Understanding Entrepreneurship

• Entrepreneurship is difficult and full of obstacles.
• Despite challenges, many start businesses yearly to achieve dreams and meet societal needs.
• In 2023, there are thousands or millions of entrepreneurs worldwide.
• There are many opportunities, which resulted in the growth of entrepreneurship.

What is Entrepreneurship?

• "Entrepreneur" comes from the French word "entreprendre," which means to undertake.
• During the Middle Ages, traveling merchants and artisans exchanged goods and services for payment.
• Tradespeople specialized in a particular trade or craft.
• Today, entrepreneurship involves creating, organizing, and operating a new business venture for profit, while taking on financial risk.

Who are the Entrepreneurs?

• Entrepreneurs take on risks and challenges of starting new businesses.
• They introduce new goods, services, or concepts to the market to make a profit by innovating or re-envisioning an existing product/service.
• Entrepreneurs must be curious, seek new knowledge and explore the unknown.
• To be successful, an entrepreneur needs hard work, sacrifices, and understand setbacks.
• Owning a business offers advantages, such as flexible hours, independent decisions, freedom from obligation, autonomy, and power.

Importance of Entrepreneurship in the Society

• Entrepreneurship drives the development and improvement of society by influencing through innovative ideas, goods, and jobs.
• Entrepreneurs create jobs, increasing employment and declining unemploymen. This benefits the whole economy.
• Entrepreneurial businesses drive economic growth by expanding operations; investing in technology and equipment; and strengthening the workforce.
• Entrepreneurs bring new ideas and products that change how people live, creating efficiency and effectiveness.
• New competition expands consumer options, resulting in better goods and services at lower costs, encouraging existing businesses to improve their offerings.
• Entrepreneurs address societal challenges by creating innovative and sustainable business solutions.

Types of Entrepreneurship

• Agripreneurship involves the production and selling of agricultural goods and inputs, examples include crop cultivation, production and processing, aquaculture, animal health and feeds, agro-bio products, biotechnical service, energy-saving, and ecological agro-production systems.
• Edita Aguinaldo Dacuycuy, a multi-awarded farmer-scientist, established the organic dragon fruit farm in the Ilocos Region, through her business Refmad-V Enterprise.
• Buyer Entrepreneurship occurs when business individuals use substantial capital to acquire established companies or merge with smaller businesses that have an existing brand, customer base, and revenue-generating activities.
• Tony Tan Caktiong acquired successful brands such as Greenwich, Chowking, Red Ribbon, and Mang Inasal, and owns the Jollibee fast-food chain.
• Ecopreneurship creates a "green" business to save the Earth while making a profit.
• Jamico Yco Jamlang is the founding director of The Bamboo Company, solving global issues by promoting bamboo production.
• Imitator Entrepreneurship copies or adapts an existing business concept or successful product/service.
• Bin Lin, co-founder/VP of Xiaomi, copied Apple iPhone design and used the Android system to make an easy-to-use interface.
• Intrapreneurship is being an entrepreneur within a company/organization by using innovation and developing new ideas to improve the company's products or services.
• Paul Buchheit developed a web-based email with a search engine in 1999, as the 23rd employee of Google; this later became Gmail.
• Large Business Entrepreneurship involves calculated risks to develop new market offerings to remain competitive and meet customer needs.
• Ernest Cua owns Globe Telecom, which partners with Mynt and Ant Financial to deliver financial services like mobile banking, credit scoring, and online lending.
• Scalable Startup Entrepreneurship launches a small-scale enterprise for quick expansion into a lucrative company through disruptive innovation.
• Roland Navarro de Ros is the Founder and President of Kumu, a social entertainment app in the Philippines which has over 7 million users and does 40,000 daily live streams.
• Small Business Entrepreneurship involves starting a business on a smaller scale without expanding into a large corporation, and is easy to manage with few or one employees.
• Nericel Bonus is a micropreneur who sells thrift clothes by live-selling, also known as “ukay-ukay during the COVID-19 pandemic.
• Social Entrepreneurship focuses on innovating for solutions to address social issues, such as poverty, education, and healthcare.
• Bryan Benitez McClelland is an Environmental Consultant at GawadKalinga and President of Bambike, which manufactures handmade bamboo bicycles.
• Technopreneurship solves complex business problems using technology.
• Diosdado Banatao developed the first 10-Mbit Ethernet CMOS, the first system logic chipset for IBM's PC-XT/AT, and the first Windows Graphics accelerator chip for PCs.

Small, Medium, and Micro-sized Enterprises (SMME)

• SMMEs include businesses in industry, agribusiness, and services, structured as single proprietorships, cooperatives, partnerships, or corporations.
• Total assets include loans, but exclude the land the business is on.
• Micro enterprises have less than P50,000 capital.
• Cottage enterprises have P50,001 to P500,000 capital.
• Small enterprises have P500,001 to P5,000,000 capital.
• Medium enterprises have P5,000,001 to P20,000,000 capital.

Forms of Business Ownership

• Determining the ownership structure is a key obstacle entrepreneurs face when setting up a business.
• Understanding the business ownership, its rights, and responsibilities impacts decisions and actions taken.
• Sole Proprietorship is initiated, organized, owned, and managed by one person.
  • Advantages: easily terminated, ownership and rewards in one person, flexibility, minimum regulation and taxation.
  • Disadvantages: unlimited personal liability, capital limitations, ends when owner dies/gets ill, limited skills and capabilities.
• Partnership is when two or more partners co-own a business to make a profit.
  • Advantages: pooling resources, ability to obtain capital, incentive for each partner, limited regulation and taxation.
  • Disadvantages: unlimited liability, termination can happen, difficult to reconcile interests, problems in share liquidation.
• Corporation is separated from its stockholders.
  • Advantages: limited liability for stockholders, legal entity protected by law, ownership is transferrable, obtaining capital is easier, employee benefits, right to vote.
  • Disadvantages: legal formalities/regulations, costly and time-consuming, separate taxation, owner's potential loss of control.
• Cooperative is a registered group of people with a common interest to voluntarily join to achieve a lawful social and economic end.
  • Advantages: open and voluntary membership, democratic control by members, education is mandated, cooperation among members, direct benefits to members/community, tax privileges.
  • Disadvantages: limited interest in shares, inequality of profit distribution, may deviate from profit orientation.

Entrepreneurial Competencies and Motivation

• Entrepreneurship is becoming feasible thanks to advancements in science, technology, and a supportive business environment.
• Approaching entrepreneurship with confidence, dedication, and personal/professional growth is key.
• Comprehending the correlation between business risks and rewards, and devising strategies for contingencies are paramount entrepreneurial skills.
• Core competencies for entrepreneurs:
  • Leadership: Displaying passion, vision, and mission with investors, employees, and external stakeholders.
  • Articulate: Facilitating communication in sales, morale, resolving conflicts, and negotiating contracts.
  • Sociable: Aligning the organizational approach with the unique characteristics of the business and its employees.
  • Adaptable: Being decisive, passionate, adaptable, and willing to make changes.
  • Collaborative: Connecting with managers, investors, partners, and stakeholders as equals, valuing each contribution.
  • Multifaceted: Managing all business aspects, including sales, marketing, and client/stakeholder management.
  • Resilient: Embracing failure and seeking new motivation after setbacks.
  • Proactive: Addressing problems before they occur, regarding finances, new markets, or benchmarking competitors.
  • Innovative: Developing new market offerings that meet changing customer demands.
  • Risk-taker: Awareness of the potential risks and being proactive in mitigating them.
  • Creative: Showing relentless curiosity that drives them to constantly discover new prospects.
  • Passion: Using a business as a constant source of motivation to revolutionize outdated methods and introduce innovative business concepts.

Motivation Theory

• Behavior is not random, but driven by objectives, leading to entrepreneurial motivations, such as taking risks, identifying new opportunities, and pursuing innovation.
  • Extrinsic Motivation: Completing a task for external rewards that fades away when the reward is absent.
  • Intrinsic Motivation: Completes a task because they are passionate about the business.
    • Achievement motive: Have a strong motivation to succeed, achieve greatness, and conquer any difficulties
    • Power motive: Desire for control, influence, and the ability to impact others and change circumstances.
    • Affiliation motive: Pursuing, upholding, or revitalizing an emotional connection with others.