What is Entrepreneurship? Meaning, Definition, Characteristics and Types

what is entrepreneurship

Entrepreneurship is the act of managing an enterprise that has the potential to make a profit or incur a loss. Entrepreneurship is the business jargon used for the process of business activity that an entrepreneur does. Here in this article, we have shared what is entrepreneurship and its meaning, definition, characteristics, and types.

► What is Entrepreneurship?

Entrepreneurship is a process that an entrepreneur follows to build his business.

An entrepreneur is a person who perceives a need and then brings together the manpower, material, and capital required to meet that need.

In other words, an entrepreneur is an individual or team that identifies the opportunity, gathers the necessary resources, creates, and is ultimately responsible for the performance of the organization.

Meaning of Entrepreneurship

Entrepreneurship means a process of action an entrepreneur undertakes to establish his enterprise. It is a creative and innovative response to the environment of his enterprise.

Definition of Entrepreneurship

Entrepreneurship can be defined as an ability to discover create, or invent opportunities and exploit them to the benefit of society, which in turn brings prosperity to the innovator and his organization.

Definition of Enterpreneur

According to Peter F. Drucker, An entrepreneur can be defined as a person one who always searches for change, responds to it, and exploits it as an opportunity.

Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for different businesses or services.

► Characteristics of Entrepreneurship

  • Vision
  • Knowledge
  • Ambitious
  • Independence
  • Optimism
  • Desire to Succeed
  • Value Addition
  • Leadership
  • Hardworking
  • Risk-Taking Ability

Concept of Entrepreneurship

The concept of entrepreneurship revolves around three things that are as follows;

  1. Entrepreneur: Person
  2. Entrepreneurship: Process of Action
  3. Enterprise: Object

These three elements of entrepreneurship are essential for any business.

  • An entrepreneur is a person who generates an idea for a new business.
  • Entrepreneurship is a process of actions that an entrepreneur takes to convert his idea into reality.
  • After years of hard work and brainstorming, an entrepreneur builds an enterprise that is the outcome of the entrepreneurship and his actions.
  • In most cases, Enterprises of entrepreneurs are known as startups and they raise large investments in a series of funding round.
  • A startup becomes a unicorn enterprise when it reaches the valuation of 1 Billion USD.

► Entrepreneurship as a style of Management;

  • Empower people
  • Inspire People
  • Motivate Subordinates
  • Shared Vision
  • Power oriented
  • Achievement-oriented

► Need & Importance of Entrepreneurship

  • Stimulate demand in the economy
  • Nurture creativity, innovation, and productivity
  • Create more job opportunities
  • Develop new community & industry
  • Bring social change
  • Better Standard of living for people
  • Promote R&D
  • Political and economic integration of outsiders

► Characteristics of Entrepreneurship

  • Decision
  • Strong desire to reap benefits
  • Economic activity
  • Management Skill
  • Dynamic Process
  • Leadership Quality
  • Risk Bearing
  • Gap Filling Function
  • Innovative Urge
  • Construction Skill

► Traits of Successful Entrepreneurs

  • Mental Ability
  • Clear Objectives
  • Business Secrecy
  • Human Relations Ability
  • Effective Communication
  • Technical Knowledge
  • Decision Making
  • Risk Bearing
  • Self Confidence

► Types of Entrepreneurship

Based on their working relationship with the business environment they are functioning in, various types of entrepreneurs can be found.

The major categories are these four types of entrepreneurs that are as follows;

  1. Innovative
  2. Imitating
  3. Fabian
  4. Drone
  • Innovative entrepreneurs are the one who brings new ideas in the market and they have the skills of innovation, Research & Development.
  • Imitating Entrepreneurs are also known as copycats entrepreneurs. This type of entrepreneur observes an existing successful business model of a well-established company. and replicate it in their country to gain market share.
  • Fabian Entrepreneurs take cautions in adopting any changes. They don’t make sudden decisions and hence lose the first-mover advantage when some new trends begin.
  • Drone Entrepreneurs are the ones who don’t like to change. They are known as old school businessmen and their business follows an orthodox method of production.

► Role & Importance of Entrepreneurship

  • Economic Change
  • Social Change
  • Technological Change

Must Read :What is Entrepreneurship Development?

► Approaches to entrepreneurship

There are broadly four approaches to the study of entrepreneurship:

  • Sociological Approach
  • Psychological Approach
  • Political Approach
  • Composite Approach

► Factors Affecting Entrepreneurship

  • Aspiration and attitude
  • Personal Factors
  • Family circumstances
  • Government policies, facilities, and incentives
  • Social and cultural factors
  • Business competition
  • Economic and business environment
  • Support system
  • The attitude of big entrepreneurs
  • Startup education and training
  • Role of bank and financial institution

► Features of Entrepreneurship

  • Passionate – They’re enthusiastic
  • They’re business astute
  • Focused – They’re certain
  • Managerial Skills
  • Dedicated – They’re on all the time
  • They’re cash chiefs
  • Persistence – They won’t ever surrender

◉ 1. Passionate

Effective business people have an enthusiasm for what they do. Regardless of whether it is fresh out of the plastic innovation, an enhancement for a current item, or a progressive help, fruitful business people accept that their contribution is down changing and they know why. They likewise know how to pass this enthusiasm on to other people.

◉ 2. They’re business astute.

As a business person, you should do everything in your business, basically toward the start. Indeed, even as you develop and enlist staff, you’ll, in any case, need to know what’s happening in bookkeeping, advertising, buying, and wherever else.

On the off chance that you don’t as of now have this information, a business degree can be monstrously useful. A specific degree program can show you all parts of the business, giving you an expansive establishment to expand on. At certain schools, you can even spend significant time in a business venture to assist you with getting your fantasies going. Having all the information that a business degree gives can assist with ensuring your new pursuit gets off to the most ideal beginning.

◉ 3. Focused

Certainty is one of the vital qualities of a business person. This one goes connected at the hip with energy. Genuine business people accept that they can put up their items for sale to the public. Now and then this implies attempting another methodology on the off chance that the first doesn’t work, as well as being able to conquer the hindrances that will come in your direction.

◉ 4. Managerial skills

We’ve all heard the articulation, “No one intends to fizzle, they simply neglect to design.” Nowhere is this more obvious than while beginning a business. It’s almost difficult to over-design. All things considered, be ready for your arrangements to change.

Entrepreneurs use managerial skills to fulfill their tasks with proper coordination with their teams. Business people should be sufficiently adaptable to dispose of an arrangement that demonstrates unfeasible and trade it for another.

◉ 5. They’re on all of the time.

One of the main attributes of a business person is the capacity to market and organize. Frequently this is a character quality certain individuals are simply normally friendly, with the capacity to converse with anybody. Be that as it may, assuming you’re a greater amount of a self-observer, sit back and relax. This is an ability that can be mastered.

The principal thing you want to advertise is to have a short presentation. This is a short discourse about your item and why it’s invigorating. Ponder what you would say assuming you were in a lift with an expected financial backer. What might you need the person in question to know in the 45 seconds or so it could take to get to your floor?

When you have your short presentation, use it. All over the place. On everybody, you meet. Tell your companions, your neighbors, and the individual who trims your hair. No one can tell who knows someone who may be an ideal client, provider, or accomplice for you. Try not to be hesitant to straightforwardly call or email individuals who can help you.

◉ 6. They’re cash chiefs.

Having the option to oversee cash is a significant quality of a business visionary. Having a business degree can give you a sufficient establishment in bookkeeping and fund to deal with the cash yourself toward the start, yet if this isn’t on your rundown of solid suits, make it the primary thing that you reevaluate. It’s too vital to possibly be disregarded while you center around different needs.

◉ 7. Never Give Up

Carrying an item or administration to the commercial center is a ton of difficult work. Since you have energy and certainty as of now, it may not seem like work to you, however, there will come times when you figure you’ve given your best. That is the point at which you need to pull yourself back up, approach the information, mastery, energy, and responsibility you have, and offer it another chance.