What is an Entrepreneur? One who creates a new business in the face of risk and uncertainty for the purpose of achieving profit and growth by identifying and assembling the necessary resources to capitalize on them.

1. Chanderprabhu Jain College of Higher Studies & School of Law
Plot No. OCF, Sector A-8, Narela, New Delhi – 110040
(Affiliated to Guru Gobind Singh Indraprastha University and Approved by Govt of NCT of Delhi & Bar Council of India)
Semester: Sixth Semester
Name of the Subject:
Entrepreneurship Development

2. UNIT1
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Definition of Entrepreneur
Internal & External Factors
Functions
Entrepreneurial Motivation & Barriers
Classification
Theories
Concept
Development of Entrepreneurship
Culture
Stages in entrepreneurial process

3. What is an Entrepreneur?
One who creates a new business in the face of
risk and uncertainty for the purpose of achieving
profit and growth by identifying and assembling
the necessary resources to capitalize on them.

4. CONCEPT OF ENTERPRENEUR
 RISK BEARER
 ORGANISER
 INNOVATOR

5. Schumpter’s Definition of
Entrepreneur
Reform or revolutionize the pattern of
production by exploiting an invention
or more generally , an untried
technological possibility for producing
a new commodity

6. Drucker’s view on Entrepreneur
Innovation is a specific tool of
entrepreneurs, this means by which
they exploit changes as an
opportunity for different business or a
different service.

7. Characteristics of Entrepreneurs
 Desire for responsibility
 Preference for moderate risk
 Confidence in their ability to succeed
 Desire for immediate feedback
 High level of energy
 Future orientation
 Skilled at organizing
 Value achievement over money

8. Functions of Entrepreneur
 Innovation
 Risk Taking
 Organization Building
 Absorb uncertainty
 Frame the Challenge
 Build Commitment

9. Entrepreneurs...Traits
 Self-confident and optimistic
 Able to take calculated risk
 Respond positively to changes
 Flexible and able to adapt
 Knowledgeable of markets
 Able to get along well with others
 Independent minded

10. Entrepreneurs...Traits II
 Energetic and diligent
 Creative, need to achieve
 Dynamic Leader
 Responsive to suggestions
 Take initiatives
 Resourceful and persevering
 Perceptive with foresight

11. Personal traits and characteristics of
entrepreneurs.

12. FACTORS RESPONSIBLE FOR
ENTREPRENEURS

13. INTERNAL FACTORS
 Desire to do something new
 Educational Background
 Experience

14. EXTERNAL FACORS
 Govt. assistance and support
 Availability of labor and raw material
 Encouragement from big business houses
 Promising demand for the product

15. TYPES OF ENTREPRENEUR
 According to the type of business
 According to the use of technology
 According to the motivation
 According to the growth
 According to the area
 According to the gender & age
 According to the sale of operation

16. Type of Business
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Business Entrepreneur( individuals who conceive an idea for a
new product or service & then create a business to materialize their
idea.)
Trading Entrepreneur (Is one who undertakes trading activities &
is not concerned with the manufacturing work)
Industrial Entrepreneur (a manufacturer who identifies the
potential needs of customers & tailors a product to meet the marketing
needs)
Corporate Entrepreneur (Is a person who demonstrates his
innovative skill in organizing & managing corporate undertaking)
Agricultural Entrepreneur ( Is one who undertake agricultural
activities as raising & marketing of crops, fertilizers & other input.)
Retail Entrepreneur
Service Entrepreneur

17. Use of Technology
 Technical Entrepreneur (he demonstrates his
innovative capabilities in matter of production of
goods & rendering services)
 Non- Technical Entrepreneur (concerned only
with developing alternatives marketing & distribution
strategies to promote their business)
 Professional Entrepreneur (a person who is
interested in establishing the business but does not
have interest in managing it once)

18. According to Motivation
 Pure Entrepreneur (an individual who is motivated
by psychological & economic rewards)
 Induced Entrepreneur (is one who induced to take up
entrepreneurial task due to the policy measures of
the Govt.)
 Motivated Entrepreneur (they are motivated by the
desire of self fulfillment)
 Spontaneous Entrepreneur (those who start their
business their by natural talents (inborn abilities)

19. According to area
 Urban Entrepreneur
 Rural Entrepreneur

20. According to gender & age
 Men Entrepreneur
 Women Entrepreneur

21. According to sale of operation
 Small scale Entrepreneur
 Large scale Entrepreneur

22. Classification of Entrepreneurs
 Innovating Entrepreneurs
 Imitative Entrepreneurs
 Fabian Entrepreneurs
 Drone Entrepreneurs

23. INNOVATING ENTERPRENEURS
Is one who introduces a
new goods,inaugrates new
method of production,
discovers new market &
reorganizes the enterprise

24. IMITATIVE ENTERPRENEURS
These are characterized by
readiness to adopt
successful innovations
inaugurated by innovating
entrepreneurs

25. FABIAN ENTERPRENEURS
These are characterized by
a great caution & skepticism
in experimenting any
changes in their enterprises

26. DRONE ENTERPRENEURS
These are characterized by a
refusal to adopt opportunities to
make changes in the production
formulae even at the cost of
severely reduced returns relative
to the other like producers.

27. THEORIES OF ENTREPRENEURSHIP
 Economic
 Psychological
 Sociological

28. ECONOMIC THEORY
Economic incentives are the main drive
for the entrepreneurial activities. The
persons inner drives have always been
associated with economic gains .Thus
these incentives are regarded as sufficient
conditions for the emergence of industrial
entrepreneurship.

29. SOCIOLOGICAL THEORY
Sociologists argue that
entrepreneurship is most likely to
emerge under a specific social
culture. Social values are the
most important determinant of the
attitudes & role expectations.

30. PSYCHOLOGICAL THEORY
This theory, entrepreneurship is most
likely to emerge when a society has
sufficient supply of individuals possessing
particular characteristics. Schumpter
believes that entrepreneurs are primarily
motivated by will of conquer.Mc Clelland
asserts that it is high need for
achievement that motivates people
towards entrepreneurial activities.

31. Barriers to Entrepreneurship
 Lack of viable concept
 Lack of market knowledge
 Lack of technical skills
 Lack of capital
 Lack of business know how
 Time presences and distractions
 Legal constraints and regulations

32. Steps in the Entrepreneurial
Process
1. Discovery
2. Concept Development
3. Resourcing
4. Actualization
5. Harvesting

33. Steps in the Entrepreneurial
Process
1. Discovery: The stage in which the
entrepreneur generates ideas,
recognizes opportunities, and studies
the market

34. Steps in the Entrepreneurial Process
2. Concept Development:
– Develop a business plan: a detailed
proposal describing the business
idea

35. Concept Development
–
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Choose business location
Will a patent or trademark be required?

36. Steps in the Entrepreneurial
Process
3. Resourcing: The stage in which
the entrepreneur identifies and
acquires the financial, human, and
capital resources needed for the
venture startup, etc

37. Steps in the Entrepreneurial
Process
4. Actualization: The stage in
which the entrepreneur operates
the business and utilizes
resources to achieve its
goals/objectives.

38. Steps in the Entrepreneurial
Process
5. Harvesting: The stage in which
the entrepreneur decides on
venture’s future growth,
development, or demise.

39. Introduction, Identifying Ideas
& Business Opportunities
Analysis
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40. To Introduce the Entrepreneurial Process &
Preparation of Business Plan for New Ventures.
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41. Entrepreneurship: the activity
of organizing, managing, and
assuming the risks of a
business or enterprise.
Entrepreneur: an entrepreneur
is a person who engages in
the activities mentioned
above.
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42. “The Entrepreneur always
searches for change, responds to
it & exploits it as an opportunity” -
Peter Drucker
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43. Inv
entor
(Ivory
Tower)
Entrepreneur
Pr ManGENERALMANAGEMENTSKILLS
LOW
LOW
HIGH
HIGH
CREATIVITY&INNOVATION
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44. 44

45. Windowof
Opportunity• Describes the time period in
which a new firm can
realistically enter into the
market.
• New entrants (2nd movers
onwards) will enter into the
market once the window is
opened.
• Interesting to note: Google is not the first in
the search business nor Facebook in the
social network business.
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46. 46

47. When is anidea an
opportunity?• Create or add value to
customer.
• Solve a significant problem,
removing a pain point or
meeting demand.
• Have robust market, profit
margin and money
marketing.
• Good fit with founder &
management team at the
right time & place
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48. Focus on idea and market of the idea.
Talk to industry leaders and players in the same space as the idea.
A typical opportunity analysis plan has four sections:
1. Description of the idea and its competition.
2. Assessment of the domestic and international market for the idea.
3. Assessment of the entrepreneur and the team.
4. Discussion of the steps needed to make the idea the basis for a
viable business venture.
Opportunity
Analysis
48

49. Observing
Market
Trends
Solving the
Problem
Finding Gaps
in the
marketplac
e
How to Identify an
Opportunity
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50. 1. Observing
Trends
Observing
Market
Trends
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51. Solving the
Problem
2. Solving a
Problem/Pain
Point
• Notice a problem &
finding a way or
solution tosolve it.
• Observing trends
and ask people
around
what their
problems are.
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52. Finding Gaps
in the
marketplac
e
• Finding a gap in the
marketplace.
• Oftentimes, big corporations
might give up niche markets
which new companies can take
advantage of.
• Nichemarkets can be scaled
up to a mainstream market or
allow disruptive technologies to
go mainstream.
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53. Regulatory Changes/Change in Government
Legislation or laws
Telecommunications, Social (New) Media, Medical,CPF
changes
10-fold change in 10 years or less Moore’s law, Real Estate market boom or bust
Reconstruction of value chain and channels
of distribution Superstores, Internet Stores
Existing management/investors burnt out/
under-managed Turnaround, New capital structure
Market leaders and customers obsessed or
customer blinded
Ignore small and niche customers, creation of
niche businesses
Entrepreneurial Leadership New vision and strategy, generation X thinking
Proprietary or contractual change
Technology innovation: Patent, license, contract, franchise or
copyrights or distributorship
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54. Feasibility Analysis
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55. Feasibility Analysis
Process
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56. Feasibility Analysis
•
•
•
•
The process of determining
whether a business idea is
viable.
Preliminary evaluation of a
business idea .
Conducted for the purpose of
determining whether the idea is
worth pursuing
Determine to a certain degree
of probability the possibility of
whether idea is viable
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57. Product/Service Feasibility
Analysis
•
•
•
Assessment of overall
appeal of product or
service being
proposed.
Determine whether
there is a market for
the product or service.
The two components
of a product/service
feasibility: Concept &
Usability Testing.
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58. Preparinga Concept
Statement•
•
A concept statement is
developed before a
company undertakes
product/service feasibility
analysis.
One page description of a
business that is distributed
by entrepreneur for startups
to people who are asked to
provide feedback on the
potential of the business
idea.
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59. Preparing a Concept
Statement
• Description of product or service being
offered.
Intended target market
Benefits of product or service.
•
•
• Description of how product will be positioned
relative to similar ones in the market.
• Description of how product or service will be
sold & distributed.
• Information about founder or founders of the
firm
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60. Modelfor Opportunity
Recognition
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80. Def of entrepreneur and entrepreneurship
Role of entrepreneur in the economic
development generation ofservices
Employment creation andtraining
Ideas, knowledge and skill development

81. Definition ofEntrepreneur:
“An individual who bears the risk of
operating businessin the face of uncertainty
about the future condition.”
Definition ofEntrepreneurship:
“Entrepreneurship is the willingness to take
risks and develop, organize and manage a
businessventure in acompetitive global
market place.”

82. 1.Promotes capitalformation:
Entrepreneur promotes capital formation by mobilizing the idle
savings of public. They employ their own aswell asborrowed
resources for setting up their enterprise. It is asource of creation
of wealth, which is very essential for the industrial andeconomic
development of thecountry.
2.Creates Large-scale Employmentopportunity:
Entrepreneur provides immediate large-scale employment to the
unemployed which is achronic problem of underdeveloped
nations with the setting up of more and more units by
entrepreneurs.
3.Promotes balanced Regionaldevelopment:-
Entrepreneur helps to remove regional disparities through setting
up of industries in lessdeveloped and backward areas .Setting up
more industries lead to more development of backward regions
and there by promotes balancedregional development.

83. 4.Reduces concentration ofEconomic power:
Economicpower is the natural outcome of industrial and business
activity .Industrial development normally leads to concentration
of economic power in the hands of afew individuals which results
in the growth of monopolies.
5.Wealth creation anddistribution:
It stimulates equitable redistribution of wealth and income in the
interest of the country to more people and geographic areas,thus
giving benefits to larger sections of society.
6.Improvement in the standard of living:
Increase in the standard of living of people is acharacteristic
feature of economic development of the country. Entrepreneur
plays akey role in increasing the standard of living of people by
adopting latestinnovation.

84. Training:
Employeetraining is alearning experience.
Arelatively permanent changein employees
thatimproves job performance.
Thereare two training methods:
Off the job: job rotation, apprenticeships,
internship
Onthe job: class room lectures, multimedia
learning, simulation and vestibule training

85. 1.Jobrotation:
Allow employees to work at different jobs and provide
exposure to avariety of tasks.
Valuable tool to increaseemployee motivation.
2.Apprenticeships:
Instructions in combination with Working alongside a
coach or mentor.
Experiencedworker provides support and
encouragement in addition to training.
3.Internship:
Opportunities for students to utilize their instructions
and training in achosen profession aspart of their
education.

86. 1.Multimedia learning:
It can demonstrate practical skills not easily
presented by other training methods.This may
include videos, and DVDsthat may be offered
online.
2.Simulation:
It involves learning ajob by actually performing
the work in an artificial setting.
3.Vestibule training:
It facilitates learning by using the same
equipment that one actually will useon the job.

87. Creation is defined asthe tendency to
generate or recognize ideas,alternatives, or
possibilities that may be useful in solving
problems, communicating with others, and
entertaining ourselves andothers.
Creation is the ability to come up with new
ideas and to identify new and different ways
of looking at aproblem and opportunities

88. Opportunity or Problem Recognition:Apersondiscovers that anew
opportunity exists or aproblem needsresolution.
Immersion: The individual concentrates on the problem and becomes
immersed in it. He or she will recall and collect information that seems
relevant, dreaming up alternatives without refining or evaluating them.
Incubation:The personkeepsthe assembledinformation in mind for: a
while. Heor shedoesnot appearto be working on the problem actively;
however, the subconsciousmind is still engaged.While the information is
simmering it is being arranged into meaningful new patterns.
Insight: The problem-conquering solution flashes into the person's mind
at an unexpected time, such ason the verge of sleep, during a shower, or
while running.Insight isalsocalledtheAha!Or Eureka! Experience.
Verification andApplication:The individual sets out to prove that the
creative solution hasmerit. Verification procedures include gathering
supporting evidence,using logicalpersuasion,and experimenting with
new ideas.

89. Ideas
Creativity results in ideasthat havepotential value.
There are two sources to identify entrepreneurial
Ideas, which arefollowing:
1.Primary sources:
It is direct or firsthand evidenceabout an event,
object, person or work of art.
Theseare contemporary to the events and people
describedand show minimal or no mediation between
the document/artefact and its creator.
Thematerials canbe written and non-written, the
latter including sound, picture, and artefact.

90. 2.Secondarysources:
In contrast to primary sources, lacks the
immediacy of aprimary record.Asmaterials
produced sometime after an event
happened, they contain information that has
been interpreted, commented, analyzed or
processed in such away that it no longer
conveysthe freshnessof the original.

91. Entrepreneurs need to equip themselves with
knowledge, especially in what should be done
tothe underlying business.
For example, an expert on food, when you
open arestaurant, they not only need to
know about food procedures, but and also
business,providing the account, set the table
employee and customerhandling.

92. Apart from the experienceandknowledge, it
must doin work skills or their chosenfields.
These skills are often born from experience
and knowledge. This advantage is adifficult
owned.
For example, askilled craftsman to carvein a
short period and high quality. Skill is avery
important asset becausenot everyone has
this advantage.

93. Development of entrepreneurship is not always
spontaneous. It is very often affected by environment
factors like economic, social, political, psychological,
legal and cultural etc. these factors may have positive
and negative both influences on the emergences and
development of entrepreneurship. In most of the
developed countries, the educational system designed
in such a way that it creates more jobs creators. Type of
education prevailing in the country is also an
important factor for entrepreneurship development.