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Entrepreneurs: The Driving

Force Behind Small Business

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Lecture: 7


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The World of the Entrepreneur In the U.S., entrepreneurs start more than 6 million

businesses a year!

Global Entrepreneurship Monitor (GEM) Approximately 8% of the U.S. population is actively

involved in entrepreneurial activity

Nearly 11% of people in 49 GEM countries studied are

involved in starting a new business


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What is an Entrepreneur?One who creates a new business in the face of risk

and uncertainty for the purpose of achieving profitand growth by identifying opportunities andassembling the necessary resources to capitalize onthem


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An entrepreneur is someone who is willingto work 16 hours a day to keep from working

8 hours a day for someone else!


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Characteristics of EntrepreneursSurvey: 61% of adults in the U.S. would like to start

their own business

Willingness to take initiative

Preference for moderate risk Confidence in their ability to succeed

Self-reliance

Perseverance1

Desire for immediate feedback

1Perseverance is commitment, hard work, patience, endurance


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High level of energy

Competitiveness

Future orientation Serial entrepreneurs

Skilled at organizing

Value achievement over money

Characteristics of Entrepreneurs


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Entrepreneurship One characteristic of entrepreneurs stands out:

Diversity!

Anyone regardless of age, race, gender, color,national origin, or any other characteristic canbecome an entrepreneur (although not everyoneshould)


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How to Spot Entrepreneurial Opportunities Creativity vs. Innovation

Creativity the ability to develop newideas and to discover new ways of

looking at problems andopportunities

Innovation the ability to applycreative solutions to problems and

opportunities to enhance or to enrichpeoples lives


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Monitor trends and exploit them early on

Take a different approach to an existing market

Put a new twist on an old idea

How to Spot Entrepreneurial Opportunities


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Look for creative ways to use existing resources

Realize that others have the same problem that you

do

Notice what is missing

How to Spot Entrepreneurial Opportunities


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Benefits of Small Business Ownership

The opportunity to: Control your own destiny Make a difference Reach your full potential Reap impressive profits Contribute to society and to be recognized for

your efforts Do what you enjoy and to have fun at it


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Drawbacks of Small Business Ownership

Uncertainty of income

Risk of losing your entire investment

Long hours and hard work


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1 to 39 hours10%

40 to 49 hours29%

50 to 59 hours22%

60 to 69 hours19%

More than 70 hours20%

Small Business Owners' Work WeekNumber of Hours Worked per Week

Average workweek = 54 hours


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Uncertainty of income

Risk of losing your entire investment

Long hours and hard work

Lower quality of life until the businessgets established



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Uncertainty of income Risk of losing your entire investment Long hours and hard work Lower quality of life until the business gets established

High levels of stress

Complete responsibility

Discouragement



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The Cultural Diversity of

EntrepreneurshipYoung entrepreneurs


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Entrepreneurial Activity by Age Group


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Women entrepreneurs


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Entrepreneurial Activity by Gender


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Women entrepreneurs

Minority-owned enterprises


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Minority Business Ownership inthe United States

0

10

20

30

4050

60

70

80

90

1st Qtr 2nd Qtr 3rd Qtr 4th Qtr

East

West

North


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Women entrepreneurs

Minority-owned enterprises

Immigrant entrepreneurs

Part-time entrepreneurs


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Small Business by Industry


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Small Businesses... Employ 50.2% of the nations private sector

workforce

Pay 45% of total private payroll Create more jobs than big businesses

SBA estimates they create 79% of all net newjobs in the U.S.


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Are leaders in offering training andadvancement opportunities to workers

Provide 67% of workers with their first jobs

Account for 47% of business sales

Key role in innovation:

Produce 13 times more patents per employees

than large companies

Small Businesses...


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Putting Failure into PerspectiveAbout 54% of new companies fail within 4 years

Entrepreneurs are not affected by the prospect offailure

Failure a natural part of the creative process Successful entrepreneurs learn to fail intelligently


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Avoiding the Pitfalls of Small Business

Failure

Know your business in depth

Prepare a business plan

Manage financial resources

Understand financial statements


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Learn to manage people effectively

Set your business apart from the

competition

Maintain a positive attitude

Avoiding the Pitfalls of Small Business

Failure


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Documents

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