ENTREPRENEURSHIP:

INTRODUCTION TO
INITIATE
Chapter 1

Prof: Karan .R. Jagani

What Is An Entrepreneur?
Prof: Karan .R.
Jagani

ENTREPRENEUR
A vision-driven individual who assumes
significant personal and financial risk to
start or expand a business.

What Is An Entrepreneur?
Prof: Karan .R.
Jagani

ENTREPRENEURSHIP
The pursuit of opportunity through
innovation, creativity and hard work
without regard for
the resources currently controlled.

Entrepreneurship
Prof: Karan .R.
Jagani

Entrepreneurship: a way of thinking,

reasoning, and acting that is:

opportunity obsessed
holistic in approach
and leadership balanced

Who is an Entrepreneur?
Prof: Karan .R.
Jagani

Situational more than personality

Flexibility

Ability
Age
Distribution
for
Starting Company

20

25

30

Age

35

40

45

Who is an Entrepreneur?
6

Managers Opportunities
Future Goals

Possible

Prof: Karan .R.

Jagani

Change

Status Quo

Entrepreneur

Satisfied
manager

Frustrated
manager

Classic
bureaucrat

Perceived
Capability
Blocked

What is Your Entrepreneruial

Potential?

Prof: Karan .R.

Jagani

Realistically assess your potential for

an
Entrepreneurial Career

Understand the
personal attributes
important for
success in a
business of your
own

Understand the
demands the
entrepreneurial
role will make on
you and your
family

Evaluate
your managerial
skills

Conduct a
personal financial
assessment

Develop a
personal
balance sheet

Assess your strengths and weaknesses

that will affect your ability to achieve
your entrepreneurial goals

Develop a
personal
budget

Why to be an entrepreneur?
Prof: Karan .R.
Jagani

To be independent
To utilize oneself
To give a fair trial of his own talent and
skill
To do something unique or outstanding
To gain an economic reward
To bring change in the society
To solve a problem

Achievement Motivation
Prof: Karan .R.
Jagani

10

Nine characteristics of achievement motivated

people:

To take personal responsibility

To take moderate risk
TO know the results of his efforts
To persist in the face of adversity
To be innovative
To demonstrate interpersonal competence
To be future oriented
To be mobile
To not completely be content based

11

Entrepreneurs Can Play a Number of

Roles
Prof: Karan .R.
in the Economy
Jagani
1.

2.

3.

4.

5.

Create new product and/or service

businesses.
Bring creative and innovative methods to
developing or producing new products or
services.
Provide employment opportunities and
create new jobs as a result of growing
their businesses consistently and rapidly.
Help contribute to regional and national
economic growth.
Encourage greater industrial

12

Entrepreneurs Can Play a Number of

Roles
in the Economy (cont..)
6.

7.

8.

9.

10.

Stimulates redistribution of wealth, income

and political power
Helps improving the social welfare by
harnessing dormant and neglected talent
Facilitates transfer of technology to rural
areas
Tools of job creation by virtue of its labour
intensiveness
Restructuring and transformation of
economy

Women Entrepreneur
Prof: Karan .R.
Jagani

13

A women capable of achieving self economic

independence individually or in collaboration,
generates employment opportunities for others
through initiating, establishing and running the
enterprise by keeping place with her personal,
family & social life.

Why do Women Take-up Employment?

14

Push Factors

Prof: Karan .R.

Jagani

Death of bread winner

Sudden fall in family income
Permanent inadequacy in income of the family

Pull Factors

Womens desire to evaluate their talent

To utilize their free time or education
Need and perception of Womens Liberation, Equity etc.
To gain recognition, importance and social status.
To get economic independence

Women Entrepreneurship in India

Prof: Karan .R.
Jagani

15

Earlier there were 3 Ks

Then came 3 Ps

Kitchen
Kids
Knitting
Powder
Pappad
Pickles

At present there are 4 Es

Electricity
Electronics
Energy
Engineering

Some examples
16

Mahila Grih Udyog

Lakme

Ms. Kiran Mazumdar Shaw

Herbal Heritage

Mrs. Sumati Morarji

Biocon

Simon Tata

Shipping corporation

7 ladies started in 1959: Lizzat Pappad

Ms. Shahnaz Hussain

Balaji films

Ekta Kapoor

Prof: Karan .R.

Jagani

Key elements for Success

Prof: Karan .R.
Jagani

17

Big

Idea
Sufficient

Relentless

Competent

Money Execution Team

Good

Plan

And a generous helping of lu

Elements of this Presentation are Courtesy of Dr. Mohan Sawhney @ Kellogg School of

INTRAPRENEURSHIP
18

Prof: Karan .R.

Jagani

...Any of the dreamers who do. Those who take handson responsibility for creating innovation of any kind,
within a business. The intrapreneur may be the
creator or inventor but is always the dreamer who
figures out how to turn an idea into a profitable
reality.
Intrapreneurs are therefore people who put new ideas
into action within established businesses.
Although employed in a corporate position
intrapreneurs are nevertheless given freedom and
incentives to create
and market their own ideas.

FORMS OF
ORGANIZATION
Chapter 2

Prof: Karan .R. Jagani

Factors to Consider in Selecting an

Appropriate Business Entity

Prof: Karan .R.

Jagani

20

Liability - Limited Liability v. Personal

Liability
Tax Implications
Complexity of Formation and
Management
Capital - effect on ability to raise capital
through angel investment, venture
capital, or initial public offering (IPO)
Credibility in the business world

21

Legal Forms of Business

Organization
Structure

Ownership
Requirements

Tax Treatment

Liability

Prof: Karan .R.

Jagani

Advantages

Drawbacks

Sole
proprietorship

One owner

Income and
losses pass
through to
owner and are
taxed at
personal rate

Unlimited
personal
liability

Low start-up costs

Freedom from most
regulations
Owner has direct
control
All profits go to
owner
Easy to exit
business

Unlimited personal
liability
Personal finances
at risk
Miss out on many
business tax
deductions
Total responsibility
May be more
difficult to raise
financing

General
partnership

Two or more
owners

Income and
losses pass
through to
partners and are
taxed at
personal rate
flexibility in
profit-loss
allocations to
partners

Unlimited
personal
liability

Ease of formation
Pooled talent
Pooled resources
Somewhat easier
access to financing
Some tax benefits

Unlimited personal
liability
Divided authority
and decisions
Potential for conflict
Continuity of
transfer of
ownership

22

Legal Forms of Business

Organization
Structure
Limited
liability
partnership
(LLP)

Ownership
Requirements
Two or more
owners

Tax Treatment
Income and
losses pass
through to
partner and are
taxed at
personal rate;
flexibility in
profit-loss
allocations to
partners

Liability
Limited,

Advantages
Good way to
acquire capital from
limited partners

Prof: Karan .R.

Jagani
Drawbacks
Cost and
complexity of
forming can be
high
Limited partners
cannot participate
in management of
business without
losing liability
protection

23

Legal Forms of Business

Organization

Group Entrepreneurship is turning

entrepreneurship into a group of people
instead of an individual, enabling them
to undertake any business propositions.

Prof: Karan .R.

Jagani

E.g. SEWA

Family enterprise is and enterprise which

is managed and run within the family.

Large no. of Indian businesses are family

run business.

Small Enterprise
Prof: Karan .R.
Jagani

24

A business that is independently

owned and operated for profit and is
not dominant in its field is known as
small enterprise

25

Advantages of small
enterprise

Providing technological innovation

Prof: Karan .R.

Jagani

Innovation among small-business workers is higher

than among workers in large businesses

Small firms produce 2.5 times as many innovations

as large firms relative to the number of persons
employed

More than half of the major technological advances

of the 20th century originated with
individual inventors and small businesses

Inventions may spark new industries or contribute

to established industries

26

Advantages of small
enterprise

Providing employment

Prof: Karan .R.

Jagani

Small firms hire a larger proportion of

younger workers, older workers, women,
and part-time workers

Small businesses provide workers with their

first job and initial job skills

Small businesses provide 2/3 of the net

new jobs added to the economy

27

Advantages of small
enterprise

Providing competition

Prof: Karan .R.

Jagani

Small firms can compete with large firms,

forcing the larger firm to become more
efficient and responsive to customer needs

Filling needs of society and other

businesses

Small firms can meet the special needs of

smaller groups of customers
Small firms can act as specialized suppliers
of goods and services to larger businesses

28

Advantages of small
enterprise

It helps in quick decision making

It is adaptable to change
Communication vertical and lateral is
fast and distinct
Due to small size, effective integration of
production and market can be easily
achieved
Doesnt hesitate to take risks
Are more simple and motivated

The Pro and Cons of

Smallness

29

ADVANTAGES

Personal relationships
with customers and
employees
Ability to adapt to
change
Simplified
recordkeeping
Independence
Advantages of sole
proprietorships

Keeping all profits

Ease and low cost of
going into business

Prof: Karan .R.

Jagani

DISADVANTAGES

Risk of failure
Limited potential
Limited ability to raise
capital

Why Small Businesses Fail?

30

Prof: Karan .R.

Jagani