1. ENTREPRENEURSHIP

2. Understanding Entrepreneurship
Chapter # 1

3. Market Opportunity
DISCOVERY
EVALUATION
EXPLOITATION

4. Entrepreneurship
Entrepreneurship is the practice of starting new organization or revitalizing mature organization, using unique and new ideas and based on identified market opportunities.
Entrepreneurship ranges in scale from solo projects (even involving the entrepreneur only part-time) to major undertakings creating many job opportunities.
Entrepreneurship is often a difficult undertaking, as a vast majority of new businesses fail.

5. Entrepreneurship is a Process
To reform and revolutionize the pattern of producing things by using new ways and techniques for producing a new commodity or producing an old one in a new way. In simple words:
Entrepreneurship means doing things that are not generally done in the ordinary course of business routine.

6. ENTREPRENEUR
The word Entrepreneur is taken from French word “entreprendre” which means “Undertaker” i.e. the person who undertakes to organize, manage and assume the risks of new enterprise.

7. Defining Entrepreneur
A person who bring resources together in unusual combination to generate profits.
An Entrepreneur is a person who organizes and manages a business undertaking, assuming the risk for the sake of profit. Any person (any age) who starts and operates a business is an entrepreneur.
In behavioral terms,” An achievement oriented individual driven to seek challenges and new accomplishments”

8. Defining Entrepreneur (cont’d)
The Entrepreneur is an inventor or a developer who:
Recognizes opportunities
Converts those opportunities into workable/marketable ideas
Adds value through time, effort, money or skill
Assumes the risks of the competitive marketplace to implement those ideas
Realizes the rewards from these efforts.

9. Contributions of Entrepreneur
Develop new markets
Discover new sources of materials
Mobilize capital resources
Introduce new technologies
Create employment

10. BACKGROUND OF ENTREPRENEURSHIP
The concept of Entrepreneurship is derived from the Economic theory.
Adams Smith (1776) “ The Wealth of Nations:.
According to Adam Smith, “Entrepreneur is an economic agent with unusual foresight who could recognize potential demand of goods and services.”
An economic risk taker.

11. Importance of Entrepreneurship Economic
Majority of new jobs are created by entrepreneurs and small businesses
Small high growth companies account for 70% of economic growth over last decade
Over 1/3 of difference in national economic growth may be due to difference in entrepreneurial activity
Entrepreneurship accounts for at least 2/3 of all technological innovation

12. Why Entrepreneurship Education
Objective is to become entrepreneurially minded with the potential to act on this by discovering or creating business opportunities.
Entrepreneurs are not “born”…they “become” through the experiences of their lives
Entrepreneurs have a great diversity of personal characteristics, the common one: being willing to take a risk in return for a profit

13. Anyone can be an entrepreneur at any time of one’s life
Entrepreneurship is NOT learned by reading a textbook and then taking a test to prove you are one.
Entrepreneurship education activities are a real-life vehicle for developing academic skills
Entrepreneurs are found in every occupation and career
Entrepreneurship education opportunities are important at all levels of education

14. Carl Menger (1871) View of Entrepreneur
According to Menger, economic change does not arise from circumstances but from the awareness and understanding of those circumstances, it’s the individuals who sense these circumstances and bring about changes/improvements.
Entrepreneur is a change agent who transform resources into useful goods and services.

15. Menger’s Model of value added Transformation
OPPORTUNITIES
Profit / Loss
Low value produce
Entrepreneurial
activity
High value produce

16. Menger’s Model of value added Transformation
Low value produce
Producing Grain
Harvesting Grain
Intermediate Points of Transformation
Grinding Grain
Producing Bread
High value produce
Delivering Bread

17. Menger’s Model of value added Transformation
Identifies intermediate points of transformation each with opportunities to add value to the original resource in such a way to eventually satisfy human needs, e.g. producing/harvesting wheat, grinding grain, making bread and delivering it.
When value is added to a product/process, that value is rewarded by profit.

18. Entrepreneurial Process
Identification and analysis of Opportunity.
Developing Business plan
Determination of required resources
Starting and Managing the Enterprise

19. Identification and analysis of Opportunity
Potential and length of opportunity
Risks and returns of opportunity
Competitive situation

20. Developing Business plan
Business plan is a formal document that describes all internal and external elements and strategies for starting a new business.

21. Determination of required resources
Identification of source and resources.
Analyzing Gap between needed and available resources.
Organizing to generate resources.

22. Starting and Managing the Enterprise
Launch of the Venture
Managing business operations
Developing sales/revenue
Improving cash flows.

23. Characteristics of Entrepreneurs
Self-confident & Optimistic
Able to take calculated risks
Responsive to challenges
Adaptive
Versatile knowledge
Creative, energetic & intelligent
Initiator & dynamic leader with a vision to excel
Have strong ability to foresee and observe
Tolerance for failure