The document discusses entrepreneurial motivation and factors that inspire entrepreneurs. It defines motivation as desires and aspirations that direct behavior. Motivation is internal, continuous, and causes goal-oriented behavior. The motivational process involves awareness of needs, searching for actions to satisfy needs, fulfilling needs or discovering new needs. Research has identified several motivating factors for entrepreneurs like educational background, family influence, desire for independence, and government assistance. Motivation can be classified into internal factors like technical skills or external factors like demand or financial assistance. Self-employment offers advantages like personal satisfaction and independence but also disadvantages like uncertain income and long working hours. People start businesses for reasons like survival, income supplementation, independence, lack of job satisfaction, or productive use

1. LESSON 6: ENTREPRENUERIAL MOTIVATION
Definition of motivation- It is the way in which desires and aspirations directs, control
or explain the behaviour of human beings
Nature of Motivation
The above definition reveals the following characteristics of motivation
i) Motivation is a personal and internal feeling i.e It is a psychological situation
that arises in the mind of an individual when his needs and wants are satisfied.
- Motivation is related to need satisfaction because all conscious or motivated
behaviour on the part of human beings is directed towards the satisfaction
of needs
ii) Motivation is a continuous process because human needs are unlimited, and a
person always feels a need
iii) A person cannot be partly motivated
iv) Motivation causes goal-oriented behaviour
Motivational Process
Motivation follows the following steps:
1. Awareness of needs- awareness of unsatisfied needs creates tension in the mind of
a person. This tension leads to goal-directed behaviour
2. Search for Action- In order to relieve his tension and to satisfy his needs, the
individual looks for suitable action. He develops certain goals and makes an
attempt to achieve them
3. Fulfilment of need- In case the attempt is successful, his need is satisfied and he
feels motivated. If the attempt is unsuccessful the need remains unsatisfied and
the individual engages himself in search for a new action
4. Discovery of new need- Once one need is fulfilled, some other need will emerge
and the individual will set a new goal. This process continuous to work within an
individual because human needs are unlimited
Motivating Factors
Several research studies have been conducted to identify the factors that inspire
entrepreneurs.
- Some of these factors are as follows:
a) Educational background
b) Occupational experience
c) Family background
d) Desire to branch out to manufacturing
e) Desire to work independently
f) Assistance from the government
g) Assistance from financial institutions

2. h) Availability of technology/raw materials
i) Other factors are demand of particular product, favourable business environment,
stable political situation
N/B The above factors were grouped into two categories- internal and external factors
1. Factors internal to the entrepreneur:
a) Strong desire to do something independently in life
b) Technical knowledge and manufacturing experience
c) Business experience in the same or related line
2. Factors external to the entrepreneur
a. Profit margin
b. Heavy demand
c. Encouragement from big business
d. Financial assistance from the government and other financial institutions
e. Machinery on hire purchase
 Another study on entrepreneurial motivation has classified the factors behind
entrepreneurial growth in three categories;
1) Entrepreneurial ambitions
a) To make money
b) To fulfil desire to self/wife/parents
c) To continue family business
d) To secure self-employment/ independent living
e) To gain social prestige
f) Other ambitions- making of a decent living, desire to do something creative,
provide employment
2) Compelling reasons
a) Unemployment
b) Dissatisfaction with the job
c) Make use of funds made else where
d) Making use of technical/professional skills
e) Maintenance of large families
3) Facilitating factors
a) Previous association
b) Previous employment in the same or other line of activity
c) Success stories of other entrepreneurs
d) Property inherited

3. e) Advice or influence
 There are other factors that are classified as psychological in nature such as:
a) Need for achievement
b) Desire for taking personal responsibility
c) Keen interest in situations involving moderate risk
d) Anticipation of future possibilities
e) Organisation skills
f) Being energetic
SELF EMPLOYMENT
This is a situation where one creates his or her own business to employ him/herself and
others.
ADVANTAGE OF SELF EMPLOYMENT
1. Personal Satisfaction – because you do what you are doing.
2. Independence – Freedom to control self and others using own knowledge and
skills, making own decisions.
3. Profit – Enjoying all the proceeds of own labour is motivated and exciting
4. Job security – self employment cannot be laid off. As long as the business exists,
one is assured of employment.
5. Status – self employed persons receive attention and recognition in the society
through customer contact and public exposure, as a result, they enjoy status above
other people.
DISADVANTAGES OF SELF EMPLOYMENT
1. Possible Loss of Invested Capital
If the business fails, the capital invested will be lost. Sometimes some entrepreneurs lose
their lifetime savings or borrowed loans which may take years to repay or lead to loss of
family assets like land, vehicles, computers etc.
2. Uncertain Or Low Income
Business is a risk- the income could at times be very low, uncertain or inadequate to meet
the family or personal needs. It could also vary from month to month.
3. Long Working Hours
Many self employed people work for more hours than employed ones e.g. they wake up
very early to start working and close business late.
4. Routine Chores
Some business involves routine chores which can be boring after some time.

4. 2.3.6 REASONS WHY PEOPLE START THEIR OWN BUSINESSES
There are various reasons that make people start their own businesses and some of them
are
A. Survival or lack of another alternative or job.
Majority of people start businesses for survival or to make a living because they have no
other way of earning their livelihood. Some of these keep on looking for other alternatives
whenever they get any they quit the business. This hinders their full commitment to the
business. However others are fully committed and succeed.
B. To supplement Income
There are many people who operate businesses to supplement their income from paid
employment. Mostly such entrepreneurs are in business part time while they leave
employees to work for them the other times.
C. To become their own bosses
Those who prefer to be their own bosses, control their working schedules and work
independently rarely fit in paid employment and therefore start their own businesses.
D. Lack of job satisfaction
Some people lack job satisfaction may be because of routine or lack of challenge etc. end
up starting their businesses.
E. To use spare time productively
Many people who have a lot of free time from their paid employment prefer to use it
productively in business other than wasting it.