Entrepreneurship

Tawhid Reaz
 Corporate Entrepreneurship
• Corporate Entrepreneurship
• Is the conceptualization of entrepreneurship at the firm level.
• All firms fall along a conceptual continuum that ranges from highly conservative to
highly entrepreneurial.
• The position of a firm on this continuum is referred to as its entrepreneurial intensity.

Entrepreneurial Firms Conservative Firms

• Proactive • Take a more “wait and see”

• Innovative posture
• Risk taking • Less innovative
• Risk adverse
 Why Become an Entrepreneur?

The three primary reasons that people become

entrepreneurs and start their own firms

Desire to be their own boss

Desire to pursue their

own ideas

Financial rewards
Characteristics of Successful Entrepreneurs 1 of 3

Four Primary Characteristics

 Characteristics of Successful Entrepreneurs
2 of 3

• Passion for the Business

• The number one characteristic shared by successful entrepreneurs is a passion
for the business.
• This passion typically stems from the entrepreneur’s belief that the business
will positively influence people’s lives.
• Product/Customer Focus
• A second defining characteristic of successful entrepreneurs is a
product/customer focus.
• An entrepreneur’s keen focus on products and customers typically stems from
the fact that most entrepreneurs are, at heart, craftspeople.

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 Characteristics of Successful Entrepreneurs
3 of 3

• Tenacity Despite Failure

• Because entrepreneurs are typically trying something new, the failure rate is
naturally high.
• A defining characteristic for successful entrepreneurs’ is their ability to
persevere through setbacks and failures.
• Execution Intelligence
• The ability to fashion a solid business idea into a viable business is a key
characteristic of successful entrepreneurs.

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 Common Myths About Entrepreneurs
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• Myth 1: Entrepreneurs Are Born Not Made

• This myth is based on the mistaken belief that some people are genetically
predisposed to be entrepreneurs.
• The consensus of many studies is that no one is “born” to be an entrepreneur;
everyone has the potential to become one.
• Whether someone does or doesn’t become an entrepreneur, is a function of the
environment, life experiences, and personal choices.

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Common Myths About Entrepreneurs
2 of 6

Although no one is “born” to be an entrepreneur, there are common traits

and characteristics of successful entrepreneurs

• Achievement motivated • Optimistic disposition

• Alert to opportunities • Persuasive
• Creative • Promoter
• Decisive • Resource assembler/leverager
• Energetic • Self-confident
• Has a strong work ethic • Self-starter
• Is a moderate risk taker • Tenacious
• Is a networker • Tolerant of ambiguity
• Lengthy attention span • Visionary

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 Common Myths About Entrepreneurs
3 of 6

• Myth 2: Entrepreneurs Are Gamblers

• Most entrepreneurs are moderate risk takers.
• The idea that entrepreneurs are gamblers originates from two sources:
• Entrepreneurs typically have jobs that are less structured, and so they face a more
uncertain set of possibilities than people in traditional jobs.
• Many entrepreneurs have a strong need to achieve and set challenging goals, a behavior
that is often equated with risk taking.

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 Common Myths About Entrepreneurs
4 of 6

• Myth 3: Entrepreneurs Are Motivated Primarily by Money.

• While it is naïve to think that entrepreneurs don’t seek financial rewards,
money is rarely the reason entrepreneurs start new firms.
• In fact, some entrepreneurs warn that the pursuit of money can be distracting.

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 Common Myths About Entrepreneurs
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• Myth 4: Entrepreneurs Should Be Young and Energetic.

• The most active age for business ownership is 35 to 45 years old.
• While it is important to be energetic, investors often cite the strength of the
entrepreneur as their most important criteria in making investment decisions.
• What makes an entrepreneur “strong” in the eyes of an investor is experience, maturity, a
solid reputation, and a track record of success.
• These criteria favor older rather than younger entrepreneurs.

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Common Myths About Entrepreneurs

• Myth 5: Entrepreneurs love the spotlight

-the vast majority of them do not attract public attention

-they are working on proprietary products and services, avoid public

notice.

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The key elements
of entrepreneurship
• There are five generally agreed conditions that
are necessary for entrepreneurship to occur:
1. an individual (the entrepreneur)
2. a market opportunity
3. adequate resources
4. a business organisation
5. a favourable environment
 The key elements
of entrepreneurship

Figure 1.1: The key elements of entrepreneurship

Types of Start-Up Firms

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Triggers and barriers to start-ups
Triggers
• Material rewards:
• make more money; keep the proceeds of the business;
reward according to effort
• Creativity:
• use my own talents; a desire to create something;
control from begin to end; passion about what I am
doing
• Desire for autonomy:
• be my own boss; work my own hours; work with
people I like, at a location of my choice
Triggers and barriers to start-ups
Barriers
• Lack of resources:
• weak management and marketing skills; lack of
information on start-ups; lack of finance
• Compliance costs:
• high taxes and costs associated with compliance to
government legislation
• Hard reality:
• setting up a venture is harder than initially expected;
uncertainty; fear of failure
Changing Demographics of Entrepreneurs
1 of 3

Women Entrepreneurs
• There were 6.2 million women-
owned businesses in 2002 (the
most recent statistics available)
• This number was up 20% from
1997.

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Changing Demographics of Entrepreneurs
2 of 3

Minority Entrepreneurs Senior Entrepreneurs

• Minorities owned roughly 18% • Although statistics are not kept
of U.S. businesses in 2002. on senior entrepreneurs, there is
• This number was up 10% from strong evidence that the number
1997. of older people choosing
entrepreneurial careers is rapidly
increasing.

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Changing Demographics of Entrepreneurs
3 of 3

Young Entrepreneurs

• Interest among young people in entrepreneurial careers is

growing.
• According to a Gallop study, 7 out of 10 high school students
want to start their own business.
• Over 2,000 two-year and four-year colleges and universities
offer entrepreneurship courses.

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The risks of a career in
entrepreneurship
• There are 4 types of risks to consider before embracing a
career in entrepreneurship:
• financial risks

• career risks

• social risks

• health risks
Financial risks
• Large amounts of own money have to be invested
• Borrowing funds from bankers, venture capitalists, or
partners can reduce financial risks
• Legal structures can help to minimise financial risks
Career risks
• Questions about (re-)employment after an eventual
failure must be considered
• This risk is particularly acute for well-paid specialists
and people close to retirement
• Risks can be minimised by launching a business on a
part-time basis
Social risks
• Starting a business venture requires much of the
entrepreneur’s energy and time
• The decision to set up a venture should therefore
involve the family to reduce conflict potential
• Another risk is linked to the (negative) image of failed
entrepreneurs like in Singapore — hence the kia siu
attitude — ‘afraid to lose’
Health risks
• There is evidence that entrepreneurs experience
higher job stress and psychosomatic health problems
than other people
• Would-be entrepreneurs should make sure that their
health can cope with the demands and challenges of
starting and running a business
Economic Impact of Entrepreneurial Firms

• Innovation
• Is the process of creating something new, which is central
to the entrepreneurial process.
• Small firms are twice as innovative per employee as large
firms.
• Job Creation
• In the past two decades, economic activity has moved in the
direction of smaller entrepreneurial firms, which may be
due to their unique ability to innovate and focus on
specialized tasks.

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 Entrepreneurial Firms’ Impact on Society
and Larger Firms

• Impact on Society
• The innovations of entrepreneurial firms have a dramatic impact on society.
• Think of all the new products and services that make our lives easier, enhance
our productivity at work, improve our health, and entertain us in new ways.
• Impact on Larger Firms
• Many entrepreneurial firms have built their entire business models around
producing products and services that help larger firms become more efficient
and effective.

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The Entrepreneurial Process

The Entrepreneurial Process Consists of Four Steps

Step 1: Deciding to become an entrepreneur.
Step 2: Developing successful business ideas.
Step 3: Moving from an idea to an entrepreneurial firm.
Step 4: Managing and growing the entrepreneurial firm.

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Steps in the Entrepreneurial Process
1 of 2

Step 1 Step 2
Developing Successful Business Ideas

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Steps in the Entrepreneurial Process
2 of 2

Step 3 Step 4

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