What is the best definition of Entrepreneurship? Things to look for when you enter the Entrepreneurship Maze
Entrepreneurship over time has taken many forms like a shape-shifting serpent. The prime reason behind its adoption of various shapes and forms is the advent of new technologies every single day that have acted as a major factor in defining its destiny for every single age. Nowadays the conventional concepts of trade and commerce have taken a long jump and have converted themselves into modernized concepts supported by the technology of the era.
Some widely asked questions
The tech sector in collaboration with traditional entrepreneurship has done wonders and has remained successful over the past few years to garner attention on a wider scale. But, has this changed the concept itself because of the new agents of change? How different is entrepreneurship these days compared to the past? What is the deciding factor approving of the right kind of definition for the concept itself and above all of that what actually is the right definition of entrepreneurship which one should look towards for attaining guidance?
This article provides you an accurate depiction of modern entrepreneurship in the light of the traditional one as provided within the real definition.
Apart from this, it gives you a wide sort of comparison between both the terminologies to serve you perfectly when you are needing a proper insight into the modern concept of entrepreneurship.
But, first of all, what is conventional and the dictionary allotted definition of entrepreneurship?
Well, you do not need to do any specific rituals so that the accurate or widely accepted definition appears in front of your eyes out of nowhere merely because of some hocus-pocus. All you need to do is to Google the word. “Entrepreneurship” and there you will find the very basic and acknowledged definition of the concept which has allotted itself a permanent place within the linguistic works of Oxford dictionaries. So, the mightiest of all, the Oxford tells the curious soul that,
“It is the activity of setting up a business or businesses, taking on financial risks in the hope of profit.”
So, this is the very basic definition of this glorious concept which makes you gasp at many places especially when you read the word “financial risk”. Obviously, anyone who hates to take risks would fret at this point a bit but it should be noted that the process of entrepreneurship is incomplete without the strength to invest your money in the “hope of profit” in the beginning. So, for many people who don’t belong to the business sector, this definition could turn up a bit problematic but we would say that a bit of patience is required from your side until we disintegrate this concept into fragments for you.
Let’s take a wider look at the definition
Entrepreneurship initially involves the act of “setting up a business”. This is the very first part of the definition which comes into the knowledge of anyone who turns up to find out the genuineness of the concept. What is the interpretation of the phrase, “setting up a business”? This must be the first question.
Setting up a business implies establishing a new start-up or initiating a new setup that requires skills.
Not everyone has the capacity to understand the right kind of market trends and setting up a goal in the light of what he finds out within the business field. So, this process itself is organic. It never comes alone. Whenever you are about to set up a business of your own, you need to be careful about a handful of factors that decide the fate of your setup.
- Considering your investment capacity
- Thinking of the right industry or niche or market
- Finding out the trends in town regarding the idea
- Considering Investment Capacity
If you ask a book dealer to invest in a clothing brand, his first expression would definitely be full of shock and then he will answer you no because it is out of his capacity or the total budget he has assorted for investment. In the same manner, you can never expect a person with a considerable amount of investment to invest in a very low-lying project where there is no hope left. Why is it so? Where does the difference come from the investment?
This is because investing according to the money in your hand can save you from any future problems.
If you have a minimum amount and you are thinking of investing in some high-profile start-up by taking out a loan, it can get dangerous for you because the business market because of the global competition can be synonymous with that of gambling. Gambling may be fruitful but it is out of sheer luck and when you are at the very first step of your business journey, you cannot take a very big risk. You need to play it carefully. So setting up a business with the amount in hand is efficient, if you are willing to work on it throughout, and the moment you find profit or see things turning up in your favor, you can easily invest more. So, always be careful about the way you invest your capital because it not only decides the success of your company in the future but also tells a lot about your business knowledge.
Let’s head to an interesting case
You all must be well familiar with the owner of Kingdom Holdings, Prince Alwaleed Bin Talal. He has a very interesting mode of investment in various projects. He actually waits till the shares of a company get lowered. He invests money at that very moment, so a minimal amount is invested by him in the beginning. After that when the shares again get sky-rocketed the benefit falls in his lap. This is the very secret of his business as he continues playing his part very cleverly and at the right time. The purpose of telling this is that investing at the right time and with a fixed amount, not an excess amount is quite necessary for the benefit in the business world.
- Taking the right industry/niche/market
Think of Dior investing in technology in the presence of furious rivals like Facebook, SpaceX, Tesla, and Google. You would laugh at such a stupid analogy and will ultimately shake off this thought by uttering “non-sense”.
This is because we all have seen Dior as a chief beauty brand and thinking of it jumping into any other market out of nowhere looks ridiculous to us. This won’t look ridiculous to Dior but could be very dangerous for the integrity of the brand itself.
Dior is well aware of the fact that it already has beauty/cosmetic/ clothing markets under its supremacy so turning from a lifestyle brand to a technology brand would get Dior itself in trouble because the clientele ratio will decrease significantly in that case. This works the very same way for all the smaller brands as well, who fail to realize the importance of sticking to a specific market at a time.
Many budding entrepreneurs are at the same time investing in variable markets which also makes the clientele’s opinion divided and the profit comes to a halt.
It is very important that at the beginning of your venture, you have a complete idea about the kind of niche in which you want to step. Once you are clear about the market in which you want to set up your business, only then invest and work on it. Entrepreneurship never implies establishing multiple businesses at the same time, but it is a slow process that makes your growth follow the specific steps to reach the top.
- Sorting out the trends in town
The digital market has a dominant change on the conventional idea about entrepreneurship. Now, the owner has complete access to the market trends and fully knows his position amidst the trends.
This is a very important factor that you keep the trends of the market in your consideration and act on your business plan according to it. This helps you find a suitable business idea.
These days the lifestyle products are selling like hotcakes, so if someone tries to sell a product regarding car service or stuff. There is a fair chance that his idea would not get as popular as an online shop claiming to sell the best kitchen items and home décor products. Though, it is also another fact that the trends keep on changing with the seasons and the power of celebrities which they hold over the business products. Yet, one cannot ignore the fact that these trends are the real reason behind the success of a business. Who can forget the recent take of CR7 regarding Coca Cola which made the company lose shares of billions in just a few hours? So, a wise entrepreneur not only thinks about setting up a business but knows the ways to set it up perfectly and in accordance with the popular trends of the business market.
Entrepreneurship: A risk coming with a profit
Coming to the second part of the definition, other than setting up a business, we find that entrepreneurship involves “taking on financial risks in the hope of profit”. This statement appears sort of a conditional sentence where we find that there is “a hope of profit” at the condition of “taking some financial risk”
But what does this financial risk actually mean?
Imagine you are walking in an alley and suddenly you hear someone shouting your name in anger behind you. What will be the immediate response from your side? Will you turn back or will you run blindly in the hope of saving yourself from the calamity? If you will run without even looking for who was that specific person following you, you might keep on contemplating this secret the rest of your life, and probably in some part of your age, you will want to go back just to look at who was there at that moment. On the other hand, if you muster up enough courage to look back at the person just for the sake of knowing whoever he is, your curiosity will at least dissolve.
Entrepreneurship can be taken synonymous with the same dark alley in which you are walking and the challenges strike you on your way.
Now it is up to you whether you want to respond to those challenges or simply move in your own direction. Moving in one singular direction without finding out the challenges and learning no lesson out of your journey, might prove itself disastrous for you because if you have not learned the lessons from your journey, you can never expect to get at the top with quite a handsome amount collected in your bucket as profit.
There are always innumerable risks on your way and if you do not have the potential to take these risks, then you can never compete with the master of the town.
One of the strongest risks presents on your way is the financial risk that is there. Just as we are told, that in the way gambling is all about fortune and yet the players with their minds take and ace this risk, financial risks in entrepreneurship work in the very same way. You spend a specific amount in setting up your business and then you have to work to make your business prominent in the eyes of the clientele.
How to turn financial risks into financial blessings?
Now a number of you would be thinking of the ways through which you can ensure the profit of your business and turn the risk into a worthy experiment. Though, some portion of the success of a specific business is dependent on how the destiny has planned it but not all of it. There is some actual manpower that can turn up the game for you. These are some of the following measures you can adopt to make a business flourishing in a very short time.
- Not only invest but give time
- Focus on your weak points
- Always welcome suggestions
- Not only invest but give time
Many entrepreneurs just want the title of being called an entrepreneur along with their name. These are the kind of people who are careless about real-time work. They actually invest money on a project and then hire some subordinates to manage the tasks coming on the way. Well, this is the biggest reason behind the failure of businesses.
An owner who himself is not considerate towards the business and expects to get at the top simply through the effort of the team can never succeed.
There is a lot for an individual to invest in a business other than the money. One needs to invest time and effort as well to ensure that the venture turns out successful. You need to remember the fact that if you are not committed to your work, the team will never produce the results you want.
This is the reason behind the success of some top-level companies all across the globe that their owners know the magnitude of their own effort other than their employees.
We can find examples in the form of Elon Musk who works twenty hours a day just to ensure that Tesla remains unbeatable in comparison with its rivals. So, a personal effort serves as an elixir for the life of any business. As an entrepreneur, you need to know that once you are starting a business, you have to devote yourself fully to the cause of it initially.
It is also because, at the initial stages, a business is standing on very weak foundations.
Hence, if your effort remains unsatisfactory for the initial time, you can never take it to the top because afterward the competitions become stiffer than ever and it becomes a lot more difficult for an individual to handle the pressure on one’s own. So, always keep in mind that whenever you are investing your money, don’t forget to invest your effort to enhance the success and assure the overall profit of your business among all other rivals.
- Focus on your weak points
No one is perfect, to err is human. One needs to take this seriously within the entrepreneurial world as well. A number of young entrepreneurs who are new in the field often complain about the failures at the very initial stage. What they don’t consider is that they might be committing some flaws too.
Whenever a business is new, it is prone to error more than anything else.
Being new players of the market, initially, many entrepreneurs are not perfect enough towards their attempts to make their business successful. The mistakes committed however can be corrected right on time before it gets too late for them to make amendments. Often the mistakes we find at the first stage are a lack of proper sense of advertisement, incorrect tags, and loopholes in the description of the product. So, it is better if you start finding your mistakes by yourself in the very beginning.
A self-evaluation is always a fine idea, to begin with where you can easily find out the flaws in your strategies and can correct them easily.
After all, no client wants to keep its eye on a product or service which is faulty and lacks proper grounds. As an owner, it is your prime duty to keep a check of all the inefficacy appearing in the effort and deal with them with an iron hand because once you get flexible with the attitude of committing mistakes, unfortunately, then there is no going back!
- Always welcome suggestions
This is true that no one wants to be spoon-fed all the time and be instructed on various things. However, there is an interesting case about that when you talk about entrepreneurship.
Here, the suggestions are no less than a cherished treasure especially when they are offered by the big fat players of the market.
You need to remember that these are the players who have seen a lot happening in the market and noticed the trends as well as have witnessed the ups and downs which remained prevalent over time. You need to take their suggestion seriously and always think that if they are pointing towards a flaw and teaching you a thing or so, it is significant in its very essence.
Your biggest critiques as a businessperson are not the rivals but the clientele.
So, you need to develop a sense of professional harmony with them. Always open to their suggestions for special reasons. They are the people who will ultimately decide the fate of your business so ignoring what they can turn out as nothing except danger for the future of your business.
Now you know that though entrepreneurship means “setting up a business, alongside taking on financial risk with the hope of a profit. Yet, there is a lot more embedded in the internal layers of the definition. You need to be careful about a number of other things and follow the instructions just the way you want to. This also takes an interesting take in the era of digitalization
Entrepreneurship gets a digital definition
The global hub has transformed the traditional concept of entrepreneurship as we have already discussed but now another entity gets its due place within the definition and it’s the “digitalization of the business” these days.
This new definition seems appropriate for modern e-commerce where entrepreneurship gets accepted as a norm rather than a mere profession. So, now one can say that,
“Modern entrepreneurship is all about setting up a business/chain of businesses or services (online or offline), taking on financial risks in the hope of profit (and new followers as well).”
This modern definition fills all the criteria of being internet friendly and tells the reader that now entrepreneurship is not just limited to the limited markets or niches but is opening its wings widely to accept indigenous niches in the mainstream providing people with more chances to prove themselves in the business sector.
The author is an M.Phil scholar conducting her thesis in Literature. As a sucker for literature, she swoons over Greek and South Asian fiction while reviewing books in her spare time. Her love for writing has made her expand her subject matter and now she pens her opinions frequently on business, finance, entrepreneurship, lifestyle, history, and literature. For a special connection with entrepreneurship, she opens up the details occasionally about it.