A.

INTRODUCTION TO ENTREPRENEURSHIP

1. DEFINITION OF ENTREPRENEUR

Entrepreneur:

An entrepreneur is an individual who creates a new business, bearing most of

the risk and enjoying most of the rewards. The entrepreneur is commonly seen
as an innovator, a source of new ideas, services and business or procedures.

Entrepreneurs play a key role in an economy, using the skills and initiative
necessary to anticipate needs and bring good new ideas to the market.

Entrepreneurs are businesspeople who can deduct and send the availability of
business opportunities in each scenario. they will utilise this opportunity to
create new products by employing new production methods in different
markets.

Definition:

According to J. b say, an entrepreneur is a person who shift economic resources

out of an area of lower productivity into an area of higher productivity and
greater yield.

Entrepreneurship:

It is the act and art of being an entrepreneur or one who undertakes innovations
or introducing new things. These new things can be any of the start-ups.

Entrepreneurship is considered as of assuming the risk of an entrepreneur.

It is a process of discovering new ways of combining resources.
entrepreneurship is the journey of opportunities, Exploration, and risk
management to create value for profit and /or social good.

Definition:

 According to Natheal H. Leff, “Entrepreneurship is the capacity for

innovation, investment and expansion in new markets, product and
techniques.
 According to Webster highlights, “Entrepreneurship as economic venture
organising.

2. ENTREPRENEURIAL TRAITS

Entrepreneurial traits are the typical characteristics, abilities and thought patterns
associated with successful entrepreneurs. While some entrepreneurs are born with
these traits, others can develop them.

Entrepreneurs possess the following vital characteristics:

1. A skilful person:
The entrepreneur is recognized as a person having a special skill and
at the same time a person providing others for motivation. He may be
either a single individual or an individual in a group. Whatever he
may be, he possesses that special skill which is not generally found
in common man.

2. An innovator:
He is rightly known as an innovator who engages himself to innovate
new varieties of products, explores new market horizons, and
 introduces new techniques of production and methods of
reconstruction of industries. According to Schumpeter, the main
characteristic of an entrepreneur is to innovate something. Through
such innovation, the execution and effective use of a creative idea
are ensured. Its success brings for commercial achievement and new
horizon of economy emerges.

3. Providing completeness to the factors of production:

An entrepreneur procures necessary resources from various sources for
the purpose of production and by utilizing them he provides
completeness to the factors of production. Moreover, he endeavours
to contact various markets for his products. He is a risk-taker and
functions as a coordinator.

4. Decision-making person:
The entrepreneur is such a person who is endowed with a power to
make a proper decision as regards the establishment of a business, its
management, and procurement of different factors, methods of
distribution and coordination of various scarce resources. Since he
has a strong power of decision-making, he can take decisions on
various maters rapidly. His achievement largely depends on the
ability of his decision- making.

5. A man of creative personality:

As the term implies, he is known as an employer who makes
optimum utilization of economic resources and thus carries on
productive activities. He has a quality of creating something new and
as such he is a person of creative personality. For this, he is known
 as a creative innovator. He creates new ideas, nurtures them in the
light of his own experience, knowledge, and intellect. Through all
such activities, his creative personality and mentality are exposed.

6. A pioneer of economic development:

An entrepreneur is the owner, employer, producer, market- creator,
decision-maker, risk-taker, coordinator, and user of market
information, creative individual, and innovator. For this, he is
regarded as a pioneer of economic development.

7. Dynamic leader:
He provides proper motivation to his workers by means of leadership
so that the workers can give their best efforts to the interest of the
organization.

8. Risk-bearer:

It is that an entrepreneur must bear the various risks concerning the

enterprise. Without risk bearing, his enterprise activities cannot be
conducted. The capacity of an entrepreneur to bear the risks is his
inherent feature. He must always bear the risks in case of production
of any new product or service. There are various types of risks to be
borne by him. These are risks associated with procurement of raw
materials and capital and marketing of goods, etc. this risk bearing is
the prerequisite to his success. This is the part and parcel of his daily
activities.

9. Self-confident and ambitious:

In the opinion of John Hornaday, one of the important features of an
 entrepreneur is that he should be self-confident as well as ambitious.
Self- confident is regarded as one of the remarkable characteristic
features for his success. This self-confidence leads him to face any
situation boldly. Self-confidence relates to harmonize between word
and work. Similarly, he should always have in himself, high
ambition.
Advantages of entrepreneurship

To an individual:

 Provide self-employment for the entrepreneur.

 End shipping you can provide employment for near and dear ones as
well.
 Entrepreneurship often provides an employment and livelihood for next
generations as well.
 Freedom to use own ideas innovations and creativity.
 Unlimited income.
 Independence
 Satisfaction

To the nation:

 Provides larger employment.

 Results in wider distribution of wealth
 Mobilises local resources, skills, and savings.
 Accelerates the pace of economic development.
 Stimulates innovation and efficiency.

3. ENTRPRENEUR v/s MANAGER

Who is an entrepreneur?

Very basically speaking, an entrepreneur is a one-man show that runs

entrepreneurship. However, such a person usually has some unique attributes that
allow him to be successful in his endeavours. He is essentially an initiator and a
leader. He brings business ideas to fruition thus starting off his venture.

A successful entrepreneur is usually a responsible person. He is accountable for the

success or the failure of his venture, and he takes this responsibility very seriously.
And since he is the only person in-charge he is automatically the leader. In
fact, leadership qualities are one of the main aspects of an entrepreneur.

Who is a manager?

A manager, on the other hand, is not an owner of an enterprise. Instead, he is the

one that is responsible for the management and administration of a group of
people or a department of the organization. His day-to-day job is to manage his
employees and ensure the organization runs smoothly.

A manager must possess some of the same qualities as an entrepreneur, like

leadership, accountability, decisiveness etc. He must also be a good manager of
people. So, qualities such as warmth and empathy are also very important in a
manager.
 BASIS FOR
ENTREPRENEUR MANAGER
COMPARISON

Meaning Entrepreneur refers to a person Manager is an individual

who creates an enterprise, by who takes the
taking financial risk to get responsibility of
profit. controlling and
administering the
organization.

Focus Business start-up Ongoing operations

Primary Achievement Power

motivation

Approach to task Informal Formal

Status Owner Employee

Reward Profit Salary

Decision making Intuitive Calculative

Driving force Creativity and Innovation Preserving status quo

Risk orientation Risk taker Risk averse

 B. CREATING AND STARTING THE VENTURE
New Venture Creation

1. Introduction:

The business venture definition is a new business that is formed with a plan and
expectation that financial gain will follow. Often this kind of business is
referred to as a small business, as it typically begins with a small number of
financial resources. A business venture is usually formed out of a need for a
service or product that is lacking in the market. This need is often a product
consumer are requesting or something that serves a particular purpose. After the
need is determined and investor or small businessperson with the time and
resources to develop and market the new service or product can start a business
venture

New venture is a global program provides services for the

development of small and medium enterprises whose main goal is to generate a
positive environment or social change within their own communities.

New venture was created in 1999 by the world Resource

Institute and it was established in emerging markets with a large biodiversity.
Currently have centres in India, Brazil, China, Colombia, Indonesia, and
Mexico. New venture reach varies in each country, but every centre offers free
development services that provide SMES with management tools and access to
capital to make them grow and increase their positive impact. The project has
assisted more than 600 enterprises worldwide.
New Venture Creation (NVC) Qualification

The purpose of this qualification is to provide

entrepreneurs and aspiring entrepreneurs in the small, medium, and micro
enterprise sector with the technical business managerial and personal skills to
create and sustain a business. The qualification is part of the National
Qualification Framework and is available to individuals who do not have formal
training and are working in or wish to work in or manage a SME business. The
New Venture Creation leadership is a 12-month practical and theoretical
training programme that allows the runner access to the mobility within the
SMME sector, the qualification meets the needs of society by providing the
entrepreneur with the skills to improve personal circumstances thereby
contributing to the upliftment of community. 70% of the leadership is based on
the practical component and 30% on the theoretical component. The formal
name of the qualification is National Certificate New Venture creation NQF
level 4.

2. SOURCES OF NEW IDEAS

Sources of New Ideas for Entrepreneurs

The entrepreneurial idea is a feasible, financially sound, technically possible,

and socially acceptable idea of a project or product that may have utility lo
perspective customers.

No one can come up with an idea and, in the very first instance, convert it into a
business opportunity and start a small business on that basis.
Most good business opportunities do not come suddenly.

1. Customers:

 Prospective customers know best what they want and the

habits/tastes that will be popular shortly.

 New product or service ideas may come from customers’ reactions

to the present product and the expected product idea.

 Contacts with prospective consumers can also reveal the features

that should be built into a product or service.

 The attention to the customers can take the form of informally

monitoring potential ideas and needs or formally arranging surveys
among prospective customers.

 Care needs to be taken to ensure that the idea or need represents a

large enough market to support a new venture.

2. Existing organization:

 Competing products and services of existing organizations and

evaluation thereof is a successful source of new ideas.

 Frequently, this analysis uncovers ways to improve on these

offerings, resulting in a new product that has more market appeal.

 The analysis of profitability and break-even level of various

industries or organizations indicate promising investment
opportunities which are profitable and relatively risk-free.
  An examination of the capacity utilization of various industries
provides information about the potential for further investment.

3. Distribution channels:

 Member of the distribution channels; intermediaries, transient

customer preference, and possible expectations may be a good
business idea.

 Not only do channel members frequently have suggestions for

completely new products, but they can also help in marketing the
entrepreneur’s newly developed products.

4. Government:

 The government can be a source of new product ideas in many

ways.

 First, the files of the Patent Office contain numerous new product
possibilities. They can suggest other more marketable new product
ideas.

 Secondly, new product ideas can respond to government

regulations, industrial policy, investment guidelines, annual plan,
Five-year plan, etc.

 Thirdly, several government agencies nowadays assist

entrepreneurs in discovering evaluating business ideas.
5. Research and Development:

 The entrepreneur’s own “research and development” is the largest

source of new ideas. It may be a more formal endeavour connected
with one’s current employment or an informal laboratory in the
private premises.

 Formal institutional research and development are often better

equipped, enabling the entrepreneur to conceptualize and develop
successful new product ideas.

 But many amazing product ideas have come from informal

research endeavours at the private level.

6. Trade Shows, Fair’s aid Exhibitions:

 These sources display new products and innovations in processes

and services.

 An innovative entrepreneur can get product ideas to adapt or

modify and produce with indigenous materials and technology.

7. Focus Groups:

 Focus groups are good sources of product ideas.

 A moderator leads a group of people through an open, in-depth

discussion rather than simply asking questions to solicit participant
response; for a new product area, the moderator focuses the
group’s discussion in either a directive or a nondirective manner.
  The group of 8 to 14 participants is stimulated by comments from
other group members to conceptualize and develop a new product
idea to fulfil market needs.

 This is an excellent method for initially screening ideas and

concepts too.

8. Brainstorming:

 The brainstorming method for generating new product ideas is

since people can be stimulated to greater creativity by meeting with
others and participating in organized group experiences.

 This method would be effective if the effort focuses on a specific

product or market area.