Essay Example on Unlock Your Potential: How Governments Encourage Entrepreneurship

Entrepreneurship refers to the process of developing new business. People who engage in entrepreneurship and the creation of new companies are referred to as entrepreneurs. The spirit of entrepreneurship has led to the creation of many industries and companies, thus leading to the creation of job opportunities for people around the globe. Many countries encourage the spirit of entrepreneurship as opposed to seeking jobs, especially for young people. Some of the ways that governments encourage entrepreneurship include tax reliefs for a startup business, as well as providing capital and training for young entrepreneurs. The paper focuses on providing an argumentative research paper on entrepreneurship. Moreover, the paper explores and analyzes the concept of entrepreneurship across the globe as well as all the aspects that relate to entrepreneurship.

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Introduction

Some of the major characteristics of entrepreneurs include being self-motivated, the ability to network, passionate, being flexible and able to understand the product offered as well as having basic money management skills and knowledge. Statistics indicate that there were approximately 25 million Americans who run their own businesses in the year 2016 (Chowdhury et al., 2019).

In addition, the majority of the people who start their own businesses are usually between the ages of 40 and 6o years. The world has approximately 582 million entrepreneurs (Azoulay et al., 2020). However, the journey to entrepreneurship is challenging since it involves many aspects such as an ability to create an appealing product to clients, taxation, as well as the intensive amount of capital to start as well as advertising. Statistics indicate that approximately 22.5 percent of small businesses fail within the first year of their establishment (Chowdhury et al., 2019). Also, only 50 percent of small businesses survive in their fifth year (Chowdhury et al., 2019). Most of the big and multinational companies on the globe started by entrepreneurs as a small business and have grown over the years to become the leading business across the globe.

There are various types of entrepreneurship, such as small businesses, scalable startup entrepreneurship, social entrepreneurship, as well as large company entrepreneurship (Kirzner, 2015). Other forms of entrepreneurship include administrative, private, public, incubate, opportunistic, individual, acquisitive, as well as imitative entrepreneurship. Entrepreneurship involves individuals who start a business and are willing to risk a loss in order to make a profit. Entrepreneurs desire to create their ventures through hard work and commitment. Not all people can be entrepreneurs; some people are meant for employment and build a career. However, entrepreneurs are opposed to the concept of employment and instead create jobs for millions of people through their innovations.

Factors to consider before engaging in entrepreneurship

It is important for an individual to consider some aspects before engaging in entrepreneurship. Some of the factors that entrepreneurs consider before starting a business include the availability of finances, marketing, business platforms and structures, legal issues, startup costs, as well as employees and the location of the business. Individuals should be in a position to estimate the costs of starting a business as well as what will be required to run the business in the first few months before the business starts being profitable (Parker, 2018). In addition, entrepreneurs consider the capital required to start the business. For instance, an individual should consider the funds to purchase the required items to start the business as well as the costs of advertising.

In addition, the location of the business should be considered since a strategic location would mean that the business will be in a position to acquire a big market share. The staff to work in the new business should also be a consideration that employers should make as well as their salaries.

Scalable Startup Entrepreneurship

Scalable startup businesses are started by innovative entrepreneurs that take a creative idea and search for a reputable and scalable business model that helps in turning it into a profitable organization. The scalable businesses are able to handle increased market demands, as well as maintain and improve profit margins while at the same time increasing the sales volumes (Kirzner, 2015). Scalable startup businesses are started by building business plans and models that are attractive and appealing to investors as well as using the minimum viable product to help in validating a model.

Small businesses

The majority of the most successful entrepreneurs fall under the category of small businesses. Some of the most successful small businesses in the globe include gardening and landscaping, information technology, child-oriented businesses, accounting, and tax preparation, as well as real estate and real estate brokering. Other successive small businesses include hairdressing, travel agents, electricians, internet commerce storefronts, as well as grocery stores.

The majority of the small businesses employ people from the locality they operate in as well as close family members of the entrepreneurs. However, the majority of the small business owners define success as the ability to feed their families as well as provide basic necessities to their families (Monitor, 2011). The majority of such small businesses usually do not have great ambitions of, for instance, making huge profits, diversification, and having a global presence. The majority of people engage in this type of entrepreneurship because it does not require a lot of capital to get started. In addition, banks and Sacco's provide capital to small businesses, thus enabling most people to engage in this type of entrepreneurship.

Social Entrepreneurship

Social entrepreneurship refers to an approach used by entrepreneurs, startup companies, and groups in which they develop, implement, as well as fund solutions to social, environmental, and cultural issues. Some of the examples of social entrepreneurship include educational programs, microfinance institutions, as well as institutions that provide banking services in underserved areas. The various types of social entrepreneurship include social enterprises, non-profit organizations, community projects, cooperatives, as well as social purpose businesses. Social entrepreneurship is not only concerned with making a profit and creating value for stakeholders but also on the economic and social empowerment of society.

Large company entrepreneurship

Large company entrepreneurship includes organizations that have efficient and solid of a set of business life cycles. The organizations have solid financial stability with the intense involvement of sustaining innovation by providing new sorts of products. Large company entrepreneurs are able to grow and develop their businesses to become leading corporates across the globe. Some of the advantages of establishing large company entrepreneurship include having a brand name, a large market prospect, as well as the advantage of high capital investment (Drucker, 2014). Large company entrepreneurs include wealthy people who can run the corporation without over-reliance on bank loans and grants.

Opportunistic and acquisitive entrepreneurship

Opportunistic entrepreneurship involves entrepreneurs who start their businesses by venturing into a business that emerges out of an emergent need. For instance, a business person who sells umbrellas may quickly order for many more umbrellas when the rainy season begins in the region he operates from. Acquisitive entrepreneurship involves individuals who learn from the competencies of other people.

Opportunistic entrepreneurs usually do not grow into large corporations as well as they do not live for long because of their opportunistic nature (Kirzner, 2015). Acquisitive entrepreneurs acquire something new of value front as well as achieving the technical capacities of their competitors. These types of entrepreneurs spend a lot of time learning how to operate a particular business and then venturing into it. For instance, an individual may be employed by a certain corporation such as a cooperative and then resign to start own Sacco based on the knowledge acquired from the employer.

Factors that promote entrepreneurship

Some of the factors that promote an entrepreneurship culture among people include quality education, culture, as well as economic and technological developments. It is important to recognize the fact that entrepreneurs work and challenging and competitive environments. Other factors that contribute to the success of an entrepreneur include tolerance to risks, leadership, and responsiveness to opportunities, creativity, and innovation, as well as the ability to take advantage of the opportunities that an individual comes across.

Psychological factors

Psychological factors contribute immensely to the ability of an individual to develop entrepreneurial traits. For instance, some of the psychological factors that lead to entrepreneurship behavior may include aspirations to achieve a need and motivation by other people. Besides, some of the entrepreneurship theories outline those motives, such as stress, which leads to entrepreneurship. For instance, if an individual has a quality education and finds it challenging to find a decent job, they are likely to get stressed and motivated to engage in the various forms of entrepreneurship, such as establishing opportunistic and small businesses.

Economic factors

Economic factors contribute to one of the main reasons why people develop entrepreneurial behavior. The main economic factors that lead to entrepreneurship include the availability of capital to start a business, availability of raw materials and affordable labor as well provision of markets. The target market should be one of the major concerns for an individual who intends to start a small business (Hodgetts, & Kuratko, 2011). When there is a ready market for certain products and services, then it is appropriate to start the business. In addition, infrastructure is one of the economic factors that lead to growth and expansion of entrepreneurship. For instance, the availability of certain types of infrastructure such as good roads, electricity, and internet connection promotes the entrepreneurship culture.

Social factors

Social factors lead individuals to entrepreneurship. Some of the social factors that lead people into entrepreneurship include an individual's family background, the attitude of the society, an individual's level of education, as well as cultural values. For instance, individuals who come from an entrepreneurial family are more likely to engage in entrepreneurship. They feel motivated by the success of their parents and therefore desire to start up their own businesses. In addition, individuals with a high level of education are also likely to engage in entrepreneurship since they have knowledge of aspects of entrepreneurship, such as taxation. Cultural factors also play a role in determining the entrepreneurship aspect of an individual. For instance, there are societies that restrict women from engaging in establishing small businesses, thus inhibiting them from entrepreneurship culture.

Benefits of Entrepreneurship

Entrepreneurship is beneficial to entrepreneurs as compared to engaging in employment. Some of the advantages of entrepreneurship include huge profits, increased freedoms, and control of the business as well as flexibility. Entrepreneurs are able to make huge profits from their businesses since they have less opera...