Entrepreneurship Module 11

Objectives Understand perceptions and definitions of entrepreneurship Understand perceptions and definitions of entrepreneurship Understand the definition of small business and why it’s important Understand the definition of small business and why it’s important Identify major characteristics of an entrepreneur Identify major characteristics of an entrepreneur

Definition of Entrepreneurship The word “entrepreneur” originates from the French word, entreprenedre, which means “to undertake” The word “entrepreneur” originates from the French word, entreprenedre, which means “to undertake” Merriam-Webster Definition: Merriam-Webster Definition: –One who organizes, manages, and assumes the risks of a business or enterprise

Perceptions of an Entrepreneur An entrepreneur is a person of very high aptitude who pioneers change An entrepreneur is a person of very high aptitude who pioneers change Anyone who wants to work for himself or herself can be considered an entrepreneur Anyone who wants to work for himself or herself can be considered an entrepreneur

What is a “small business” We all have our own ideas of what constitutes a small business We all have our own ideas of what constitutes a small business –Husband and wife operating a business –Neighbor who owns a hair salon –Tech company with 75 plus employees –All of these can be considered a “small business”

Some Aspects of Entrepreneurship Business Size Business Size –Can be assed in a number of ways, including number of employees and revenues The SBA The SBA –Small Business Administration –Federally funded government agency providing loans and assistance to small businsses

The NAICS The SBA produces a table of size standards, matched to the North American Industry Classification System (NAICS) to guide the definition of a small business The SBA produces a table of size standards, matched to the North American Industry Classification System (NAICS) to guide the definition of a small business

What does this all mean? On average, the SBA defines most small businesses as having 500 or fewer employees, and revenues not exceeding $6-$8 million On average, the SBA defines most small businesses as having 500 or fewer employees, and revenues not exceeding $6-$8 million –A business could be as large as $30 million or have as many as 100 employees and still be considered a small business

Fun Fact Of all the businesses in the US with employees, four of five businesses have fewer than 20 people working in them Of all the businesses in the US with employees, four of five businesses have fewer than 20 people working in them

Additional Notes Federal agencies must use the SBA size charts when awarding contracts to small businesses Federal agencies must use the SBA size charts when awarding contracts to small businesses Financing institutions including the SBA make small business loans based on the table as well Financing institutions including the SBA make small business loans based on the table as well

Major Characteristics of Entrepreneurs –Desire for Responsibility –Preference for moderate risk –Confidence in their ability to succeed –Desire for immediate feedback –High level of energy

Characteristics of Entrepreneurs –Future orientation (visualize future) –Skilled at organizing –Value of achievement over money –High Degree of commitment –Tolerance for ambiguity –Flexibility

Characteristics of Entrepreneurs From what other entrepreneurs say…. From what other entrepreneurs say…. –Tenacity and drive –Opportunity “vision” –Passion –Relationships –Judgment