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Entrepreneurship definition in perspectives.

The term entrepreneurship seems to be misunderstood by many people. Some people think that entrepreneurship is limited to inventing new things or starting a business with huge amount of capital.

Here in Nigeria, if you mention entrepreneurship, certain famous entrepreneurs like Alhaji Dangote, Femi Otedola, Jim Ovia, Stella Okoli and Oba Otudeko quickly come into your mind. Also in india, famous entrepreneurs like Sridhar Vembu of Zoho Corporation, Azim Premji of Wipro, Bhargav Sri Prakash of FriendsLearn, Dhirubhai Ambani of Reliance Industries and Lakshmi Mittal of ArcelorMitta can be described as faces of entrepreneurship. People can easily identify with these famous entrepreneurs.  Possibly, this has made the general public to believe that only the people operating in their class are qualified to be called entrepreneurs. You don’t need to be a great inventor nor own a conglomerate before you can be referred to as an entrepreneur. If you ask these famous entrepreneurs I mentioned about their success stories, you will discover that almost all of them have the stories of their little beginning.

What is entrepreneurship?

It is difficult to come with just one entrepreneurship definition. What will be entrepreneurship meaning to one person may be different from the way another person will define it. It all depends on the angle at which an individual is looking at it. To define entrepreneurship in a layman language, I will say that it is all about the conception of entrepreneur ideas and turning the idea into a profitable business. Entrepreneurship does not have anything to do with the size of the business. However, when it comes to ranking for top entrepreneurs, the size of the business may be considered a crucial factor. Please note that the fact that you can come up with tons of entrepreneur ideas does not make you an entrepreneur. Entrepreneur ideas are very cheap. It is just like a mere talk of the tongue which leads to penury. It is your ability to convert the ideas into profitable ventures that makes you an entrepreneur.

Another way to define entrepreneurship is to say that entrepreneurship is about identifying and seizing opportunities for profit making. What are opportunities? Opportunities are basically challenges confronting individuals or communities awaiting solutions. A challenge may be a lack of potable water. We all know that everybody needs water. If you see this as a business opportunity and you provide solution by offering potable water to the people so that you can make profit from the venture; that is entrepreneurship in display. Therefore, entrepreneurship definition in economists’ viewpoint will be about identifying the gap between demand and supply and willingness to fill the gap with the aim of making profits.

Still looking for another entrepreneurship definition? You can define entrepreneurship as economic activities involving innovation and implementation of change within markets through the introduction of new goods or better quality of existing goods. Entrepreneurship meaning is wide indeed. For instance, an act of introducing new method of production or opening a new market still falls within entrepreneurship definition.

Read Also:How to Know Whether You Can Be an Entrepreneur

Truths about entrepreneurship

In this section, I like to share some truth with you about entrepreneurship. Knowing them beforehand will help you in your journey to becoming an entrepreneur. If you are not aware of them, you may soon be discouraged along the way.

Entrepreneurship involves risk taking. Risk in this context is the possibility of losing your investment. On the other hand, it can be referred to as the possibility that your business may not be successful. On your journey to entrepreneurship, you cannot be hundred per cent sure that the business will succeed. Risks cannot be taken out completely from entrepreneurship but you can mitigate it. You can reduce your business risks by using appropriate business analysis tools to determine those factors that can negatively impact your business. Vital business analysis tools you can use include SWOT Analysis, PESTEL Analysis and Porter’s Five Forces Model.

If you are not a risk taker, you cannot be an entrepreneur. In fact, the higher the risks you are willing to take, the more the likely returns you will enjoy; all things being equal.

Read Also: SWOT Analysis and How To Use it

Entrepreneurship requires planning: Everything about entrepreneurship requires planning. It starts from planning the type of business to do. Of course, there are several entrepreneurial ideas but you cannot be Jack of all trades. You need to select the entrepreneurial idea that matches your skills and lifestyles. You need to plan the form of legal structure the business will take. Every phase of the business will need adequate planning. When you are starting up a new business, you need to choose a location that is good for the type of business you want to do. With planning, you may discover that you don’t need an office. Many entrepreneurs operate their business from home. Hiring of staff also requires planning. Growing the business also demands a good planning.

Entrepreneurship requires adding value: There are different names on entrepreneurship. You will hear something like social entrepreneurs, women entrepreneurs, young entrepreneurs, serial entrepreneurs, teen entrepreneurs etc. Whatever the name they are called, something is common to all of them. They add value. They provide solutions to problems. If you are not adding any value, you cannot be regarded as an entrepreneur.

Entrepreneurship requires funding: You may not need a huge capital to start your business. Nevertheless, you still require some levels of funding to start a business. When you hear somebody saying how he started his business with no capital, the point is that he must have started the business by using its existing assets. This means that he didn’t need to pump in additional new capital before he could start the business. For instance, a person that wants to start a proofreading business may not require any money to start provided he has a laptop of his own. But for someone who doesn’t have a laptop, he needs funds money to buy a laptop. However, it cannot be totally ruled out that you can start a business with no money. Businesses that are essentially talent based may not require money to start but if you want to really enjoy growth very fast, you may need to invest in marketing. The type and size of your business will determine the amount and source of funds you require. Sources of capital include personal savings, gifts and supports from friends and relations, capital from angel investors and venture capitalists.

Entrepreneurship requires hard work. You can never see an entrepreneur who is not hardworking. Before you choose the path of entrepreneurship, you need to know that you may need to put in long hours of hard work into your business. This is contrary to the belief of many people. When you work as an employee, you can say that your work start by 8am and ends by 5pm. As an entrepreneur, don’t be surprised that you may need to work longer. There will be situations where you need to take work home and work in the night or at odd hours.

Entrepreneurship requires self discipline: Ask successful entrepreneurs, they will tell you the sacrifice they made before they become who they are today. They had to sacrifice their time and resources. If you want to become an entrepreneur, you may not do what other people that are not having entrepreneurial spirit do. For instance, someone with entrepreneurial spirit may not afford to spend money on frivolous things. Instead of buying things that appeal to human emotions, he will rather prefer to invest the money into his business. This is one of the characteristics of successful entrepreneurs.

Entrepreneurship requires time management: Whether you work as an employee or as an entrepreneur, you have twenty four hours available to you to accomplish your tasks for the day. Nothing more, nothing less. What you are able to achieve depends on how you are able to management your time. Among other entrepreneurial skills, time management skill is a skill every entrepreneur should possess. If you lack time management skill, you will discover that you hardly achieve much at the end of the day. You can be busy all through the day without much results to show for the day. Activity is not the same as productivity. Young entrepreneurs especially those that started their business alone will attest to the fact they wear many caps at the same time. Nevertheless, this should not be an excuse for failure to do the right thing at the right time. It is all about prioritization.

Entrepreneurship requires patience: It is not a get rich quick scheme. It takes time to grow a business. If you just start a business, you can’t expect that money will start rolling in immediately. The gap between when you start a business and when you start reaping profits may depend on the type of business you do. Some businesses may just have one year as a payback period while some may have up to five years. This is one of the characteristics of entrepreneurs that all young entrepreneurs should imbibe in this our jet generation.

Entrepreneurship requires giving back: If you study the lives of successful entrepreneurs, you will discover that all of them have a way of giving back to the society. There is a saying that you don’t bite the hands that feed you. Giving back to the society is a way of saying thank you to the community or society through which they become wealthy and successful. It can be in form of donations or sponsorship of projects that can better the lives of people around them. They do these as part of their corporate social responsibilities.

Read Also:22 Reasons for Small Business failure and How to Avoid Them

Benefits of entrepreneurship to individuals

Entrepreneurship, they say, is a new pathway to success. Entrepreneurship is not only beneficial to individuals; communities and the nation at large stand to benefit immensely.  If we can see these benefits, I believe we can be motivated to take a positive step towards entrepreneurship.

Let’s quickly consider some of the benefits of entrepreneurship to individual.

• Entrepreneurship Gives Personal Fulfilment: This is what I rank first among the benefits of entrepreneurship. There is nothing comparable to being fulfilled in life. May people think that if they have plenty money, then they will be fulfilled. This is like building castle in the air. If money alone gives fulfilment, you will not hear any rich people committing suicide. One of the reasons people go into entrepreneurship is to do things that give them fulfilment in life. Entrepreneurs enjoy great pride in achieving success on their own. This usually boosts their self confidence and self esteem. Entrepreneurship gives an individual the opportunity to build equity, which can be kept, sold, or passed on as legacy or an inheritence to the next generation.  It creates an opportunity for a person to make a contribution. Most new entrepreneurs help the local economy
• Entrepreneurship Offers Freedom: The second on this list of benefits of entrepreneurship is freedom. Entrepreneurs are able to choose their own working hours because they are their own boss. They are not tied to 9-5pm daily routine. They have a flexible schedule and can always adjust their schedules to accommodate family and spiritual obligations. They have the liberty to take independent decision because you are your own boss. You can choose whom to do business with and what work you will do. You can decide what hours to work, as well as what to pay and whether to take vacations. Entrepreneurs has time to do regular physical exercise if he wants to put it as part of his regular schedule. They also enjoy more privacy than employees do while at their workplace. In entrepreneurship, you don’t require educational degrees to become an entrepreneur. There are many successful entrepreneurs that are billionaires who are college dropouts. But if you work as an employee, your employer decides on the qualifications you need to possess before you can work in a particular function. Also, entrepreneurs are free to own more than one business at a time.
• Entrepreneurship Promises Greater Profits: It is noteworthy to mention that entrepreneurship can make you rich. It offers a possibility of achieving greater financial rewards than working for someone else. However, this is not automatic. You must have heard that no employer can make you rich. This means that you may not become rich if you continue working as an employee. Generally, on average, entrepreneurs earn more than employees. Employees are only entitled to their wages or salaries but entrepreneurs own the profits. Employees can be pegged down on a particular salary but in entrepreneurship, sky is the limit to your earnings. After a business has stabilised, entrepreneurs can earn income even while sleeping. Entrepreneurs earn passive income from their past efforts. Apart from the fact that entrepreneurs tend to achieve greater income, their incomes are taxed after deducting their expenses. An entrepreneur can claim allowable expenses related to his business as deductions to his taxable income. 

• Entrepreneurship Provides Job Security: Among the benefits of entrepreneurship is job security. Somebody has said that the only job security you have is the job of your own. The threat of job loss is sweeping across the globe. It doesn’t matter your position in an organisation, if you are not the owner, your employer can show you the way out at any time. The fear of job loss causes stress on its own. The financial instability that usually follows job loss is not untold. Some resort to selling their personal effects if they  don’t get new job on time. Nobody can fire you from your own business. The only duty you have is to ensure that you are meeting the needs of your customers. So when someone says that entrepreneurship is too risky, I wonder if working as an employee is not risky either, It is just about the matter of which risk you are willing to take. But personally, I will rather like to put my destiny in my own hands.
• Entrepreneurship Drives High Energy Level: The slogan among employees is ‘Thank God it’s Friday’ (TGIF). Friday it’s the only day some employees enjoy in a week. But for entrepreneurs, it is ‘Thank God is Today’ (TGIT). Entrepreneurs are happy to see each day of the week. Any time I compare the way I work now with how I worked as an employee, the difference is clear. Please note that I had never been lazy to discharge my responsibility working as an employee then. But the difference is that I feel more energised working for myself. I seldom feel tired regardless of long hours I put in. At times, I wish we have more than twenty four hours a day.
• Entrepreneurship Empowers for High Productivity. You cannot be your best doing what you don’t enjoy. Entrepreneurs are more productive. Because they love what they do, they can afford to put in longer hours without any complaint of fatigue. Every hour counts. You know that if you don’t work, you may not have anything to earn at the end of the month. Unlike working as an employee which qualifies you to receive a pay check at the end of every month. In entrepreneurship, the more you put into your business, the better results you expect.

Read Also: How to Get and Start Entrepreneur Ideas while Working Full Time

Benefits of entrepreneurship to the country

1. Entrepreneurship Allows Capital Formation: A lot of money will remain idle without entrepreneurship. Entrepreneurs don’t only use their own personal savings; they borrow money from other people to set up their enterprises. A lot of money is waiting to be channelled into profitable venture. I notice that there is always over-subscription to government bonds. If this money is directed to entrepreneurship, our economy will grow and develop more rapidly.

1. Entrepreneurship Promotes Job Creation: It is not really the job of government to provide jobs to their people. Government needs to act as a facilitator to help the entrepreneurs who bring in the tax revenues and jobs to the public. Multinational companies can only create limited employment opportunities. It is the creation of small businesses that can solve the problem of unemployment in Nigeria. If small businesses can make up more than 99.7 percent of all employers in the United States of America, Nigeria cannot be different if actually we want to tackle unemployment.
2. Entrepreneurship Helps in Wealth Creation and Distribution: As a result of increased level of economic activities usually generated by entrepreneurs, more wealth are created and distributed better. Small-scale businesses, because of its ownership pattern which is widespread and labour intensive in character provide millions of employment to the unemployed more particularly the rural poor who are in search of employment to earn their living.
3. Entrepreneurship Reduces Concentration of Economic Power: Lack of entrepreneurship will make the economic power of the country to remain in the hands of few individuals; the type we are now experiencing in our oil sector. Creation of small business will help the country break or prevent monopoly. Entrepreneurship brings about competition which in turn leads to production of quality products.
4. Entrepreneurship Increases Gross National Product/Per Capital Income: Country can only increase its Gross National Product if it succeeds in increasing its outputs by engaging in productive activities. The role of small business in boosting Gross Domestic Product of a nation cannot be over-emphasized. Improved earnings or profits by entrepreneurs will definitely translate to improvement in our Per Capital Income.
5. Entrepreneurship Promotes Export Trade:Our agricultural sector has a lot of potentials to boost our export trade. Nigeria has the capacity to feed its citizens and still export to foreign countries. Giving adequate consideration to entrepreneurship in the area of agriculture will boost our export, resulting into balance of trade and better foreign reverses.
6. Entrepreneurship Brings About Increased Standard of Living:There is strong correlation between level of income and standard of living. Unemployment leads to poverty, poverty leads to different social vices. Entrepreneurs will not only create jobs for themselves, they make jobs available to others. When a person is gainfully employed, he enjoys better standard of living. Such person will not even have time to think of crimes. There will be peace in the land.
7. Entrepreneurship Promotes Balanced Regional Development: Our cities in Nigeria are becoming over-populated while villages are being deserted. This rural-urban drift is primarily caused by lack of industries in the rural areas. The level of population in urban cities is creating too much pressure on the available infrastructure. Ten people can be living in a room in a city and still prefer it to staying in a village. If industries are set up in these rural areas this will bring public benefits such as roads, water and education which will make the areas to become attractive to live.

The benefits of entrepreneurship cannot be exhaustive. There are other benefits which are not listed here. I believe, if I say that every entrepreneur should list all the benefits of entrepreneurship they know, it will run into several pages. Some  things an individual will mention as the benefits of entrepreneurship will be as a result of his/her personal experience. If you are not yet an entrepreneur, some of these may look like theory. In summary, entrepreneurship is rewarding.

Read Also: Money Management Tips for Business Owners

Challenges of Entrepreneurship

With all the benefits of entrepreneurship mentioned so far, this article will not be complete if I don’t mention the challenges that you may likely face as an entrepreneur. The path to entrepreneurship is full of bumps. There are obstacles, challenges and hurdles to cross if you decide to consider entrepreneurship as a way of creating wealth for yourself and to the benefits of other people. These challenges should not scare you. They are all surmountable. Your motivation should be that if other people have crossed the challenges, then you will be able to surmount them too. That is what they call “I can do it” attitude. This is one of the characteristics of entrepreneurs and you cannot afford to be an exception. So, below are the challenges of entrepreneurship.

What business to start

“What business should I start?” This is a question I have asked over and over. So, if you are asking yourself “what business should I start?” you are not alone. There are various entrepreneurial ideas one can turn into profitable business. However, the ability to select business idea that matches your skills and lifestyle is very important. You need to know the entrepreneurial idea that is right for you. You should not rush into starting a business because other people are doing it. You should follow your passion. When you do what you love, you will not have problem overcoming problems that may come on your way. It is like when you truly love someone, you won’t have problem relating with the person. Even though the person offends you, you will be willing to forgive and allow the relationship to continue. This is the same with business. The reason why some people give up their entrepreneurial ideas easily is because they don’t actually love the business idea. Possibly, they are only motivated by the money they hope to make in the business. So, if the money is not coming as expected, they easily give up. The best way to live a fulfilled life is to follow your passion. My watchword is “Follow your passion and fulfil your dream.”

Challenge of funding

Funding is very critical in entrepreneurship. Many entrepreneurial ideas have been abandoned as a result of lack of capital. I am not unaware of this challenge. However, I still believe that good entrepreneurial ideas attract funding. You may not have all the funds you need at once. You should learn how to break your business into phases. If you don’t have enough capital to start in a large scale, you can start the business in a small scale. If you don’t have the money to pay for office rent, you can start from your house. If you don’t have the money to buy the equipment needed for the business, you can start your business by renting the equipment. If you can hire a staff, you can outsource some functions to freelancers. This will make your cost a variable cost instead of fixed cost you will have paid as staff salary.

Read Also: Funding Options for Small Businesses

Managing Stress

Entrepreneurship can be stressful. Stress is an adverse reaction to pressure. Human body tends to respond to physical or mental demand placed on it automatically. Therefore, as an entrepreneur, you should know how to manage stress as it can cause adverse health effects if it occurs too often or is prolonged. How do you know whether you are stressed? It can manifest through depression, insomnia, low self-esteem, weight loss, high blood pressure and aging. Other signs of stress include mood swings, poor concentration, excessive eating, drug abuse, alcoholism and accident prone. Stress can be caused by different factors. Few of them shall be discussed here:

Financial instability: Entrepreneurship is quite different from working for someone. In entrepreneurship, you may not be sure of where and when the next cheque may come. Employees are not too bothered about this as they are sure of getting their salary at the end of the month, all things being equal. Entrepreneurs have to think about how to pay business related bills as well as how to meet household needs. If money is not forthcoming, this can lead to stress. In entrepreneurship, the possibility that you will experience this type of situation is high. But how long this period will last may vary from one entrepreneur to the other. You can manage this through adequate planning. If you plan your finance ahead, you may not find yourself in a very tight corner. Before the needs arise, you must have made a plan on how to source for the money.

Excessive workload: Entrepreneurship is not for lazy people. The lives of entrepreneurs are filled with works. If you are just starting, you may be the only one to run the business. You perform different roles. You are the Chief Executive Officer, Project Manager, Administrative Officer, Accountant, Marketers, Sales Officers and Office Clerk. So, entrepreneurship can be tasking. Even when you employ other people to work with you, you still need to oversee their works. Ultimately, you are responsible for whatever they do. Proper planning and organization can help you reduce the workload.

Work-life imbalance: Every entrepreneur wants his business to succeed. That is why they devote a lot of times working on their businesses. This can become worse, if you love what you do. You will find yourself concentrating on the business and this can affect your family life. When you work too much to the extent that you don’t have time for other things, the result may not be palatable. At the end of the day, you may realise that your children are manifesting the behaviours that you never wished for them. It can also lead to strained relationship with your spouse. Therefore, all entrepreneurs should know why to take off time from their works. The time you spend away from work is not lost. When you resume work, you will have fresh ideas and the pressure must have come down. Experts usually recommend that entrepreneurs should engage in social recreation, relaxation, healthy diet, physical exercise and routine check-up.

Even though the list of challenges of entrepreneurship above is not exhaustive, I believe it provides a clue of what to expect in entrepreneurship. Knowing this will help you brace up to face the challenges.

The Dearth of Entrepreneurship

The impact that dearth of entrepreneurship is having in our economy is enormous. The effects have cut across other three factors of production and, of course, the nation at large. Greater percentage of the problems facing us in this country is traceable to not having enough entrepreneurs. I know this may sound comical but that is just the truth. Considering the current level of unemployment in the country, there is a need to embark on entrepreneurship education among the youths across the country. The type of education given to our graduates from different institutions has proved inadequate in helping them develop entrepreneurial skills. This entrepreneurship development initiatives cannot be achieved by the government alone. It has to be by public/private participation. Corporate bodies, religious organisations and individuals all have roles to play.  The unemployment can only be tackled by all stakeholders. Organizing seminars, symposia, business fora, talk shows and publications on entrepreneurship will go a long way in helping our youth discover and develop their entrepreneurial potentials.

List of Famous Entrepreneurs

Below are the list of famous entrepreneurs that usually serve as motivators to me. Even though I have never had any physical interaction with any of these famous entrepreneurs, hearing and reading about them usually fuel my entrepreneurial spirit. While you may not necessarily follow these entrepreneurs, I encourage every entrepreneur to have their own list of famous entrepreneurs which they can look up to. Good enough, there is no country in the world where you will not see people who will stand out as famous entrepreneurs in that nation. It doesn’t matter whether they are young entrepreneurs, women entrepreneurs or social entrepreneurs. Please, note that my own list of famous entrepreneurs does not have anything to do with their wealth and they are listed in no particular order:

1. Mark Zuckerberg, FaceBook
2. Bill Gate, Microsoft
3. Gordon Moore, Intel
4. Warren Beffett, Berkshire Hathaway
5. Oprah  Winfrey, Harpo Inc.
6. Larry Ellison, Oracle Corporation
7. Alhaji Dangote Aliko, Dangote Group
8. Richard Brandson, Virgin Group
9. Michael Dell, Dell Inc.
10. Michele Ferrero

You are free to add more famous entrepreneurs in the comment below.

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