1. The Foundations of Entrepreneurship
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2. Aarong Old name new Image 20 years ago… 5 years ago… …was a food
Village market
5 years ago…
Amazon: was a river in S. America
Yahoo… was something cowboys yelled

3. What is an Entrepreneur?
An entrepreneur is one who
creates a new business in the face of risk and uncertainty
for the purpose of achieving profit and growth
by identifying opportunities &
assembling the necessary resources to capitalize on them.
An entrepreneur is a
Risk bearer
Organizer
innovator
An Entrepreneur

4. Entrepreneur and Entrepreneurship
Entrepreneurship is the attempt
to create value through recognition of business opportunity,
the management of risk-taking appropriate to the opportunity, and
through the communicative and management skills to mobilize human, financial and material resources necessary to bring a project to completion
Difference between
Entrepreneur and Entrepreneurship
Person
Process
Organizer
Organization
Innovator
Innovation
Risk-bearer
Risk-bearing
Motivator
Motivation
Creator
Creation
Visualiser
Vision
Leader
Leadership

5. Characteristics of Entrepreneurs
Desire for responsibility-
prefer to be in control of their resources and use the resources to achieve self determined goal.
Preference for moderate risk
They are calculated risk taker, rarely gamble
Confidence in their ability to succeed
They are optimistic. This high level of optimism may explain why some of the most successful entrepreneur have failed in business before finally succeeding.
Desire for immediate feedback
High level of energy

6. Characteristics of Entrepreneurs
Future orientation
Have a well-defined sense of searching opportunities. Entrepreneurs are less concerned about yesterday they are more focused on future.
Skilled at organizing
Effectively combining people and jobs.
Value achievement over money
Achievement seems to be the primary motivating source; money is symbol of achievement
High degree of commitment
Launching a company successfully needs total commitment from an entrepreneur

7. Characteristics of Entrepreneurs
Tolerance for ambiguity
The ability to handle uncertainty is critical because these business builders constantly make decision using new, sometimes conflicting information gained from variety of unfamiliar sources.
Flexibility
The ability to adopt to the changing demand of their customer and their business.
Persistence
Obstacle cannot stop pursuing their vision they simply keep trying.
Anyone – regardless of age, race, gender, color, national origin, or any other characteristic – can become an entrepreneur (although not everyone should).

8. Benefits of Entrepreneurship
Create own destiny
Provides independence and opportunity to achieve what is important to them.
Make a difference
Entrepreneurs are finding ways to combine their concerns for social issues and their desire to earn a good living.
Reach full potential
Most people find their work is boring, unchallenging and unexciting, but not for the entrepreneurs. It gives them a sense of empowerment.
Reap impressive profits
Contribute to society and to be recognized for the efforts
Do what you enjoy and to have fun at it
“Find a job doing what you love, and you will never have to work a day in your life” – Harvey McKays. Entrepreneurs make their vocation (work) their hobbies and are glad they did.

9. Drawbacks of Entrepreneurship
Individual who prefer the security of a steady income, a benefit package, a two week paid vacation, should not go into business for themselves.
Uncertainty of income
Risk of losing your entire investment
Failure rate is relatively high
Long hours and hard work
Lower quality of life until the business gets established
Half of all entrepreneurs launch their business between age 25 and 39 just when they start their family. So family life suffers.

10. Drawbacks of Entrepreneurship
High level of stress
Sometimes they unnecessarily bear the burden of managing alone, because they can not bring themselves to delegate authority and responsibility to other in the company, even though their employees are capable
Complete responsibility
It is great to be boss. But many entrepreneur find that they must make decisions on issues about which they are not really knowledgeable. The realization that the decision they make are the cause of success or failure has a devastating effect on some people.
Discouragement

11. Types of Entrepreneur According to the type of business
Business Entrepreneurs
Conceive the idea of a new product or services and then translate their ideas into reality.
Entrepreneurs examine the various possibilities of sources of finance, supply of labor, raw materials or finished products.
Trading Entrepreneur
Buying the finished products from the producer and selling off to the customer directly or through a retailer.
Has to be creative enough as he has to identify the market, create demand through extensive advertising. So he have to find out the desires tests and choices of his customers in domestic and international market

12. Types of Entrepreneur Industrial Entrepreneurs Corporate Entrepreneur
Perceive the opportunity to set up his unit complies with necessary formalities
Has ability to convert economic resources and technology into considerably profitable venture.
Corporate Entrepreneur
The one who plans, develops and manage a corporate body. He is a promoter, an part of board of directors an owner as well as an entrepreneur
He gets his corporate body registered under the requisite Act which gives his company the status of separate legal entity.
Agricultural Entrepreneur
The one who is engaged in the agricultural activities.
He uses latest technology to increase the productivity of agriculture and also adopts mechanization.

13. Types of Entrepreneur Pure entrepreneurs Induced entrepreneur
According to Motivation
Pure entrepreneurs
One who may or may not possess an ability for entrepreneur.
But is tempted by the monetary reward or profit
They are status- conscious and wants recognition.
Induced entrepreneur
Is attracted by the various incentives, subsidies and facilities offered by the government.
Every person can be trained to become a good entrepreneur.

14. Types of Entrepreneur Technical Entrepreneurs
According to the Use of Technology
Technical Entrepreneurs
Strength is his skill in production techniques.
Concentrate more on production then marketing.
Applies the skill to develop and improve the technical aspects of the product.
Non-technical Entrepreneur
Concentrate on marketing strategies and distribution to promote his business.
His target is not to change the production technique but how to increase the demand of the product.
Professional Entrepreneurs
One who is interested in floating a business but does not want to manage or operate it.
Once the business is established he sells it out and catches on to float a new business.

15. Types of Entrepreneur First Generation Entrepreneurs
According to Stages of Development
First Generation Entrepreneurs
One who do not possess any entrepreneurial background.
They start an industrial unit by means of their own innovative skill.
Second Generation Entrepreneur
One who inherits the family business firms and pass it from one generation to another.
Classical Entrepreneur
aim is to maximize his economic return at a level consistent with the survival of the unit but with or without an element of growth.

16. Types of Entrepreneur According to gender Men entrepreneurs
Women entrepreneur
According to Age
Young entrepreneur
Old entrepreneur
Middle aged entrepreneur
According to Area
Urban entrepreneur
Rural entrepreneur
According to Scale
Large scale industry entrepreneur
Medium scale industry entrepreneur
Small scale industry entrepreneur
Tiny industry entrepreneur

17. The Cultural Diversity of Entrepreneurship
Minority-owned enterprises
Hispanics, Asians, African Americans
Immigrant entrepreneurs
Arrives with more education and experience but few assets. Their dedication and desire to success enable them to achieve their entrepreneurial dream.
Part-time entrepreneurs
Advantage of going into business part time is the lower risk in case the venture flops

18. The Cultural Diversity of Entrepreneurship
Home-based businesses
Operating costs are minimum
Flexible lifestyle and work style
Copreneurs
Couples who work together as co-owner of their business
Corporate castoffs
Downsizing made the corporate executives entrepreneurs
Corporate dropouts
Downsizing also created trust gap among the employees those who where left.

19. Ten Deadly Mistakes of Entrepreneurship
Management mistakes
Poor management is the primary cause of failure. Lacks leadership ability, sound judgment
Lack of experience
Need to have experience in the field they want to enter
Poor financial control
Tend to have overly optimistic and often misjudged the financial requirements. They start undercapitalized.
Cash not the profit what matters most in a new venture
Weak marketing efforts
Believe that if they build it, customer automatically come
Failure to develop a strategic plan
Without a clearly defined strategy business has no sustainable basis for creating and maintaining a competitive edge in the market

20. Ten Deadly Mistakes of Entrepreneurship
Uncontrolled growth
Expansion can be done when sales increases 40 to 50 percent
Expansion should be financed by the profit they generate (retained earning) or by capital contribution of owner.
Most business wind up borrowing a portion of the capital investment
Expansion increase problems and entrepreneurs must learn to deal with the problems.
Poor location
Location are selected without proper study, investigation and planning
Improper inventory control
Insufficient inventory levels results in shortages and stock outs causing customers to become disappointed and leave.
Incorrect pricing
Charge at competitors price or selling the best product at a lowest price – both are dangerous
Inability to make the “entrepreneurial transition”
Growth requires entrepreneurs to delegate authority

21. Putting Failure Into Perspective
Entrepreneurs are not paralyzed by the prospect of failure.
Failure – a natural part of the creative process.
Successful entrepreneurs has the ability to fail intelligently, which means learning why they failed.

22. Avoiding the Pitfalls of Small Business Failure
Know your business in depth
Get best education in your business area
Personal contact with supplier, customer, trade association
Develop a solid business plan
Allows to replace faulty assumption with fact
Manage financial resources
To have adequate start up capital
Earning a profit is essential to its long-term survival
Business must have adequate supply of cash to pay its bill.
Understand financial statements
Helpful in signaling potential problem
Learn to manage people effectively
Keep in tune with yourself

23. Common Myths About Entrepreneurs
Myth 1: Entrepreneurs Are Born, Not Made
This myth is based on the mistaken belief that some people are genetically predisposed to be entrepreneurs.
The consensus of many studies is that no one is “born” to be an entrepreneur; everyone has the potential to become one.
Myth 2: Although no one is “born” to be an entrepreneur, there are common traits and characteristics of successful entrepreneurs
Such as: Achievement motivated, Alert to opportunities, Creative, Decisive, Energetic

25. Myth 3: Entrepreneurs Are Gamblers
Most entrepreneurs are moderate risk takers.
The idea that entrepreneurs are gamblers originates from two sources:
Entrepreneurs typically have jobs that are less structured, and so they face a more uncertain set of possibilities than people in traditional jobs.
Many entrepreneurs have a strong need to achieve and set challenging goals, a behavior that is often equated with risk taking.
Myth 4: Entrepreneurs Are Motivated Primarily by Money
While it is naïve to think that entrepreneurs don’t seek financial rewards, money is rarely the reason entrepreneurs start new firms.

26. Myth 5: Entrepreneurs Should Be Young and Energetic
Entrepreneurial activity is fairly easily spread out over age ranges.
While it is important to be energetic, investors often cite the strength of the entrepreneur as their most important criteria in making investment decisions.
What makes an entrepreneur “strong” in the eyes of an investor is experience, maturity, a solid reputation, and a track record of success.
These criteria favor older rather than younger entrepreneurs.
Example: Colonel Harland David Sanders(1890 – 1980) Founder of KFC.
Started selling his recipe on 1952, became popular by 1962 at the age of 72!