Entrepreneurship, also called construction, or project engineering, is the process of identifying a specific business project that aims to solve a challenge, problem, or new innovation, to start it and focus on it, provide the necessary resources, organize them, and bear risks in order to achieve financial profit. It is also known as the process of creating an organization or... Grouping new organizations or developing existing ones, namely creating one or more new businesses or responding to new opportunities in general.
In political economy, entrepreneurship is defined as a method that provides a framework for how to transform a great idea into a great business, going through all stages of establishment, growth, and financing in an effective and unconventional manner, while ensuring continuity. In order to obtain a profit and achieve financial independence, by developing a startup company that creates familiarity and a positive impression among customers, suppliers, and investors.
Entrepreneurship is not an easy thing as most new companies are not well organized. Entrepreneurial activities vary depending on the type of activity that this emerging organization follows. Entrepreneurship ranges from individual companies (in which the entrepreneur often works alone part-time) to pledges to provide new job opportunities.
Many new business ventures (pilot projects) seek funding from either venture capital or co-investors to either raise capital or start a new venture.
Participation investors are generally looking for a return of 20-30% as well as more involvement in the business.
There are now many organizations that support entrepreneurs which include some relevant government agencies; Business incubators, some scientific bodies and some non-profit organizations (NGOs).
History of Entrepreneurship:
The concept of entrepreneurship goes back to economist Joseph Schumpeter and some Austrian economists such as Ludwig von Mises and Von Hayek. Schumpeter defined the entrepreneur as the person who has the will and ability to transform a new idea or invention into a successful innovation or project (start-up). Thus, the presence of entrepreneurial forces (constructive destruction) in different markets and industries creates new products and business models. Thus, entrepreneurs (constructive destruction) greatly help those responsible for industrial development and long-term economic growth. Despite Schumpeter's contributions in the early twentieth century, traditional microeconomic theory in the economic system provided little space for entrepreneurs in its theoretical framework (instead of assuming that resources would be determined according to the price system).
As for Frank Knight (1967) and Peter Drucker (1970), they consider entrepreneurship to be essentially about risk. The behavior of the entrepreneur is what reflects the type of ability that he or she has to put his or her career and financial position into reality and take risks by implementing his idea and putting it into practice by giving it More time, effort and capital is spent at unsecured risk.
Knight classified the reasons for non-warranty into three types:
Risk: It can be measured statistically (such as the probability of drawing a red ball from a bottle containing five red balls and five white balls).
Ambiguity: which is difficult to measure statistically (such as the probability of drawing a red ball from a bottle containing five red balls and an unknown number of white balls).
Actual or Knightian Uncertainty that is impossible to estimate or predict statistically (such as the probability of drawing a red ball from a bottle containing an unknown number of red balls and an unknown number of other colored balls).
The impact of entrepreneurship is often unpredictable, practically when you try to create or invent something new to this world the market for it is unknown. Before the advent of the Internet, no one would have known the extent of the success of the online business market such as Amazon, Google, YouTube, Yahoo, etc...
After the advent of the Internet, some began to see opportunities and markets for this technology. However, even if there was a market, let us say, for example, the soft drinks market (created by Coca-Cola), there is no guarantee that a new player will not join the market for the soft water industry. So the question will be: Is there a new market for your idea or not?
The presence of a distinguished and innovative pioneer in traditional economic theory (which evaluates the efficiency of the economy using some ratios assuming that outputs are equal) presents some theoretical problems. This part of economic theory has been added to by the research of William Baumol, who was honored in 2006 at the annual meeting of the American Economic Association.
Entrepreneurship is considered an integral factor of the business culture in American life, specifically as a fundamental driver and driver for the creation of new job opportunities and the growth of the national economy.
Characteristics of entrepreneurship:
A pioneer is characterized by a number of characteristics, including:
The most important characteristic of an entrepreneur is his ability to manage time based on Stephen Covey’s matrix of priorities, as most of his daily activities fall within the Crisis box and the Future box.
- An ambitious goal, which is the force that drives him to build the company.
- A vision supported by many strong, specific ideas that are unique, i.e. new to the market.
- A clear, comprehensive vision of how to achieve this goal, even if the details are not complete, is flexible and scalable.
- Strengthening and supporting oneself with great hope and strong passion towards achieving the goal.
- Develop a strategy to turn his dream into reality and implement it with persistence and determination.
- Taking the initiative to make his idea successful.
- Calculated risk in terms of how to reach or create a market, and how to meet customer needs.
- Convince others to join them and help.
- Positive decision making.
Six tips to succeed as an entrepreneur:
Not all of us are capable of being real entrepreneurs, this lifestyle is not simple at all. Entrepreneurship is a difficult task that involves great challenges and requires a set of experiences, knowledge, skills and attributes.
Whoever wants to become a successful entrepreneur must make sacrifices and have high ambitions. In light of the surge in new companies and projects that arise on a daily basis, here are tips that may help you establish a company and achieve success in this difficult market.
1- Keep a goal in mind. First of all, the entrepreneur must ask himself this question: “Why do I want to establish this company?” You will be wrong if you answer that the reason is that you are tired of working from nine in the morning until five in the evening or that your manager is annoying you. Entrepreneurship is a never-ending job, requires self-discipline, and involves other roles and tasks. Therefore, the goal should not be to make money and amass a fortune, but rather to provide value that people can benefit from. When money is your goal, you will run the company according to what you want to make, not what you want to give. Because the first years of establishing a startup are difficult and tiring and require patience and determination, you need a non-financial goal that will encourage you when you face doubts, criticism, and obstacles.
2- Love what you do and feel passionate about your project. Do you love your idea and believe in it? Do you feel passionate about it? Is it a dream you want to achieve? Don't forget that you will spend your life working in it. So, if you do not love and believe in it, you will not enjoy your work and this will negatively affect your performance and creative abilities. In addition, you will tend to abandon it as soon as you encounter any problem, obstacle or doubt.
3- Do not be afraid of failure. Some people wait for the “perfect moment” when they feel ready to start a company. It may be when they get enough money, or when they reach that position...etc. But you will never be ready or find the perfect moment. If you don't fail, it means you're not trying hard enough. So, don't give up on your dreams and follow your passion.
4- Know the market you are targeting. You don't need to launch a company that you think people need. Rather, you need to conduct research to know the size of your audience and see current and future user trends. You don't want to spend time, money and effort for something that will benefit no one now or in the future. Study the extent of your product’s compatibility with the market and its suitability, know your competitors and the alternatives to the above, evaluate the category in which you operate, and the positive scenarios that you will adopt in the event of an emergency.
5- Knowledge is your ally. An entrepreneur must learn continuously. So improve your skills and knowledge in your field and in other areas related to your work. Participate in events, workshops in your field, and study classes. Read a lot, choose advisors and mentors, and spend time with entrepreneurs, people who think the same way, and experts as well!
6- Choose the appropriate team. Surround yourself with suitable people that you choose yourself. Having a brilliant team will help you achieve success and reach your goal. Your team must believe in what you are building. A ship does not reach its destination if the captain is the only sailor on board. So, choose your co-founders, team, and advisors carefully.
Establishing a new company is very difficult and requires a leader, a dreamer, a hard worker, and an adventurer.
The role of entrepreneurs:
Creating new markets. According to the modern concept of marketing, a market is a group of individuals who have the desire and ability to satisfy their needs. This is economically called effective demand. Entrepreneurs are creative people and creators of resources and opportunities. They create customers and sellers, and this is what makes them different from traditional businessmen who (i.e., businessmen) perform traditional administrative functions such as planning, organizing, and defining tasks.
Discover new sources of materials. Entrepreneurs are never satisfied with traditional or available sources of materials. Therefore, due to their innovative nature, they work to discover new sources of materials to improve their companies. In business, they can develop new sources of materials that have a competitive advantage in terms of transportation, cost and quality.
They move capital resources. Entrepreneurs are the organizers and determiners of most elements of production, such as land, workers, and capital. They combine these factors of production to create new goods and services. Capital resources, from Lehman's point of view, mean money. However, financial resources, in economics, represent machines, buildings, and other physical resources used in production. Entrepreneurs have the innovation and self-confidence that enable them to accumulate and move capital to create new businesses or expand existing businesses.
Introducing new technology, new industries and new products. Far from being innovative and taking risks responsibly, entrepreneurs are good at exploiting opportunities to create new businesses and turn them into profits. So they offer something new and a little different. Such a pioneering spirit contributes strongly to the modernization of our economy. Every year we see new products and technology. All these products and technology aim to satisfy human needs in a convenient and beautiful way.
Creating new job opportunities, as the largest provider of job opportunities is the private sector, millions of job opportunities are provided by factories, the service industry, agricultural companies, and some small and medium businesses. For example, major stores such as SM, Uniwide, Robinson, and others employ thousands of workers. Likewise, major companies like SMC, Ayala and Soriano Group of Companies are creating many job opportunities. Creating huge job opportunities like this has ripple effects that accelerate the growth of the economy as a whole. More jobs means more income, and this increases the demand for goods and services and thus increases production. Thus the demand for jobs increases again and so on.
