Rewards and Challenges of Entrepreneurship Chapter 5, Section 1

Entrepreneurship Entrepreneur Entrepreneur-  A person who recognizes a business opportunity and organizes, manages, and assumes the risks of starting and operating a business. Entrepreneurship Entrepreneurship-  The process of recognizing an opportunity, testing it in the market, and gathering the resources necessary to go into business.

Entrepreneurship (cont.) venture A venture is a new business undertaking that involves risk. All entrepreneurs must be willing to take risks.

Personal Characteristics of Entrepreneurs Persistent  Willing to work until a job is done, no matter how long it takes Risk-taking  Take risks, but they are not reckless Self-confident  Believe in themselves

Personal Characteristics of Entrepreneurs Restless  Once entrepreneurs achieve their goals, they start looking for new challenges Goal-oriented  Set and achieve goals Action-oriented  Doers instead of spectators; They take action.

Personal Characteristics of Entrepreneurs Responsible  Take responsibility for their decisions and action Self-demanding  High expectations Creative  Look for new ways to solve old problems

Personal Characteristics of Entrepreneurs Independent  Want to make their own decisions Inquisitive  Conduct research and ask questions to solve problems Enthusiastic  Energetic and passionate about their pursuits

Small Business SBA  Government agency that protects the interests of small businesses.  small business  A small business is an independently owned business that usually has the owner as its manager.

Internet Business Virtual business dot-com company Virtual business or dot-com company-a business that operates on the Internet. Makes shopping easier. Have the potential to attract huge numbers of customers.

Rewards of Entrepreneurship Being the boss  This is the main reason people become entrepreneurs. Doing what you enjoy Having the opportunity to be creative Building an enterprise Develop own schedule

Challenges for Entrepreneurs Obtaining funds to start the business  This is one of the biggest obstacles. Being fully responsible for the business Feeling alone and insecure about making right decisions Work long hours Face uncertain income levels

The Impact of Small Business More than 99% of U.S. firms are small businesses. Small businesses employ more than 50% of the U.S. workforce. A majority of small businesses are one- person operations that generate more than half the nation’s income.

Business Failure About four out of five small businesses fail in their first five years. Most failures are due to inadequate financial planning and management.