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Understanding The Basic Concept Of Entrepreneurship

The word “entrepreneurship” is used to describe the creative, innovative, and risk-taking and organisational process and functions of individuals who initiate, run and nurture a business venture.

In this article, I want to talk about all that you need to know about the basic concept of Entrepreneurship.

The ultimate aim of such an individual is to receive the reward of resultant profit, independence, personal achievement and fame. However, there are risks which the venture of the entrepreneur must take.

These are business or financial losses as well as social, psychological and health-related risks. 

Entrepreneurship also involves a strong initiative-taking ability to start something new, venture into new areas to take advantage of opportunities, continuous innovations, commercialization of new technology, and a strong managerial process. 

An example of an entrepreneur is Ingvar Kamprad, founder of IKEA, a multinational company that makes first-class furniture. Others are Bill Gates, Warren Buffet, Carol Slim Helm, and Aliko Dangote among others. These are individuals who achieve greatness through entrepreneurship. 

There are many perspectives on the definition of entrepreneurship. Economists view entrepreneurship as the taking of risks in expectation of profit by combining factors of production or resources such as Land, labour, and capital in a way that produces something new with greater value or utility for the satisfaction of human wants. 

To a management scientist, entrepreneurship is a creative, innovative, and strategic process of starting and revitalizing an organization and continuously improving its products and services. 

It involves perceiving business opportunities and using available resources efficiently and effectively to achieve the goals and objectives of an organization. 

To an accountant or financier, entrepreneurship is concerned with the activities of individuals with realistic business or investment ideas and is able to take advantage of investment opportunities that yield a high return on investment.

 The majority of psychologists and sociologists see entrepreneurship as the activities of individuals with a high aspiration to achieve, seek financial and personal independence, and want to create a new thing. 

To a business person, entrepreneurship has to do with the process of a modern business, industrial leadership, and aggressive competition among others with the aim of making financial gains by offering better products and services. Others may have a negative view.

To many others who dislike free enterprise such as communists, labour unionists, social activists among others, the entrepreneur is a rogue who appropriates profits, exploit society and destroys the natural environment.

Notwithstanding, the benefits of entrepreneurship largely outweigh any negative aspects. In all, these different views there are common components of entrepreneurship. These include: 

Recognition of business opportunities. Initiating ideas and action. Using economic, managerial, social, and technical mechanisms in converting, improving, and organizing resources.

Innovation and creating something new and of value. 
Risk-taking and tolerance for failure.

Entrepreneurship is a process of identifying opportunities, creating or improving new or existing technology, products, and services, bearing the accompanying risk, and receiving a resultant reward. 


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