Q1. Define Entrepreneurship and state its importance.

[5m]
Ans:
The word ‘Entrepreneur’ is derived from French word ‘entrependre’
which means undertaking the risk of enterprise.
“Entrepreneurship is the process of creating, developing ad managing a
new business venture to make a profit.” It involves identifying a business
opportunity, mobilizing resources and taking calculated risks to establish
and grow a business.

Importance of Entrepreneurship:
1. Economic Growth - In a given economy, entrepreneurship creates new
wealth. Entrepreneurs drive economic development by creating new
businesses, which inturn generate jobs, increase income and contribute
to the GDP.

2. Innovation - Entrepreneurs introduce new products, services,

technologies, fostering innovation and competition.
Entrepreneurship is the hub of innovation that provides new product
ventures, market, technology and quality of goods, etc. And increase the
standard of living of people.

3. Social Change - Entrepreneurship has positive social impact by

addressing societal unmet needs and challenges. Entrepreneurs focus on
creating ventures that generate social or environmental benefits
alongside financial returns, contributing to sustainable development and
social welfare.

4. Self-Sufficiency - Entrepreneurship encourages self-employment and

reduces dependency on traditional employment, promoting financial
independence.

5. Creation of Job - Entrepreneurs are significant job creators, as they

establish new businesses that require a workforce to operate. It provides
an entry-level job, required for gaining experience and training for
unskilled workers. Employment opportunities reduces unemployment
rates and improves living standards in communities.

Q2. Explain various factors influencing entrepreneurship[5m]

Ans:
Factors influencing entrepreneurship:
1. Economic factors 4. Personality/Personal Factors
2. Social Factors 5. Political and Legal factors
3. Environmental factors 6. Other - Educational, etc.

 Economic factors - The economic environment exercises the most

direct and immediate influence on entrepreneurship. Major
economic factors affecting entrepreneurship are:
a) Capital - one of the most important factors yet one of the biggest
barrier to entrepreneurs, capital is the lifeline of any business.
Availability of funds is crucial for starting and sustaining a
business.
b) Market - It consists of producers and buyers or a place where
seller sells his/her producers to customers. Access to a market
determines the success of any business.
c) Labour - The famous economist Adam Smith has considered
labour as an important factor for economic development.
Availability of skilled and unskilled labour in right quantity is
always considered one of the major factors of economic as well
as entrepreneurship development.
d) Infrastructure - Adequate infrastructure such as transport and
communication are key factors.

 Social Factors - Social scientist/advocates of social theory states that

influence of economic factors on entrepreneurship growth depends
on social factors such as family background and support,
entrepreneurial heritage, etc.
“An entrepreneur can never be successful where society fails.”
a) Family background - Includes size, type and economic status can
influence entrepreneurship. According to study, 51.9% fall
entrepreneurs were 1st to launch a business in their family.
b) Social Networks: Networks and relationships with other
entrepreneurs, mentors, and investors provide support,
resources, and opportunities, making it easier to start and grow a
business.

 Environmental Factors - Another factor affecting entrepreneurship is

integrated approach of environmental analysis, i.e. geographic
 location, infrastructure and access to markets. Environmental
scanning gives the idea of enterprises strengths and weaknesses and
opportunities and threats posed by environment.
 Personality/Personal Factors - Along with economic and social
factors psychological factors like:
a) Risk Tolerance - Ability to take financial and psychological risks
b) Motivation - Drive to achieve goals and aspirations
c) Experience - Previous work or entrepreneurial experience also
contribute in the growth of entrepreneurship

 Political and Legal Factors - All other factors directly or indirectly are
influenced by actions of government. Government through its
policies, regulations and incentives tries to provide congenial
environment to entrepreneurs and a stable political environment
encourages entrepreneurship.

 Other miscellaneous factors may also play a role in influencing

entrepreneurship, such as:
a) Technological Advances - Rapid technological development
provides new business opportunities.
b) Globalization - Access to global markets, resources, and talent
can spur entrepreneurship.
c) Media Influence - Coverage of entrepreneurial success stories
can inspire new entrepreneurs.
d) Support Institutions - Availability of incubators, accelerators, and
entrepreneurial support organizations helps start-ups thrive.
e) Educational - Studies state that 95.1% of all entrepreneurs hold a
bachelor degree, 47% of those have advanced in their education
and acquired masters, PhD, etc. This indicates the importance of
education to the development of entrepreneurship.

Q3. Define Entrepreneurship and state its characteristics. [5m]

Ans:
The word ‘Entrepreneur’ is derived from French word ‘entrependre'
which means undertaking the risk of enterprise.
“Entrepreneurship is the process of creating, developing ad managing a
new business venture to make a profit.” It involves identifying a business
opportunity, mobilizing resources and taking calculated risks to establish
and grow a business.

Characteristics of Entrepreneurship:
1. Innovation - It drives entrepreneurship. The entrepreneur is
constantly evaluating current business models and identifying new
models. “Innovation in entrepreneurship can either save money or
increase revenue.”

2. Leadership - It is the ability to influence and guide others. Good

leaders share their vision, develop well-rounded teams and have
confidence in themselves and what they sell.

3. Risk-Taking - The essence of entrepreneurship is ‘willingness to

assume risk’. Accordingly, individuals who choose a career in
entrepreneurship take a greater risk than those with a career in
employment. For example, to an outsider, the risk of leaving a well-
established and promising career appears to be a high risk but for an
entrepreneur it is a calculated risk..

4. Curiosity - An entrepreneur’s curiosity allows them to continuously

learn and discover new opportunities. Entrepreneurs ask challenging
questions and explore ways to deliver solutions to their customers.

5. Motivation - It drives one forward through ups and downs of the

businesses. It is also important for leaders in keeping the team
motivated to bring the dream to life.

6. Passion - Many successful entrepreneurs start their own business

from a passion. Whether that’s a profitable hobby, a unique idea, or a
drive to make change, passion drives entrepreneurship and keeps
entrepreneurial spirit alive through challenges.

7. Vision - Every venture starts with a vision: the desired direction of

business. While mission statement defines the organization’s business
objectives, a vision statement declars one’s aspirational goals.
8. Decision-making - Every step in the process of entrepreneurship
involves decision making. The entrepreneur has to choose the best
alternative available at each step.

9. Discipline - Entrepreneurs need discipline to move forward and do the

work-even when they don’t feel like it. Being discipline can be especially
helpful if you are developing and entirely new business concept.

10. Adaptability - It is a essential personality trait in a world of evolving

business practices and changing consumer trends. The business
environment is costantly changing, making it difficult for entrpreneurs to
adapt. However, in order to be successful in the market, they must
closely analyse the environment and adapt to any potential changes.

Q4. Explain different types of entrepreneur. [5m]

Ans:
Entrepreneurs are divided on various factor like on the basis of
motivation(Spontaneous, Motivated, etc), on the basis of technology, on
basis of business type(Trading, Industrial, etc), on the basis of the
classification given by C.H.Danhof,etc.
The main types of entrepreneurs are:
1. Social 2.Serial 3. Innovative
4. Imitative 5. Fabian 6. Drone
 Social Entrepreneurs
Someone who starts a business to solve social problems is called a social
entrepreneur. They aim to address social issues and improve society
instead of just making profits.
Ex; Anshu Gupta, the founder of Goonj in India, exemplifies Social
entrepreneurship by repurposing urban surplus for rural needs,etc.

 Serial Entrepreneurs
Someone who continuously starts and develops new businesses is a
serial entrepreneur.
Ex; Elon Musk who established his career with Zip2 in 1995, then
founded PayPal a few years later and now SpaceX and Tesla Motors.
 Innovative Entrepreneurs
An innovative entrepreneur is visionary and seeks new opportunities to
create and develop groundbreaking ideas, products or services.
Ex; Mark Zuckerberg, the co-founder of Facebook, innovated how
people connect and communicate globally.

 Imitatve Entrepreneurs
An imitative entrepreneur is an individual who focuses on replicating
existing business ideas, products, or services with minor modifications.
They are skilled at identifying and duplicating successful business models
in different markets or contexts. This approach allows them to reduce
risks associated with innovation while still meeting customer needs.
Ex; Fast food companies and multinational conglomerate companies

 Fabian Entrepreneurs
A Fabian entrepreneur adopts a cautious and incremental approach to
entrepreneurship. They tend to proceed gradually, making calculated
decisions and mitigating risks as they progress. They prioritize stability
and long-term sustainability over rapid growth.

 Drone Entrepreneurs
These individuals resist embracing new opportunities and fail to
capitalize on them. They adhere to conventional methods and are
unwilling to adapt their production processes, even if it results in losses.

Q5. What are the barriers in entrepreneurship. [5m]

Ans:
The main barriers in entrepreneurship are:
1.
 Financial barrier - This is one of the most prominent barriers in the
life of an entrepreneur. The barriers includes:
 Insufficient funds to start or grow a business.
 Short-term or long-term debt
 Huge financial loss, no gains
 Market barriers - It includes difficulty in accessing markets or
competing with established players. Many entrepreneurs face the
challenge of establishing a successful enterprise in an already saturated
market. It can be difficult to identify and target a niche market, which
can result in lower sales and revenue.
 Societal barriers - This barrier includes:
a) Caste and religious affiliations often act as hurdles in the way of a
business.
b) Financial stability and family backgrounds can impact the
operations and development of an enterprise.
c) Socio--cultural norms and values also hamper the smooth
processing of a entreprise

 Fear of failures -The amount of profit that the firm may generate is
determined on ones ability to take risks. Hence, it is a state of mind that
assists an entrepreneur in gaining a clear vision to face danger without
fear.
When a new enterprise is launched there is always concern about
securing early funding, investors, and a variety of other issues. This
dread puts pressure on entrepreneurs’ thoughts and heightens their
anxiety about failing which indirectly prevents the entrepreneur from
taking risks

 Lack of practical knowlegde - The majority of schools and colleges

place a greater emphasis on theoretical information than practical
expertise. Every entrepreneur may have the same theoretical
knowledge, but it is their actual expertise that distinguishes them. Lack
of practical expertise can be a stumbling block in the way of a company’s
success.

 Economic Uncertainty - It can create an environment where future

market conditions are unpredictable making it difficult to plan
effectively, secure financing, and assess the potential demand for the
products or services. Unstable economy can lead to consumers cut on
spending and investors taking less risk, making it harder for new
businesses to attract investment.

 Regulatory hurdles - They can act as significant barriers to

entrepreneurship by either slowing down or complicating the process of
starting and running a business. These hurdles include complex licensing
requirements, various laws and regulations, high taxes, and the need for
permits. Navigating these can be time-consuming and costly. Strict
regulations can stifle innovation and regulatory uncertainty can also
deter investment.

Q6. Which skills are required to become an entrepreneur. [5m]

Ans:
Skills required to be a entrepreneur:
1. Leadership 6. Technical & Digital
2. Networking 7. Decision -making
3. Problem Solving 8. Negotiation
4. Business Management & Financial 9. Risk Taking
5. Interpersonal & Communication 10. Marketing

 Leadership Skills
 Networking Skills
 Problem Solving Skills
 Business Management & Financial Skills
 Interpersonal & Communication Skills
 Technical & Digital Skills
 Decisio - making Skills
 Negotiaion Skills
 Risk Taking Skills
 Marketing Skills