1. The Foundations of
The Foundations of
Entrepreneurship
Entrepreneurship
Prof Purshottam Patil

2. The World of the Entrepreneur
 Every year in the U.S., entrepreneurs launch
850,000 new businesses.
 Entrepreneurial spirit - the most significant
economic development in recent history.
 GEM study: 11.3 percent of adult population
in the U.S. is actively involved in trying to
start a new business.
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3. The World of the Entrepreneur
 GEM study
 Globally 9.4 percent of adults are actively
engaged in trying to start a business.
 Men are twice as likely as women to start a
business (exactly the opposite trend in the U.S.,
however).
 Nearly one-third of global entrepreneurs are
between the ages of 25 and 44.
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4. What Is an Entrepreneur?
One who creates a new business in the face
of risk and uncertainty for the purpose of
achieving profit and growth by identifying
opportunities and assembling the necessary
resources to capitalize on them.
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5. Characteristics of Entrepreneurs
 Desire for responsibility
 Preference for moderate risk – risk
eliminators
 Confidence in their ability to succeed
 Desire for immediate feedback
 High level of energy
 Future orientation – serial entrepreneurs
 Skilled at organizing
 Value achievement over money
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6. Entrepreneurship
 One characteristic of entrepreneurs stands
out:
Diversity!
 Anyone – regardless of age, race, gender,
color, national origin, or any other
characteristic – can become an entrepreneur
(although not everyone should).
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7. Benefits of Entrepreneurship
The opportunity to:
 Create 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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8. Drawbacks of Entrepreneurship
 Uncertainty of income
 Risk of losing your entire investment
 Long hours and hard work
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9. Small Business Owners' Work Week
Number of Hours Worked per Week
More than 60 hours Less than 30 hours
17% 11%
30 to 40 hours
24%
51 to 60 hours
20%
41 to 50 hours
28%
Source: Adapted from Dun & Bradstreet 21st Annual Small Business Survey Summary Report, 2002, p. 35.

10. Drawbacks of Entrepreneurship
 Uncertainty of income
 Risk of losing your entire investment
 Long hours and hard work
 Lower quality of life until the business gets
established
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11. Entrepreneurs' Age at Business Formation
55 - 64 O ver 65 18 - 24
6.7% 1.0% 12.0%
45 - 54
17.4%
25 - 34
32.3%
35 - 44
30.6%
Source: 2004 Global Entrepreneurship Monitor.

12. Drawbacks of Entrepreneurship
 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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13. Feeding the
Entrepreneurial Fire
 Entrepreneurs as heroes
 Entrepreneurial education
 Demographic and economic factors
 Shift to a service economy
 Technological advancements
 Independent lifestyle
 E-commerce and the World Wide
Web
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14. U.S. Retail E-Commerce Revenues
$250.0
$232.1
$199.3
$200.0
$169.5
Revenues (in Billions)
$142.5
$150.0
$117.7
$94.0
$100.0
$50.0
$-
2003 2004 2005 2006 2007 2008
Year
Source: eMarketer, 2005.

15. Feeding the
Entrepreneurial Fire
 Entrepreneurs as heroes
 Entrepreneurial education
 Demographic and economic factors
 Shift to a service economy
 Technological advancements
 Independent lifestyles
 E-commerce and the World Wide
Web
 International opportunities
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16. The Cultural Diversity of
Entrepreneurship
 Young entrepreneurs
 Women entrepreneurs
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17. Why Women Start Businesses
Frustrated with Other reasons
"glass ceiling" at 7%
big companies Gain control over
23% my schedule
46%
Saw a market
opportunity and
decided to pursue
it
24%
Source: Center for Women’s Business Research, 2004.

18. The Cultural Diversity of
Entrepreneurship
 Young entrepreneurs
 Women entrepreneurs
 Minority-owned enterprises
 Immigrant entrepreneurs
 Part-time entrepreneurs
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19. The Cultural Diversity of
Entrepreneurship
 Home-based businesses
 Family businesses
 Copreneurs
 Corporate castoffs
 Corporate dropouts
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20. Small Business by Industry
O the r
Fina nce 7.3%
8.0%
M a nufacturing Serv ice
5.8% 39.2%
Who les ale
7.4%
C o ns tructio n
11.8%
R eta il
20.5%
Source: U.S. Small Business Administration, 2005.

21. Small Businesses...
 Employ 51 percent of the nation’s
private sector workforce.
 Create more jobs than big businesses.
 Are leaders in offering training and
advancement opportunities to
workers.
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22. Small Businesses...
 Produce 51 percent of the nation’s
private GDP.
 Account for 47 percent of business
sales.
 Create 13X more innovations per
employee than large companies.
 Zipper, FM radio, laser, air
conditioning, escalator, light bulb,
personal computer, automatic
transmission, and many more!
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23. Small Business Survival Rate
100%
100%
90%
% of Small Firms Surviving
81%
80%
70% 65%
60% 54%
50% 46%
40%
40% 36%
32% 29%
30% 27% 25%
20%
10%
0%
New 1 2 3 4 5 6 7 8 9 10
# of Years in Business
Source: NFIB Business Policy Guide, 2003, p. 16.

24. Ten Deadly Mistakes of
Entrepreneurship
1. Management mistakes
2. Lack of experience
3. Poor financial control
4. Weak marketing efforts
5. Failure to develop a strategic plan
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25. Ten Deadly Mistakes of
Entrepreneurship
6. Uncontrolled growth
7. Poor location
8. Improper inventory control
9. Incorrect pricing
10. Inability to make the “entrepreneurial
transition”
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26. Putting Failure into Perspective
 Entrepreneurs are not paralyzed by the
prospect of failure.
 Failure – a natural part of the creative
process.
 Successful entrepreneurs learn to fail
intelligently.
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27. Avoiding the Pitfalls of
Small Business Failure
 Know your business in depth
 Develop a solid business plan
 Manage financial resources
 Understand financial statements
 Learn to manage people effectively
 Keep in tune with yourself
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