1 Entrepreneurship models by Prof RAVINDRA PUJARI Management Consultant

Ravindra_pujari@yahoo.com
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"ENTREPRENEUR" or "entrepreneurship" comes from the French verb
entreprendre, meaning "to undertake".
Though the concept of an entrepreneur existed since the beginning of human
race and was known for centuries, the classical and neo-classical economists
left entrepreneurs out of their formal models:
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Meaning of Entrepreneur
An entrepreneur is an individual who creates a new
business, bearing most of the risks and enjoying most of
the rewards. The process of setting up a business is
known as entrepreneurship.
The entrepreneur is a person, who has the ability and
desire to establish, administer and succeed in the startup
venture, along with risks attached/entitled to the business
venture, and to make profits and grow.
The entrepreneurs are often known as a source of new
ideas or innovators, and bring new ideas in the market by
replacing old with a new invention.
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ENTREPRENEURE The term ‘entrepreneur’ is derived
from the French word ‘entrprendre’ which means ‘go
between’ or ‘to undertake’.
Thus an entrepreneur is any person who undertakes the
risk of establishing and running of a new enterprise. There
are different types of entrepreneurs on the modes or
objectives or ventures.
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The entrepreneur is commonly seen as an innovator, a
source of new ideas, goods, services, and business/or
procedures.
In a nutshell, anyone, who has the will and determination to
start a new company and deals with all the risks that go with
it can become an entrepreneur. Entrepreneurs play a key
role in any business enterprise, using the skills and initiative
necessary to anticipate needs and bringing good new ideas
to market.
Entrepreneurship that proves to be successful in taking on
the risks of creating a startup, is rewarded with profits, fame,
and continued growth opportunities.
Entrepreneurship that fails, results in losses and less
prevalence in the markets for those involved.
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TYPES OF ENTREPRENEURS
1)ACCORDING TO THE TYPE OF BUSINESS
i)Business entrepreneurs:-who start business units after
developing ideas for new products/services.
ii)Trading entrepreneurs :-who undertake buying & selling of
goods, but not engage in manufacturing.
iii)corporate entrepreneurs:-who establish and manage
corporate form of organization which have separate legal
existence.
iv)Agricultural entrepreneurs:- who undertake activities like
raising and marketing of crops, fertilizers and other allied
activities. Ravindra_pujari@yahoo.com
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Characteristics of Entrepreneurs.
Not all entrepreneurs are successful; there are definite
characteristics that make entrepreneurship successful.
A few of them are mentioned below:
Ability to take a risk- Starting any new venture involves a
considerable amount of failure risk. Therefore, an
entrepreneur needs to be courageous and be able to
evaluate and take risks, which is an essential part of being
an entrepreneur.
Innovation- It should be highly innovative to generate new
ideas, start a company and earn profits out of it. Change can
be the launching of a new product that is new to the market
or a process that does the same thing but in a more efficient
and economical way.
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· Visionary and Leadership quality- To be successful,
the entrepreneur should have a clear vision of his new
venture. However, to turn the idea into reality, a lot of
resources and employees are required. Here, leadership
quality is paramount because leaders impart and guide
their employees, towards the right path of success.
Open-Minded- In a business, every circumstance can
be an opportunity and used for the benefit of a company.
For example, Paytm recognised the gravity of
demonetization and acknowledged the need for online
transactions, so did educational institutes, went online,
during the pandemics/lock-down. It utilised the situation
and expanded massively during this time.
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· Flexible/Versatility
An entrepreneur should be flexible and open to change
according to the situation. To be on the top, a business
person should be equipped to embrace change in a
product and service, as and when needed. Online
delivery of food and essentials during the lck-down.
Know your Product- A company owner should know
the product offerings and also be aware of the latest
trend in the market. It is essential to know, if the
available product or service meets the demands of the
current market, or whether it is time to tweak/change it a
little. Being able to be accountable and then alter as
needed is a vital part of entrepreneurship.
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Creativity/Collaboration
No matter what industry you’re in, the entrepreneurs or
employers have to be creative—always thinking of new
ways, to improve the company’s workflow, productivity,
and bottom line. Entrepreneurs, just think of doing the
assignments, but also come up with better ways of
doing things.
Think out of the box is an old idiom, the new one
is, with out-of-the-box ideas.
Decisiveness
Do you exercise sound judgment under pressure.
When you’re an entrepreneur, you don’t have room to
procrastinate—and the same is true for employees
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Hard Work
Business Acumen & Sincerity
Prudence
Achievement Motivation
Self Reliance & Independence
Persuasiveness
Communication Skills.
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This classification is done on the basis of the
willingness of an entrepreneur to create and
accept the innovative ideas.
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Innovative Entrepreneur: These are the ones who have
the new/unique/revolutionary ideas, new products, new
production methods or processes, or discover potential
markets and reorganize the company’s structure. They are
the industry leaders and contributes significantly towards
the economic development of the country.
The innovative entrepreneurs have an unusual foresight to
recognize the demand for goods and services. They are
always ready to take a risk because they enjoy the
excitement of a challenge, and every challenge has some
risk associated with it.
Eg: Ritesh Agarwl OYO, Vijay Shekar Sharma Paytm,
Shradda Sharma Yourstory, Nandan Reddy Swiggy,
Panindra Sam Red Bus.
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Imitating Entrepreneurs: The imitating entrepreneurs
are those who immediately copy the new inventions
made by the innovative entrepreneurs. These do not
make any innovations by themselves; they just imitate
the technology, processes, methods pioneered by others.
These entrepreneurs are found in the places where
there is a lack of resources or industrial base due to
which no new innovations could be made.
Thus, they are suitable for the underdeveloped regions
where they can imitate the combinations of inventions
already well established in the developed regions, in
order to bring a boom in their industry.
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Fabian Entrepreneurs: These types of entrepreneurs are
skeptical about the changes to be made in the organization.
They do not initiate any inventions but follow only after they
are satisfied with its success rate. They wait for some time
before the innovation becomes well tested by others and do
not result in a huge loss due to its failure.
Drone Entrepreneurs: These entrepreneurs are reluctant to
change since they are very conservative and do not want to
make any changes in the organization.
They are happy with their present mode of business and do
not want to change even if they are suffering the losses.
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Types of Entrepreneurship
When you hear the word “entrepreneur,” you might
think of someone starting up a tech company in their
garage and taking it to a multi-million dollar enterprise.
However, there are many different types of
entrepreneurship, and some remain rather small
throughout the lifetime of the company.
In general, entrepreneurs start and run a business.
There are many basic types of entrepreneurship.
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1. Small Business
Probably the most common of the types of
entrepreneurship is the small business model. This would
be any business with typically less than 100 employees.
There is some variation, depending upon the industry.
If you open a bakery in your town, you’re considered a
small business. If you eventually start your own
manufacturing and employ 10,000 bakers, your
classification changes. A small business entrepreneur
knows they will need the support of their family,
community and good old-fashioned work ethic.
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2. Innovators
Some entrepreneurs come up with a completely new way
of doing things or a concept, no one else ever thought of.
If you’re an inventor or you have a truly unique idea, you
may be an innovative entrepreneur.
Some examples of innovative entrepreneurs would be Bill
Gates, who invented the Windows Operating system,
taking computers from something where you had to know
DOS coding to use to a what you see is what you get
(WYSIWYG) environment.
No one can keep up with an innovator, because they have
unique products and ideas the rest of the world doesn’t
offer.
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3. Hustler
Another of the types of entrepreneurship is the hustler
mentality. This is a person who may not have a unique
idea or even an unusual product. They simply work
harder and smarter than their peers.
The hustler business owner tends to start small, such
as a local real estate agent who began in the industry,
started buying rental properties and flipping houses,
and eventually worked up the way up to a multi-million
income in a year income.
The advantage of a hustler is that, they can start on a
shoestring budgets, without waiting for investors and
build something out of seemingly nothing.
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4. Buyer Entrepreneur
Most people will not fall into this type of
entrepreneurship. The buyer is already wealthy. They
look for opportunities to invest in companies they feel
will be successful, acquiring them and letting them
continue business as usual with a few tweaks.
In order to invest in other companies, the buyer
entrepreneur must have experience of business or
have the backing of rich investors.
An example of this type of business would be Google,
who has acquired many smaller companies and
gobbles up the competition and unique new ideas.
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5. Imitator
They say imitation is the sincerest form of flattery, but it
doesn’t seem that way when someone takes your
business idea and does it better. Out of the types of
entrepreneurship, imitators may be the most controversial.
The imitator sees a business idea they like and
immediately starts wondering how they might improve it.
An example of an imitator would be someone who likes
Uber’s model, so they start their own ride sharing app. If
they don’t like a few things Ola does, they tweak their
policies to improve on the idea.
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6. Researchers
The researcher entrepreneur studies many different
ideas and fully vets all aspects of starting a new
business. They know the statistics and the odds of
success before they invest a dime. They may even
have a list of the potential pitfalls and what trouble
areas they’ll run into as the business goes.
Researchers understand the risks involved before
they open a company and are likely to be highly
successful. However, a big disadvantage of a
researcher entrepreneur is they may not have a
passion for what they’re doing. They simply choose
the least risky venture.
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7. Solopreneur
Some people start businesses as a side hustle. They have
no desire to quit their day job, but they want a little extra
money on the side. They may have a passion for art or some
other craft and want to share it with the world.
The solopreneur is a one-man or one-woman show. They
don’t have any staff and they don’t want to grow beyond a
certain point, because they don’t have the time to bother with
scaling up.
The solopreneur is one of the types of entrepreneurship
which falls into other categories as well. It could be defined
as a small business, tech or fall into any other category. The
advantage is you can start a solopreneurship inexpensively.
The disadvantage is that you’re unlikely to grow past a
certain point until you change your model.
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8. Social Entrepreneurship
One of the most interesting types of entrepreneurship is
social. This is a business that starts because the founders
see something in society that needs changed. Perhaps they
notice local school children go hungry in the summer. They
want to set up a program to feed those kids, so they start a
business selling personal chef services and donate the
profits to meals for school children. In todays scenerio, it
serving to the corona patients.
This particular type of company isn’t in it only for the profit,
but also to help make the world a better place. The owner
tends to be idealistic and involved in many aspects of a
cause they care deeply about.
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Entrepreneurs vs Managers
Who is an Entrepreneur
Very basically speaking, an entrepreneur is a one-man show
that runs entrepreneurship. However, such a person usually
has some unique attributes that allow him to be successful in
his endeavors. He is essentially an initiator and a leader. He
brings business ideas to fruition thus starting off his venture.
A successful entrepreneur is usually a responsible person.
He is accountable for the success or the failure of his venture,
and he takes this responsibility very seriously. And since he
is the only person in-charge he is automatically the leader. In
fact, leadership qualities are one of the main aspects of an
entrepreneur.
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Who is a Manager
A manager, on the other hand, is not an owner of an
enterprise. Instead, he is the one that is responsible
for the management and administration of a group of
people or a department of the organization. His day to
day job is to manage his employees and ensure the
organization runs smoothly.
A manager must possess some of the same qualities
as an entrepreneur, like leadership, accountability,
decisiveness etc. He must also be a good manager of
people. So qualities such as warmth and empathy are
also very important in a manager.
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Difference between Entrepreneur and Manager
The key difference between an entrepreneur and a
manager is their standing in the company.
An entrepreneur is a visionary that converts an idea into a
business. He is the owner of the business, so he bears all
the financial and other risks. A manager, on the other hand,
is an employee, he works for a salary. So he does not have
to bear any risks. The focus of an entrepreneur lies in
starting the business and later expanding the business.
A manager will focus on the daily smooth functioning of the
business. For an entrepreneur the key motivation is
achievements. But for the managers, the motivation comes
from the power that comes with their position.
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The reward for all the efforts of an entrepreneur is the
profit he earns from the enterprise and grow.
The manager is an employee, so his remuneration is the
salary he draws from the company.
The entrepreneur by nature is a risk taker. He has to
take calculated risks to drive the company further.
The entrepreneur can be informal and casual in his role.
A manager, on the other hand, is risk-averse. His job is
to maintain the status quo of the company. So he cannot
afford risks. The manager’s approach to every problem
is very formal.
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An intrapreneur is an employee of the organization
who is paid remuneration and incentives or share of
profits according to the success of the business unit,
for which he/she is hired or responsible. He may be
the CEO/COO and directly, reports to the
entrepreneur.
The primary difference between an entrepreneur and
intrapreneur is that the former refers to a person who
starts his own business with a new idea or concept,
the latter represents an employee who promotes
innovation within the limits of the organization.
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