Entrepreneur and Entrepreneurial Venture
Entrepreneurship involves the creation of new ventures. It is based on innovation and the desire for certain outcomes. It may also be viewed as the search for new opportunities. Entrepreneurship is guided by the insight and vision of the entrepreneur. Hence, an entrepreneur starts up ventures in many ways. According to the nature and goal of the entrepreneur, an entrepreneurial venture can be started in three ways. They are Salary-Substitute Firms, Lifestyle Firms, and Entrepreneurial Firms.
1. Salary-Substitute Firms:
Salary-Substitute Firms are small firms. They are called Salary-Substitute Firms as they are started to earn a certain level of income similar to earning a salary from the employer. In simple words, the objective of this type of firm is to substitute salary income through entrepreneurial income. Most of the small firms fall under this category. Examples of such firms include dry cleaners, retail stores, accounting firms, hair salons, restaurants, etc. They offer standardized products and services to customers which are not innovative. They are happy to serve local customers and normally compete on a price basis.
2. Lifestyle Firms:
Lifestyle Firms provide the owner opportunity to pursue a certain lifestyle while earning a livelihood. Examples include photographers, tour guides, golfers, etc. The firms are not innovators and them. do not wish to grow rapidly. They are largely based on habits or hobbies.
3. Entrepreneurial firms:
These are the firms that bring new products and services to the market. They seek and create market opportunities regardless of the resources they currently control. They create products and services that are worth taking. They attempt to offer superior customer value. Google, Facebook, and Zynga are well-known, highly successful examples of entrepreneurial firms. They create products and services that have worth, that is important to their customers.
Traits of an Entrepreneur
An entrepreneur is a person who starts a new enterprise. He brings and organizes the factors of production together for the exploitation of opportunities from change. The factors may be capital, men, material, technology, equipment, etc. Hence, he is an innovator. He also bears the risk of operating the business amidst uncertainty. The main objective of an entrepreneur is to maximize profit.
An entrepreneur is always action-oriented. He always works to convert the idea into action through planning and resource mobilization. He assumes himself as a job creator, not a job seeker. The following are some of the notable traits of an entrepreneur.
1. Motivator:
An entrepreneur acts as a motivator. He is required to get the activities done through others (employees). Hence, he has to ensure that the employees are motivated towards their works. He should build team spirit and motivate the employees for organizational efficiency and effectiveness.
2. Organizer:
An enterprise needs a number of resources. The resources may be capital, men, material, technology, etc. The entrepreneur organizes the resources into a productive unit to create utilities in the form of goods and services. The effectiveness of the enterprise largely depends on the efficiency of organizing.
3. Risk bearer:
Risk is the degree of uncertainty Of carrying out a venture. An entrepreneur always takes calculative risk. Hence, he is not the wild risk-taker. He sets realistic and attainable goals and assumes risks to realize the goals. He manages the risks through proper planning and rational decisions.
4. Innovator:
An entrepreneur constantly searches for change. He takes the change as an opportunity. He innovates to exploit the change as an opportunity. He creates something new and different. Hence, innovation is the most important tool for entrepreneurs.
5. Proactive:
An entrepreneur is proactive in nature not reactive. He always searches for future opportunities. He is less concerned with past activities. Problems are secondary for him. He is more focused on future opportunities.
6. High achievement desire:
An entrepreneur has always the desire of achieving high. He sets high and ambitious goals and works hard towards their attainment. Utmost efforts are made to turn the dream into reality.
7. Desire for independence:
An entrepreneur has a strong desire for independence: He does not want to work under others. He is confident in his own abilities and gives high priority to self-respect. The desire for independence motivates him towards goal achievement.
8. Tolerance for ambiguity:
An entrepreneur works in a complex and dynamic business environment that may be ambiguous and uncertain. Hence, he has to tolerate ambiguity. He explores as well as manages change. He takes change as a constant phenomenon.
9. Seek immediate feedback:
An entrepreneur seeks immediate feedback on his performance. Information about the performance is essential for nurturing his strengths and overcoming the weaknesses. Feedback drives his future activities.
