Entrepreneurship Overview: Intention & Beyond - Essay Sample

Overview of Entrepreneurship

According to Krueger and Carsrud (1993) define entrepreneurial intention as an individual commitment to start a new business. On the other hand, Bird (1988) describes entrepreneurial intention as the level of cognitive awareness, which directs the setup of a new business. According to bird, intention refers to a thinking situation consisting of concentration, experience, and individual behavior towards a specific objective or certain behavior. It is extremely important to ensure that there is a clear understanding of entrepreneurial intention because the intention is usually related to the establishment of a new business. Summer (1998) states that when an individual has certain intentions to achieve a specific objective, he//she is sure to direct his behavior so that it runs parallel with the objective in achieving the intention. In today economic terms that money person can be referred to as a venture capitalist. The merchant-adventurer in these contracts took the active role in trading, which meant that he/she had to bear al the emotional and physical risks associated with the contract. According to Hirsch et al. (2002), after completing a journey by the merchant-adventurer, the money person took most of the profits (up to 75 percent), while the entrepreneur merchant settled for the remaining twenty-five percent.

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Entrepreneurship has evolved as an important force in global economic growth. According to Ronald (1958), one early example of an entrepreneur as a go-between is Marco Polo, an Italian who was one of the first Europeans who sailed to the Far East. During his time, Marco Polo had the intention to establish trade routes to China. Marco Polo signed money contracts with a money person to sell his goods whereby the contracts provided a loan to the merchant-adventurer at a 22.5 percent rate, including insurance (Hirsch et al. 2002).

According to Vanyushyn (2009), during the Middle Ages, an entrepreneur was both an organizer of musical performances and a manager of large building projects whereby the entrepreneur did not take any risks but instead merely managed the project using the resources provided. According to Fredrick (1931), the definition of an entrepreneur in the 17th century was regarded as a danger taker. An entrepreneur was considered as a person who entered into a contractual agreement with the government to perform a service or to supply stipulated products. The entrepreneur enjoyed any resulting profits or losses from these contractual agreements, mainly because the price was fixed. The definition of entrepreneur in the 18th century was regarded as capital users as opposed to capitalist's user who were considered as capital providers (Vanyushyn 2009).

According to Hisrich et al. (2002), an entrepreneur is regarded as an organizer who controls systematic, purchases raw resources, throw in his own inventiveness, arranges infrastructure, experiences, and programs and administers the venture. Entrepreneurship has evolved over the years, becoming an everyday buzzword across all economic sectors. Policymakers, academics, economists as well as university students have all been involved in entrepreneurship, creating a conversation on the various factors that influence it. The importance of entrepreneurship has been stressed every year across the world, whereby various seminars, conferences, and workshops are being organized every year across the world (Bechard & Toulouse 1998). Economists have, over the years, argued that entrepreneurship is the best strategy to boost a country's competitiveness in facing the increasing trends of globalization (Schaper and Volery 2010). Entrepreneurship has also been cited as a source of economic growth through the creation of employment through economic stagnation, outsourcing of manufacturing, corporate downsizing (Prahalad 2005). According to Brown and Mason (2017), the increased attention towards entrepreneurship has resulted in courses being introduced in colleges and university levels. According to Brown and Mason (2017), identifying the factors that drive successful entrepreneurs has been cited as critical given the high failure rate of new ventures whereby more than 50% do not survive five years.

Participation in Entrepreneurship by College/University Students

According to Deakeans (2000), college and university institution have over the past decades introduced entrepreneurship courses whereby students are provided with skills and knowledge on entrepreneurship intentions and activities. This has resulted in many institutions achieving many start-ups which are introduced by students in their deliberate effort to foster entrepreneurship. According to Fletcher (1999), various universities have achieved good start-up rates from their graduate enterprise programs a good example being the University of Sterling. Other institutions which have reported a high start-up rate for students include the University of Twente in the Netherlands and the Basco College in the United States (Deakeans, 2000). Research has indicated that most world-renowned entrepreneurs began their business as students while in colleges and universities. A recent example is Mark Zuckerberg, who is the founder of Facebook. Mark founded the company while a student at Harvard University. Facebook, a social networking website, has gained a lot of popularity since its introduction resulting in over 40 million registered members (John 2007).

Apart from Facebook, other successful global businesses which were started by entrepreneurship while in University or colleges include a number of business across other fields such as engineering, communication history, hospitality, and service among others. Many students become more interested in entrepreneurship once they are introduced to the course as well as want to take advantage of the many opportunities which are offered while on campus. However, the number of graduate entrepreneurship start-ups, though has received an increase in the past decades is yet to reach its maximum potential. This is despite the overwhelming importance of entrepreneurship in the economy both across developed and developing countries.

Schatz (1963) in his own study, believe that low ability to invest is the most important reason for the poor entrepreneurial performance in developing the economy. There has been an attempt by most studies to explain the success or failure or even growth of entrepreneurs in Nigeria in terms of certain absent values and motivations. Killy (1963), in his investigation of the courses of business failure or success, emphasized the importance of worky-capital shortages, deficient product quality control, and poor economic environment. He only speculated on some other factors like entrepreneur motivations, the extended family, and the propensity of an entrepreneur to invest his profits, which he believed would be a useful area for further research.

Factors Influencing Participation in Entrepreneurship among University Students

This section will discuss factors influencing entrepreneurship motivation among university students in China and Britain universities.

Seed Funding and Student Participation in Entrepreneurship

According to Bygrave (2004), universities are seedbeds of entrepreneurship whereby students are equipped with knowledge and skills in entrepreneurship. Universities, therefore, make a substantial contribution to the motivation of students to participate in entrepreneurship. Securing funding for student entrepreneurs is a great challenge which has resulted in many entrepreneurial ideas being abandoned by students (Astebro, Bazzazian & Braguinsky 2012). Traditionally, start-ups funding, i.e., funding of entrepreneurial ventures is done by angel investors, financial institutions, or venture capitalists (Swamidass 2013). However, these start-up funding sources are reluctant to fund student entrepreneurs. This is mainly because they feel that the students lack the business experience, knowledge, and skills require in ensuring that the start-ups are successful. Securing investors to provide funding for student entrepreneurs has increasingly become tough and thus reducing the number of students motivated to participate in entrepreneurship activities (Swamidass 2013).

For a start-up business to become successful, an entrepreneur should ensure that they seek adequate funding. Student entrepreneurs have been encouraged to consider seed funding has an alternative source of start-up funding. Seed capital refers to the initial funding used to begin a new capital (Astebro, Bazzazian & Braguinsky 2012). Seed capital is a form of securities offering in which an investor invests capital in a start-up company in exchange for an equity stake in the company. The fund covers only the first essentials of the business, such as initial operating expenses, product development, market research, and business plan. Sources of seed funding options range from family funding, angel funding as well as crowdfunding. According to Swamidass (2013), the main goal of seed funding is to attract the interest of venture capitalists to fund the business. Venture investors who are the main sources of funding for entrepreneurial ideas are inclined to invest large amounts of money in a new idea that only exists in a paper (Swamidass 2013). Therefore it is important for an investor to seek seed funding before seeking venture funding.

According to Rasmussen & Sorheim (2012), the availability of seed capital influences a student entrepreneurship motivation. This is so because seed funding is essential in developing an entrepreneurial idea from paper to actual business, which will then attract potential investors. Different programs have been formulated both at the universities and government levels to provide seed capital to student entrepreneurs (Rasmussen & Sorheim 2012). This has encouraged students to innovate and think creatively about starting companies that have some positive influence on the world. Seed funding initiatives provide the student entrepreneurs with resources to execute the entrepreneurial intentions. Entrepreneurship motivation among university students is therefore influenced greatly by the availability of seed capital.

Exposure in Entrepreneurship Courses in Academic Institutions

According to Maria & Sergio (2002), a growing consensus globally indicates that in a knowledge economy and information society education is one of the significant factors in explaining the emergence of new businesses. Kuip and Verheul (2003) emphasize the importance of entrepreneurial education in Universities. According to these researchers, entrepreneurial education can represent a positive influence in terms of general attitudes to entrepreneurship, which in turn promotes entrepreneurship among the students. According to GEM (2008), students participate in entrepreneurial education and training at various educational...