1.

Introduction to Entrepreneurship
Entrepreneurship is the act oI being an entrepreneur, which can be deIined as "one
who undertakes innovations, Iinance and business acumen in an eIIort to transIorm
innovations into economic goods". This may result in new organizations or may be part oI
revitalizing mature organizations in response to a perceived opportunity. The most
obvious Iorm oI entrepreneurship is that oI starting new businesses (reIerred as Startup
Company); however, in recent years, the term has been extended to include social and
political Iorms oI entrepreneurial activity. When entrepreneurship is describing activities
within a Iirm or large organization it is reIerred to as intra-premiership and may include
corporate venturing, when large entities spin-oII organization.
According to Paul Reynolds, entrepreneurship scholar and creator oI the Global
Entrepreneurship Monitor, "by the time they reach their retirement years, halI oI all
working men in the United States probably have a period oI selI-employment oI one or
more years; one in Iour may have engaged in selI-employment Ior six or more years.
Participating in a new business creation is a common activity among U.S. workers over
the course oI their careers." And in recent years has been documented by scholars such as
David Audretsch to be a major driver oI economic growth in both the United States and
Western Europe.
Entrepreneurial activities are substantially diIIerent depending on the type oI
organization and creativity involved. Entrepreneurship ranges in scale Irom solo projects
(even involving the entrepreneur only part-time) to major undertakings creating many job
opportunities. Many "high value" entrepreneurial ventures seek venture capital or angel
Iunding (seed money) in order to raise capital to build the business. Angel investors
generally seek annualized returns oI 20-30 and more, as well as extensive involvement
in the business. Many kinds oI organizations now exist to support would-be entrepreneurs
including specialized government agencies, business incubators, science parks, and some
NGOs. In more recent times, the term entrepreneurship has been extended to include
elements not related necessarily to business Iormation activity such as conceptualizations
oI entrepreneurship as a speciIic mindset (see also entrepreneurial mindset) resulting in
entrepreneurial initiatives e.g. in the Iorm oI social entrepreneurship, political
entrepreneurship, or knowledge entrepreneurship have emerged.
The entrepreneur is a Iactor in microeconomics, and the study oI entrepreneurship
reaches back to the work oI Richard Cantillon and Adam Smith in the late 17th and early
18th centuries, but was largely ignored theoretically until the late 19th and early 20th
centuries and empirically until a proIound resurgence in business and economics in the
last 40 years. Donald Trump is one such example.
In the 20th century, the understanding oI entrepreneurship owes much to the work oI
economist Joseph Schumpeter in the 1930s and other Austrian economists such as Carl
Menger, Ludwig von Mises and Friedrich von Hayek. In Schumpeter, an entrepreneur is a
person who is willing and able to convert a new idea or invention into a successIul
innovation. Entrepreneurship employs what Schumpeter called "the gale oI creative
destruction" to replace in whole or in part inIerior innovations across markets and
industries, simultaneously creating new products including new business models. In this
way, creative destruction is largely responsible Ior the dynamism oI industries and long-
run economic growth. The supposition that entrepreneurship leads to economic growth is
an interpretation oI the residual in endogenous growth theory and as such is hotly debated
in academic economics. An alternate description posited by Israel Kirzner suggests that
the majority oI innovations may be much more incremental improvements such as the
replacement oI paper with plastic in the construction oI a drinking straw.
For Schumpeter, entrepreneurship resulted in new industries but also in new
combinations oI currently existing inputs. Schumpeter's initial example oI this was the
combination oI a steam engine and then current wagon making technologies to produce
the horseless carriage. In this case the innovation, the car, was transIormational but did not
require the development oI a new technology, merely the application oI existing
technologies in a novel manner. It did not immediately replace the horse drawn carriage,
but in time, incremental improvements which reduced the cost and improved the
technology led to the complete practical replacement oI beast drawn vehicles in modern
transportation. Despite Schumpeter's early 20th-century contributions, traditional
microeconomic theory did not Iormally consider the entrepreneur in its theoretical
Irameworks (instead assuming that resources would Iind each other through a price
system). In this treatment the entrepreneur was an implied but unspeciIied actor, but it is
consistent with the concept oI the entrepreneur being the agent oI x-eIIiciency.
2. Challenges Ior Entrepreneurship
Today, with the internet boom, entrepreneurs have become one oI the most dynamic
Iorces in the economy. Entrepreneurs are now driving the technology boom, which is
itselI driving much oI the world's economic growth. This makes entrepreneurs very
important Irom a macro-economic perspective. They have become a broader economic
phenomenon that has a major impact on the economy. As the globalism oI business
becomes even more widespread, this impact will be Ielt even more deeply. Entrepreneurs
are already becoming a major Iorce in developing nations and in the economy worldwide.
The scope oI what entrepreneurship involves will continue to change and evolve as
the world continues to change and evolve, and yet there are some common issues oI how
to start a business, how to Iinance the business, how to run the business that within this
community we can share and learn Irom each other. While we still have many heroes and
stories, entrepreneurism is an established Iield with a wide range oI issues at all stages oI
the enterprise.
A common denominator Ior all entrepreneurs is the challenge oI starting a business, be
it through inventing something, looking Ior a new idea within a business, Iinding the right
opportunity to break into a business or buying into a Iranchise. And these entire take
planning - organizing all the aspects so that you reach your goals. All entrepreneurs are
also Iaced with Iinancing their entrepreneurial venture. Even entrepreneurs usually are
Iaced with Iinancial hurdles within corporate rules. So unless the venture comes Irom your
own pocket getting money is a challenge that requires preparing Iunding proposals or
applications to be written and/or presented Ior loans, venture capital, angel investors or
even IPO's. There is so much inIormation written about these stages oI an entrepreneurial
venture that sorting the good Irom the bad is an overwhelming challenge in and oI itselI.
Once past those challenges, however, one would think there would be smooth sailing.
Given the business has a good plan, everything should proceed with minor glitches.
However, the implementation stage seems to be the real make-or-break point oI an
entrepreneurial venture. There are hypotheses that part oI the problem is that idea people
and implementation people are very diIIerent breeds oI people, but there are enough
exceptions to that rule that is a diIIicult position to deIend. More realistic, perhaps, is that
there are such a wide variety oI skills needed at the implementation stage, that no one
person can have the skills to manage all the Iunctions well. The real talent is Ior
entrepreneurs to recognize what they do well and then Iind employees or subcontractors
who can Iill the gaps.
One way to look at this implementation stage is to look at how many diIIerent skills are
involved in operating a business. Operating a business involves employees, marketing,
advertising, sales, communications, public relations, legal needs, government regulations,
equipping the oIIice, risk management, disaster planning, crisis management, insurance,
technology, hardware, soItware, the internet, and the Iinancial aspects oI the company -
bookkeeping, managing debt, taxes, and barter.
Without a strong technical basis, there is no business. Above and beyond this, however,
is the conceptual aspect oI management: ethics, leadership, growth philosophy, and even
the exit strategy oI the company. These are much less tangible, yet set the overall theme
and direction that the business will take.
How is an entrepreneur to deal with all this overload oI challenges? The good news is
that there are plentiIul resources: discussion groups, educational resources, proIessional
associations, and publications to turn to Ior support and counsel. One could also say that
having so many available resources is also bad news because one other element that
entrepreneurs have in common is lack oI time -- sorting through those resources to Iind
the ones that work Ior you can be an arduous and painIul process. That is what this site is
really about -- a place that helps people running small businesses Iind the valuable
inIormation they need to Iind solutions Ior their particular needs and interests.