ENT 211

LECTURE 1
WHAT ENTREPRENEURSHIP?
There are many definitions of entrepreneurship but according to Hisrich and
Brush (2005) - Entrepreneurship is the process of creating something new with
value by devoting the necessary time & efforts, assuming the accompanying
financial, psychological and social risks and receiving the monetary rewards for
monetary and personal independence.
Please note the following points:
creative process (physical outfit) a creation that has
value (satisfaction of needs). a risky transaction
(psychological, financial, social).
a transaction with rewards for the entrepreneur external (community intrinsic
(inward).
Entrepreneurship is the practice of starting a new organization or revitalizing the
existing ones, most especially new business in response to identified
opportunities,
Identify opportunities i.e. existing gaps and business opportunities in ones
immediate environment and bringing together necessary resources an
innovative way to fill these gaps.

How many of us have started one business or the other, what led you to it
or how did you recognize the opportunity?

Who is an entrepreneur?
An entrepreneur is a person who takes the risk of setting up his/her own venture
for perceived rewards.
He:
initiates the idea formulates a plan organizes resources and puts the plan
into action for achieving goals set at his/her own risk.
THE CHARACTERISTICS OF SUCCESSFUL ENTREPRENEURS
The following are some basic characteristics that must be fully developed by
intending entrepreneurs.

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1. Dedication & Diligence: entrepreneurs dedicate themselves to the
fulfillment of their plans and dreams and their tenacity about the business
helps in targeting a goal, and pursuing it to a logical end.

2. Optimism: entrepreneurs maintain a positive outlook throughout their

business plans and operations. They recognize opportunities where others
see problems (e.g. Marketer). Bill Gates developed simple and user friendly
software in the place of very difficult and complicated software.

3. Risk taking: entrepreneurs know that business start-up is a risk but he is

ready to go through the whole hog to achieve his goal In case of failure,
they also have a reserve to fall back to.

4. Team playing: He possesses the ability to work with his team to achieve set
goals. One person cannot achieve much.

5. Creativity: he is always looking out to get a new thing from an existing one.

6. Endurance: He is ready to patiently wheather the storm to see his business

succeed.

7. Flexibility: He is not rigid about decisions but is always ready to listen to

other's suggestions in the business operation that will ootimize their
offerings and satisfy market needs.
8. Planning: entrepreneurs are planners since business ventures are lifelong
venturesŸTheyztake--tinxe—to nlažvand consider details that will
enhance his business success and deal with unforeseen possibilities.

9. Communication: entrepreneurs recognize that the vital part of any business

is the human element. Human resource whether client, employees or
strategic partners are what can make/break a business and communication
is key to successful relationship with people. Communication could be in
writing, verbal or non -verbal.
10. Money Management: Entrepreneurs recognize the fact that it takes time to
make profit in any entrepreneurial venture whereas capital is limited and
must be wisely utilized. Hence they compulsorily plan for present and
future financial obligations especially cash flows.

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11. Always Learning: They are always ready to learn not only from the
classroom, but always asking questions and doing personal reading and
research. They are always ready to learn from their mistakes.

OPPORTUNITY RECOGNITION IN ENTREPRENEURSHIP

Much of entrepreneurship is taking advantage of opportunities when they present

themselves. Some of the greatest entrepreneurs of all time became great
when they found a worthwhile opportunity and pursued it with purpose.
Many of today’s new entrepreneurs are doing the same. But how do
entrepreneurs know a good opportunity when they see it?
The ability to identify opportunities as an entrepreneur is called opportunity
recognition. Finding and recognizing opportunity is an important step in the
entrepreneurial process. One can argue that it is one of the most important.
Without the right opportunity, it will be hard for an entrepreneur to carve
out space for themselves and their business in the competitive market.
On top of that, an entrepreneur risks pursuing an idea or model that is no longer
working. For these reasons and many more, successful entrepreneurs must
learn how to identify, evaluate, pursue, and capitalize on the opportunities
they discover. In this article, we’ll outline 4 ways that can be done.

What is Opportunity Recognition in Entrepreneurship?

Opportunity recognition in entrepreneurship is the process of identifying and
evaluating potential business ideas or markets that are not yet fully
maximized. This is a critical skill for entrepreneurs. The reason is that it
involves finding gaps in the market or a specific need that has not been
met.
Successful opportunity recognition often hinges on an entrepreneur’s ability to
perceive change. It requires a combination of intuition, insight, and a deep
understanding of the market dynamics. While opportunity recognition is
similar to entrepreneurial idea generation, which is the step in
entrepreneurship that involves coming up with ideas, it is not the same. In
opportunity recognition, entrepreneurs are not yet coming up with ideas.

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 Rather, they are recognizing an opportunity to execute a future idea or fill a
gap in the market.
Entrepreneurs who excel in this often have a unique mindset. They are curious,
always questioning the status quo, and constantly looking for ways to
improve existing products or services. They are good at connecting
seemingly unrelated dots to come up with innovative solutions.
However, this process often involves a significant amount of risk-taking. Going
after an opportunity may sometimes mean going where no one has gone
before. But, it is this willingness to embrace uncertainty and think outside
the box that often leads to groundbreaking business success. Opportunity
recognition is not just about having a great idea; it’s also about having the
foresight to see its potential and the resilience to pursue it despite
challenges.

1. Be On the Lookout For Opportunities

Thomas Edison once said, “Opportunity is missed by most people because it is
dressed in overalls and looks like work.” One of the best ways to find
opportunities is to simply always be on the lookout for them. This is one of
the things successful entrepreneurs do well. Those who typically capture
opportunities are the ones who recognize that there are opportunities
everywhere.
Around 2005 Netflix was trying to make a name for itself by shipping DVDs to
customers and, later, allowing customers to stream movies and television
through the internet. In February 2007, the company delivered its billionth
DVD but began to move away from its original core business model of
DVDs. This was because the leadership team at Netflix realized that
internet download speeds were increasing which would make streaming TV
shows and movies online better.
Conversely, its primary competitor, Blockbuster, chose to stay with its retail
video store business model instead of prioritizing its video-on-demand
service. Eventually, the missed opportunity caused Blockbuster to shut
down as they could no longer compete against the up-and-coming
streaming giant.
For entrepreneurs, recognizing how technological, consumer behavior, and
societal changes impact businesses is a big part of finding opportunities.

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2. Find Pain Points
Identifying pain points is a fundamental step in recognizing entrepreneurial
opportunities. Pain points are problems or frustrations experienced by
consumers in their daily lives or business operations. Entrepreneurs who
can successfully identify these pain points can develop solutions that fulfill
unmet needs. This process involves closely observing and understanding
the customer’s experience and looking for issues that cause inconvenience,
inefficiency, or dissatisfaction.
For instance, a common pain point in urban areas could be the lack of convenient,
healthy food options. An entrepreneur recognizing this could create a
business model around delivering healthy, home-cooked meals to busy
professionals. To find these pain points, entrepreneurs need to talk directly
with potential customers. They need to immerse themselves in the
customer’s environment to really understand their problem.
Take Amazon founder Jeff Bezos, for example. He started the online retail giant
as an online bookstore in 1994. By 1997, the company had expanded to
also selling CDs and DVDs. However, Bezos wanted to see what pain
points his customers were having.
He emailed 1,000 randomly selected customers and asked them, ‘Besides the
things we sell today, what would you like to see us sell?’” Bezos noted that
the answers were varied and usually revolved around what that particular
customer needed at the time. This led him to believe that Amazon could
sell anything. Now, Amazon is often referred to as ‘the everything store’.
When an entrepreneur can find what their customer’s pain points are they have
the potential to capture an opportunity if they can solve those problems.

3. Conduct Research
Conducting research is a pivotal aspect of opportunity recognition in
entrepreneurship. This process involves gathering and analyzing
information to understand market trends. As an entrepreneur, one must also
understand consumer behavior, competition, and other factors that
influence business success. Research can be primary, involving direct data

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 collection through surveys, interviews, or observation. It can also be
secondary, utilizing existing data from reports, studies, or online resources.
Really good research enables entrepreneurs to make informed decisions. This can
lower the risk associated with launching a new business or product. Also, it
helps in validating the existence of a pain point or a market need. Research
can uncover insights about consumer preferences, emerging trends, or gaps
in the market that can be used for business opportunities.
For example, an entrepreneur considering launching a new fitness app would
benefit from researching existing fitness apps. From there, they should
understand current user satisfaction levels and identify what features people
feel are missing. This research could help form the app’s development and
make sure that it addresses the specific things customers want that they
can’t get in other apps.
Keep in mind that research is not a one-time thing. Ongoing research is important
even after a business is established. This is because it helps entrepreneurs
stay ahead of market changes and adapt their strategies.

4. Follow Trends
Following trends is a crucial aspect of opportunity recognition in
entrepreneurship. This means staying informed about the latest
developments, shifts, and emerging patterns in various industries and the
entire market. Entrepreneurs who are adept at trend analysis can anticipate
changes in the world. Then, they can use that information to innovate or
adapt their business models accordingly.
Trend-following starts with keeping an eye out and a proactive attitude towards
market research. It requires entrepreneurs to be constantly attuned to news,
reports, social media, and other platforms where trends surface.
It would also be helpful to network with industry peers and attend relevant
conferences or trade shows. Entrepreneurs should be particularly observant
of long-term trends, as these have the potential to redefine industries and
create entirely new markets.
Digital tools and data analytics play a significant role in trend analysis. They
allow for the tracking of consumer behavior online, monitoring of industry-
specific developments, and even prediction of future trends using
sophisticated algorithms.

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However, it’s important to distinguish between fleeting fads and sustainable
trends. Entrepreneurs must critically assess whether a trend aligns with
their business vision, target market, and operational capabilities. Jumping
on every new trend without strategic consideration can lead to misaligned
efforts and wasted resources.
Conclusion
Great opportunities do not come along every day. Also, not every opportunity
that comes your way is a good opportunity. As an entrepreneur, you must
learn how to find and distinguish the opportunities that present themselves
so that you can pursue the ones that make the most sense for you and your
business.