Chapter 1

•Introduction to Entrepreneurship
Bruce R. Barringer
R. Duane Ireland

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Explain entrepreneurship and discuss its
Explain importance.

Describe corporate entrepreneurship and its

Describe use in established firms.
Chapter
Objectives Discuss
Discuss three main reasons people decide to
become entrepreneurs.

Identify four main characteristics of

Identify successful entrepreneurs.

Explain five common myths regarding

Explain entrepreneurship.
Chapter Objectives
Explain how entrepreneurial firms differ from
Explain salary-substitute and lifestyle firms.
Discuss the changing demographics of entrepreneurs in the
Discuss United States.
Discuss the impact of entrepreneurial firms on economies
Discuss and societies.
Identify ways in which large firms benefit from the presence
Identify
of smaller entrepreneurial firms.

Explain Explain the entrepreneurial process.

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Motivation for you
• https://www.youtube.com/watch?v=0Nw_J8SFnOQ
• https://www.youtube.com/watch?v=h214BiXXjFY
Who are
entrepreneurs?

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Who are entrepreneurs?
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Who are entrepreneurs?

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Who are entrepreneurs?
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Who are
entrepreneurs?
Who are entrepreneurs?
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Few Famous
Entrepreneurs
Few Famous
Entrepreneur
s

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Few Famous Entrepreneurs

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5

Few Famous
Entrepreneurs
(Smith)
Few Famous
Entrepreneurs
(Jeff)

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Few Famous Entrepreneurs
(Numan)
Few Famous Entrepreneurs (Ray)
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Few Famous Entrepreneurs
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Few Famous
Entrepreneur
s (Monis)
Few Famous
Entrepreneurs
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Few Famous
Entrepreneurs

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Few Famous Entrepreneurs

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Few Famous
Entrepreneur
s

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Few Famous
Entrepreneur
s
Few Famous
Entrepreneurs

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Few Famous
Entrepreneurs

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Next Big
Thing is
“YOU”
 Famous Pakistani Entrepreneurs

•http://www.amazingpakistanis.com/entrepreneurs.html

•Some amazing Pakistanis !

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 A video on
Entrepreneur
https://www.youtube.com/watch?v=mWBif5GTzNs

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 100 million businesses are
According to launched each year.
Global
Entrepreneurshi
p Monitor:
That is 11,000 per hour.

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 Quick Facts
• Annual creation of 600,000 to 800,000 new
companies
• More employees work for entrepreneurial
ventures than any other sector in the
economy
• In Pakistan, Many Students become
entrepreneurs at very early age.

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Indications of Increased Interest
in Entrepreneurship

Books
• Amazon.com lists over 45,000 books dealing with
entrepreneurship and 118,000 focused on small business.

College Courses
• In 1985, there were about 250 entrepreneurship courses
offered across all colleges in the United States.
• Today, more than 5,000 entrepreneurship courses are
offered in two-year and four-year colleges and universities
in the United States.

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 What is Entrepreneurship?
Academic Entrepreneurship is the process by which individuals
Definition pursue opportunities without regard to resources they
(Stevenson) currently control.

Venture Entrepreneurship is the art of turning an innovative idea

Capitalist into a business.
(Fred Wilson)

Explanation of Entrepreneurs assemble and then integrate all the

What resources needed –the money, the people, the business
Entrepreneurs model, the strategy—needed to transform an invention or
Do an idea into a viable business.

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 MORE THAN JUST THE
CREATION OF A BUSINESS; IT
ALSO INCLUDES THE
GENERATION AND
IMPLEMENTATION OF NEW
What is IDEA.
Entrepreneurship?
IT IS ABOUT BEING A DYNAMIC
THINKER AND OPERATOR WHICH
INCLUDES EFFECTIVE
COMMUNICATION TO ALL OF
YOUR STAKEHOLDERS

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Entrepreneur
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Problem
Solution
 Class Task

Think of any business

which has turned a
problem Into solution
https://www.youtube.com/watch?v=mEogoeHaj3A

Power of
Entrepreneurship

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Corporate Entrepreneurship

• Is the concept of entrepreneurship at the firm

level.
• All firms fall along a conceptual scale that ranges
from highly conservative to highly entrepreneurial.
• The position of a firm on this range is referred to
as its entrepreneurial intensity.
• Corporate entrepreneurship refers to the
entrepreneurial activities carried out in large
corporations

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Corporate Entrepreneurship

Entrepreneurial Firms Conservative Firms

• Proactive • Take a more “wait and see”

posture
• Innovative
• Less innovative
• Risk taking
• Risk adverse

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Why Become an Entrepreneur?
The three primary reasons that people become
entrepreneurs and start their own firms

Desire to be their own boss

Desire to pursue their

own ideas

Financial rewards

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Characteristics of Successful Entrepreneurs

Four Primary Characteristics

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 Passion for the Business

• The number one characteristic shared by

successful entrepreneurs is a passion for the
business.
Characteristics • This passion typically stems from
entrepreneur’s belief that the business
the
will
of Successful positively influence people’s lives.

Entrepreneurs Product/Customer Focus

• A second defining characteristic of successful

entrepreneurs is a product/customer focus.
• An entrepreneur’s keen focus on products and
customers typically stems from the fact that
most entrepreneurs are, at heart,
craftspeople.
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 • Tenacity Despite Failure
Characteristics • Because entrepreneurs are typically trying
of Successful something new, the failure rate is naturally
high.
Entrepreneurs • A defining characteristic for successful
entrepreneurs’ is their ability to persevere
through setbacks and failures.
• Execution Intelligence
• The ability to fashion a solid business idea
into a viable business is a key characteristic of
successful entrepreneurs.
Common Myth About Entrepreneurs

• Myth 1: Entrepreneurs Are Born Not Made

• This myth is based on the mistaken belief that
some people are naturally predisposed to be
entrepreneurs.
• The consensus of many studies is that no one
is “born” to be an entrepreneur; everyone has
the potential to become one.
• Whether someone does or doesn’t become an
entrepreneur, is a function of the environment,
life experiences, and personal choices.

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Example

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 Common Myths About Entrepreneurs

Although no one is “born” to be an entrepreneur, there are common traits and

characteristics of successful entrepreneurs

• Achievement motivated • Optimistic disposition

• Alert to opportunities • Influential
• Creative • Promoter
• Decisive • Resource assembler
• Energetic • Self-confident
• Has a strong work ethic • Self-starter
• Is a moderate risk taker • Determined
• Is a networker • Tolerant of ambiguity
• Lengthy attention span • Visionary

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 • Most entrepreneurs are moderate risk takers.
• The idea that entrepreneurs are gamblers
originates from two sources:
• Entrepreneurs typically have jobs that are less
Myth 2: structured, and so they face a more uncertain set
Entrepreneurs of possibilities than people in traditional jobs.

Are Gamblers • Many entrepreneurs have a strong need to

achieve and set challenging goals, a behavior that
is often associated with risk taking.

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 Myth 3: • While it is naïve to think that entrepreneurs
Entrepreneurs don’t seek financial rewards, money is
rarely the reason entrepreneurs start new
Are Motivated firms.
Primarily by • In fact, some entrepreneurs warn that the
pursuit of money can be distracting.
Money.

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 • The most active age for business ownership is 35
to 45 years old.
Myth 4: • While it is important to be energetic, investors
Entrepreneurs Should often cite the strength of the entrepreneur as their
Be Young and most important criteria in making investment
decisions.
Energetic. • What makes an entrepreneur “strong” in the eyes of an
investor is experience, maturity, a solid reputation,
and a track record of success.
• These criteria favor older rather than younger
entrepreneurs.

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 Successful
entrepreneurs
started late

https://youtu.be/7NULp-403GI
Types of Start-Up Firms

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Changing Demographics of Entrepreneurs

Women Entrepreneurs

• There were 6.2 million women-

owned businesses in 2002. This
number was up 20% from
1997.

111 million women currently

operate established businesses

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 Changing Demographics of Entrepreneurs

Minority Entrepreneurs Senior Entrepreneurs

• Minorities owned roughly 18% •The percentage of U.S.

of U.S. businesses in 2002. entrepreneurs who are seniors
• This number was up 10% from jumped from 15% to 23% from
1997. 1996 to 2012.
In 2007 about 5 million minority
•
owned businesses in US

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Changing Demographics of Entrepreneurs

Young Entrepreneurs

• Interest among young people in entrepreneurial careers is

growing.
• According to one study, 7 out of 10 high school students
want to start their own business.
• Over 2,000 two-year and four-year colleges and universities
offer entrepreneurship courses.

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 • Innovation
• Is the process of creating something new,
which is central to the entrepreneurial
process.
• Small firms are twice as innovative per
Economic employee as large firms.
Impact of • Job Creation
• In the past two decades, economic activity
Entrepreneurial has moved in the direction of smaller
entrepreneurial firms, which may be due to
Firms their unique ability to innovate and focus on
specialized tasks.
 • Impact on Society
• The innovations of entrepreneurial firms have a
dramatic impact on society.
• Think of all the new products and services that
Entrepreneurial make our lives easier, enhance our productivity at
Firms’ Impact work, improve our health, and entertain us in new
ways.
on Society and
• Impact on Larger Firms
Larger Firms • Many entrepreneurial firms have built their entire
business models around producing products and
services that help larger firms become more
efficient and effective.

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McDonald’s
Johnny & Jugnu
 The Entrepreneurial Process Consists of Four
Steps

Step 1: Deciding to become an entrepreneur.

The
Entrepreneurial Step 2: Developing successful business ideas.

Process
Step 3: Moving from an idea to an
entrepreneurial firm.

Step 4: Managing and growing the entrepreneurial

firm.

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Steps in the Entrepreneurial Process
Step 1 Step 2
Developing Successful Business Ideas

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Steps in the Entrepreneurial Process
Step 3 Step 4

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 Inventions Saving the Earth

https://www.youtube.com/watch?v=FWFb-8hFutY
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Video Of This Lecture

https://www.youtube.com/watch?v=Q
kis-k9JYVQ&feature=youtu.be
Important Questions
Important Exam Questions
• Write your key strengths and weaknesses as an entrepreneur. How will
you improve your weaknesses? Write a detailed plan of action to
improve your profile as an entrepreneur.