Entrepreneurship is essential for national growth and social development. Most of the developing countries have a history of long years of foreign domination.
Entrepreneurship is the creation of value. It is an act of seeking investment and production opportunities and managing a business venture.
Example: Grocery stores, electricians, consultants etc.
Meaning of Entrepreneur
An entrepreneur is someone who develops an enterprise around innovation. An entrepreneur is defined by the personal risk they take on in pursuit of a new business or some other form of enterprise.
The entrepreneur is expected to identify the environmental change as an opportunity and use the factors of production to produce new goods and services.
Three main views about entrepreneur are:
1. Entrepreneur as a Risk bearer:
Entrepreneur as an agent who buys factors of production at certain prices in order to combine them into a product with a view to selling it at uncertain prices in future.
2. Entrepreneur as an Organizer:
An entrepreneur is associated with the functions of coordination, organization, and supervision. Entrepreneur combines the land, labor, and capital and thus produces a product.
3. Entrepreneur as an Innovator:
Economic development is a dynamic change brought by entrepreneurs by instituting new combinations of factors of production. i.e. innovations.
Types of Entrepreneurship
- Administrative Entrepreneurship
- Incubative Entrepreneurship
- Imitative Entrepreneurship
- Private Entrepreneurship
- Public Entrepreneurship
- Individual Entrepreneurship
- Small Business Entrepreneurship
- Large company Entrepreneurship
- Joint Entrepreneurship
1. Administrative Entrepreneurship
In this category all the administrative techniques and functions of entrepreneurial activity is included.
It helps to manage all the current situations that avail the business with merits and a competitive edge.
All the tasks like redesigning of job, new techniques to do things and management helps to maximize the efficiency of an organization.
Example: The government of India consider old-age pension scheme as administrative entrepreneurship.
2. Incubative Entrepreneurship
The generation of new ideas and ventures within the premises of the organization is involved in this type of entrepreneurship.
Example: Microsoft always discovers new technologies in a wide range of products and forms differentiation among all the categories of the products.
3. Imitative Entrepreneurship
This entrepreneurship copying the operative products and services. It includes the adoption of current technologies from across the world and takes on existing technologies with a few modifications that suit the local conditions.
Example: A Ltd.produced many products like refrigerators,electronic products without being the real creator of those products.
4. Private Entrepreneurship
When an individual or group of individuals start a business, takes risks, and initiates innovation in the private sector it is called private entrepreneurship.
The main object of such entrepreneurs has been possible due to private enterprise.
Example: Clothing boutique a privately owned business enterprise operating under a system of free enterprise.
5. Public Entrepreneurship
It referred to as the entrepreneurship that is come under the government through the various agencies.
All development and underdeveloped nations take initiative in venture ideas to meet the shortage of private entrepreneurs. It is the process of the generation and implementation of new ideas in the public sector.
Example: Public roads,Public education etc.
6. Individual Entrepreneurship
It is entrepreneurship that is managed by an individual or a member of a family with some personal motives as well as initiates.
Example: Sachin bansal company- Flipkart,Deepinder Goyal company- Zomato.
7. Small Business Entrepreneurship
One who starts and controls a business or other independent enterprise, often employing innovation and more than an ordinary degree of risk.
Example: paper, toothpick, bakeries, candles, etc.
8. Large company Entrepreneurship
large companies through sustaining innovation, offering new products that are variants around their core products. New products are developed in order to meet changing customer needs and advanced technology.
9. Joint Entrepreneurship
It is a collaboration of private and public entrepreneurship. when a business enterprise is partly controlled and managed by a private entrepreneur and the government.
Example:Smart phone develop by Nokia and Microsoft.
Importance of Entrepreneurship
- Entrepreneurs are Innovators: Entrepreneurs keep a close eye on the changes and take measures to fill the gaps. They understand the negative impact of technological innovations and the loss of certain occupations but they also sense newer opportunities that can be derived from this age of technology.
- Entrepreneurs create jobs: The importance of entrepreneurship can be understood by the number of jobs that are created once entrepreneurs launch new businesses. These establishments become the source of job creation. Entrepreneurs contribute to economic growth.
- Entrepreneurs improve the standard of living: The journey of entrepreneurship is dynamic. As they see a problem in the lives of the consumers they use their creative thinking to identify a solution. They start a new organization and create employment. when new employees are hired they are remunerated and this income is spent in the local economy. This generates incremental wealth for the population and results in raising the standard of living for all involved.
- Entrepreneurs introduce changes in the community:Entrepreneurship benefits the local community and society.The new company hires employees who earns an income to spend at local stores.This generates more business for the store owners.when one business grows it contributes to the number of another.
- Entrepreneurs support other entrepreneurs: Some entrepreneurs move on to also become mentors and consultants. They like to guide aspiring innovators on their path to success. Entrepreneurs can advise on ways to arrange funds like obtaining loans for entrepreneurship.
Characteristics of Entrepreneurship
- Ability to take a risk
- Visionary and leadership
1. Ability to take a risk
Starting any new venture involves a considerable amount of failure risk. Therefore an entrepreneur needs to be courageous and able to evaluate and take risks.
It should be highly innovative to generate new ideas, Start a company and earn profits out of it. change can be the launching of a new product that is new to the market or a process that does the same thing but in a more efficient and economical way.
3. Visionary and leadership
To be successful the entrepreneur should have a clear vision of his new venture. Leadership quality is paramount because leaders impart and guide their employees towards the right path of success.
4. Open minded
In a business every circumstances can be an opportunity and used for the benefit of a company.