Class 10 – IT 402 Entrepreneurial Skills – II – Notes

Unit 4 – Entrepreneurial Skills – II

Entrepreneur

A person who makes money by starting or running businesses, especially when this involves taking financial risks.

Example of well-known entrepreneurs include Bill Gates, Steve Jobs, Mark Zuckerberg, Caterina Fake etc.

How to become an entrepreneur?

“Entrepreneur” is an exciting title for many as it can be a fulfilling and rewarding career. The entrepreneurial path tends to start with a great idea. You may turn to your friends and say “would not it be great if ……” and your wheels start turning on what resources and technology you might need to bring this idea to life. Those interested should create a plan and include the following steps on becoming an entrepreneur.

1. Identify the problem
2. Expand your formal and informal education
3. Build your network
4. Reach financial stability
5. Solve the problem with a business idea
6. Test the idea
7. Raise money

Benefits of studying entrepreneurship

• It helps to think about new business ideas.
• It help to cultivate skills and knowledge for starting an enterprise.
• It develops business skills in areas such as finance, sales, marketing, management and accounting.
• It helps in the development of other skills such as adaptability, effective communication, business discipline and confidence.

Types of businesses activities

1. Service business: It is an enterprise of a professional or team of experts that deliver work or aid in completing a task for the benefit of its customers.
   • Example: Banks, Airlines, Law Firms etc.
2. Merchandising business: It sells goods, also known as Merchandise.
   • Example: Retail clothing, grocery stores etc.
3. Manufacturing business: It uses raw materials, parts and components to assemble them into  finished products.
   • Example: Mobile company, Ford motor company etc.
4. Hybrid business: It is a company that functions with the uses of multiple means of reaching their customers.
   • Example: Amazon

Characteristics of Entrepreneurship

1. Innovation: Entrepreneurs are often driven by innovative ideas and solutions, seeking to create new products, services, or business models that address unmet needs or improve existing offerings.
2. Risk-taking: Entrepreneurship involves taking calculated risks and being willing to face uncertainty and potential failures to achieve long-term success.
3. Vision and Creativity: Entrepreneurs possess a clear vision for their business and demonstrate creative thinking to turn ideas into reality.
4. Persistence and Resilience: Successful entrepreneurs are persistent and resilient in the face of challenges and setbacks, not giving up easily and learning from failures.
5. Opportunity Recognition: Entrepreneurs have a keen eye for identifying business opportunities in the market and are quick to act upon them.
6. Flexibility and Adaptability: Entrepreneurship requires the ability to adapt to changing market conditions and consumer preferences, adjusting business strategies accordingly.
7. Self-Motivation: Entrepreneurs are self-motivated individuals who can drive themselves to pursue their goals without external guidance or supervision.
8. Leadership: Entrepreneurs often take on leadership roles, inspiring and guiding their teams toward achieving common objectives.
9. Resourcefulness: Entrepreneurs are resourceful in utilizing limited resources efficiently, often finding creative ways to bootstrap their ventures.
10. Market Knowledge: Successful entrepreneurs have a deep understanding of their target market, customer needs, and industry trends.
11. Networking and Relationship Building: Entrepreneurs build and leverage networks to gain valuable support, partnerships, and resources.
12. Customer Focus: Entrepreneurial ventures prioritize understanding and satisfying customer needs to build strong customer relationships and loyalty.
13. Sustainable Growth: Entrepreneurs aim for sustainable growth, balancing short-term gains with long-term viability and scalability.
14. Passion and Commitment: Entrepreneurs are passionate about their ventures and fully committed to achieving their goals.
15. Continuous Learning: Entrepreneurship involves ongoing learning and adaptation to stay relevant and competitive in a dynamic business environment.

Myths about Entrepreneurship

Misconceptions

• The misconception is that every business idea needs to be unique or special.
• The misconception we have is that a person needs a lot of money to start a business.
• A misconception we have is that only a person having a big business is an entrepreneur.
• A misconception we have is that entrepreneurs are born, not made.

Entrepreneurship as a Career Option

A career is a line of work that a person takes for life. There are two ways a person can earn a living.

1. Self-employment
2. Wage (labour) employment

A person who becomes an entrepreneur goes through a career process. This process is as follows:

1. ENTER – When an entrepreneur is starting, they are just entering the market to do business.
   • For example, Sanjana is starting a small grocery store in a locality.
2. SURVIVE – There are many entrepreneurs in the market. The entrepreneur has to remain in a competitive market.
   • For example, there are many other grocery stores in the area. Yet, Sanjana’s store survives the competition and does well. She also expands the store to two more floors and adds more items/products at best price.
3. GROW – Once the business is stable, an entrepreneur thinks about expanding his or her business.
   • For example, after five years, Sanjana has opened a chain of four more grocery stores in the same city. In the next two years, she plans to expand to tow other cities.

Some common entrepreneurship activities related to society

1. Social Entrepreneurship : It can be understood as creation of sustainable solutions for social problems that leads to social change. Many social problems are tackled by social entrepreneurs such as low reach of quality education, health and sanitation, unemployment, child Labour etc.
2. Agricultural Entrepreneurship: It can be defined as being primarily related to the marketing and production of inputs and products used in agricultural activities.
3. Women Entrepreneurship: It is referred to the entrepreneurial activity led by women, where women undertake risks, create enterprises, organize factors of production, innovate with products/services and generate employment opportunities.
4. Small Scale Entrepreneurship: It refers to starting industries in which manufacturing, trading, providing services, productions are done on a small scale or micro scale. These businesses serve as the backbone of many developing countries.

Importance of Entrepreneurs

1. Free market evolution: In a free market, entrepreneurs bring change in technology, trends and markets. For example, with increase in digital services, entrepreneurs have created companies that offer many home delivery services such as groceries, restaurant food, clothes, accessories etc.
2. New values: Sometimes, entrepreneurs choose ethics over profit and offer a more ethical product to the world and are transparent about it.
3. New markets: Entrepreneurs can often ‘redefine the rules’ of an established industry. They do this by creating new markets for existing products and slightly innovating in small ways to suit the needs of a new target market.