Entrepreneurship involves creating and building something of value from limited resources, pursuing opportunities regardless of current resources. It benefits individuals, groups, organizations and society through the provision of goods and services. Entrepreneurs are skilled at identifying new products, production methods, or marketing ways and setting up operations to exploit these opportunities. They create enterprises where none existed before by combining ideas, skills, money, equipment and markets. Entrepreneurship is important as it sparks economic activity and growth through new businesses and jobs.

1. Introduction to
entrepreneurship

3. What is entrepreneurship?
• ‘Entrepreneurship is creating and building something of
value from practically nothing.
• That is, entrepreneurship is the process of creating or
seizing an opportunity and pursuing it regardless of the
resources currently controlled.
• Entrepreneurship involves the definition, creation and
distribution of value and benefits to individuals,
groups, organizations and society.
• Entrepreneurship is very rarely a get-rich-quick
proposition; rather it is one of building long-term value
and durable cash flow streams.’

4. • Entrepreneurship involves creating and building
something of value e.g. a business enterprise or
company.
• Note also that the quantity of resources held has little
bearing on entrepreneurship.
• Whilst resources are important, their absence does not
necessarily stop entrepreneurship. Entrepreneurship
benefits individuals, groups, organizations and society
through the provision of goods and services.

6. • It should be noted that entrepreneurship can be
developed.
• People can be stimulated and activated to be
venturesome, creative and dynamic. This is why we are
talking about entrepreneurship, so that the
entrepreneurial spirit can be developed in the reader.
• And finally, entrepreneurship has benefits for the
economy, society and the entrepreneur. Benefits to
the economy and society and entrepreneur include:
• The establishment and management of small businesses.
• The sale of products and services and the creation of
employment.
• Benefits to the entrepreneur from self-fulfillment by
doing what they enjoy, reaping profits, contribution to
society to recognition for his/her efforts.

7. Entrepreneurs
• We have established the concept of
entrepreneurship, the next question we have
to tackle is, but who are entrepreneurs? We
will look at two definitions that will help
clarify the term.
• Entrepreneurs are skilled at identifying new
products, new methods of production or new
ways of marketing existing products. They set
up operations to provide new products, market
the products and arrange the financing of the
operations

9. • This definition emphasizes that entrepreneurs are skilled people in
the identification of new products, new methods of production and
marketing. Having identified these opportunities, they set up
operations to exploit these opportunities.
• This skill can be in-born or developed by reading books, magazines
and learning from others.
• Let us look at the next definition. Entrepreneurs are people with
the ability to create an enterprise where none existed before.
• They produce combinations of ideas, skills, money, equipment and
markets that form a successful enterprise. The emphasis on this
definition is the creation of an enterprise (Niewenhuizen et al.,
2007).

10. • An entrepreneur can therefore be described as someone
who:
• Starts his/her own enterprise
• Manages his own enterprise
• Buys an existing enterprise
• Identifies new products or opportunities
• Is creative and/or innovative
• Organizes and controls resources (like capital, labor,
materials) to ensure a profit
• Has the ability and insight to market, produce and
finance a service or product;
• Is willing to take calculated risks

11. • The common view is that a person who starts and
establishes any enterprise, not necessarily an enterprise
that shows high levels of innovation, is an entrepreneur.
• We pose the question, who can be an entrepreneur?
• The answer is anyone- regardless of age, race, gender,
colour, national origin or any other characteristic can be
an entrepreneur.
• They need the drive, the energy and other
characteristics that are valuable to an entrepreneur for
success.

12. The richest self-made woman in Africa
and one of just two female billionaires
on the continent. Folorunsho Alakija's
first company was an upscale fashion
label that catered to Nigeria's elite,
including the wife of the former
military president, Ibrahim Babangida.
This connection paid off: the president
later gave Alakija's company a
prospecting license for one of the most
lucrative oil fields in Nigeria. The drop
in oil prices has dented the fortune of
Alakija, one of just two women
billionaires in Africa.
Source: www.forbes.com
•Real Time Net Worth
As of 6/29/15
•$2.2Billion

13. Importance of entrepreneurs
• Entrepreneurs occupy a central position in an economy. It is
the entrepreneurs who serve as the spark plug in the
economy's engine, activating and stimulating different
economic activities. Most nations worldwide can trace their
economic success to efforts at encouraging and rewarding the
entrepreneurial spirit.
• A society is prosperous only to the degree to which it rewards
and encourages entrepreneurial activity because it is the
entrepreneurs and their activities that are the critical
determinant of the level of success, prosperity, growth and
opportunity in any economy. The most dynamic societies in
the world are the ones that have the most entrepreneurs,
plus the economic and legal structure to encourage and
motivate entrepreneurs to greater activities

14. • The South African economy is experiencing a
high unemployment problem.
• In such an economy entrepreneurship is
critical both in creating the much needed job
opportunities for its citizens and producing
products and services. The trend around the
world is that small businesses especially the
informal sector creates more jobs than large
companies.

15. Personal qualities of entrepreneurs
• Entrepreneurs have some common features that set them
apart from people who are not intent on starting their own
enterprises. This is not to say that all entrepreneurs have the
same characteristics. Each entrepreneur has the unique
combination of factors at his/her disposal for achieving
success.
• We will discuss the skills, expertise and aptitudes of
entrepreneurs and their interpersonal qualities.
• These factors are:
• Skill
• Expertise and
• Aptitude

16. • Skills refer to the ability to do an activity or job well,
especially because you have practiced it. For example,
you can learn to become an electrician, dentist,
carpenter or a beautician.
• Expertise on the hand is knowledge that you acquire by
either studying or through experience. You can be an
expert in computer programming, air conditioning
systems or manpower recruitment.
• Successful entrepreneurs have particular skills,
expertise and aptitudes that can be applied profitably in
any enterprise. It is always advisable to start or run an
enterprise in something you feel comfortable with and
know a lot (expertise) and in which you are skilled.

18. The personal characteristics of
entrepreneurs
• It is not enough to have expertise, skills and aptitude.
To enhance chances of success in business, business
characteristics and management skills are also needed.
• The following are personal characteristics of
entrepreneurs deserve our attention:
• Persistence
• Entrepreneurs have a lot of confidence both in
themselves and their enterprises. They press on despite
setbacks and difficult situations and problems that may
arise. They are not easily discouraged when they make
mistakes or fail. They exercise patience until the task at
hand has been completed and the goal has been
reached.

19. Commitment to the enterprise
• Entrepreneurs dedicate their time, skills, expertise and
resources to establish and build the enterprise. They
prove their commitment through the following actions:
• using their own money in the enterprise;
• borrowing and securing the loan against their house;
• putting in long hours to ensure the success of the
enterprise;
• accepting a lower standard of living; usually at the
beginning;
• earning little or no income from the enterprise until it
stabilizes.

20. Reginald
Mengi
•Net Worth : $560
Million
Source Of Wealth:
media, mining, Self
Made
Residence: Dar es
Salaam, Tanzania
Citizenship:
Tanzania

21. Tanzanian media mogul Reginald Mengi
sits atop one of the largest media
conglomerates in Africa. His IPP Media Group
owns 11 newspapers, radio and television stations
and internet properties.
He also owns Bonite Bottlers, the sole bottler of
Coca-Cola products in the northern region of
Tanzania. His Kilimanjaro brand of bottled water is
the biggest selling in the country.
His IPP Resources mines gold, uranium, copper,
chrome and coal. A devout philanthropist, he
sends hundreds of Tanzanian children with heart
ailments to India for treatments.
Source: www.forbes.com

22. Involvement in the enterprise
• Entrepreneurs are actively involved in all
aspects of the enterprise and are aware of
what is happening in the enterprise. They
communicate with staff, suppliers and clients
to ensure the success of the business.

23. Willingness to take risks
• Entrepreneurs take risks, it must be noted that
this is calculated risk. The risk must not be
excessive, for then the chances of success will
be out of the entrepreneur’s hands. On the
hand, the level of risks should not be too small
as lower risk is not usually challenging and
profitable. Entrepreneurs do not take
gambles.

24. Sound relationships
• Entrepreneurs make an effort to cultivate good
relationships with people. This is part of networking.
They develop good working relations with their staff,
clients, suppliers and other entrepreneurs. Success is
difficult to achieve in isolation. Networking is critical to
the success of the business venture.

25. Creativity
• Creativity refers to the
entrepreneur’s
imagination, his ability
to think originally or
differently.
• Examples include the
recently designed
sports shoe washing
and drying machine.
This machine can wash
sports shoes and dry
them in ten minutes
time. This is a good
example of creativity.

26. Positive attitude
• Entrepreneurs remain positive despite
setbacks and failure. Yes, sometimes
they get discouraged because when
situations are not favorable, but they
overall they accept their situation and
remain positive.
• Whilst anyone can become an
entrepreneur, because of the
difficulties that are usually
encountered, not everyone should
become an entrepreneur. Whilst the
rewards do come eventually, there may
be periods of stress and difficulty.

27. The objectives of an
entrepreneur
• What drives entrepreneurs to work so hard
with no guarantee for success?
• What forces drive them to risk so much and to
make so many sacrifices in an attempt to
achieve the ideal?
• Why do entrepreneurs start their own
business? The objectives of an entrepreneur
vary depending on the entrepreneur and his
circumstances.

28. To gain control over one’s
destiny
• Owning a business gives the
entrepreneur the independence and
opportunity to achieve what they
have always desired. They can get
satisfaction in knowing that they are
in control of their destiny and
determining the direction of their
businesses. In addition, to be ones
own boss is better for most of us.

29. To reach full potential
• Entrepreneurship stretches the entrepreneurs
to reach their full potential by exploiting a
business opportunity that they have identified.
Additionally, the demands and challenges of
the business, stimulates new levels of
determination and creativity. This might be
especially appealing as an escape from a
boring job.

30. To contribute to society and be
recognised for their efforts
• Entrepreneurs enjoy the recognition they receive from
customers for their service. The knowledge that their
work has a bearing on the economy brings them
satisfaction. They are generally held in high esteem in
society for their achievements, which is gratifying.

31. To start a new career
• The aim of an entrepreneur might be to start a new
career after being retrenched or unemployed. After the
frustration of retrenchment or losing a job, some people
feel they would rather start something of their own and
avoid another painful experience of being retrenched or
losing their job.

32. To make a profit
• Entrepreneurs might go into business because they
want to make a profit and so supplement their
income. The issue of profit is critical to the
sustainability of the business. Profit is the money
left after expenses incurred by the business have
been deducted i.e. Income - Expenses = Profit.
• Profit is important because it enables owners to
invest in the continued operations of the business.
It should therefore be the objective of any
entrepreneur to make a profit from the business
and in the long term grow this profit. Profit is the
reward for taking the risk and running a business.

33. Conclusion – Part One
• Entrepreneurship involves creating and building
something of value e.g. a business enterprise or
company. Note also that the quantity of resources held
has little bearing on entrepreneurship. Entrepreneurship
benefits individuals, groups, organisations and society.
Entrepreneurship is about building long-term value and
durable cash flow streams. It is not about making a
quick buck.
• Entrepreneurs are people with the ability to create an
enterprise where none existed before. They are
important to any economy, producing a combination of
ideas, skills, money, equipment and markets that form a
successful enterprise. The emphasis on this definition is
the creation of an enterprise.

34. Entrepreneurship and the
business world
• What is a business?
• All of us interact with one form of business or another
every day of our lives. We buy food from a business, use
transport that is either run by some business or bought
from a business. We use phones provided by a business,
wear clothes bought from a business and even work for
a business our selves.
• But what is a business? A business is any individual or
group of individuals that satisfy the needs of people
(Smit, 2004). A business focuses on producing, goods or
services to its customers. A business will combine
capital, labour and technology in providing goods or
services to its customers. There are different types of
businesses. A business could be in the manufacturing,
information technology, services sector etc.

35. Factors of production
• Resources are required to produce goods and services.
Resources are scarce relative to the needs and wants of
people and businesses operating in an economy. It is
important that these resources are used efficiently in
order to maximise the output that can be produced
from them. Production factors can be looked at as
resources when starting an enterprise.
• Certain factors are needed to start an enterprise. These
are called the factors of production:
• Land
• Labour
• Capital
• Entrepreneurship

36. • 1. Land
• Land refers to the natural resources available for production.
Some countries are endowed with natural resources and
exploit this by specialising in the extraction and production of
these resources - for example – Saudi Arabia has oil in
abundance. Other examples of natural resources include
water, minerals, wood, leather and iron ore.
• 2. Labour
• Your desire to start an enterprise of your own is only the first
step in establishing a business. You need people who can
assist you with the business. Labour is the human input into
the production process. These employees or labourers are
paid a wage or salary. Not all labour is of the same quality.
Some workers are more productive than others because of the
education, training and experience they have received. The
technical knowledge and skills of people who work in an
enterprise is called human capital.

37. • 3. Capital
The word capital has several meanings. It means the
finance raised to operate a business (financial capital).
Capital also refers to machinery, plant and equipment,
new technology, factories and buildings - all goods
designed to increase the productive potential of the
economy. This is called physical capital. Human capital
refers to the technical knowledge and ingenuity of people
who work in an enterprise.

38. 4. Entrepreneurship
• Entrepreneurs are people who organize
productive resources to make goods and
services. The skill in combining the other
three production factors in order to generate a
product is known as entrepreneurial ability.
The success and/or failure of a business often
depends on the quality of entrepreneurship.

39. The location of an enterprise
• The enterprise is a body that is established by an
entrepreneur to provide goods and services that meet the
needs of consumers. The location or premises where an
enterprise operates is called an establishment. In the
example of a manufacturing business, this would be a
factory. The factory is where the company’s production
equipment is located and where raw materials are converted
to outputs.
• Every business must have some location or establishment to
operate from. The choice of where to locate the premises is
not an easy one neither should it be taken lightly. The choice
depends on a host of factors including your preference,
availability, costs and concentration of customers. A proper
study must be done before settling on a location. The key
criteria are concentration of customers and least cost. A
wrong choice can spell trouble for the enterprise.

40. The Primary Sector
• The primary sector involves the exploitation of natural resources in their
unprocessed form. An example is a citrus plantation.
• The Secondary Sector
• In the secondary sector, natural resources are processed to their final product.
For our example, this would be preserving oranges.
• The Tertiary Sector
• Here the final product is transported from the manufacturer or producer to the
consumer. Supermarkets such as Checkers, Spar and Woolworth’s belong to the
tertiary sector.
Enterprises and their establishments are classified according to
their activities into primary, secondary and tertiary sectors. Let
us see what these words mean.

41. Informal enterprises
• Let us see what these interesting terms mean. An
informal enterprise is an enterprise that does not
have officially recognised business premises. It is
not officially recognised and does not keep official
records. Examples are people selling oranges and
apples at a street corner.
• Clearly there are advantages with this form of
business. It is easy to start, as it does not need to
be registered or recorded for tax purposes. But
there are disadvantages as well. The owner of an
informal enterprise cannot rent premises on behalf
of his/her enterprise. Obtaining finance will be
equally difficult as financial institutions view
informal enterprises with suspicion. In addition
they usually have little or no security to offer.
• A formal enterprise is an enterprise that has a
registered form of enterprise and is registered for
tax purposes. Examples of formal enterprises are
private companies and close corporations.

42. The Business Environment
• A management system describes the organization and the set of
significant interacting institutions and forces in the organization's
complex and rapidly changing environment that affect its ability
to serve its customers.
• The firm must continuously monitor and adapt to the environment
if it is to survive and prosper. Disturbances in the environment
may spell profound threats or new opportunities for the firm.
• The successful firm will identify, appraise, and respond to the
various opportunities and threats in its environment. The business
environment is made up of all the factors that can affect the
business enterprise in any way.
• The business enterprise is affected by both the internal and the
external environment. Unfortunately, we have no control over
some of these factors. An entrepreneur or his manager should be
skilled in knowing how to analyse and improve the ability of an
organization to survive and grow in a complex and changing
world.

43. The internal environment
• The management system can be conceptualised on
two levels. The first level involves the
organization's internal environment. Internally, an
organization can be viewed as a resource
conversion machine that takes inputs (labour,
money, materials and equipment) from the
external environment (i.e., the outside world),
converts them into useful products, goods, and
services, and makes them available to customers
as outputs. The internal environment is called the
micro environment.

44. The external environment
• The second level of the management system
involves the organization's external environment.
The external environment is part of the business
environment outside the environment.
• It consists of all the outside institutions and forces
that have an actual or potential interest or impact
the organization's ability to achieve its objectives.
• These include competitors, suppliers, economic
conditions, technological changes, political and
legal variables, social and cultural forces, physical
variables and international forces. Environmental
forces create challenges and opportunities for the
organization.

45. Conclusion
• The factors of production are land, labour, capital and
entrepreneurship. The primary sector involves the
exploitation of natural resources in their unprocessed
form.
• The secondary sector involves the processing of natural
resources into their final product. In the tertiary sector
the foods the finished goods are transported to the
consumer.
• Although the objectives of entrepreneurs vary, the
profit motive deserves special attention because profit
sustains the business.
• Enterprises can be formal or informal. The business
environment is made up of all the factors that can
affect the business enterprise in any way.