Entrepreneurship
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ORIGIN, DEVELOPMENT
AND TYPES OF
ENTREPRENEURSHIP
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INDEX
ROLL NO
NAME
TOPICS
301
NIRMALA
•History and Origin.
•Stages of evolution of entrepreneurship.
302
NETESH
•Entrepreneurs role towards economic growth and
development:
(i) Innovation
(ii) Backward and forward linkages.
(iii) Optimum use of resources.
303
SYLVESTER
(iv) Regional dispersal of industries.
(v) Capital formation
304
NADIA
(vi) Improvement in per capita income.
(vii) Generation of employment.
(viii) Improvement in living standard.
(ix) Economic independence.
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ROLL NO
NAME
TOPICS
305
RUQAIYAH
(x) Increase productivity.
(xi) Reduce unrest and tension.
(xii) Manpower or human resources.
Theories of entrepreneurship –
1. Economic theory.
306
ALISHA
2. Sociological theory
307
SHRADHA
3. psychological theory
308
MELISHA
4. Integrated theory
309
HADRINA
Types of entrepreneurs
(i) Based on decision making
(ii) Based on gender
(iii) Based on location
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ROLL NO
N AME
TOPICS
310
DIONISIO
(iv) Based on educational background.
(v) Based on market operated.
311
VELONIA
(vi) Based on business – Trading, Industrial, corporate
entrepreneur and agriculture.
312
XAVIERINA
(vii) Other classification
(a) Innovation
(b) Imitative
(c) Fabian
313
TRANIE
(Vii) Other classification
(d) Drone
 Individual and Institutional
 Entrepreneurs by inheritance
315
BASTEN
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Intrapreneurs
Difference between entrepreneur and Intrapreneur
What is an Entrepreneur?
• An Entrepreneur (ahn’tra pra nur)
is a person who organizes and
manages a business undertaking,
assuming the risk for the sake of
profit. Any person (any age) who
starts and operates a business is an
entrepreneur.
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Who is an entrepreneur?
• One who owns and operates a business
venture.
• One who accepts all the risk.
• One who tries to identify and meet a need
for a product or service.
• Examples ………….
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1930, Harland sanders
• Opened sanders court
and café in the front
Room of a gas station.
• Awarded the first
Franchise to Pete Harman in salt
Lak city,Utah.
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Bill Gates ,1955
• By linking his microsoft
Software to IBM’s first
PC’s ,he dominated the
industry.
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Ashutosh Gupta,19
Owner of Gupta
financial consulting.
Has clients with revenue
Between $200,000 & $3.3 million.
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History & Origin
• Entrepreneurial history of any country
is based on economic history.
India .
•Organized industrial activity: Banaras,
Allahabad and Mizapur.
• Handicraft industry decline due to
industrial revolution in England
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STAGE IN EVOLUTION OF
ENTREPRENEURSHIP
1)ANCIENT PERIOD:
• Before industrial revolution
• It was developed nation
• India was called golden
bird.
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• a) DEVELOPMENT STAGE 18571947
• East India company contributed
growth of entrepreneurship India
adopted policies of discrimination
protection.
• Lost of monopoly by east India
company.
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• b) DEVELOPMENT AFTER
INDEPENDENCE (1947 ONWARDS)
• Objectives:
• *Proper distribution of economic
power.
• *Encourage the growth of industries
• *encouragement of small-scale
industries.
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Entrepreneur’s role towards economic
growth and development:
• The one major issue we address here is:
What is the significance of entrepreneurship
for economic development? Dose it add an
important independent influence to that of
other factors widely agreed to promote
economic development?
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• Adam Smith, the foremost classical
economist assigned no significance to
entrepreneurial role in economic
development in his monumental work.
• David Ricardo identified only three
factors of production, namely,
Machinery, Capital, and Labour, among
whom the entire produce is distributed
as rent, profit and wages respectively
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1. Innovation
• Schumpeter visualized the
entrepreneurs as the key figure in
economic development.
• The entrepreneur searches for change, sees
need and then brings together the
manpower, material and capital required to
respond the opportunity what he sees.
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2. Backward and forward linkages
• An entrepreneur initiates changes which has
a chain reaction.
• E.g.. the establishment of a steel plant
generates several oxcillary units and
expands the demands for iron ore , coal etc.
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3. Optimum use of resources
• It is the responsibility of the
entrepreneur to make use of resources
at the fullest extent.
• The resources include land ,money , labour,
machinery.
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4. Regional dispersal of industries / Balance
regional development
• India itself is an under-developed country
aims at decentralized industrial structure to
militate the regional imbalanced in levels of
economic development.
• Small-scale entrepreneurship in such
industrial structure plays an important role
to achieve balanced regional development .
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5.Capital Formation
• Entrepreneur mobilizes the idle
savings.
• Saving in industry result in productive
utilization of national resources.
• An entrepreneur is the creator of wealth.
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6. Improvement in per capita income
• Entrepreneurs locate and exploit
opportunities.
• It convert idle resources like road, labour
and capital into national income and wealth
in the form of goods and services.
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7.GENERATION OF EMPLOYMENT.
• Entrepreneurs generate employment both
directly and indirectly.
• Entrepreneurship helps to reduce the
unemployment problem in the country.
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8.IMPROVEMENTS IN LIVING
STANDARDS
• Entrepreneurs set up industries which
remove scarcity of essential commodities
and introduce new products.
• Production of goods on mass scale helps to
improve the standard of living of a common
man.
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9. Economic independence
• Entrepreneurship is essential for national
self – reliance.
• Businessman exports goods and services on
a large scale and earns foreign exchange for
the country.
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10. Increases productivity
• The entrepreneur through massive small
scale and large scale industries , it
helps in growing productivity in the
enterprise.
• The entrepreneur plays a vital role through
good relation.
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11.Reduces unrest and tension
• An entrepreneur plays a crucial role
in solving tensions and problems and
tries to minimize it.
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12. Manpower or human
resources
• Manpower or human resource
means the quantity as well as the
quality of population.
• High productivity and efficiency would
depend on their skill enterprise knowledge,
imagination and good health.
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THEORIES OF
ENTREPRENEURSHIP
• The concept of entrepreneurship and its
theory have been evolved over a period of
more than two centuries. There are different
opinions on the emergence of
entrepreneurship. These opinion may be
classified into 3 categories, they are: (1)
Economic theory, (2) sociological theory,
(3) psychological theory (4) integrated
theory.
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1.Economic theory
• G.F. Papanek and J.R. Harris, are the
main developers of this theory.
• The economic incentives includes taxation
policy, industrial policy of the government,
demand and supply, market position.
• In economic theory cost, incentives and
gains are the important elements considered
for the emergence of entrepreneurship.
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• According to Marshall, organization and are the
major functions of an entrepreneur.
• According to Tandan, the entrepreneur must
possess:
a) Ability of organization and administration,
b) Ability of material resources,
c) Technological knowledge, willingness to accept
changes, ability to initiate, opportunity,
d) Capacity to assume risk and self confidence.
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2.Sociological theory
• According to sociologist
entrepreneurship is most likely to
emerge under a specific social culture.
• According to Weber, Religion beliefs
produce intensive exertion in
occupational pursuits.
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• According to Frank Young, is mainly
concerned with inter group relations and
his theory of change is based on society’s
incorporation of reactive group.
• According to Schumpeter, an important
factor in terms of social climate which
influence the behavior of the of an
entrepreneur for the emergence of
entrepreneurship.
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3.Psychological theory
 According to the psychological
entrepreneurship is most likely to emerge when
a society has sufficient supply of individuals
possessing particular psychological
characteristics.
Schumpeter believes that entrepreneur is
motivated by will to power will to find a private
kingdom or will to conquer.
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Hagen’s consider withdrawal of status
respect as a trigger mechanism for change
in personality formation.
According to Mc Clelland , the need for
achievement is one of the drives toward
entrepreneurial growth.
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4.Integrated theory
 Each of the above theory is incomplete and none
of them is right or wrong.
 Entrepreneur is influenced by a multiple factors
and therefore no single factor whether economic,
social or psychological generates
entrepreneurship.
 The economic, political and legal factor if positive
to the entrepreneur can be quickly generates and
make environment favorable to the emergence
of entrepreneurship.
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Types of entrepreneurs
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1. Based on decision-making –Forced
Entrepreneurs
• Neo-rich Indians returning from aboard (NRIs)
and educated unemployed seeking selfemployment may be described as forced
entrepreneurs.
• Entrepreneurs may also be classified into first
generation (new) and established entrepreneurs,
rural and urban entrepreneurs, male (men) and
female (women) entrepreneurs, small-scale and
large-scale entrepreneurs, etc.
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2. Based on Gender -Men and
Women Entrepreneurs
• From the olden days man is supposed to
organize for everything, i.e., work to get
money, protect the family.
• The advantages of man entrepreneur is that
he can run about from place-to-place to
secure orders for his business, arrange for
bank finance etc.
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3. Based on location – Rural,
Semi urban and Urban
• Urban entrepreneurs are those who work in
the city areas.
• The rural entrepreneur is one who comes
from the rural areas.
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4.Based on educational
background -Based on
educational background
• An educated entrepreneur is one who has
received the basic education at least. i.e., he
can read and write.
• There are two types of education, one
formal education and the other specialized
education.
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5. Based on market operatedLocal/Indian/Foreign
entrepreneur
• The local entrepreneurs are able to have
better understanding of the nature of the
products demanded.
• An Indian entrepreneur carries on the
business of his forefathers in the similar
ways as was done years back .
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6. Based on Business – Trading,
Industrial, Agricultural and
Corporate Entrepreneur
a) Trading entrepreneur:
Trading entrepreneur is one who
undertakes trading activities and is not
concerned with manufacturing work.
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b) Industrial Entrepreneur:
 He is a product- oriented man .
 The entrepreneur has the ability to
convert economic resources.
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c) Corporate Entrepreneur
• Corporate entrepreneur is a person who
demonstrates his innovation skill in
organizing and managing corporate
undertaking.
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d) Agricultural Entrepreneur:
• Agricultural Entrepreneur is that
entrepreneur who undertakes agricultural
activities as raising and marketing of crops,
fertilizer and other inputs of agriculture.
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7. Other classification –
( i) Innovation
(ii) Imitative
(iii) Fabian
(iv) Drone
(v) Individual and Institutional
(vi) Entrepreneurs by Inheritance.
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(i) Innovation entrepreneurs
• Innovation entrepreneurs are generally
aggressive in experimentation and cleverly
put attractive possibilities into practice.
• Innovating entrepreneurs are very
commonly found in developed countries.
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(ii) Adoptive or imitative
entrepreneurs
• This kind of entrepreneurs is ready to adopt
successful innovation created innovative
entrepreneurs.
• Such entrepreneur are particularly important
in underdeveloped countries.
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(iii) Fabian entrepreneur
• Entrepreneurs of this type are very cautions
and skeptical while practicing any change.
• They are not much interested in taking risk
and they try to follow footsteps of their
predecessors.
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(iv) Drone entrepreneur:
• Drone entrepreneurship is characteristic by
a refusal to adopt and use opportunities to
make changes in production.
• Such entrepreneurs may even suffer losses
but they do not make changes in production
methods.
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• (a) Individual and Institutional
entrepreneurs:
• In the small scale sector individual
entrepreneurs are dominant.
• Individual entrepreneur and institutional
entrepreneur coexist and support each other.
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• (b) Entrepreneur by inheritance:
• People become entrepreneurs when they
inherit the family business.
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Intrapreneurs:
• The term ‘Intrapreneur’ was coined in
America in the late seventies.
• Intrapreneurs introduce new products
services and processes which enables to
company to grow and succeed in a changing
environment.
• Such people are ‘Intra-corporate
entrepreneurs’ or Intrapreneurs’.
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Difference between Entrepreneur
and Intrapreneur
Difference
Entrepreneur
Intrapreneur
(1) Dependency
An entrepreneur is an
Whereas, an Intrapreneur
independent businessman is semi-independent
businessman.
(2) Risk
An entrepreneur bears full An Intrapreneur does not
risk involved in the business fully bear the risk of the
business he develops and
operates.
(3) Operation
An entrepreneur operates
from outside an
organization
On the contrary, an
Intrapreneur operates
from within the
organization itself.
(4) Raising of capital
The entrepreneur himself On the other hand, the
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raises the recovery capital Intrapreneur does not
from various sources.
raise the capital himself.
(5) Guarantee of returns Guarantees the return to Does not guarantees any
people who
finance.
(6) Characteristics
give
him return to the suppliers of
capital.
Whereas, the Intrapreneur is
The entrepreneur is a
a creator or inventor.
innovator
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