Lesson 2: Entrepreneurship
Table of Contents
1. Introduction
2. Definition of an Entrepreneur
3. The Entrepreneurial Process
4. Entrepreneurial Skills and Resources
5. Owning a Business
Starting a New Business
Buying an Existing Business
6. Franchising as a Business Opportunity
Advantages of a Franchise
Challenges of a Franchise
7. Entrepreneurship and the Fourth Industrial Revolution (4IR)
8. Summary
9. References
10. Further Reading: Open Educational Resources (OERs)
1. Introduction
Entrepreneurship is a term that has gained significant attention in both business and
media environments. This lesson delves into entrepreneurship as the fourth factor of
production, discussing the role of entrepreneurs and small businesses in society and the
entrepreneurial process.
Learning Outcomes:
Define "entrepreneur" and "entrepreneurship."
Discuss the entrepreneurial process.
Explain the skills and resources required to become an entrepreneur.
Distinguish diverse ways in which an entrepreneur may start a business.
Discuss the advantages and disadvantages of owning a business.
Discuss the implications of choosing a franchise as a business opportunity.
Understand the impact of the Fourth Industrial Revolution on entrepreneurship.
Key Terms:
Entrepreneur
Entrepreneurship
Starting a business
Entrepreneurial process
Franchise
Existing business
Entrepreneurship skills and resources
Fourth Industrial Revolution
2. Definition of an Entrepreneur
An entrepreneur is defined as a person who takes up a new venture and is willing to
accept full responsibility for the outcome. Entrepreneurs take the initiative and financial
risk by harnessing the factors of production to generate products and services, with the
reward of earning a profit. However, they can also incur losses due to unforeseen
circumstances or wrong decisions.
Entrepreneurship:
It is the process undertaken by an entrepreneur—identifying, creating, or sensing an
investment or business opportunity where others do not see it. It involves finding and
combining resources (often owned by someone else) to pursue the opportunity until it
becomes a successful, established business.
Examples of Successful African Entrepreneurs:
Aliko Dangote: Founder of the Dangote Group, the largest conglomerate in West
Africa.
, Richard Maponya: Established businesses including general stores, car
dealerships, and filling stations.
Dr. Patrice Motsepe: South African entrepreneur and first black billionaire,
known for his mining interests.
Magda Wierzycka: Founder of Sygnia Limited, one of South Africa's most
successful businesswomen.
3. The Entrepreneurial Process
The entrepreneurial process involves several critical steps:
1. Aptitude, Personality, and Skills: Aspiring entrepreneurs must know their
personality, strengths, weaknesses, and the skills required to run a business.
2. Access to Resources: Financial resources are essential to start a business.
3. Opportunities and Ideas: Opportunities and business ideas need to be
converted into viable products, services, or processes.
4. Feasibility Study: Ensure the business idea is realistic and feasible.
5. Business Plan: Develop a viable plan to comfort potential investors.
6. Managing the Business: Commit time and effort to manage the business
effectively.
4. Entrepreneurial Skills and Resources
To operate a business successfully, entrepreneurs need specific skills and resources:
Marketing Skills: Evaluate the relevance of products or services in the target
market.
Financial Skills: Manage business finances, track expenditure, and cash flow.
Project Management Skills: Organize various business activities and manage
resources.
Human Relations Skills: Interact, communicate, lead, motivate, and form
relationships with employees and stakeholders.
Resources Needed:
Financial resources
Human resources
Operating/physical resources
5. Owning a Business
5.1 Starting a New Business
Starting a new business offers autonomy, flexibility, and the potential for profit.
However, it is time-consuming, demanding, and comes with financial risks.
Advantages:
Autonomy: Make independent decisions.
Flexibility: Control work-life balance.
Profit: Potential for financial rewards.
Learning: Gain experience through trial and error.
Fulfilment: Personal achievement.
Disadvantages:
Time-consuming: Requires constant attention.
Demanding: Stressful responsibilities.
Financial Risk: No guarantee of success.
Unpleasant Tasks: Handling disliked functions.
5.2 Buying an Existing Business
Buying an existing business provides access to an established customer base,
experienced employees, and historical data. However, challenges include undesirable
locations, inherited liabilities, and difficulty in changing the business culture.
Advantages:
Familiar customers.
Experienced employees.
Known historical data.
Table of Contents
1. Introduction
2. Definition of an Entrepreneur
3. The Entrepreneurial Process
4. Entrepreneurial Skills and Resources
5. Owning a Business
Starting a New Business
Buying an Existing Business
6. Franchising as a Business Opportunity
Advantages of a Franchise
Challenges of a Franchise
7. Entrepreneurship and the Fourth Industrial Revolution (4IR)
8. Summary
9. References
10. Further Reading: Open Educational Resources (OERs)
1. Introduction
Entrepreneurship is a term that has gained significant attention in both business and
media environments. This lesson delves into entrepreneurship as the fourth factor of
production, discussing the role of entrepreneurs and small businesses in society and the
entrepreneurial process.
Learning Outcomes:
Define "entrepreneur" and "entrepreneurship."
Discuss the entrepreneurial process.
Explain the skills and resources required to become an entrepreneur.
Distinguish diverse ways in which an entrepreneur may start a business.
Discuss the advantages and disadvantages of owning a business.
Discuss the implications of choosing a franchise as a business opportunity.
Understand the impact of the Fourth Industrial Revolution on entrepreneurship.
Key Terms:
Entrepreneur
Entrepreneurship
Starting a business
Entrepreneurial process
Franchise
Existing business
Entrepreneurship skills and resources
Fourth Industrial Revolution
2. Definition of an Entrepreneur
An entrepreneur is defined as a person who takes up a new venture and is willing to
accept full responsibility for the outcome. Entrepreneurs take the initiative and financial
risk by harnessing the factors of production to generate products and services, with the
reward of earning a profit. However, they can also incur losses due to unforeseen
circumstances or wrong decisions.
Entrepreneurship:
It is the process undertaken by an entrepreneur—identifying, creating, or sensing an
investment or business opportunity where others do not see it. It involves finding and
combining resources (often owned by someone else) to pursue the opportunity until it
becomes a successful, established business.
Examples of Successful African Entrepreneurs:
Aliko Dangote: Founder of the Dangote Group, the largest conglomerate in West
Africa.
, Richard Maponya: Established businesses including general stores, car
dealerships, and filling stations.
Dr. Patrice Motsepe: South African entrepreneur and first black billionaire,
known for his mining interests.
Magda Wierzycka: Founder of Sygnia Limited, one of South Africa's most
successful businesswomen.
3. The Entrepreneurial Process
The entrepreneurial process involves several critical steps:
1. Aptitude, Personality, and Skills: Aspiring entrepreneurs must know their
personality, strengths, weaknesses, and the skills required to run a business.
2. Access to Resources: Financial resources are essential to start a business.
3. Opportunities and Ideas: Opportunities and business ideas need to be
converted into viable products, services, or processes.
4. Feasibility Study: Ensure the business idea is realistic and feasible.
5. Business Plan: Develop a viable plan to comfort potential investors.
6. Managing the Business: Commit time and effort to manage the business
effectively.
4. Entrepreneurial Skills and Resources
To operate a business successfully, entrepreneurs need specific skills and resources:
Marketing Skills: Evaluate the relevance of products or services in the target
market.
Financial Skills: Manage business finances, track expenditure, and cash flow.
Project Management Skills: Organize various business activities and manage
resources.
Human Relations Skills: Interact, communicate, lead, motivate, and form
relationships with employees and stakeholders.
Resources Needed:
Financial resources
Human resources
Operating/physical resources
5. Owning a Business
5.1 Starting a New Business
Starting a new business offers autonomy, flexibility, and the potential for profit.
However, it is time-consuming, demanding, and comes with financial risks.
Advantages:
Autonomy: Make independent decisions.
Flexibility: Control work-life balance.
Profit: Potential for financial rewards.
Learning: Gain experience through trial and error.
Fulfilment: Personal achievement.
Disadvantages:
Time-consuming: Requires constant attention.
Demanding: Stressful responsibilities.
Financial Risk: No guarantee of success.
Unpleasant Tasks: Handling disliked functions.
5.2 Buying an Existing Business
Buying an existing business provides access to an established customer base,
experienced employees, and historical data. However, challenges include undesirable
locations, inherited liabilities, and difficulty in changing the business culture.
Advantages:
Familiar customers.
Experienced employees.
Known historical data.
