What is Entrepreneurship? - Napkin Finance

Entrepreneurship

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What is entrepreneurship?

Entrepreneurship is building a new business from the ground up. It means coming up with an idea you think will be successful, and then doing the work to make that business a reality – including raising money to get started, developing a brand, producing products, and managing the business.

What counts as entrepreneurship?

All big businesses start out as someone’s idea, but not all entrepreneurs need to aim so high. Any type of business can be entrepreneurship:

  • Selling your services as a freelancer or contractor
  • Developing an app
  • Tutoring
  • Creating and selling art
  • Starting a food truck
Pros and cons
Pros Cons
  • Setting your own schedule
  • Taking pride in building something
  • Choosing your coworkers
  • Creating a legacy
  • Profiting directly from your hard work
  • Calling the shots
  • Taking responsibility for all the risk
  • Working longer hours, particularly in the beginning
  • Making less money in the early stages
  • Accepting the possibility that even a good idea might fail
  • Having less time to work on other goals

“Entrepreneurship is about turning what excites you in life into capital,
so that you can do more of it and move forward with it.“

—Richard Branson

Goals of entrepreneurship

There are plenty of benefits to running your own successful business, but it’s still a ton of work. Entrepreneurship can mean making your own hours and (eventually) writing your own paycheck, but many entrepreneurs start businesses for other reasons.

Some other perks of being your own boss can include:

  • Being the brains of the operation
    • Hiring staff to manage the day-to-day aspects of your business can free you to focus on high-level strategy and growth.
  • Enjoying a steady stream of income
    • Some businesses, such as selling your intellectual property to others, may let you receive regular income without significant ongoing investment.
  • Selling your company
    • With a good idea, some hard work, and a little luck, your startup might be bought out by a larger competitor for a handsome sum.
Entrepreneurship process

Following through on your dreams of entrepreneurship can be intimidating when you’re just getting started. Here’s what the process can look like:

Step 1: Find an idea. Solve a problem for people or create a product that fills a need.

Step 2: Do some market research. Look into what others are already doing in this field. Figure out if demand is strong.

Step 3: Make a plan. Design your product or service. Outline the steps it will take to build your business and your brand.

Step 4: Organize your finances. Does your business need cash to get started? If so, consider your assets, loans, crowdfunding, and other potential sources.

Step 5: Do the boring stuff. Pick a name, create a website, and file for any licenses. Choose your business structure, whether a sole proprietorship, LLC, or partnership.

Step 6: Get the word out. Before you launch, start promoting your business online and in social media. Consider creating an advertising budget so you can increase your reach as your business grows.

Step 7: Bring it to life. Launch your website. Open your doors.

It’s ok if your business isn’t perfect on the first day it opens—you can always tweak things along the way. At some point, it becomes more important to simply get it up and running.

“Chase the vision, not the money. The money will end up following you.“

—Tony Hsieh

Where can I get ideas?

Keep a journal and make a note any time you think of:

  • Products or services that you wish existed but can’t find
  • Ideas for anything that would fulfill a need many people share
  • Ways existing products or services could be better
  • Ways to help people access information or products more easily
Get started

You don’t have to wait until you have your Big Idea™ to start your entrepreneurship journey. There are already tons of ways to start your own small business to get the entrepreneurship ball rolling:

  • Sell things you own or make through an auction site or build your own retail site
  • Sell your services or labor
  • Start freelancing online
Myths about entrepreneurship

Many people think it takes something special to become an entrepreneur, such as an advanced degree, a ton of money, or a sky-high IQ. Really, though, anyone with an idea for a product or service that other people will pay for and the guts to put in the work can become an entrepreneur.

  • Myth 1: You need a college degree to start a business.
  • Reality: Many very successful business owners actually dropped out of school or weren’t very good students. Education is important, but intelligence and drive aren’t limited to the classroom.
  • Myth 2: You have to be rich to start a business.
  • Reality: While some businesses require a lot of money to get off the ground (such as a restaurant), other businesses (such as a website selling online services) need very little. Plus, the rise of crowdfunding can mean it’s easier than ever for entrepreneurs to raise funds.
  • Myth 3: Everything has already been done.
  • Reality: Many successful businesses are based on existing products and services—there’s always room for improvement. If your idea is good enough to compete, you might end up having your business bought out by a big competitor. Cha-ching!!
  • Myth 4: Failure is your enemy.
  • Reality: Most successful entrepreneurs don’t hit it out of the park on their first try. Many even have a long string of failed businesses before they find the right fit. Learn from your mistakes, but don’t be afraid of making them!

“I’m convinced that about half of what separates successful entrepreneurs from the nonsuccessful ones is pure perseverance.“

—Steve Jobs

Fun facts
  • Famous entrepreneurs Mark Zuckerberg, Steve Jobs, and Bill Gates were all college dropouts.
  • Many famous business owners—such as Oprah Winfrey and Elon Musk—are “serial entrepreneurs” who start many different businesses and try new things all the time.
  • More than 15.5 million Americans are self-employed.
Key Takeaways
  • Entrepreneurship means building a business from the ground up.
  • Anyone can be an entrepreneur, regardless of education or finances.
  • Entrepreneurs take on both the risks and rewards of their businesses.
  • Keeping track of business ideas in a journal can help you find your focus.
  • You don’t need an idea for the next Facebook or Amazon to become an entrepreneur. You can start by selling your services or products as a freelancer or through an online business.
Some successful entrepreneurs include Oprah, Jeff Bezos, and the clever Girl Scouts selling cookies outside weed dispensaries.—Napkin Finance

References

https://www.inc.com/guides/201101/top-10-reasons-to-run-your-own-business.html
https://www.entrepreneur.com/article/243145
https://hbr.org/2014/10/myths-about-entrepreneurship
https://www.inc.com/peter-economy/these-5-surprising-myths-about-entrepreneurs-just-arent-true-but-heres-brutal-truth.html
https://www.entrepreneur.com/article/274711
https://money.usnews.com/money/blogs/my-money/2012/05/07/6-myths-about-starting-your-own-business
https://www.cnbc.com/2017/05/10/10-ultra-successful-millionaire-and-billionaire-college-dropouts.html
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https://www.investopedia.com/articles/personal-finance/083115/worlds-top-10-serial-entrepreneurs.asp
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https://www.bonanza.com/ebay_alternative
https://es.shopify.com/
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https://www.shopify.com/retail/optimizing-online-sales-the-11-common-digital-platforms-and-how-to-choose-the-right-ones-for-your-retail-business
https://www.entrepreneur.com/article/245953
https://www.bls.gov/bdm/entrepreneurship/entrepreneurship.htm
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https://www.thebalancesmb.com/starting-a-small-business-4161641
https://www.entrepreneur.com/slideshow/300146#7
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