entrepreneurship notes 1st semester

1. ENTREPRENEURSHIP
Module 1 Part 1

2. MODULE 1
OBJECTIVES
At the end of these topics, the
learners are able to:
To understand a brief history and the
evolution of entrepreneurship
Identify the importance of
entrepreneurship
Identify and discuss local enterprises
that contributes to the development

3. WHO IS AN
ENTREPRENEUR?
• Entrepreneur – the person who undertakes
entrepreneurship.An entrepreneur is someone
who starts a side hustle that can eventually
create a full-time, sustainable business with
employees.
• Entrepreneurship means staying committed to your
goals beyond your feelings of excitement. Stay the
course and keep your “why” in mind.”
It’s not about ideas. It’s about making ideas happen –
Scott Belsky
The entrepreneur always searches for change, responds
to it, and exploits it as an opportunity
A person who sees a problem is a human being; a
person who finds a solution is visionary; and the person
who goes out and does something about it is an
entrepreneur ‘ Navin Jain

4. BRIEF HISTORY/EVOLUTION OF
ENTREPRENEURSHIP (CONT)
• The earliest usage of the term “entrepreneur” is recorded in 17th
century French military history. It referred to persons who undertook
to lead military expeditions.
• An 18th century Irishman named Richard Cantillon who was living in
France at the time, is credited of being the first to use the term
“entrepreneur” in a business context, as someone who buys goods and
services at certain prices with a view to selling them at uncertain
prices in the future, in other words bearing a not-insured risk.

5. BRIEF HISTORY/EVOLUTION OF
ENTREPRENEURSHIP (CONT)
• The word “Entrepreneur” is an English word that has been loaned
from the 18th century French. The French loan word was
“entreprende”, which means in Old French “to undertake” and was
used mainly in French to describe a "manager or promoter of a
theatrical production". The word entrepreneur can be also
translated to mean “between-taker” or “go between”.
• Later, in 1803 Jean Baptiste Say described entrepreneurial function
in broader terms laying emphasis on “the bringing together of the
factors of production with the provision of management and the
bearing of the risks associated with the venture.

6. BRIEF
HISTORY/EVOLUTION OF
ENTREPRENEURSHIP
(CONT)
• It was not until the early 20th
century when the Moravian
(Czech), Joseph Schumpeter, cast
the entrepreneur as being the
central actor in the change
process that anyone really took
note. He contended that the single
most important function of the
entrepreneur was innovation.

7. BRIEF
HISTORY/EVOLUTION
OF
ENTREPRENEURSHIP
(CONT)
• The meaning of entrepreneurship
involves an entrepreneur who takes
action to make a change in the world.
Whether start-up entrepreneurs
solve a problem that many struggle
with each day, bring people together
in a way no one has before, or build
something revolutionary that
advances society, they all have one
thing in common: action.

8. • Founder and CEO of Neuro Flow
shares “Entrepreneurship means being
the one that is willing to take a leap, work
hard enough to sacrifice everything else
around you, all in the name of solving
problems because no one else is capable
or possesses the desire.” Entrepreneurs
take the idea and execute it.
Entrepreneurship is about
execution of ideas.
MEANING
OF
E N T R E P R E N E U R S H I P

9. DEVELOPMENT OF ENTREPRENEURSHIP THEORY AND THE
TERM ENTREPRENEUR
(STEMS FROM THE FRENCH: MEANS BETWEEN-TAKER OR GO
BETWEEN
Middle Ages Actor (war like action) and person in charge of large scale production projects
17th Century Person bearing risks of profit (loss) in a fixed price contract with the government
1725 Richard Cantillon – person bearing risks is different from one supplying capital, a
risk-taker observing the merchants, farmers, craftsmen, and other sole proprietors”
buy at a certain price and sell at an uncertain price, therefore operating at a risk.
1797 Beaudeau – person bearing risks, planning, supervising, organizing and owning
1803 Jean Baptiste Say – entrepreneurship as the shifting of economic resources out of
an area of lower and into higher productivity and greater yield; separated profits of
entrepreneur from profits of capital

10. DEVELOPMENT OF ENTREPRENEURSHIP THEORY AND THE
TERM ENTREPRENEUR
(STEMS FROM THE FRENCH: MEANS BETWEEN-TAKER OR GO
BETWEEN) (CONT)
1876 Francis Walker – distinguished between those who supplied funds and received interest
and those who received profit from managerial capabilities
1934 Joseph Schumpeter – entrepreneur is an innovator and develops untried technology
1961 David McClelland – entrepreneur is an energetic, moderate risk taker
1964 Peter Ducker – entrepreneur maximizes opportunities; one who starts his own, new and
small business
1975 Albert Shapero – entrepreneur takes initiative, organizes some social-economic
mechanisms, and accepts risks of failure

11. DEVELOPMENT OF ENTREPRENEURSHIP THEORY AND THE
TERM ENTREPRENEUR
(STEMS FROM THE FRENCH: MEANS BETWEEN-TAKER OR GO
BETWEEN) (CONT)
1980 Karl Vesper – entrepreneur seen differently by economics, psychologists,
businesspersons, and politicians
1983 Gifford Pinchot – intrapreneur is an entrepreneur within an already established
organization, 1985
Robert Hisrich – entrepreneurship is the process of creating something different
with value by devoting the necessary time and effort, assuming the accompanying
financial, psychological, and social risks, and receiving the resulting rewards of
monetary and personal satisfaction
20th Century The notion of innovation and newness attributed to entrepreneurs is now the
heart and essence of entrepreneurship. The innovation and newness can come in
the form of anything from new product to a new distribution system for simplifying
a new organizational structure

12. EVOLUTION OF
ENTREPRENEURRSHIP
By the middle of the 20th century, the notion of an entrepreneur as “innovator” was established.
Hisrich and Peters described the function of an entrepreneur as follows:
• “to reform or revolutionalize the pattern of production by exploiting an invention or, more generally, an untried
technological possibility for producing a new commodity or producing an old one in a new way, opening a new
source of supply of materials or a new outlets of products, by reorganizing a new industry,”
The latter part of the 20th century, the notion of “innovation” and “newness” attributed to
entrepreneurs is now the “heart and essence” of entrepreneurship. The innovation or newness can
come in the form of anything from a new product to a new distribution system for simplifying a new
organizational structure.

13. WHO IS AN ENTREPRENEUR?
(CONT)
Prof. Robert Nelson defines entrepreneur as a person who is able to look at the environment,
identify opportunities to improve the environment, marshall resources, and implement action to
maximize those opportunities. In non-work situation, entrepreneurs maybe considered those
persons who improve social and economic conditions primarily in the local communities
Joseph Schumpeter defines entrepreneurship as doing things that are not generally done in the
ordinary course of business routine. It is essentially a phenomenon that comes under wider
aspect of leadership.

14. CONTEMPORARY VIEWS ON
ENTREPRENEURSHIP
Loyd Shefsky in his book “Entrepreneurs are
Made Not Born” dissect the word
entrepreneur into three parts:
entre means to enter
pre means before, and
neur means nerve center
This leads to a definition of the word as
someone who enters a business – any
business. Individuals develop or change the
nerve center of the business

15. CONTEMPORARY VIEWS ON
ENTREPRENEURSHIP (CONT)
• To an economist: an entrepreneur is one who brings resources, labor,
materials and other assets into combination that made their value greater
than before and also one who introduces changes, innovation, and a new
order
• To a psychologist – could refer to a personas typically driven by certain
forces – need to obtain or attain something, to experiment, to accomplish .
• To a businessman – an entrepreneur appears as a threat, an aggressive
competitor, whereas to another businessman, the entrepreneur maybe an
ally, a source of supply, a customer, or someone good to invest in
According to KarlVesper: entrepreneurship is the dynamic
process of creating incremental wealth

16. CAVEATS ON THE
DEFINITION OF
ENTREPRENEURSHIP
There was no specific indication as to the
particular line of business operations the
entrepreneur is engaged in
Does not indicate that an entrepreneur is a
capitalist
There is any no bias indicating that
entrepreneur is small-time or low capitalisation
business endeavour
Entrepreneurs can now be found in all
professions

17. DEFINITIONS OF ENTREPRENUERSHIP
Entrepreneurship is
the process of creating something different with value by devoting the necessary time and
effort, assuming the accompanying financial, psychic and social risks, and receiving the
resulting rewards of monetary and personal satisfaction. - Hisrich and Peter
a dynamic process and that it is a matter of creating incremental wealth.A value must be
infused by the entrepreneur by securing and allocating the necessary skills and resources to a
product or service. – Robert Rondstat
the process of identifying opportunities in the marketplace, marshalling (organizing) the
resources to pursue those opportunities, and committing actions and resources necessary to
exploit the opportunities for long-term personal gain. – Sexton and Bowman-Upton

18. DEFINITIONS OF ENTREPRENUERSHIP
(CONT)
William Bygrave entrepreneurship evolves
around the notion that:
• First, an entrepreneur is someone who perceives an
opportunity and creates an organization to pursue it
• Second, the entrepreneurial process involves all the
functions, activities, and actions associated with perceiving
opportunities and creating organizations to pursue them

19. ENTREPRENEURSHIP
IS A PROCESS AND
APPROACH
Bygrave subscribes to
Carol Moore’s model on
the entrepreneurial
process as shown in the
figure shown. Moore’s
model follows a pattern
commencing with an
innovation, a triggering
event, implementation,
and growth

20. ENTREPRENEURSHIP IS A PROCESS
Albert Shapero pointed out that entrepreneurship is a
dynamic process of innovation and new venture creation
through four major dimensions: individuals, organization,
environment, process – and aided by collaborative networks
in government, education and institutions. The entrepreneurial
event focuses on the process of entrepreneurial activity and
includes the following factors:

21. ENTREPRENEURSHIP IS A PROCESS (CONT)
Initiative: an individual or group takes the initiative
Organization: Resources are brought together in organization to accomplish some
objectives (or the resources in existing organization are reorganized
Administration:Those who took the initiative take over the management of the
organization
Relative autonomy:The initiators assume relative freedom to dispose of and
distribute resources
Risk taking:The organization’s success or failure is shared by the initiator’s superiors and
subordinates

22. ENTREPRENEURSHIP IS AN APPROACH
Two Approaches to Problem Solving
ADAPTER INNOVATOR
Employs a discipline, precise methodical approach Approaches tasks from unusual angles
Is concerned with solving, rather that finding
problems
Discovers problems and avenue of solutions
Attempts to refine current practices Questions basic assumptions related to current
practices
Tends to be means-oriented Has little regard for means, is more interested in
ends
Is capable of extended detail work Has little tolerance for routine work
Is sensitive to group cohesion and cooperation Has little or more need for consensus, often is
sensitive to others