Types of Entrepreneurship: Objective and Characteristics

Types of Entrepreneurship: Objective and Characteristics

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Jaya
Jaya Sharma
Assistant Manager - Content
Updated on May 27, 2024 18:36 IST

Entrepreneurship is the process of planning, starting and operating a business venture. Based on the objective of what an owner wants from a business, they choose among the different types of entrepreneurship.

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In this article, we will be discussing types of entrepreneurship, characteristics, and principles on which these ventures are based.

Table of Contents

What is Entrepreneurship?

An entrepreneur is a working individual who builds new businesses on his own. Such a person is an innovator who comes in with a new ideology and the ability to take the initiative using his skillset. The process through which different types of entrepreneurs set up businesses is known as entrepreneurship. It is integral to production, natural resources, capital, and labour. Using these resources, products and services are provided to consumers. 

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Features of Successful Entrepreneurship

The following characteristics must be reflected in entrepreneurship for it to be successful.

  • Innovative: For any entrepreneurship’s success, innovation is the most fundamental ingredient. If an entrepreneur starts an innovative business, the probability of its success is more than a business based on a generic idea. 
  • Risk appetite: Do note that the chances of failure are also equivalent to success in such cases. Due to this probability, business owners must have risk tolerance. They should have an understanding of what they are getting into and how much time it may take to generate profits from the business. 
  • Future vision: Entrepreneurship should be based on strong visions for the future. There should be a vision for direction and possibilities in the future. This makes the business more flexible to changes in times. /
  • Resources: There should be the availability of sufficient resources for entrepreneurship to flourish and operate successfully. 
  • Knowledge of the industry: Entrepreneurs must have detailed knowledge about the industry in which they are establishing the business. This allows them the ability to strategize and manage their operations. 

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Principles of Entrepreneurship

The basic principles of entrepreneurship are:

  • Planning a business: While launching a startup, you need to smartly build strategies for establishing the startup. This involves building a vision, assessing financial risks, gathering team members, and planning out a contingency plan. Without a proper plan, a business is likely to face losses and failures.
  • Starting a business: After planning the administration and management of the business, entrepreneurs can start the business. To start a business venture, owners will have to first register the company and complete legal formalities. They will also need to have a space to start the business operation. 
  • Operating a business: Once this entrepreneurial venture has been brought legally into existence, it will need capital to fund operations. Entrepreneurs can either bootstrap or invest venture capital in the business. After the business has its working capital, a team must be built, logistics should be managed and processes must be planned.
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Types of Entreprenuership

We have already discussed the need for entrepreneurship. In this section, we will be discussing the following entrepreneurship types:

  1. Small businesses entrepreneurship: It is a small-cap business that does not turn into a multi-chain organization or a large conglomerate. Small-scale entrepreneurship is initiated through bootstrapping, giving the owner a complete right to profits. In such ventures, entrepreneurs take loans to run the business.
  2. Scalable startup entrepreneurship: Such a startup is started with high ambitions, including making profits and achieving high growth. For such types of entrepreneurship, there is a requirement for huge funds that require large external investments. These startups aim to compete with established and successful companies. 
  3. Intrapreneurship: These are the entrepreneurship in an existing organization. Due to the support of a well-established organization, these ventures already have facilitators who act as a support to the entrepreneur. Once the business owner is financially ready, they can start on their own. 
  4. Large company entrepreneurship: This type of entrepreneurship is suitable for those owners that have experience of sustaining innovation. Often C-level executives opt for this type of venture. This is the new division created within an established and larger company to offer new variants of its core products. It is an adaption to environment expansions.
  5. Imitative entrepreneurship: These are based on the idea of existing and successful entrepreneurship. Such entrepreneurs set their businesses in a manner similar to the venture they follow. Here methods, technology, and processes are imitated.  
  6. Social entrepreneurship: These are ventures that do not aim to make profits but aim to benefit society, the community, and the environment. Such social entrepreneurs work at creating a business that builds environment-friendly products and services. Here, ethical practices such as conscious consumerism, corporate social responsibility, and impact investing are followed.
  7. Buyer entrepreneurship: Such entrepreneurship are bootstrapped by their owners. Such entrepreneurs use their funds to buy those businesses that they find successful. The aim is to make more profits and grow their business. Since entrepreneurs are already buying well-established businesses, this type of entrepreneurship has less risk.

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Need for Types of Entrepreneurship

There are several advantages of entrepreneurship which makes it is very significant:

  • Brings change: Innovation is one of the most unique aspects of any entrepreneurship. Innovative entrepreneurs have the quality of leadership. through which they introduce new technologies and trends. These help in changing the way we lead our lives. 
  • Facilitates development: Successful entrepreneurship leads to changes in our society, ultimately leading to holistic development and growth of people, technology, and processes. 
  • Improves your lifestyle: Entrepreneurships help improve and ease the way we lead our lives. This ultimately helps in improving our standard of living.
  • Job opportunities: As more businesses grow and flourish, job opportunities are created. This generates employment for skilled as well as unskilled labours. 

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Conclusion

Entrepreneurship is the process of building a business from scratch. Based on risk tolerance and capacity, entrepreneurs should choose a type that aligns with their future goals. Once entrepreneurs have decided their direction, they should start planning the business. The ultimate goal should not only be about making profits but also about serving its consumers with satisfaction.

FAQs

How does social entrepreneurship differ from traditional entrepreneurship?

Social entrepreneurship prioritizes social impact and community benefits over financial gains, whereas traditional entrepreneurship focuses primarily on profitability and business growth.

Can scalable startups be social enterprises?

Yes, scalable startups can also be social enterprises if their business model is designed to address social issues while achieving significant growth and impact.

What is the role of innovation in scalable startup entrepreneurship?

Innovation is crucial in scalable startup entrepreneurship as it drives the development of new products, services, or business models that can disrupt existing markets and achieve rapid growth.

What challenges do large company entrepreneurs face?

Large company entrepreneurs often face challenges such as bureaucratic inertia, resistance to change, and the need to align new ventures with the company’s overall strategy and resources.

About the Author
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Jaya Sharma
Assistant Manager - Content

Jaya is a writer with an experience of over 5 years in content creation and marketing. Her writing style is versatile since she likes to write as per the requirement of the domain. She has worked on Technology, Fina... Read Full Bio