Podcast
Questions and Answers
What is one major barrier to entrepreneurship related to individual capabilities?
What is one major barrier to entrepreneurship related to individual capabilities?
Why do many banks hesitate to lend to start-up businesses?
Why do many banks hesitate to lend to start-up businesses?
How can lack of training impact potential entrepreneurs?
How can lack of training impact potential entrepreneurs?
Which barrier is primarily related to emotional factors faced by potential entrepreneurs?
Which barrier is primarily related to emotional factors faced by potential entrepreneurs?
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What is a common misconception about access to finance for entrepreneurs?
What is a common misconception about access to finance for entrepreneurs?
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What is meant by entrepreneurial capacity as a barrier to entrepreneurship?
What is meant by entrepreneurial capacity as a barrier to entrepreneurship?
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Which of the following is a common reason for lack of access to finance for entrepreneurs?
Which of the following is a common reason for lack of access to finance for entrepreneurs?
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What internal barrier can significantly affect a person's decision to start a business?
What internal barrier can significantly affect a person's decision to start a business?
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What psychological factor often prevents individuals from pursuing entrepreneurship?
What psychological factor often prevents individuals from pursuing entrepreneurship?
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Study Notes
Barriers to Entrepreneurship
- Entrepreneurship faces various obstacles.
- Five key barriers are discussed:
- Entrepreneurial capacity
- Access to finance
- Lack of training/know-how
- Fear of failure
- Lack of confidence
Entrepreneurial Capacity
- Growing awareness of learnable entrepreneurial skills, knowledge, and attitudes.
- Widespread development of entrepreneurial mindsets and culture benefits individuals and society.
- Lack of capacity or ability is a significant barrier.
- Simple terms definition needed.
Access to Finance
- Many entrepreneurs struggle to start due to funding limitations.
- Insufficient savings and lack of family support hinder business initiation.
- Banks often avoid lending to start-ups due to high risk, lack of sales data.
- Government initiatives exist to lower loan costs.
- Various sources of startup business funding in the UK are shown in a chart:
- Personal Savings
- Family and friends
- Home remortgage
- Other sources
- Personal credit cards
- Business bank loan
- Personal bank loan
- Redundancy money
- Leasing/hire purchase
- Grants
- Business credit cards
- MFIs (e.g., building societies)
- Venture capital
- Business angels
Lack of Training/Know-how
- Many lack training or know-how regarding business start-up procedures.
- This discourages potential entrepreneurs.
- Online resources (like eBay, Etsy) provide business startup information.
- Government websites (HMRC, Gov.uk) contain helpful resources.
Fear of Failure
- Fear of failure is a common deterrent for potential entrepreneurs.
- Failure itself and its costs can be reasons to avoid starting a business.
- Especially problematic for those leaving salaried jobs to start their own ventures.
Lack of Confidence
- Many lack the confidence to embark on a new venture (starting a business).
- This can be a significant obstacle to becoming an entrepreneur.
- This hurdle can be overcome through training, information, and marketing.
- Confidence may grow when entrepreneurs are sure they can sell their products.
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Description
This quiz explores the key obstacles faced by entrepreneurs, focusing on five main barriers: entrepreneurial capacity, access to finance, lack of training, fear of failure, and lack of confidence. Understand how these challenges can impact startup success and the importance of developing an entrepreneurial mindset.
