Entrepreneurship
KCA 004/ BAC 1306/ BCT 1203/ BSD
1303
Introduction
Entrepreneur
The word 'Entrepreneur' is derived from the French
word 'Enterprendre', meaning to undertake.
A person endowed with more than average
capacities in the risk of organizing and
coordinating various factors of production -F. A.
Walker
A person who searches for change, responds to it
and exploits it as an opportunity. - Peter Drucker
A person who is willing and is able to convert a
new idea (invention) into successful innovation -
Joseph Schumpeter
A person primarily motivated by an
overwhelming need for achievement and strong
urge to build - David Mclelland (1961)
TRAITS of An Entrepreneur
Tough, fragmatic (practical oriented) people
driven by the need for independence and
achievement, rarely submit willingly to authority –
Findings of Collins & Moore (1970)
A people prone to insights, ingeniousness and
resourcefulness [cleverly inventive, matters
involving nvolving new ideas and methods] - Bird
(1992)
Cunning, opportunistic, creative and
unsentimental
Overview
An action-oriented person; has the ability to
visualize the necessary steps involved from idea
generation to its actualization.
Both a thinker and doer; planner and worker.
Accepts risks and manages them.
All the definitions portray an entrepreneur as an
initiator of action, stimulator of social economic
change and a harnesser of resources
Entrepreneur Vs Manager
- Owner Vs Servant
- Profit (Uncertain) Vs Salary (Fixed)
- Bearing full Risk Vs No risk bearing
- Functions cut across Vs Designated Managerial
functions
- Innovator / Planning Vs Executor of plans
Entrepreneur Vs Intrapreneur
In refers to ‘within’ organizations
Employees with entrepreneurial talents are
encouraged to generate new ideas and
convert them into products through research
and development
Nurturing talents within allows for personal
growth or else such staff exit and start their
businesses
Entrepreneur Vs Intrapreneur
Independent / Dependent
Need not be educated / Highly educated,
professional
Has to fundraise to start / Not bothered by funds
Risk bearing / Does not bear risks
Strong authoritarian / Less authoritative ..
Social Entrepreneur
A person who uses business as a way to solve
social challenges
Driven by the desire to make a social impact
rather than just to make a profit
Discussion
Give examples of such businesses and the
challenges they focus
Who is an Ontrepreneur / Netpreneur?
Benefits of Entrepreneurship
The acts of Entrepreneurship are often associated
with uncertainty especially when it involves
bringing something new to the world whose
market never existed.
Discuss with examples the statement..
Entrepreneurship forces creative destruction
across markets and industries simultaneously
creating new products and business models’
Benefits of Entrepreneurship
Fosters economic growth – Small businesses are
changing the lives of communities
Source of employment, pay taxes, reduce
dependence on government support, make use
of local raw materials, drive innovations
Increases productivity
Ability to produce more goods and services with
less labour and inputs
Creates new technologies, products and
services
Entrepreneurs promote innovative technologies,
products and services.
Sometimes innovations can trigger many other
innovations (Cite examples)
Changes and rejuvenates market competition
(market place change)
Small businesses serve as agents of change in
the market economy
Role of Entrepreneurship in economic
development
Promotes capital formation by mobilizing the idle
saving of the public
Provides employment
Provides balanced regional development
Helps reduce the concentration of economic
power
Role of Entrepreneurship in economic
development
Stimulates the equitable distribution of wealth,
income and even political power
Encourages effective resource mobilization of
capital and skill, otherwise idle
Induces backward and forward linkages
stimulating economic development
Theories of Entrepreneurship
A theory refers to a set of interrelated concepts,
definitions and propositions presenting a
systematic view of a phenomena.
A good theory can help an entrepreneur
understand all the issues of new venture creation
without having to start one to understand what
works and what doesn’t.
Theories of Entrepreneurship
Innovation Theory (Schumpeter, 1949) –
Economist
Need for Achievement Theory (McClelland,
Psychologist)
Hierarchy of Needs Theory (Abraham Maslow,
Psychologist)
Theory of Entrepreneurial growth (Max Weber,
Sociologist)
