Entrepreneurial background and characteristics 4

04/15/2023 Entrepreneurial Leadership-HIMS

Entrepreneurial background and characteristics

Small Business Owners

• Small business owners are people who own a major equity stake in a company with fewer than 500 employees.

• In 1997 there were 22.56 million small business in the United States.

• 47% of people are employed by a small business.

Entrepreneurial Leadership-HIMS04/15/2023

Employee Satisfaction

• In companies with less than 50 employees, 44% were satisfied.

• In companies with 50-999 employees, 31% are satisfied.

• Business with more than 1000, only 28% are satisfied.




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Advantages of a Small Business

• Greater Opportunity to get rich

• Feel more important

• Feel more secure

• Comfort Level


Entrepreneurial Leadership-HIMS

Disadvantages of a Small Business

• Lower guaranteed pay• Fewer benefits• Expected to have many skills• Too much cohesion• Hard to move to a big company• Large fluctuations in income possible

04/15/2023

Why NOT to be an Entrepreneur

• Uncertainty of income• Risk of losing entire invested capital• Lower quality of life until business gets

established• High levels of stress• Complete responsibility• Constant depression during initial phase (do or

die)


Who are entrepreneurs?

• Common traits

– Original thinkers

– Risk takers

– Take responsibility for own actions

– Feel competent and capable

– Set high goals and enjoy working toward them



• Common traits

– Self employed parents

– Firstborns

– Between 30-50 years old

– Well educated – 80% have college degree and

1/3 have a graduate level degree

Why should you be interested?

• Many young people have succeeded:– Michael Dell - Dell Computers– Frank Carney - Pizza Hut– Paul Orfalea - Kinko’s – Fred DeLuca - Subway.– Kristy Taylor - SkinCareRx.com

• Opportunity to reap large profits


Successful and Unsuccessful Entrepreneurs

• Successful– Creative and Innovative– Position themselves in

shifting or new markets– Create new products– Create new processes– Create new delivery

• Unsuccessful– Poor Managers– Low work ethic– Inefficient– Failure to plan and

prepare– Poor money managers


Characteristics of Entrepreneurs

Successful Entrepreneurs

Key Personal Attributes

Good Technical Skills

Strong Managerial Competencies


Key Personal Attributes

• Entrepreneurs are Made, Not Born!

– Many of these key attributes are developed early in life, with the family

environment playing an important role

– Entrepreneurs tend to have had self employed parents who tend to

support and encourage independence, achievement, and responsibility

– Firstborns tend to have more entrepreneurial attributes because they

receive more attention, have to forge their own way, thus creating

higher self-confidence


Key Personal Attributes (cont.)

• Entrepreneurial Careers– The idea that entrepreneurial success leads to more

entrepreneurial activity may explain why many entrepreneurs start multiple companies over the course of their career

– Corridor Principle- Using one business to start or acquire others and then repeating the process

– Serial Entrepreneurs- A person who founds and operates multiple companies during one career



• Need for Achievement– A person’s desire either for excellence or to succeed in

competitive situations– High achievers take responsibility for attaining their goals,

set moderately difficult goals, and want immediate feedback on their performance

– Success is measured in terms of what those efforts have accomplished

(McClelland’s research)



• Desire for Independence

– Entrepreneurs often seek independence from others

– As a result, they generally aren’t motivated to perform well in large, bureaucratic organizations

– Entrepreneurs have internal drive, are confident in their own abilities, and possess a great deal of self-respect



• Self-Confidence– Because of the high risks involved in running an

entrepreneurial organization, having an “upbeat” and self-confident attitude is essential

– A successful track record leads to improved self-confidence and self-esteem

– Self-confidence enables that person to be optimistic in representing the firm to employees and customers alike



• Self-Sacrifice– Essential– Nothing worth having is free (no pain no gain)– Success has a high price, and entrepreneurs have to be

willing to sacrifice certain things



ENTREPR E NEURIAL FEELINGS

There is no "true entrepreneurial profile"- entrepreneurs come from many educational backgrounds, family situations, and work experiences.

A potential entrepreneur may presently be a nurse, secretary, assembly line worker, sales person, mechanic, home maker, manager or engineer.

A potential entrepreneur can be male or female and of any race or nationality.


ENTREPR E NEURIAL BACKGROUND

Only a few background characteristics have differentiated the entrepreneur from the general populace or managers.

Childhood Family Environment The impact of birth order and social status has had conflicting research results. There is strong evidence that entrepreneurs, both male and female, tend to have self-employed or entrepreneurial fathers. Having a father who is self-employed provides a strong inspiration in the example of independence and flexibility of self-employment. This feeling of independence is often further enforced by an entrepreneurial mother.


Education

Education appears important in the upbringing of the entrepreneur, in the level of education obtained and in playing a major role in coping with problems.

Although formal education is not necessary for starting a new business, it does provide a good background.

In education, entrepreneurs experienced some disadvantage, with few having degrees in engineering, science, or math.

The ability to deal with people and communicate clearly in written and spoken work is also important.

Academic qualification is a barrier or facilitator in the way of entrepreneurship?Article …………..


Age

Entrepreneurial age is the age of the entrepreneur reflected in the experience.

Entrepreneurial experience is one of the best predictors of success.

In chronological age, most entrepreneurs start their careers between ages 22 and 55.

Earlier starts in an entrepreneurial career seem to be better than later ones.

Generally, male entrepreneurs start their first venture in their early 30s, while women tend to do so in their middle 30s.

Between 30-50 years old


Work History

Dissatisfaction with one’s job often motivates the launching of a new venture.(Gift within trouble)

Previous technical and industry experience is also important once the decision to start a business is made.

Experience in the following areas is particularly important: financing; product or service development; manufacturing; development of distribution channels; and preparation of a marketing plan.

As the venture becomes established, managerial experience and skills become more important.

Entrepreneurial experience becomes increasingly important as the complexity of the venture increases.

04/15/2023 Entrepreneurial Leadership- HIMS

MOTIVATION

While motivations may vary, the reason cited most often for becoming an entrepreneur independence-not wants to work for anyone else.

Other motivating factors differ between male and female entrepreneurs.

Money is the second reason for men’s starting a venture.

Job satisfaction, achievement, opportunity, and money are the second order reasons for women

Video….

Small Business & Entrepreneurship

Entrepreneurial background and characteristics 4