1.

0 Introduction
This course is designed to provide insight into Entrepreneurship, Entrepreneurship functions, Types, Advantages,
Drawbacks, contribution of entrepreneurship to National development, Starting a Business etc. By the end of the
course you are expected to have an overview Entrepreneurship.
2.0 Definition of Terms
o Enterprise: A business or organization focused on commercial activities, often driven by an
entrepreneur's vision and innovation.
o Business: An entity engaged in producing, buying, or selling goods or services for profit.
o Innovation: Introducing new ideas, products, or methods that improve efficiency, solve problems, or
create value.
o Creativity: The ability to generate unique and original ideas, often the foundation for innovation in
entrepreneurship.
o Transaction: An exchange of goods, services, or money between two or more parties.
o Investment: The act of putting money, time, or resources into a business or project with the expectation
of future profit or benefit.
o Demand: The desire and willingness of consumers to purchase goods or services at a given price.
o Interest: The cost of borrowing money or the return earned on an investment.
Interest rate: The percentage charged on a loan or paid on savings over a period of time.

• Profit/loss: Profit is the financial gain when revenue exceeds expenses; loss occurs when expenses surpass
revenue.
o Undertaken: Actions or efforts initiated to start and manage a business or project.
o Risk: The possibility of loss, failure, or unforeseen challenges in business activities.
Finance: Managing money, including activities like budgeting, investing, borrowing, and planning for
business operations.
o Product/goods: Tangible items produced and offered for sale to meet customer needs.
o Income: Money earned by an individual or business through work, investments, or business activities.
3.0 Entrepreneurship meaning
Entrepreneurship: Entrepreneurship is the dynamic process of identifying business opportunities, organizing
resources, taking calculated risks, and establishing and managing a business venture. The ultimate goal is to
create value, solve problems, and
generate profit.
3.1 Entrepreneur and Entrepreneurship
Entrepreneur
i) An entrepreneur is a person who identifies a business opportunity, harnesses and obtains the resources
necessary to initiate a successful business activity.
ii) An entrepreneur implements business idea
iii) An entrepreneur undertakes risk to operate the business
v) An entrepreneur is therefore a central key individual in the society who makes things happens for economic
development.
Entrepreneurship
i) Entrepreneurship looks at particular individuals in a business set-up. It operates in large business or
organization which is business minded to make profit.
ii) Entrepreneurs operate autonomously for the welfare of the organization.
3.2
Functions of an Entrepreneur
1. The bearing of uncertainty is the primary function of the entrepreneur i.e losses or profits.
2. The management of the business enterprise ie can delegate
3. Provision of risk capital and invention.
4. Identifying gaps in the market and turning such gaps to business opportunities i.e to initiate a business.
5. Financing the businesses, through raising and mobilizing the necessary resources to exploit opportunity.
6. Searching for business opportunities through environmental scans.
7. Mobilization of resources needed to start and run a business e.g. from
1. Personal savings
2. Friends & relatives
3. Financial institutions e.t.c
1. Evaluation of business opportunities to access viability and any other benefits that might accrue to the
business.
2. Provide the necessary leadership for the business and those working in it.
3.3 Types of Entrepreneurs
1. Craft entrepreneurs: Exploits and utilizes personal skills to start a business without thinking of its growth or the
expansion objectives.
This type of entrepreneurship;
i. There is no expanding even after a long time ii. It is not business expansion oriented
iii. the skills can be technical skills, professional skill e.t.c
2. Opportunistic entrepreneurs: This is a person who starts a business, acts as a manager and with a view to
expand the business to maximum.
i. He might not have the skill or profession but he has the opportunity to start and direct others.
ii. He sees beyond and has abilities to initiate and venture into business that will
expand and grow.
iii.
He is innovative i.e. somebody able to delegate activities to others, ready and able to see, scan the environment.
1. Social entrepreneur: Recognizes a social problem and uses entrepreneurial principles to organize,
create and manage a venture to achieve social change.
Political entrepreneur.
2. Political entrepreneur
i. Is a business person who utilizes political systems or seeks support from political bodies in order to promote,
expand and profit from their own commercial ventures.
II. Apolitical player who seeks to gain certain political and social benefits in return for providing the common
goods that can be shared by an organized general public.
3.4 Advantages of Entrepreneurship
Advantages of Entrepreneurship
1. Financial gains
2. Self-employment which leads to job satisfaction and flexibility
3. Provide job opportunities to the unemployed or those seeking better jobs.
4. A means of opening up new industries especially in the rural areas - facilitating globalization
5. A source of generating income and increased economic growth.

1. Facilitates competition encouraging high quality products

2. Facilitates production of more goods and services
3. Leads to the development of newer markets
4. Promotes use of modern technology in especially small- scale manufacturing to enhance higher
productivity
3.5
Drawbacks of entrepreneurship
Challenges of a being an entrepreneur
1. long working hours
2. poor pay
3. unclear future
4. fear of losing all that has been invested
5. bankruptcies and closure
Other challenges
1. Fear of delegating
2. the problem do it yourself and know it all
3. competition by established business
4. lack of funds especially before break even
5. Mis- management by employees
3.6 Contribution of Entrepreneurship to National Development
The economic growth, the improved quality of life, the equitable distribution of resources and the capacity of the
economy to deal with economic, social and environmental development.
The main objectives of national development include:

o Provide basic needs to every citizen:- food, shelter, health, security, education, clothing
o Elimination / Reduction of poverty: reduce rural-urban migration Provision of opportunities for
employment and personal advancement
o Trying to narrow the income differences between the rich and the poor.
There for Entrepreneurship has contributed to National development in way like:
1) Employment Creation:
ii) Promotion of National Productivity: This is through production of goods and services within the country and
therefore they contribute to the Gross Domestic Product (GDP)
Ill) Raising Standards of Living: It's measured by the capacity of people of a country to buy goods and services.
Entrepreneurs contribute by employing people and giving them salaries or wages to buy their necessities.
iv) Conservation of foreign Exchange: Entrepreneurs produce goods and services that are needed by people and
reduction in importing those goods and hence the government saves foreign exchange.
v) Export Promotion: Entrepreneurs who produce goods and services for export earn vi) Conservation Agent:
Entrepreneurs can contribute to conservation and utilization of resources e.g. manufacturing a Jiko that uses
sawdust instead of wood charcoal vii) Rural development which in effect.
4.0 Entrepreneurial opportunities
Entrepreneurship has been recognized all over the world as a catalyst for development in any economy.
Entrepreneurship in developing countries in particular is being seriously advocated because of the following
importance:
1. Employment Generation: It helps to provide jobs through the establishment of new businesses,
especially small and medium scale enterprises.
2. Productivity: One of the factors for the greater interest in entrepreneurship has been the increasing
recognition of its role in raising productivity through various forms of innovation. Entrepreneurs, through
their innovation and creativity are capable of transforming existing business sectors, and creating new
sectors. They are helping to bring about new goods and services (expanding productivity) and supplying
the needs of large enterprises, which have to rely on their operations for business success.
1. Facilitate the transfer/adaptation of technology: It enables entrepreneurs to have the opportunities of
developing and adapting appropriate technological methods and provide a veritable avenue for skilled,
unskilled and semi-skilled workers.
2. Ensures increased resource utilization: It helps entrepreneurs to put limited resources that might
otherwise remain idle into good use. They contribute to the mobilization of domestic savings and
utilization of local resources, including human resources.
3. Stimulates growth in those sectors which supplies it with inputs: Entrepreneurship stimulates growth in
its supply market. The greater the number of entrepreneurship that exist in the Downstream of a
particular sector, the greater the market, hence, the greater the potential for increased capacity
utilization.
4. Reinvigorates large-scale enterprises and public enterprises: Most large scale enterprises and public
sector enterprises depend on the activities of small and medium scale enterprises (SMEs) to supply
them with various raw materials and other component parts and also to assist them in the distribution of
the finished goods to the final consumers. Entrepreneurship has made it possible to be able to transform
the public sector into a viable, market oriented and profitable organization.
5. Encourages and sustains economic dynamism that enables an economy to adjust successfully in a
rapidly changing global economy: As a result of the dynamic nature of the environment, small and
medium scale enterprises have no choice than to respond and adapt to environmental changes from
time to time.
6. Enables individuals to use their potential and energies to create wealth, independence and status for
themselves in society. The above eight points are not in any way exhaustive
4.1 Procedures of Starting a Business
1. Identification of a business idea
2. Development of a business plan
3. Location of a business, This demand evaluation
4. Registration of the business
5. Choice of the business organization
6. Business name
7. Trading licenses / permit
8. Start-up and management of the business.
All entrepreneurs are business people - though not all business people are entrepreneurs.
Entrepreneurs tend to be more innovative than ordinary business people and end up developing a business
plans.
4.2 Means of Generating a Business Idea
1. identifying a need
2. brainstorming
3. building on ones skill, hobbies or interests
4. spotting a market niche
5. listening to what people say
6. attribute listening
7. gaining from waste
8. look to see and listen to hear
9. research
10. importing an idea
11. day dreaming
12. Spin off from employment.
1. Identifying a Need: A need can be an opportunity and indeed a consumer buys to satisfy need.
Abraham Maslow in his humanistic hierarchy of needs, physical needs to very high personalized needs.
Therefore identifying an unidentified or unserved need is a sure way of generating business ideas.
2. Brain Storming: This is a process of detaching analysis of an idea from the actual ideas. The idea may
or may not be related to a given product. In brainstorming even silly and stupid ideas may be generated.
1. Building on One's Skill, Hobbies or Interests: Business ideas can be generated through personal
interests and hobbies, Copying or improving somebody's ideas. ( skills)
2. Sporting a Market Niche: Entrepreneurs usually look for gaps in the growing markets, identifying market
sections which are not being utilized.
 3. Listening to what People say: These are people who simply say or speak their needs
e.g if these good bus services
1. Attribute listening: This method of generating business ideas is based on changing the way one looks at
something in order to find a new use for it. It attempts to answer the question - what do we do with this
product.
2. Gaining from Waste: What would appear waste can be used- say recycles to create a new opportunity.
Others by soliciting ideas by interview, reading, observations, listening
etc.
4.3 Characteristics of a Good Business idea
1. Easy to manage and involve minimal risk.
2. Does not require excessive capital investments
3. Offers a good returns on capital
4. The idea has scope for growth, expansion and diversification
5. Comparative with owner's goal and interest
6. Not against expectation of the society
7. Has a short gestation period
8. Has a readily available market
9. Easy to exit when necessary.
5.0 Creativity and Innovation
Creativity
Creativity refers to the process of devising a new idea, or thing that result in the
improved efficiency or effectiveness of a system.
/ Cretive destruction occurs when innovations make long-standing arrangement obsolete and frees resources to
be employed elsewhere leading to greater economic efficiency. E.g. computerization
Innovation
o Innovation means improving an existing idea or thing. Commercializing of an idea or turning idea into an
opportunity.
o Innovation builds on creativity when something new, tangible and value-creating is developed from the
ideas.
o Innovation turns new concepts into realities, creating wealth and power.
5.1 Reasons for Innovation
1. Innovation is essential for the entrepreneur in solving the inefficiency problems.
2. As a means of cost reduction and imposing significance social and market grip.
3. Profit improvements are looked at from the innovation point of view though newer technology in
management and production.
4. To encounter competition by already established businesses.
5. To facilitate opening up of new markets both locally and internationally.
6. To facilitate diversification of products risks and losses.
7. To protect current position of monopoly or success
o 6.0 Concept of Marketing
o 6.1 Meaning of Market
Meaning of Market:
o A word derived from Latin; 'Marcatus' which means: Merchandise, trade or place where business is
conducted.
o A place and where goods are bought and sold.
o Generally it means "anybody of persons who are in intimate business relations and carry on extensive
transactions in any commodity."