ENTREPRENRENERSHIP AMONG YOUTH IN INDIA

NAME: ABDUL KHADER.P ROLL.NO:11PBA001 REG.NO:11BIA1033

Abstract

Instead of sticking on to the traditional and quite frustrating safe Jobs the youngsters of India, now strive to take risks and create something new, connecting the dots and following their heart. Defining the youngsters in India is the relatively new concept called Entrepreneurial mindset. Young entrepreneurs exposure to the various aspects and intricacies of business environment is insufficient and hence they face innumerable problems relating to the finance, marketing and other functions of business. The entrepreneurs need more capital for their expansion activities. Many entrepreneurs have technical knowledge about their business but usually are not capable to get finance from Banks and Financial Institutions due to insufficient exposure to financial management. The young entrepreneurs also have to face tough competition. They have to overcome many obstacles through various strategies for survival and growth. They also face other problems like dealing with Government Departments, Labor, getting correct raw materials, logistics and transportation, quality control etc.
Our country is growing fast at almost 10 percent annually, and there are a lot of opportunities for new entrepreneurs. Still a person who wants to start a venture faces a lot of challenges. With the rest of the world beating a path to India and China to cash in on the rapid economic growth in those countries and tap low-cost manufacturing (China) and services (India), countless business opportunities have opened up. Even in the early part of this decade, the degree of entrepreneurship activity number of people engaged in new and early stage ventures as measured by the

did not progress nearly as quickly in the most

China as in India. According to the Global Entrepreneurship Monitor s report for 2003 recent statistics available for India

12.5 per cent of the total Indian working population was

involved in opportunity-based ventures, whereas in China the figure was about half that at 5.5 per cent.

Meaning of young entrepreneurs

The definition of the young entrepreneur (male-female) means business owners between the age group of 18 & 34 years youth owned small and medium sized entrepreneurs(SMEs) or independently owned business as a partnership or proprietorship and entrepreneurs involved in business as director, chairman, M D in corporate or multinational

What is Entrepreneurship?

The definition of entrepreneurship has been debated among scholars, educators, researchers, and policy makers since the concept was first established in the early 1700 s. The term entrepreneurship comes from the French verb entreprendre and the German word

unternehmen , both means to undertake . Bygrave and Hofer in1891 defined the entrepreneurial process as involving all the functions, activities, and actions associated with perceiving of opportunities and creation of organizations to pursue them . Joseph Schumpeter introduced the modern definition of entrepreneurship in 1934. According to Schumpeter, the carrying out of new combinations we call enterprise , and the individuals whose function it is to carry them out we call entrepreneurs . Schumpeter tied entrepreneurship to the creation of five basic new combinations namely: introduction of a new product, introduction of a new method of production, opening of a new market, the conquest of a new source of supply and carrying out of a new organization of industry. Peter Drucker proposed that entrepreneurship is a practice. What this means is that entrepreneurship is not a state of being nor is it characterized by making planes that are not acted upon. Entrepreneurship begins with action, creation of new organization. This organization may or may not become self-sustaining and in fact, may never earn significant revenues. But, when individuals create a new organization, they have entered the entrepreneurship paradigm. The definition of entrepreneurship has evolved over time as the world s economic structure has changed and become more complex. Risk taking, innovation, and creation of wealth are the criteria that have been developed as the study of new business creations has evolved.

Creating Indian Entrepreneurs

A recent Mckinsey & Company-Nasscom report estimates that India needs at least 8,000 new businesses to achieve its target of building a US$87 billion IT sector by 2008. Similarly,

in the next 10 years, 110-130 million Indian citizens will be searching for jobs, including 80100 million looking for their first jobs. This does not include disguised unemployment of over 50% among the 230 million employed in rural India. Since traditional large employersincluding the government and the old economy player-may find it difficult to sustain this level of employment in future, it is entrepreneurs who will create these new jobs and opportunities. Today s knowledge based economy is fertile ground for entrepreneurs, in India. It is rightly believed that India has an extraordinary talent pool with virtually limitless potential to become entrepreneurs. Therefore, it is important to get committed to creating the right environment to develop successful entrepreneurs. To achieve this, India must focus on four areas.
1. Create the Right Environment for Success: Entrepreneurs should find it easy to start a business. To do so, most Indians would start slow with capital borrowed from family and friends, the CEO playing the role of salesman and strategist, a professional team assembled months or perhaps years after the business was created, and few, if any, external partners. Compare this with a start-up in Silicon Valley: a Venire Capitalist (VC) or angel investor would be brought in early on; a professional management team would drive the business; a multifunctional team would be assembled quickly; and partnerships would be explored early on to scale up the business. A major challenge for India is to create a handful of areas of excellence- the breeding ground where ideas grow into businesses. For example, Gurgaon and Hyderabad for remote services, or Bangalore for IT. One way of strengthening these areas is to consider the role of universities and educational institutions- places whereexcellencetypicallythrives. 2. Ensure that Entrepreneurs have access to the Right Skill: A survey conducted by McKinsey & Company last year revealed that most Indian start-up businesses face two skill gaps: entrepreneurial (how to manage business risks, build a team, identify an get funding) and functional (product development know-how, marketing skills, etc.) India can move toward ensuring that the curriculum at universities is modified to address today s changing business landscape, particularly in emerging markets, and to build centres of entrepreneurial excellence in institutes that will actively assist entrepreneurs. 3. Ensure that Entrepreneurs have access to Smart Capital : For a long time, Indian entrepreneurs have had little access to capital. It is true that in the last few years, several Venture Funds have entered the Indian Market. And, while the sector is still in infancy in India (with estimated total disbursement of less than US$0.5 billion in the year 2003), VCs are providing capital as well as critical

knowledge and access to potential partners, suppliers, and clients across the globe. However, India has only a few angel investors who support the idea in the early stages before VCs become involved. While associations such as TIE are seeking to bridge the gap by working at creating a TIE India Angel Forum, this is India s third challenge creating a global support network of angels willing to support young business.

4. Enable Networking and Exchange: Entrepreneurs learn from experience-theirs and that of others. The rapid pace of globalization and fast growth of Asian economies present tremendous opportunities and challenges for India. Through planning and focus, India can aspire to create a pool of entrepreneurs who will be the regions and the world s-leaders of tomorrow.

Roles of an Entrepreneur
Every start-up entrepreneur has an overwhelming amount to get done the "to dos" are constantly

outrunning the "dunes." It is easy to get caught up in the day-to-day and endless hours, and you often forget that running really hard does not necessarily equate with running in the right direction. To paraphrase one of my partners, the good news is that you're making good time, and the bad news is that you're lost.

To stay focused, early stage CEOs need to remember that there are just three important things that need to get done in a business 1) planning, 2) selling, and 3) executing and

that these tasks require three different mindsets. Some entrepreneurs can excel in all three roles, but the best ones are aware of their strengths and weaknesses and build their teams accordingly. The first step is in knowing which role your talents match most closely.

The Architect: Big-Picture Planning

Entrepreneurs set the vision, the romance, and culture around a big and daring goal. In doing so, they must have a general plan for where they want to go, but they should not get hung up on developing the perfect plan. Their thinking should be like an architect in the concept and design development phase rather than one in the detailed schematic phase. The details of every initiative should change with new customer and market feedback. This is why the best venture capitalists bet first and foremost on the people and second and it's a distant second on the plan. There is no

doubt that it's easier to adjust a plan than it is to adjust people. Plans at the start-up stage need a

clear purpose and the top few priorities for achieving it, but many other aspects, including product development, have to be viewed as a first direction at this point in time.

The Storyteller: Researching and Selling

Great entrepreneurs

need to be constantly selling the story of their vision, as well as researching

like a

how it should evolve. Whether raising funds, evangelizing the vision among employees, recruiting top new talent, or selling the product itself, an entrepreneur needs to constantly pitch salesman out of Glengarry Glen Ross

and act as the company's chief storyteller. More business

schools should integrate the art and science of communications and selling into the curriculum. In my experience, people can learn and develop many aspects of effective selling. Even if they turn out to be only moderately good at it, they realize that by selling on the front lines, they gain access to invaluable customer and product research. These customer interactions help turn a directional vision into one with more precise focus. This is especially true in the digital world where strategies are iterative with more frequent version releases. Selling slightly ahead of the perfect product cycle early can help you test cheaply and make adjustments as required.

The Disciplinarian: Executing

Excellent execution comes from adhering to a tight set of controls and operating principles. In my view, the starting point for this is having the right set of operating metrics to measure the progress

you are trying to achieve. Across our portfolio companies, we work with CEOs to establish the right big priorities and then set the right operating metrics in a dashboard, which we review at regular intervals. This dashboard might include, for example, customer counts, recurring customers, and online usage metrics. The key to delivering what you want to deliver is to know how to pick the few customer and operating metrics that can serve as leading indicators for the ultimate financial metrics desired. To read more on my thoughts on this subject, see my prior blog entry, The Fallacy of Financial Metrics. Planning, selling, and executing sound straightforward, but playing the three roles at once can be challenging for early-stage CEOs. At times these aspects of the job can seem the antitheses of each other, and few people possess the talent to do all three equally well. Fortunately, you don't need to if you build a strong team.

To assess your own entrepreneurial aptitude and effectiveness, take a hard look at your recent tasks, meetings, and other activities. How do they fit into these three buckets? Once you

understand which of these areas you are strongest in, focus on the priorities that map to your skills and quickly fill the gaps with the best talent you can find.

Risks of Business in Entrepreneurship

Chances of suffering from heavy losses. A businessman or woman Faces setbacks in business in case the market is not favorable or there is general economic decline. Recession, for example, causes much setbacks to business people. Products do not get sold in the market as the purchasing power of the individual comes down. Business people cannot sell their products and as a result are unable to make profits. Market fluctuations Market does not always remain stable. It fluctuates. Many variables cause this. Steady profits may not always be there Loan payments A businessman is usually in debt as he or she has to borrow a lot of money to invest. Often he or she suffers losses and is unable to pay up the loans. Debts can cause much worry. Strikes and Lockouts Workers go on strike for either increased salaries or for being maltreated by management. Valuable production time is lost. An entrepreneur loses out on money on such occasions. Time is money for them. Competition Stiff competition at times can wipe out a business completely. Many times small ventures cannot survive the onslaught of big ventures. The latter have money to advertise and publicize their products. A business without risks is not business at all. An entrepreneur loves taking risks. He or she gets much thrill in venturing into unknown domains.

Conclusion

The study of entrepreneurship has relevance today, not only because it helps entrepreneurs better fulfill their personal needs but because of the economic contribution of the new

ventures. More than increasing national income by creating new jobs, entrepreneurship acts as a positive force in economic growth by serving as the bridge between innovation and market place. Although government gives great support to basic and applied research, it has had great success in translating the technological innovations to products or services. Although intrapreneurship offers a promise of marriage of those research capabilities and business skills that one expects from a large corporation, the results have not been spectacular. This leaves the entrepreneur, who frequently lacks both technical and business skills, to serve as the major link in the process of innovation development, and economic growth and revitalization. The study of entrepreneurship and education of potential entrepreneurs are essential parts of any attempt to strengthen this link so essential to a countrys economic well-being.