ZHEJIANG GONGSHANG UNIVERSITY

SCHOOL OF BUSINESS ADMINISTRATION

COURSE: ENTREPRENEURSHIP

STUDENT NAME: Lillian Kobusingye

NATIONALITY: UGANDAN

STUDENT NUMBER: B1019443

SUBMITTED TO: PROFESSOR WONG KAM BILL

ASSIGNMENT 4: Entrepreneurship, Innovation and Economic crisis.

Academicians integrate crisis management with entrepreneurship. Opportunities always show up
during dangerous situations. Entrepreneurs amidst a crisis need to deploy more EQ than IQ in
order to succeed. Women entrepreneurship is a huge topic because most women’s EQ is
comparatively lower. Entrepreneurs have top strategies employed in times of crisis. These
fundamental steps include: (1) pre-crisis: mitigation and preparedness; (2) during the crisis; (3)
response (emergency); (4) post-crisis; and (5) recovery. During recovery, we might have fertile
grounds for entrepreneurship.
Startup businesses usually do not have many assets for collateral. The prime rate is the interest
rate at which lenders charge their most trustworthy business borrowers. Collateral is an asset
guaranteed by the borrowers and can be used to pay off the loan in the event the borrower
defaults. Banks usually decline loans for startups because they consider them too risky, with an
over 80% failure rate. Higher interest rates affect profits for entrepreneurs in developing
countries. e.g. Pakistan. Many loans are based on the US dollar. A strong US dollar exchange
rate and an interest rate are both detrimental to business. Islamic finance is profit sharing. An
Islamic bank cannot charge interest as it is considered "haram" in the Koran. These are venture
funds or investors. Angel investors use their money to support an entrepreneurial venture. This is
a source of cheap capital.
In conclusion, Joseph Schumpeter defines capitalism as a matter of creative destruction. An
innovation presents a technical or organizational newness, not just an invention in the market.
Entrepreneurial profit expresses the value of what the entrepreneur adds to production. In
economics, we experience recession, depression, and revival. Creative destruction is the core of
capitalism. The Schumpeter cycle of innovation and entrepreneurship illustrates the countless
chances of entrepreneurship. Entrepreneurs must take advantage of opportunities during a crisis.