Entrepreneurship
“Successful Entrepreneur”
Submitted By: Zunaira Tauqeer (BBA-VII)
Submitted To: Ma’am Faiza Dar
“Elon Musk”
When something is important enough, you do it even if the odds are not in
your favour – Elon Musk
Who Is Elon Musk?
Elon Musk is a South African-born American entrepreneur and businessman who founded
X.com in 1999 (which later became PayPal), SpaceX in 2002 and Tesla Motors in
2003.Musk became a multimillionaire in his late 20s when he sold his start-up company,
Zip2, to a division of Compaq Computers.Musk made headlines in May 2012, when SpaceX
launched a rocket that would send the first commercial vehicle to the International Space
Station.He supported his portfolio with the purchase of SolarCity in 2016 and cemented his
standing as a leader of industry by taking on an advisory role in the early days of
President Donald Trump's administration.In January 2021, Musk reportedly exceededJeff
Bezos as the wealthiest man in the world.
A.Personal Profile
Early Life:
Musk was born on June 28, 1971, in Pretoria, South Africa. As a child, Musk was so lost in
his daydreams about inventions that his parents and doctors ordered a test to check his
hearing.At about the time of his parents’ divorce, when he was 10, Musk developed an
interest in computers. He taught himself how to program, and when he was 12 he sold his
first software: a game he created called Blastar. In grade school, Musk was short, introverted
and bookish. He was bullied until he was 15 and went through a growth spurt and learned
how to defend himself with karate and wrestling.
Education:
At age 17, in 1989, Musk moved to Canada to attend Queen’s University and avoid
mandatory service in the South African military. Musk obtained his Canadian citizenship that
year, in part because he felt it would be easier to obtain American citizenship via that path.In
1992, Musk left Canada to study business and physics at the University of Pennsylvania. He
graduated with an undergraduate degree in Economics and stayed for a second bachelor’s
degree in physics.After leaving Penn, Musk headed to Stanford University in California to
pursue a PhD in Energy Physics. However, his move was timed perfectly with the Internet
boom, and he dropped out of Stanford after just two days to become a part of it, launching his
first company, Zip2 Corporation in 1995. Musk became a U.S. citizen in 2002.
Training:
Elon Musk's education relied heavily on self-teaching,and he quickly figured out that reading
books was one of the best ways for him to learn.
Musk learned programming by reading a book. And when he wanted to learn more about
rocket propulsion, Musk read college textbooks.
Experience:
At 17, Musk left his home in South Africa and headed to Canada where he became a citizen
and stayed with his cousin.At first, Musk worked at his cousin’s farm in Waldeck,
Saskatchewan (a village that as of 2016 had a population of fewer than 300 people), tending
to vegetables and shovelling grain bins.Then Musk learned to cut logs with a chainsaw in
Vancouver, British Columbia.
However, after asking at the unemployment office what jobs paid the best, Musk took on his
hardest performance yet: cleaning out the boiler room of a lumber mill.
Elon Musk was paid $18 an hour, and he had to put on this hazmat suit and then shimmy
through this little tunnel that you can barely fit in. He had to move through the same hole he
came in through and if a person stay in there for more than 30 minutes, he would get too hot
and die.”This job was really tough because thirty people started out at the beginning of the
week with Musk, and by the third day, five people were left. And By the end of the week,
Musk was left with only two other people to do the work.
Others:
Musk did venture to Silicon Valley, and applied for a job at Netscape. He was interested in
the then-nascent internet.Musk didn’t get the job at Netscape. He had a guess for why he
didn’t land it: He had a degree from Wharton and was accepted to do graduate-school work in
physical and materials science, but he didn’t have a computer science degree, nor several
years under his belt working at a software company.He started Zip2 after his experience
applying to Netscape, deciding that instead of pursing a PhD at Stanford, he would first try to
start a company.
B. Business Profile
Nature:
In 1995 he founded Zip2, a company that provided maps and business directories to online
newspapers. In 1999 Zip2 was bought by the computer manufacturer Compaq for $307
million, and Musk then founded an online financial services company, X.com, which later
became PayPal, which specialized in transferring money online.
In 2002 he founded Space Exploration Technologies (SpaceX) to make more affordable
rockets. Its first two rockets were the Falcon 1 (first launched in 2006) and the larger Falcon
9 (first launched in 2010), which were designed to cost much less than competing rockets. A
third rocket, the Falcon Heavy (first launched in 2018).
Musk had long been interested in the possibilities of electric cars, and in 2004 he became one
of the major funders of Tesla Motors (later renamed Tesla), an electric car company founded
by entrepreneurs Martin Eberhard and Marc Tarpenning.
Sales:
With the most recent disposals, Musk now has offloaded 9.2 million shares and collected
about $9.9 billion of proceeds since he conducted a Twitter poll asking whether he should
sell 10% of his Tesla stake. A chunk of that money will go to taxes.The company, led by
billionaire entrepreneur Elon Musk, posted a net profit of $1.6bn and sold 241,391 cars.
In late 2008, Musk divorced his first wife and it took a toll on his finances. A year later,
Musk said he "ran out of cash" and had been living off loans from friends while trying to
keep his companies afloat.But when Tesla debuted on the stock market in 2010, Musk's
fortune skyrocketed. By 2012, he appeared on Forbes' richest list for the first time with a net
worth of $2 billion.
Expenditure:
Over the years, Elon Musk has purchased more than $100 million in residential property in
California. He has since offloaded much of his real estate after vowing to sell it all and "own
no house" last year.
As the leader of one of the famous auto-makers, it's no surprise Musk has an affinity for cars.
Back in 2013, he paid $920,000 at an auction for the Lotus Esprit submarine car used in a
James Bond movie.In the first six months of 2018, he bought more than $35 million worth of
shares in Tesla.
Musk's net worth rose in 2020 during the pandemic, increasing by 197% between March and
August, according to an analysis by the Institute for Policy Studies.
By December 2020, Musk had become the world's second-richest person behind Amazon
founder Jeff Bezos.
Net Worth:
At the start of 2020, Musk had a net worth of $27 billion. Throughout that year, his net
worth increased by $150 billion, largely driven by his ownership of around 20% of Tesla
stock.
On September 27, 2021, Forbes announced that Musk had a net worth of over $200 billion,
and was the richest person in the world, after Tesla stock surged.
In November 2021, Musk became the first person with a net worth over $300 billion.
Q. The distinct characteristics of the Entrepreneur required for success?
1. Ambitious: A person who is ambitious has a dream of succeeding in some
endeavor—usually related to his or her career. An ambitious person is hard-working
in striving to achieve goals and to move up in the world. They are competitive and
have a high need for achievement.
2. Independent: Entrepreneur are individualists and self-starters who prefer to lead
rather than follow.
3. Self-confident: Entrepreneur understand the challenges of starting and operating a
business and are decisive and confident in their ability to solve problems.
4. Risk-takers: Although they are not averse to risk, most successful entrepreneurs
favor business opportunities that carry a moderate degree of risk where they can better
control the outcome over highly risky ventures where luck plays a large role.
5. Visionary: Their ability to spot trends and act on them sets entrepreneurs apart
from small-business owners and managers.
6. Creative: To compete with larger firms, entrepreneurs need to have creative
product designs, bold marketing strategies, and innovative solutions to managerial
problems.
7. Energetic: Starting and operating a business takes long hours. Even so, some
entrepreneurs start their companies while still employed full-time elsewhere.
8. Passionate: Entrepreneurs love their work, as Miho Inagi demonstrated by opening
a bagel shop in Tokyo despite the odds against it being a success.
9. Committed: Because they are so committed to their companies, entrepreneurs are
willing to make personal sacrifices to achieve their goals.
10. Flexibility: To a certain degree, you need to be flexible as an entrepreneur. Be
willing to change as needed. Stay on top of your industry and be ready to adopt
changes in processes and product as they are needed. Sometimes, you also need
flexibility in your thinking. This is an essential part of problem-solving. You want to
be able find unique and effective solutions to issues.
Q. The strategies employed by the entrepreneur to overcome internal and
external factors affecting the business?
1. Internal Factors: The internal factors refer to anything within the company and under the
control of the company no matter whether they are tangible or intangible. Within the
company, there are numerous criteria need to be taken into consideration.
The three types of internal risk factors are human factors, technological factors, and physical
factors.
1. Human-factor Risk:
An entrepreneur may need to hire or replace personnel key to the company's success.
Improving personnel management can help reduce internal risks by boosting
employee morale through effective compensation and empowerment. A motivated
and happy employee tends to be more productive.
2. Technological Risk:
Technological risk includes unforeseen changes in the manufacturing, delivery, or
distribution of a company's product or service.Research and development is often a
component of reducing internal risks because it involves keeping current with new
technologies. By investing in long-term assets, such as technology, companies can
reduce the risk of falling behind the competition and losing market share.
3. Physical Risk:
Physical risk is the loss of or damage to the assets of a company. An entrepreneur can
reduce internal risks by hedging the exposure to these three risk types.
For example, an entrepreneur can obtain credit insurance for their accounts receivable
through commercial brokers. Credit insurance is usually very comprehensive and
provides protection against debt default for a wide range of reasons, covering virtually
every conceivable commercial or political reason for non-payment.
2. External Factors
On the contrary to internal factors, external elements are affecting factors outside and under
no control of the company. Considering the outside environment allows businessmen to take
suitable adjustments to their marketing plan to make it more adaptable to the external
environment.
The three types of external risks include economic factors, natural factors, and political
factors.
1. Economic Risk:
Economic risk includes changes in market conditions. As an example, an overall
economic downturn could lead to a sudden, unexpected loss of revenue. An
entrepreneur can respond to economic risks by cutting costs or diversifying their
client base. By exercising due diligence, keeping an eye on the investments and
paying attention to changes in government policy and business practices, as well as
your own spending habits, you can minimize your exposure to economic risk.
2. Natural Risk:
Natural risk factors include natural disasters that affect normal business operations.
An entrepreneur can overcome this external factor by creating an emergency
operations plan, backup important data, meet with an insurance advisor, and maintain
communication with employees, clients, and customers,
3. Political Risk:
Political risk is comprised of changes in the political environment or governmental
policy that relate to financial affairs. Changes in import and export laws, tariffs, taxes,
and other regulations all may affect a business negatively.Since external risks cannot
be foreseen with accuracy, it is difficult for a company to reduce these three risk
factors.
References:
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https://www.investopedia.com/articles/personal-finance/061015/how-elon-muskbecame-elon-musk.asp
https://www.biography.com/business-figure/elon-musk
https://www.forbes.com/sites/allbusiness/2019/08/21/natural-disaster-protectionbusiness-preparation/?sh=222bb2085bc1
https://www.mageplaza.com/blog/what-are-internal-external-environmental-factorsthat-affect-business.html
https://opentextbc.ca/businessopenstax/chapter/characteristics-of-successfulentrepreneurs/