Introduction to Entrepreneurship
Entrepreneurship is the process of venturing into business activities for the purpose of gaining profits. An entrepreneur is therefore a person who ventures into business activities in order to gain profits. People view entrepreneurship and small business as being similar. However, there are certain differences that can be used to distinguish the two terms. Entrepreneurship involves more innovation. In entrepreneurship, the profits are yielded at a shorter time than in the small business. The profits gained by an entrepreneur are greater than the ones gained by people who run small business. Entrepreneurship also covers a wide scope of business activities that are meant to increase wealth as well as total welfare.
There are different types of entrepreneurship. These include idealist, optimizing, hard work, juggler and sustainer entrepreneurship (Martin 2011). In the idealist type, there is a lot of innovation that is involved. This means that an entrepreneur gathers several ideas in order to come up with new ideas that help him to invent an innovated product. This type of entrepreneurship is important because it induces the production of unique products. In the optimizer’s type of entrepreneurship, the entrepreneur is aimed at maximizing his personal desires. In this case, he is aimed at owning a business of his own. The satisfaction of the entrepreneur becomes optimal when he owns an enterprise of his desire.
A hard working entrepreneurship involves working exceptionally in order to yield high profits. In this case, the entrepreneur may spend a lot of time in looking after the business to ensure that more revenue is collected. This type of entrepreneurship has a lot of challenges. The good thing about it is that it is likely to yield high profits if the business goes well. Juggler entrepreneurship consists of people who like to work without much help from other partners. In this case, they work under pressure in order to meet the set deadlines. Sustainer entrepreneurship is whereby the entrepreneur divides his time between business and family. He therefore carries out his business while ensuring that this does not compromise the time for doing personal issues.
There are various stages of entrepreneurship. The first stage is conviction. In this stage, a personal has to decide whether he is capable of indulging in business ventures (Martin 2011). The person should evaluate whether he is capable of becoming an entrepreneur and whether it can be helpful to him. The second stage is the idea stage. This stage requires the generation of a business idea that will help you to start up a business. One can generate a business idea by studying the current business environment and analyzing the various needs that have not been met. One can come up with the idea of providing a means of satisfying these needs. The third stage, concept, involves conducting research in the market and analyzing any models that may be involved. It also involves seeking advisors regarding the business that one wants to start.
The other stage is venture. In this stage, the entrepreneur carries out actual investment. This stage is difficult because it may require many resources. The entrepreneur may also spend a lot of time in this stage. The fifth stage is the business stage. Most investors fall in this category. In this stage, an entrepreneur can record profits by calculating the difference between the total revenue and the total costs (Martin 2011). If there are high profits, the entrepreneur will depend less on the external sources of capital. The last stage is sustainable business stage. Here, every entrepreneur is striving to maintain a stable business that is competitive in the business environment. The entrepreneur also ensures that the business does not yield losses.
In conclusion, entrepreneurship is important because it improves the welfare of people. Firstly it improves the standard of living of the entrepreneur since it enables him to get money to purchase better houses and to satisfy all the basic needs. Entrepreneurship is a form of employment, therefore reducing the rate of unemployment in a country. It also involves a lot of innovation through the creation of new ideas. This leads to the production of high quality goods. Finally, encouraging entrepreneurship in a country will lead to higher economic growth as well as economic development.
