any risks.
They focus on starting the business and expanding
Focus They focus on the daily smooth functioning of the company.
the company.
Their key motivation is the achievements of the Their motivation comes from the power that comes with the
Motivation
company. position.
Their reward is the profit they earn from the
Reward Their reward is the salary they draw from the company.
company.
They can be casual in their role and have an informal Their approach to every problem is formal, and they take a
Approach
approach. scientific approach.
They are risk-takers. They take calculated risks to They are risk-averse. Their job is to maintain the status quo
Nature of decisions
drive the company. of the company.
Decision making The decisions tend to be intuitive. The decisions are calculative.
They do not need to be specialised in any particular They are trained to perform tasks and are specialists in their
Specialisation
trade. domain.
Who is an Intrapreneur?

Intrapreneur is a person who works at a company/business that someone else founded.

Intrapreneur is a person who works with his entrepreneurial skills at a previously
established company. His/her input in the company is that they embrace innovation, such
as expanding the innovation by introducing new products, etc. They embrace innovation to
expand the company and help it grow.
 Myths of Entrepreneurship
• Entrepreneurs Are Always Successful
• Entrepreneurs Are Born With A Certain Set Of Skills
• Entrepreneurs Are Always Innovators
• Entrepreneurs Are Always Self-Employed
• Entrepreneurs Are Always Confident
• Entrepreneurs Are Born Not Made
• Entrepreneurs Are Always Risk-Takers
• Entrepreneurs Can Do It All On Their Own
• Entrepreneurs Always Have A Clear Vision Of Their Goals
• Entrepreneurs Always Have A Lot Of Funding
 Role of Entrepreneurship in Economic
Development
1. Encourages Capital formation Amongst Youth
2. Improvement in per capita income 10. Innovations in Enterprises
3. Improvement in living standards 11. Economic Independence
4. Economic independence 12. Benefits of New Firms and Businesses
5. Backward and forward links 13. Elimination of Poverty
6. Generation of Employment 14. Optimal Use of Resources
7. The exploitation of locally available 15. Increases Gross National Product and Per
resources & entrepreneurship Capita Income
8. Balanced Regional Development
9. Reducing Unrest and Social Tension
Entrepreneurial Competency

It is in the best interest of every entrepreneur to have the crucial competencies in entrepreneurship. These refer
to the set of skills, attitudes, and behaviours individuals possess that enable them to identify opportunities, take
calculated risks, and establish a successful business venture.

Simply, these entrepreneurial competencies are the qualities and characteristics that differentiate successful
entrepreneurs such as:

• Opportunity Identification
• Risk-Taking
• Creativity
• Self-Confidence
• Flexibility and Adaptability
• Leadership and Teamwork
• Financial Management
• Market Knowledge
• Networking
• Strategic planning
 Importance of Competencies in
Entrepreneurship
• They improve efficiency.

• They increase your confidence in taking risks, trying out new ideas, and tackling challenges
without fear of failure.

• They help you build strong relationships with customers, investors, and other stakeholders
who are essential for success.

• They give you a leg up when applying for jobs or internships within the industry.

• They help aspiring entrepreneurs who wish to pursue a career in the corporate business to
stand out from other prospective employees.
 Awareness of self-competency and its
development.
As an entrepreneur, two of the most important personality traits you must possess are Self-reflection and self-awareness,
they help entrepreneurs identify their strengths and weaknesses, understand their emotions and make informed decisions.
Entrepreneurs who are self-aware are more likely to have a clear sense of their values, goals and vision for their company.
Improving self-competency:
• Create time and space to pause and reflect.
• Write down your plans and priorities.
• Know your values and follow them.
• Know your emotional triggers.
• Gain a different perspective.
• Observe others.
• Leverage your strengths
• Address your weaknesses
• Building team and culture
• Work-life balance