What is entrepreneurship and why is it important.
Entrepreneurship can be considered a national asset, and entrepreneurs are the drivers of that asset for any country. It is a dynamic process that not only increases wealth and but can also create value that results in improved well-being.
Entrepreneurship plays an important role in changing society, so it makes sense to cultivate, motivate, and remunerate this greatest asset to the greatest extent possible.
Importance of Entrepreneurship
In entrepreneurship, unutilized resources, labor, and capital are utilized most efficiently. Entrepreneurs take on risks in the hopes of making profit, or in the case of social entrepreneurship, of solving a problem facing communities. So the significance of entrepreneurs and the role of entrepreneurship go beyond the business world. The importance of entrepreneurship is so broad that it’s quite tough to explain all the aspects of it in a short blog post. However, I would like to shed some light on the importance and role of entrepreneurship in economic development and society.
1. Entrepreneurship Accelerates Economic Growth
Entrepreneurs are important to market economies because they can act as the wheels of the economic growth of the country.
By creating new products and services, they stimulate new employment, which ultimately results in the acceleration of economic development. So public policy that encourages and supports entrepreneurship should be considered important for economic growth.
A large number of new jobs and opportunities are created by entrepreneurship. Entrepreneurship creates a huge amount of entry-level jobs that are very much important to turn unskilled jobholders into skilled ones. It also prepares and provides experienced workers to large industries. The increase in the total employment of a country largely depends on the rise of entrepreneurship. So the role of entrepreneurship in creating new job opportunities is huge.
By bringing innovation to every aspect of businesses, entrepreneurial ventures enhance production utilizing the existing resources in the most effective ways. Entrepreneurs develop new markets by introducing new and improved products, services, and technology. Thus, they help generate new wealth and add more to the national income. So the government can offer the citizens more national benefits.
2. Entrepreneurship Promotes Innovation
Through the right practices of research and development, entrepreneurs bring new innovation that opens the door of new ventures, markets, products, and technology. Entrepreneurs have a role to play in solving problems that existing products and technology have not yet solved. So by producing new products and services or bringing innovation to existing products and services, entrepreneurship has the potential to improve peoples’ lives.
3. Entrepreneurship Can Promote Social Changes
Entrepreneurs change or break the tradition or cultures of society and reduce the dependency on obsolete methods, systems, and technologies. Basically, entrepreneurs are the pioneer of bringing new technologies and systems that ultimately bring changes to society. These changes are associated with improved lifestyle, generous thinking, better morale, and higher economic choice. In this way, social changes gradually impact national and global changes. So the importance of social entrepreneurship must be appreciated.
At Duke, the Innovation and Entrepreneurship Initiative has a special program aimed specifically at Social Innovation. The program is “building upon and extending the strengths of the university to create a transformational learning environment to inspire, prepare, and support entrepreneurial leaders and scholars to turn knowledge into action in pursuing innovative solutions to the world’s most pressing problems.”
For example, one of the most recent projects of the initiative is the Duke-UNICEF Innovation Accelerator, which is focused on entrepreneurship for menstrual health and hygiene for women and girls in vulnerable communities in three African countries.
4. Entrepreneurship Promotes Research and Industrial Development
Along with producing new business ideas and thinking out of the box, entrepreneurs also promote research and development. They cultivate their ideas, shape them into a new form, and turn them into a successful business endeavor.
Entrepreneurs are a special kind of people, they are always working to discover new ideas and improve existing ones. But their impact extends beyond their own companies and ventures: when an entrepreneur develops a new product, service, or idea, others often follow (and sometimes even further refine the ideas).
Innovation and industry is accelerated through the combined action of entrepreneurs. They can motivate each other, share ideas and inspiration, and share planning to establish new industries. The change of the existing industrial climate opens the doors for others at the same time. Therefore, we see that the importance of entrepreneurship to the economy is multi-functional.
5. Entrepreneurship Develops and Improves Existing Enterprises
We often think of entrepreneurs as inventing totally new products and ideas, but they also impact existing business. Since entrepreneurs think differently, they can come up with innovative ways to expand and develop the existing enterprises. For example, modernizing production processes, implementing new technology in the overall distribution and marketing processes, and helping the existing enterprises to utilize existing resources in more efficient ways.
To sum up, supporting and promoting entrepreneurship can have a positive impact on the country’s economy and even existing businesses, and social entrepreneurship increases the likelihood of finding innovation solutions to social challenges faced by communities around the world.
What are types of entrepreneurship?
01. Small business entrepreneurship
This type of entrepreneurship refers to any kind of small business that has been created by one person, without the goal to expand or franchise. For example, if you were planning to open a nail salon, a general store or a taco truck your goal would be to launch a single store. You’d likely plan on hiring local employees or even family members to get your business off the ground and would need to invest your resources directly into the business.
02. Scalable startup entrepreneurship
Rooted in the idea of changing the world, scalable startups focus on how to create a business model that is both repeatable and scalable (more sales with more resources). From the get go, this style of entrepreneurship begins with the hope of rapid expansion and big profit returns. Many startups have a similar ‘garage to riches’ narrative, beginning with a simple idea that is brought to life by the tenacity of entrepreneurs with the support of investors. Amazon, Google and Apple are all examples of trailblazing startups that have changed the world.
Types of Entrepreneurship
Becoming an entrepreneur requires passion, perseverance and fervor. Whether you are just starting out and opening a business, or developing an existing one, understanding the types of entrepreneurship is an important part of your journey to success.
By focusing on the unique differences of entrepreneurship, you’ll be able to address your business’ challenges with a deeper awareness of how you should handle them and what types of resources you’ll need. From picking which type of venture you want to develop, to creating a website that targets the right audience, there are many steps you’ll need to take to become a successful entrepreneur.
What are types of entrepreneurship?
While the basic principles of entrepreneurship are the same—planning, starting and operating a business—the distinct nuances and skills needed vary depending on the type of business you plan to start. Becoming an entrepreneur requires the ability to define these differences, and pinpoint the unique elements that are needed.
Traditionally, entrepreneurship is categorized into four main types: small businesses, scalable startups, large companies and social entrepreneurs. These models cover the fundamentals of starting a business and focus more on the company itself, rather than the qualities of the entrepreneur. However, just as the world continues to change, so do businesses. This means new opportunities for risk-taking and innovative game changers to pave the way in diverse entrepreneurial ways.
With this in mind, even though there are quite a few similarities when it comes to the challenges that all business owners will face, there are certain types of entrepreneurship defined by the skills, characteristics, and personality traits of the entrepreneur. At the end of the day, it is the way you choose to run your business that makes them differ from one another.
10 most common types of entrepreneurship:
01. Small business entrepreneurship
This type of entrepreneurship refers to any kind of small business that has been created by one person, without the goal to expand or franchise. For example, if you were planning to open a nail salon, a general store or a taco truck your goal would be to launch a single store. You’d likely plan on hiring local employees or even family members to get your business off the ground and would need to invest your resources directly into the business.
In this type of business, you only make a profit if your company does, meaning you need to be very driven, responsible and committed to your vision. In 2020, there were 33.7 million small businesses in the United States, accounting for 99.9% of companies, proving that small business entrepreneurship is on the rise.
02. Scalable startup entrepreneurship
Rooted in the idea of changing the world, scalable startups focus on how to create a business model that is both repeatable and scalable (more sales with more resources). From the get go, this style of entrepreneurship begins with the hope of rapid expansion and big profit returns. Many startups have a similar ‘garage to riches’ narrative, beginning with a simple idea that is brought to life by the tenacity of entrepreneurs with the support of investors. Amazon, Google and Apple are all examples of trailblazing startups that have changed the world.
In order to establish a successful startup, you need to pay attention to the amount of money you have (which is often supported by venture capital investors) and the human resources behind your business. The key to starting this type of business model is knowing the long-term plans for profitability and the ways in which your company will grow, both for the sake of your investors, and your own.
03. Intrapreneurship
Unlike an entrepreneur, who is also the founder, designer and manager of a business, an intrapreneur is a self-motivated, and action-oriented employee who thinks out of the box and works as an entrepreneur within a company. Intrapreneurship is a way that companies can support and encourage employees that have entrepreneurial spirit.
Shutterstock, for example, hosts an annual 24-hour hackathon which lets employees pursue innovative ideas that will benefit the company. Another example of an intrapreneurial innovation is Facebook’s ‘Like’ button which was also created in a similar hackathon event, which is now an integral part of the brand.