ENTERPRENEURSHIP

Unit-1
Entrepreneur: An individual who bears the risk of operating business in the face of uncertainty
about the future conditions. Common Meaning – one who starts his own, new and small business

Entrepreneurs are people who create new business activity in the economy and bear
considerable business risk in the process. This is often done by starting new companies. But they
can also create new business activity by introducing a new product or creating a new market

Entrepreneurship is the process of creating something different with value by devoting the
necessary time and effort, assuming the accompanying financial, psychic, social risks and
receiving the resulting rewards of monetary and personal satisfaction and independence. Word
“Entrepreneur” stems from French Verb Entrepreneur – means between; taker or go between

New Definition involves four aspects –

(a) The creation process

(b) Devotion of time and efforts

(c) Assumption of risks

(d) Rewards of independence, satisfaction, money.

Advantages of Entrepreneurs hip:

To an Individual

(a) Provides Self Employment for the entrepreneur

(b) Entrepreneur can provide employment for near & dear one as well

(c) Entrepreneurship often provides an employment and livelihood for next generations as well.

(d) Freedom to use own ideas – Innovation and creativity

(e) Unlimited income / higher retained income (f) Independence

(g) Satisfaction

To the nation

(a) Provides larger employment – Entrepreneurs provide employment for self as

well as other people and is source of employment creation.

(b) Results in wider distribution of wealth – This is a logical sequel of above issue. Higher the
employment, greater the distribution of wealth

(c) Mobilizes local resources, skills and savings

(d) Accelerates the pace of economic development – Entrepreneurship is the

govt’s one of the most trusted vehicles for economic development

(e) Stimulates innovation & efficiency

What makes a Successful Entrepreneur?

1. The urge for achievement (most often monetary ambitions) – Most Important

2. Willingness to take moderate risks – (High risk takers are not entrepreneurs but gamblers).

3. Determination to win

4. Win– Win Personality

5. Ability to identify & explore opportunities

6. Analytical ability to take strategic decisions

7. Perseverance

8. Flexibility

9. Capacity to plan and organize

10. Preparedness to undergo physical and emotional stress

11. Positive self concept/Self Belief

12. Future orientation – Vision

13. Ethics and Values – Mission

Characteristics:

1. Family Environment – In most cases, people follow the footstep of father. A businessman’s
son takes up business and a salaried person’s son tries to find a job So, if a family has had a
tradition of entrepreneurship, later generations also follow the step of their ancestors, like the
Guajarati’s and Marwari’s. Conversely, if a family has had a bad experience with
entrepreneurship, it is unlikely that next generation will be very entrepreneurial.
2. Education – Education has no correlation with entrepreneurial spirit. If at all ther is one, it
seems to be inverse. Most of the entrepreneurs come from low education background. Educated
people who get decent job rarely prefer comfort of salaried job. It is only those who are unable to
find a living for themselves eventually try their hands at new business.

3. Age – There are people who start as early as probably 10 and some others after their
retirement. Harland David Sanders, better known as Colonel Sanders (not a Army Colonel but an
honorary one) started his famous Kentucky Fried Chicken business quite late in his varied career.
But commonly, men are often in the age group of 25 – 35 and women in the age group of 30– 45.

4. Physical Attributes – Have absolutely no correlation with entrepreneurial spirit.

5. Marital Status – No direct correlation but going by the age group, most entrepreneurs are
married.

6. Working History – Entrepreneurs quite often have some working experience as a salaried
employee in the field of their venture. It always helps to learn a little about business before
putting your money in. Sindhi community follows this practice assiduously.

7. Family Contacts – Family contacts in business world reduce the risks and help the
entrepreneur.

8. Professional Contacts – Professional contacts again help. IIT and IIM graduates venturing
into entrepreneurship often get help from their peer and seniors.

9. Personal values

10. Lifestyle – Most entrepreneurs are fond of good things in life but are willing to wait till they
strike rich. In the interim they are willing to rough it out.

Entrepreneurial Decision Process:

A person decides to do something either because something in that activity lures him or he

he takes it as option in lieu of something else, ie, he is forced to do it by people or

circumstances. The factors which lure a person to become entrepreneur are called Pull

factors and the factors that compel him are called Push factors.

Pull Factors

Perception of Advantages – If a person feels that he can earn better or overall gains in terms of
money. Status, security, future, etc as an entrepreneur are better than working as an employee, he
tends to turn an entrepreneur.
Spotting an Opportunity – Many employees spot a business opportunity in the course of their
work and decide to exploit that opportunity rather than pass it on to their employer. Many
employees buy unsuccessful businesses at throw away prices from their former employers and
turn them around.

Government Policies – Govts very often formulate policies to promote certain business activity
or backward areas which offer tax concessions/holidays, cash subsidies, cheap land, etc, which
improve success and profit prospects.

Role of entrepreneurs in Economic Development:

The role of entrepreneurs is not identical in the various economies. Depending on the material
resources, industry climate and responsiveness of the political system, it varies from economy to
economy. The contribution of entrepreneurs may be more in favourable opportunity conditions
than in economies with relatively less favourable opportunity conditions.

The important role that entrepreneurship plays in the economic development of an economy can
now be put in a more systematic and orderly manner as follows:

 Promotes Capital Formation:- Entrepreneurs promote capital formation by mobilising

the idle savings of public. They employ their own as well as borrowed resources for
setting up their enterprises. Such type of entrepreneurial activities lead to value addition
and creation of wealth, which is very essential for the industrial and economic
development of the country.
 Creates Large-Scale Employment Opportunities:- Entrepreneurs provide immediate
large-scale employment to the unemployed which is a chronic problem of
underdeveloped nations. With the setting up. of more and more units by entrepreneurs,
both on small and largescale numerous job opportunities are created for others. As time
passes, these enterprises grow, providing direct and indirect employment opportunities to
many more.
 Promotes Balanced Regional Development:- Entrepreneurs help to remove regional
disparities through setting up of industries in less developed and backward areas. The
growth of industries and business in these areas lead to a large number of public benefits
like road transport, health, education, entertainment, etc. Setting up of more industries
lead to more development of backward regions and thereby promotes balanced regional
development.
 Reduces Concentration of Economic Power:- Economic power is the natural outcome
of industrial and business activity. Industrial development normally lead to concentration
of economic power in the hands of a few individuals which results in the growth of
monopolies. In order to redress this problem a large number of entrepreneurs need to be
developed, which will help reduce the concentration of economic power amongst the
population.
  Wealth Creation and Distribution:- It stimulates equitable redistribution of wealth and
income in the interest of the country to more people and geographic areas, thus giving
benefit to larger sections of the society. Entrepreneurial activities also generate more
activities and give a multiplier effect in the economy.
 Increasing Gross National Product and Per Capita Income:- Entrepreneurs are
always on the look out for opportunities. They explore and exploit opportunities,,
encourage effective resource mobilisation of capital and skill, bring in new products and
services and develops markets for growth of the economy. In this way, they help
increasing gross national product as well as per capita income of the people in a country.
 Improvement in the Standard of Living:-Increase in the standard of living of the
people is a characteristic feature of economic development of the country. Entrepreneurs
play a key role in increasing the standard of living of the people by adopting latest
innovations in the production of wide variety of goods and services in large scale that too
at a lower cost.
 Promotes Country's Export Trade:- Entrepreneurs help in promoting a country's
export-trade, which is an important ingredient of economic development. They produce
goods and services in large scale for the purpose earning huge amount of foreign
exchange from export in order to combat the import dues requirement.
 Induces Backward and Forward Linkages:- Entrepreneurs like to work in an
environment of change and try to maximise profits by innovation. When an enterprise is
established in accordance with the changing technology, it induces backward and forward
linkages which stimulate the process of economic development in the country.
 Facilitates Overall Development:- Entrepreneurs act as catalytic agent for change which
results in chain reaction. Once an enterprise is established, the process of industrialisation
is set in motion.
 Creating innovation :-An entrepreneur is a person who always look for changes. apart
from combining the factors of production, he also introduces new ideas and new
combination of factors.
 Entrepreneurs Create New Businesses:- Path breaking offerings by entrepreneurs, in
the form of new goods & services, result in new employment, which can produce a
cascading effect or virtuous circle in the economy. The stimulation of related businesses
or sectors that support the new venture add to further economic development.

Ethics: Individual values form the basis of ethics, a set of moral principles that govern decisions
and actions. To act ethically is to behave in ways that are in keeping with certain values.
Universal values are values that are shared by all cultures throughout history. Business ethics are
moral principles applied to business issues and actions. Entrepreneurs have considerable
influence on their company’s business ethics.
Business Ethics: The main reason for behaving ethically, in business or in any area of life is
simply that it’s the right thing to do. Three practical reasons why you should practice business
ethics:

 Customers are more confident when buying goods and services from an ethical company.
 An ethical workplace motivates employees.
 Ethical behavior also prevents legal problems.

Ethical Workplace: Universal values establish a strong foundation for society and are also a
good basis for running your business.

 To deter unethical behavior, companies try to create transparency, or openness and

accountability in business decisions and actions.
 To enhance transparency, companies today are using social media, which are are
interactive electronic forms of communication such as blogs and message boards
 A whistle-blower is a term for someone who reports illegal or unethical conduct to
superiors or to the public.

Ethical Issues for Entrepreneurs

When faced with an ethical decision, it’s best to rely on your own strong personal values to help
guide your response.

 Intellectual property is artistic and industrial creations of the mind.

 Copyright is the exclusive right to perform, display, copy, or distribute an artistic work.
 A patent is the exclusive right to make, use, or sell a device or process.
 A trademark is a symbol that indicates that the use of a brand or brand name is legally
protected and cannot be used by other businesses.
 A conflict of interest exists when personal considerations and professional obligations
interfere with each other.
 Confidentiality involves respecting the privacy of others.

Corporate social responsibility: affects employees, customers, investors, and creditors.

 Entrepreneurs have legal obligations to provide a safe workplace and fair employment
policies. Business owners are bound by law to treat customers fairly.
 Acting responsibly toward suppliers or vendors results in making the best choices of
materials and using them wisely.
 Investors and creditors provide the money to start and run a business. They must believe
in both the idea behind the business and the entrepreneur.

Responsibility to the Environment To an environmentalist, “green” means protecting natural

resources. To an entrepreneur, being “green” means money. Sustainable Design. Sustainable
products meet the planet’s current needs while preserving resources for future generations.
Alternative Energy.

Researchers are working to make fossil-fuel alternatives such as solar, wind, and hydrogen
power more efficient.

Organics. Organic produce, grains, and meats make up a small but steadily growing segment of
the food market. Fair Trade. This is a way of doing business based on principles of social and
environmental responsibility and promoting sustainable growth.

The Energy-Efficient Workplace:

 Creating an energy-efficient workplace saves money and can draw customers.

 Five ways that a business can lower its expenses, while also helping the environment
include: Getting into the recycling loop.
 Doing business electronically. Buying supplies in bulk.
 Replacing incandescent light bulbs with fluorescent ones.
 Using environmentally friendly transportation.
 Unit-2
The Role of Banks in the development of entrepreneurship in India:

Introduction: Entrepreneurship has been one of the most popular subjects that have aroused the
interest of students and young entrepreneurship in large measure. The importance of the subjects
is magnified manifold in today’s economic climate. Entrepreneurship introduces a critical
element of dynamism into an n economic system. The issue of getting finances for the small
businesses and entrepreneurs is always been in debate and remain unresolved in many countries
due to unavailability of qualified venture capitalists.

There is no gainsaying the fact that activities of banks reflect their unique role as the engine of
growth in any economy. Banks especially commercial and specialized ever remain crucial to the
growth and development of entrepreneurship, and their operations provide a solid backing
capable of encouraging entrepreneurs in viable and profitable ventures. The role of banks goes
beyond their traditional functions which if entrepreneurs avail themselves of could be of
tremendous assistance in meeting their desired needs. There are several ways banks could get
involved in small and medium scale enterprise finance, ranging from the creation or participation
in SMEs finance investment funds, to the creation of special unite for financing SMEs.

1. Statutory Roles These consist in the main the functions for which banks were created in
the first place. Such roles are for example accepting of deposit and safekeeping of same,
transfer of money, giving of loans and advances, etc. By accepting deposit of customers
especially entrepreneur-customers, the banks will be providing security for customers’
money and giving them opportunity to use their deposit to borrow more money from the
banks to finance the running of their enterprises. By funds transfer, money is moved from
one account to another and from one place to another.
2. Financing Roles The primary reason that banks want deposits is to enable them grant
loans and advances from which they earn interest income. Extension of credit to the
economy for the financing of business enterprises is the core link that banks have to the
real sector, acting like a catalyst and contributing to the growth of the economy of the
country.
3. Business Investment Promotion Roles. Because of the specialized and professional
status of banks, they are in a position to play investment promotion roles to
entrepreneurs. Such roles may include management of investment for customers, advice
on sustainable lines of investment to follow by analyzing the pros and cons of each
investment alternatives to the entrepreneur-customer.
4. Advisory, Guaranty and Consultancy Roles. In addition to the normal lending and
other service, banks now also engage in business advisory, guaranty and other
consultancy services which help immensely in the promotion and financing of
entrepreneurship activities in the country. It is well known fact that some
 enterprises/businesses fail simply because of mismanagement, faulty investment
decisions, inefficient capital and foul planning etc.
5. Other areas Other areas in which banks could offer advisory and consultancy services to
the SMEs include methods of control systems or measures to be adopted by the
enterprises with respect to defined lines of business or trend of challenges. Advice on
methods of raising capital or reorganization of a company to bring about the desired level
of efficiency. Advice on tax and tax related matters. Status enquiry services could be
offered to effect credit purchases within the domestic market or overseas.

DICs
The ‘District Industries Centre’ (DICs) programmer was started by the central government in
1978 with the objective of providing a focal point for promoting small, tiny, cottage and village
industries in a particular area and to make available to them all necessary services and facilities
at one place. The finances for setting up DICs in a state are contributed equally by the particular
state government and the central government. To facilitate the process of small enterprise
development, DICs have been entrusted with most of the administrative and financial powers.
For purpose of allotment of land, work sheds, raw materials etc., DICs functions under the
‘Directorate of Industries’. Each DIC is headed by a General Manager who is assisted by four
functional managers and three project managers to look after the following activities :

Activities of District Industries Centre (DIC):

i. Economic Investigation

ii. Plant and Machinery

iii. Research, education and training

iv. Raw materials

v. Credit facilities

vi. Marketing assistance

vii. Cottage industries

Objectives of District Industries Centre (DIC):

The important objectives of DICs are as follow :

i. Accelerate the overall efforts for industrialization of the district.

ii. Rural industrialization and development of rural industries and handicrafts.

iii. Attainment of economic equality in various regions of the district.

iv. Providing the benefit of the government schemes to the new entrepreneurs.

v. Centralization of procedures required to start a new industrial unit and minimisation- of the
efforts and time required to obtain various permissions, licenses, registrations, subsidies etc.

Functions of District Industries Centre (DIC):

i. Acts as the focal point of the industrialization of the district.

ii. Prepares the industrial profile of the district with respect to :

iii. Statistics and information about existing industrial units in the district in the large, Medium,
small as well as co-operative sectors.

iv. Opportunity guidance to entrepreneurs.

v. Compilation of information about local sources of raw materials and their availability.

vi. Manpower assessment with respect to skilled, semi-skilled workers.

vii. Assessment of availability of infrastructure facilities like quality testing, research and
development, transport, prototype development, warehouse etc.

viii. Organizes entrepreneurship development training programs.

ix. Provides information about various government schemes, subsidies, grants and assistance
available from the other corporations set up for promotion of industries.

x. Gives SSI registration.

xi. Prepares techno-economic feasibility report.

xii. Advices the entrepreneurs on investments.

xiii. Acts as a link between the entrepreneurs and the lead bank of the district.

xiv. Implements government sponsored schemes for educated unemployed people like PMRY
scheme, Jawahar Rojgar Yojana, etc.

xv. Helps entrepreneurs in obtaining licenses from the Electricity Board, Water Supply Board,
No Objection Certificates etc.

xvi. Assist the entrepreneur to procure imported machinery and raw materials.

xvii. Organizes marketing outlets in liaison with other government agencies.

Small Industries Service Institutes (SISI’s)

The small industries service institutes (SISI’s) are set-up one in each state to provide consultancy
and training to small and prospective entrepreneurs. The activities of SISs are co-ordinate by the
industrial management training division of the DC, SSI office (New Delhi). In all there are 28
SISI’s and 30 Branch SISI’s set up in state capitals and other places all over the country.

SISI has wide spectrum of technological, management and administrative tasks to perform.

Functions of SISI

1. To assist existing and prospective entrepreneurs through technical and managerial counseling
such as help in selecting the appropriate machinery and equipment, adoption of recognized
standards of testing, quality performance etc;

2. Conducting EDPs all over the country;

3. To advise the Central and State governments on policy matters relating to small industry
development;

4. To assist in testing of raw materials and products of SSIs, their inspection and quality control;

5. To provide market information to the SISI’s;

6. To recommend SSI’s for financial assistance from financial institutions;

7. To enlist entrepreneurs for partition in Government stores purchase programme;

8. Conduct economic and technical surveys and prepare techno-economic feasible reports for
selected areas and industries.

National Small Industries Corporation Ltd. (NSIC)

The National Small Industries Corporation Ltd. (NSIC), an ISO 9000 certified company, since its
establishment in 1955, has been working to fulfill its mission of promoting, aiding and fostering
the growth of small-scale industries and industry related small-scale services/businesses in the
country.

At present, the NSIC operates through 6 Zonal Offices, 26 Branch Offices, 15 Sub-offices,
5 Technical Services Centers, 3 Extension Centers and 2 Software Technology Parks supported
by a team of over 5000 professionals spread across the country. To mange operations in Gulf and
African countries, the NSIC operates from its offices in Dubai and Johannesburg.
Functions of NSIC:

NSIC provides a wide range of services, predominantly promotional in character, to small-scale

industries.

Its main functions are to:

a. Provide machinery on hire-purchase scheme to small-scale industries.

b. Provide equipment leasing facility.

c. Help in export marketing of the products of small-scale industries.

d. Participate in bulk purchase programme of the Government.

e. Develop prototype of machines and equipments to pass on to small-scale industries for

commercial production.

f. Distribute basic raw material among small-scale industries through raw material depots.

g. Help in development and up-gradation of technology and implementation of modernization

programmes of small-scale industries.

h. Impart training in various industrial trades.

i. Set up small-scale industries in other developing countries on turn-key basis.

j. Undertake the construction of industrial estates.

NIESBUD:

NIESBUD is an apex body for co-ordinating and overseeing the activities of various institutions
and agencies engaged in entrepreneurship development particularly in the area of small-scale
industry. The National Institute for Entrepreneurship and Small Business Development is an
apex organization under the Ministry of Skill Development and Entrepreneurship, Government
of India engaged in Training, Consultancy, Research and Publication, in order to promote
entrepreneurship. The major activities of the institute consist of Training of Trainers (ToT ),
Management Development Programmes (MDP), Entrepreneurship- cum-Skill Development
Programmes (ESDP) and Entrepreneurship Development Programmes (EDP) etc. NIESBUD has
provided training to 9,43,625 persons as of March 31, 2016 through 36,877 different training
programmes since inception. This includes 3,194 international participants hailing from more
than 130 countries throughout the globe.
The main objectives of the institute are:

 To accelerate the process of entrepreneurship development throughout the country and

among all segments of the society.
 To help institutions/agencies in carrying out activities relating to entrepreneurship
development.
 To evolve standardized process of selection, training support and sustenance to potential
entrepreneurs enabling them to set up and run their enterprises successfully.
 To provide information support to trainers, promoters and entrepreneurs by organizing
documentation and research work relevant to entrepreneurship development
 To provide functional forums for integration and exchange of experiences helpful for
policy formulation and modification at various levels.

Functions: The main functions of the Institute are as follows:

(i) Evolving effective training, strategy and methodology.

(ii) Formulating scientific selection procedure)

(iii) Standardizing model syllabus for training for various groups.

(iv) Developing training aids, manuals and other tools.

(v) Supporting 9ther agencies engaged in entrepreneurship development.

(vi) Conducting such programmes for promoters, trainers and entrepreneurs which are commonly
not undertaken by other agencies

(vii) Organizing all those activities that help develop entrepreneurial culture in the country.
the action of teaching a person or animal a particular skill or type of behaviour.

Training is teaching, or developing in oneself or others, any skills and knowledge that relate to
specific useful competencies. Training has specific goals of improving one's capability, capacity,
productivity and performance.

Types of Training

There are a number of different types of training we can use to engage an employee. These types
are usually used in all steps in a training process (orientation, in-house, mentorship, and external
training). The training utilized depends on the amount of resources available for training, the
type of company, and the priority the company places on training.

1. Technical or Technology Training: Technical training is a type of training meant to

teach the new employee the technological aspects of the job. In a retail environment,
technical training might include teaching someone how to use the computer system to
ring up customers.
2. Quality Training: Quality training refers to familiarizing employees with the means of
preventing, detecting, and eliminating nonquality items, usually in an organization that
produces a product. In a world where quality can set your business apart from
competitors, this type of training provides employees with the knowledge to recognize
products that are not up to quality standards and teaches them what to do in this scenario.
3. Skills Training: Skills training, the third type of training, includes proficiencies needed
to actually perform the job. For example, an administrative assistant might be trained in
how to answer the phone, while a salesperson at Best Buy might be trained in assessment
of customer needs and on how to offer the customer information to make a buying
decision.
4. Soft Skills Training: Soft skills refer to personality traits, social graces, communication,
and personal habits that are used to characterize relationships with other people. Soft
skills might include how to answer the phone or how to be friendly and welcoming to
customers.
5. Professional Training and Legal Training: rofessional training is a type of training required
to be up to date in one’s own professional field. For example, tax laws change often, and as a

result, an accountant for H&R Block must receive yearly professional training on new tax

codes.
Team Training: team training as a process that empowers teams to improve decision making,

problem solving, and team-development skills to achieve business results. Often this type of training

can occur after an organization has been restructured and new people are working together or

perhaps after a merger or acquisition. Some reasons for team training include the following:

 Improving communication

 Making the workplace more enjoyable

 Motivating a team

 Getting to know each other

 Getting everyone “onto the same page,” including goal setting

 Teaching the team self-regulation strategies

 Helping participants to learn more about themselves (strengths and weaknesses)

 Identifying and utilizing the strengths of team members

 Improving team productivity

 Practicing effective collaboration with team members

Safety Training

Safety training is a type of training that occurs to ensure employees are protected from injuries

caused by work-related accidents. Safety training is especially important for organizations that use

chemicals or other types of hazardous materials in their production. Safety training can also include

evacuation plans, fire drills, and workplace violence procedures. Safety training can also include the

following:

 Eye safety

 First aid

 Food service safety

 Hearing protection

 Asbestos

 Construction safety
  Hazmat safety

Designing a Training Program

1. Needs assessment and learning objectives. This part of the framework development

asks you to consider what kind of training is needed in your organization. Once you have

determined the training needed, you can set learning objectives to measure at the end of the

training.

2. Consideration of learning styles. Making sure to teach to a variety of learning styles is

important to development of training programs.

3. Delivery mode. What is the best way to get your message across? Is web-based training

more appropriate, or should mentoring be used? Can vestibule training be used for a portion

of the training while job shadowing be used for some of the training, too? Most training

programs will include a variety of delivery methods.

4. Budget. How much money do you have to spend on this training?

 5. Delivery style. Will the training be self-paced or instructor led? What kinds of discussions

and interactivity can be developed in conjunction with this training?

6. Audience. Who will be part of this training? Do you have a mix of roles, such as accounting

people and marketing people? What are the job responsibilities of these individuals, and how

can you make the training relevant to their individual jobs?

7. Content. What needs to be taught? How will you sequence the information?

8. Timelines. How long will it take to develop the training? Is there a deadline for training to

be completed?

9. Communication. How will employees know the training is available to them?

10. Measuring effectiveness of training. How will you know if your training worked? What

ways will you use to measure this?

Entrepreneurship Training Models And Programmes:

An entrepreneurship training model can be defined as a structure or layout of constructs
that form the framework of an entrepreneurship training intervention. A model includes all of the
training elements that are presented when the training is carried out.
Entrepreneurial Performance Education Model (E/P model)
The formula for the E/P model is illustrated as:
E/P = f [aM (bE/S x cB/S)]
Where, E/P = Entrepreneurial Performance
M = Motivation
E/S = Entrepreneurial Skills
B/S = Business Skills
a to c = Constants
The model, as developed by Van Vuuren and Nieman (1999: 6), is concerned with the
elements that drive entrepreneurial performance and was developed to guide syllabi and
curriculum development. The four elements (E/P, M, E/S and B/S) that are evident in this model
are described in detail.
Entrepreneurial Performance (E/P):
According to Ladzani and Van Vuuren (2002: 156), entrepreneurial performance is based on the
starting of a business/utilising of an opportunity, and growth of the business idea. Holland (1985:
20) states, in his theory of vocational choice, that the interaction of work environment and
personality may affect performance in a career. Specifically, he argues that higher levels of fit
between the personality and work environment characteristics will result in higher performance
in that role.
Van Vuuren (1997:3) agrees that entrepreneurial performance goes hand in hand with
entrepreneurial achievement or results with regard to the realising of set entrepreneurial goals.
This construct can be presented as: firstly, an increase in productivity; secondly, the increase in
the number of employees employed, which implies the expansion of the business; thirdly, the net
value of the business; fourthly, a core aspect in entrepreneurship, namely the increase in
profitability; and finally, the completion of the first market-related transactions.
Entrepreneurial Skills (E/S):
Individuals’ belief in their own ability to start a business plays an important role in their
decision to start a business. People who believe that they have the ability to start a business are
five times more likely than others to actually attempt to start a business
Entrepreneurial Education Model (E/E model):
The second model that needs further explanation is the E/E model. The formula for the E/E
model is illustrated as:
E/E = f[aF(bA x cB/P) x (dE/S x eB/S)]
Where,
E/E = Entrepreneurial education for start-ups
F = Facilitator skills, knowledge and motivation
A = Approaches used by facilitator(s)
B/P = Business Plan utilisation
E/S = Entrepreneurial success themes and knowledge
B/S = Business Skills and knowledge
a to e = Constants
Performance Feedback:
Performance feedback is the on-going process between employee and manager where
information is exchanged concerning the performance expected and the performance exhibited.
Constructive feedback can praise good performance or correct poor performance and should
always be tied to the performance standards.

Training and Performance Evaluation:

Many companies, whether large or small, conduct performance evaluations of their

employees. For the company, an annual review is an opportunity to assess the value of an
employee's contribution over the past year, identify areas for improvement, praise the employee
for any outstanding good work and provide direction for the employee's career in the future. For
the employee, it is an opportunity to receive feedback and recommendations on his work ethic
and habits.

The performance evaluation routinely includes recommendations for training programs

the employee should consider if he wishes additional recognition and opportunities for
advancement. The employee sometimes may be consulted on training programs of interest to
him. For example, a junior marketing specialist who shows interest in a more senior position
may need to improve his public speaking skills. The employer could recommend various
programs designed to teach better public speaking techniques.

Follow-Up:

The performance evaluation should include detailed means by which an employee's

progress should be measured and outline target dates to achieve any desired improvements. The
evaluation should describe how additional training is perceived to benefit the employee and the
company as well as how the employee's improved skills and knowledge can be put to good use.
For example, an evaluation might specify that once an employee has completed a public
speaking course, he could be assigned to tasks that involve public speaking to evaluate how best
he assimilated the training.

The Next Evaluation:

If an employee has completed any training programs successfully since the last review,
the performance evaluation should make a note of it and provide detailed feedback on how the
employee's skills have improved and how they may allow the employee to become a more
productive member of the organization, including whether a promotion is possible. The
evaluation can include specific events or times when the employee was allowed to showcase her
new skills. The comments should be as detailed as possible, providing both praise for positive
applications of these skills as well as suggestions for further development or improvement.
Cross-Training:

Sometimes the training comes not through a specific program but by assigning the
employee to a different department or location for a specific period, either full- or part-time. This
technique often is used when the company identifies a rising star and wishes to groom him for
management or an executive position. Allowing the employee to perform different duties gives
him a firsthand look at different aspects of the company, which ultimately gives him a better
understanding of the inner workings of the business.

Recommendations:

If the employee's work and skills are judged to be more than satisfactory to meet the
requirements of a promotion, the performance evaluation can show a recommendation for
advancement of the employee, including any specific positions for which the employee has
showed himself worthy of consideration.
 Unit-4
Role Of Women Entrepreneurs:

The role of women in our society has changed drastically in the past few decades and for
the better. Women are now occupying the corporate positions previously regarded as masculine
and are outpacing their male counterparts in some areas. The gender stereotypes which were
more prevalent in the society decades ago are breaking slowly. But there is still a long way to go.

The Government of India has defined Women Entrepreneurs as ― an enterprise owned and
controlled by women having a minimum financial interest of 51 per cent of the capital and giving
at least 51 per cent of the employment generated in the enterprise to women.

The class of women entrepreneurs may be understood to be the one that takes the initiative of
launching a business project, organizes work and undertakes the risk involved in running it.
Women entrepreneurs have to perform a wide range of functions relating to establishment of an
enterprise. These include the generating of an idea, its screening, choosing a form of
organization, setting organizational goals and objectives, project planning and analysis, the
completing of preliminary and promotional formalities, raising of capital, procuring factors of
production and operating the business.

Fredrick Harbison^ says a woman entrepreneur, like male entrepreneurs, has to perform the
following five functions:

1. Exploring Prospects; A business cannot be launched until and unless a business opportunity
survey is conducted. A woman entrepreneur too, like her male counterpart, has to explore a
business unit.

2. Undertaking Risks; Business is full of uncertainties; the entrepreneur has to undertake risks
arising out of both the economic as well as the non-economic uncertainties.

3. Innovation or imitation of goods/services become an integral part of an entrepreneurial

activity.

4. Administering, co-ordinating etc.; A woman entrepreneur, like a male entrepreneur, is the

whole and soul of her enterprise. She has to organize, coordinate and administrate the activities
of her organization.

5. Providing Leadersliip; A woman entrepreneur is a business leader of her unit. She has to
provide able guidance and lead the organization towards achieving the set goals.
Qualities Of Women Entrepreneurs

Some of the outstanding qualities of women entrepreneurs are as follows:

 Challenge loving
 Adventurous
 Diligent
 Sincere and serious
 Less corrupt
 Ambitious
 Patient
 Intelligent
 Studious
 Optimistic
 Understanding
 Sensitive
 Motivating
 Keen to learn and imbibe
 Determined
 Enthusiastic and energetic
 Perseverant
 Efficient
 organizer
 Soft spoken
 Skillful
 Impressive personality (as industrial leader)
 Good manager
 Good administrator World wise

Problems Of Women Entrepreneurs

Women Entrepreneurs struggle more than the male entrepreneurs. They have to deal with
the general entrepreneurial problems as well as problems that relate to women in particular.

1. Lack of Motivation: Women in India are not motivated to achieve something.. . They do
not experience the need to be economically independent or to enjoy autonomy. They are
obsessed by the idea of being perfect wives, mothers and homemakers . They see
themselves only in these multiple roles that they have to perform. They even take pride in
the achievements of their father, husband, soil etc. The very urge to do something
independently is normally absent. This comes in the way of their progress.
2. Lack of Risk Bearing Capacity: Women lead a protected life throughout their lives. In
their childhood they are protected by parents, elders, brothers etc. I Once they get married
, protection comes from the husband and in-laws . In i the old age again , it is the husband
and sons. They therefore , never get an opportunity to face life alone. The confidence to
face uncertainties and risks of; life alone never gets developed in them . Since the main
ingredient of entrepreneurship , which is risk-bearing ability, is absent in women, they
find it difficult to undertake entrepreneurial activities.
3. Lack of Funds: Small entrepreneurs always experience the problem of I finance.
Women Entrepreneurs, too, confront the problem of insufficient financial resources and
working capital. They have less access to external 1 sources of finance. They do not
enjoy bank credit in a big way on account of a number of problems. They are either
ignorant about the banking procedures I or do not have adequate security to offer. The
size of their loan is also normally small. The time taken to process the loans is also very
long.
4. Lack of Education: Women in India are discouraged to learn more than the male
members of the family . There is also a widespread illiteracy problem among them . Sixty
percent of the women are still illiterate in India. This illiteracy has become the root cause
of a number of social and economic problems. Due to lack of education and that too a
qualitative one, women are not aware of business , technology and market knowledge .
Lack of education also results in lack of confidence, which in turn creates problems in
setting and running business enterprises for women.
5. Lack of Information and Experience: Lack of knowledge about business
opportunities, information about formulating a business plan involving market survey,
project finalization etc., lack of information about procedures and sources of assistance in
setting up business including financial and legal aspects, lack of knowledge about
managing different areas like accounting, marketing, manpower etc. comet in the way of
handling entrepreneurial I activities successfully.
6. Lack of Family Support: In India , it is almost only a woman’s duty to look after' the
children, other members of the family and also attend to all the household chores. Here
the man plays a secondary or an insignificant role. Women’s involvement in family
problems drains them of energy and also leaves little time for them to participate in the
economic activities .
7. Lack of Equality: The Indian society is still a male dominated one. Equal treatment to
men and women is absent at both the family as well as the social level. Men have a
superiority complex. The male ego often comes in the way of their success. It is difficult
for men to digest the idea of women superseding them. Women often face hostile
reactions from their male colleagues when they are promoted to higher levels of
management. Similar is the situation in their homes.
8. Lack of infrastructure: Majority of women entrepreneurs operate from their
residential premises . This puts a limitation to the growth and development of their
projects . Time and household duties do not permit them to move to industrial estates and
avail of the facilities provided therein.
 9. Lack of Marketing Ability: When it comes to aggressive marketing, women fail .
They may be able to match the quality of their products and services with those provided
by their male counterparts but , they do not have the organizational set-up to pump a lot
of money into advertisement. Stiff" competition from the organized markets and the male
entrepreneurs sometimes put hurdles in their pathway to success. Despite this, women in
business have been known for giving quality products and timely deliveries .
10. Low Mobility: Women entrepreneurs are often handicapped by their inability to
travel from one place to another for business work. From time to time , they have to visit
Government Departments and meet Licensing Authorities , Sales Tax and Labour
Officers. They are unable to cope up with all this as domestic responsibilities restrict their
mobility . This takes a toll on them and they are compelled to appoint middlemen to do
their purchases , marketing and other outside jobs. The outcome is high- costs of
operation which further increases their financial burden.

Successful female entrepreneurs in India

Women have come a long way from just being a homemaker. Narendra Modi’s start up friendly
environment in the country has proved to be a blessing for female entrepreneurs and instrumental
in fighting gender stereotyping in the business community.

Kiran Mazumdar Shaw: She is the founder Chairman and Managing Director (CMD) of
Biocon Limited. Born in Bangalore, Shaw completed her Bachelors in Zoology from Mount
Carmel College, Bangalore University. She later did her post-graduation in Malting and Brewing
from Ballarat College, Melbourne University.

She worked as a trainee brewer in Carlton and United Breweries, Melbourne and as a trainee
maltster at Barrett Brothers and Burston, Australia. She started Biocon in 1978 and spearheaded
its evolution from an industrial enzymes manufacturing company to a fully integrated bio-
pharmaceutical company.

Today Biocon under Shaw’s leadership has established itself as a leading player in biomedicine
research with a focus on diabetes and oncology. Kiran is also a member of the board of
governors of the prestigious Indian School of Business and Indian Institute of Technology
Hyderabad.

Kiran received the prestigious Padma Shri (1989) and the Padma Bhushan (2005) from the
government of India

Indra Nooyi:

The most well-known face amongst Indian women entrepreneurs -Indra Nooyi is the CFO and
President of PepsiCo. With a Masters Degree in Public Management from Yale University and
Masters in Finance and Marketing from IIM, Kolkata, Nooyi held several senior positions at
Motorola and Asia Brown Boveri before joining PepsiCo.
Born in Chennai, Indra did her Bachelor’s in Science from Madras Christian College in 1974
.Beginning her career in India, Nooyi held product manager positions at Johnson & Johnson and
textile firm Mettur Beardsell. Nooyi joined PepsiCo in 1994 and was named president and CFO
in 2001.She has been conferred with prestigious Padma Bhushan for her business achievements
and being an inspiration to India’s corporate leadership. Her strong acumen for business has
helped the company garner as much as 30 billion dollars worth of crucial deals within the last
couple of years.

Chanda Kochar: She is currently the MD & CEO of India’s largest private bank ICICI Bank.
Rajasthan born chanda got Masters Degree in Management Studies from Jamnalal Bajaj Institute
of Management Studies, Mumbai. She received the Wockhardt Gold Medal for Excellence in
Management Studies as well as the J. N. Bose Gold Medal in Cost Accountancy.
Chanda Kochhar is married to Deepak Kochhar, a wind energy entrepreneur and her
Business schoolmate. Under Kochhar’s leadership, ICICI Bank won the “Best Retail Bank in
India” award in 2001, 2003, 2004 and 2005 and “Excellence in Retail Banking Award” in 2002;
both awards were given by The Asian Banker. Kochhar personally was awarded “Retail Banker
of the Year 2004 (Asia-Pacific region)” by the Asian Banker, “Business Woman of the Year
2005” by The Economic Times and “Rising Star Award” for Global Awards 2006 by Retail
Banker International.

Entrepreneurial process: In today’s economic world, entrepreneurship is considered the key

factor toward economic development. Entrepreneurs strive to create more opportunities in
industry, providing more employment options and ultimately having a positive impact on per
capital income, revenue generation, lifestyle, etc. This article deals with one of the most
important elements of entrepreneurship: creativity.

CHARACTERISTICS OF THE ENTREPRENEURIAL PROCESS

Innovation:
 An entrepreneur’s mind revolves around new ideas and opportunities for innovation.
There is a continuous and conscious effort required to look for niches and undertake the
risks in entering them.
 Economic Importance
 Entrepreneurship works toward optimizing resources and taking full use of them to create
efficient processes. It increases an enterprise’s wealth and adds value by increasing the
economic activity that comes with optimizing the whole process.

More Profit:
The process of entrepreneurship rewards the individual by increasing the profit potential of the
enterprise. This is the result of undertaking new ideas and providing an innovative product or
service.
Risk-Taking:
The whole essence of entrepreneurship revolves around the courage and ability to take new risks.
Patience is needed to observe the fruitful outcome of an idea, and it takes time and effort to go
from conceptualization to implementation of ideas. This time and effort is the risk that the
entrepreneur is willing to take.
Job Opportunities;
Entrepreneurship creates new niches and enterprises, which requires a work force. This provides
exciting job opportunities for young adults. Hence, with the innovation and profit,
entrepreneurship has immense potential for creating jobs.

The Entrepreneurial Process;

The entrepreneurial process starts with conception and refinement of an idea, followed by
implementation and management. The flow chart of the entrepreneurial process is shown below:

ENTREPRENEURSHIP AND CREATIVITY:

In today’s world, due to globalization and excessive industrialization, products are
manufactured and exported to international markets. As a result, there is easier access to every
product, everywhere. The consumer has access to various kinds of products ranging in type and
quality.
A creative mind answers all those questions. Creativity helps us think of how to improve
existing business practices. A brand might be very established and popular among the
consumers, but there is always something that can be done differently from them and in a better
way.

Creativity is simply the ability of imagination. Imagination leads someone to reach never
before explored areas. In business terms, imagination alone is what is known as “thinking outside
the box”. Using imagination, an entrepreneur can put aside the practical norms and think of
something creative and innovative.
There are indicators that signify the creative thinking of a successful entrepreneur. Creativity
does give an entrepreneur a competitive advantage, but how does one assess whether they are
creative enough or not?

Following are characteristic features indicative of a creative entrepreneur:

 An entrepreneur adheres to rules and principles only when they add value to the
organization and have a potential to attract more customers.
 An entrepreneur experiments with his ideas as the first step. The second step is learning
from the experience and the third step is implementation of what they have learned.
 An entrepreneur is less afraid to lose and is always keen to experiment in new ventures.
 The entrepreneur is not afraid of creativity and believes that creative ideas will only help
their enterprise.
 A creative thinker will take inspiration from new ideas in every area directly or indirectly
related to the enterprise.
 An entrepreneur is not afraid to go beyond the industry and enter new markets. This
opens a wide range of opportunities to formulate new niches.
 Every product and service is not good enough and has room for improvement. An
entrepreneur realizes that very well.
 A creative thinker is interested in bringing totally opposite things together to create new
products or services.
 An entrepreneur creates new products for existing services and new services for existing
products.
 Creative ideas come more quickly when someone is not afraid to appreciate new ideas
irrespective of who comes up with them.
 An entrepreneur shares an idea and is open to feedback that improves and refines the
idea.
 Creativity comes from learning different things, whether they are related to the industry
or not.

Idea Generation Techniques:

Ideas are things that come and go and fairly frequently too. However, the really great ideas
usually spring unexpectedly in moments of inspiration. It becomes easier to come up with great
ideas when we free ourselves from the mundane, everyday, conventional thoughts that take up
the thought space in our brain.

1. SCAMPER

SCAMPER is an idea generation technique that utilizes action verbs as stimuli. It is a well-
known kind of checklist developed by Bob Eberie that assists the person in coming up with ideas
either for modifications that can be made on an existing product or for making a new product.
SCAMPER is an acronym with each letter standing for an action verb which in turn stands for a
prompt for creative ideas.

S – Substitute

C – Combine

A – Adapt

M – Modify

P – Put to another use

E – Eliminate

R – Reverse

2. Brainstorming:

This process involves engendering a huge number of solutions for a specific problem (idea) with
emphasis being on the number of ideas. In the course of brainstorming, there is no assessment of
ideas. So, people can speak out their ideas freely without fear of criticism. Even bizarre/strange
ideas are accepted with open hands. In fact, the crazier the idea, the better. Taming down is
easier than thinking up.

Frequently, ideas are blended to create one good idea as indicated by the slogan “1+1=3.”
Brainstorming can be done both individually and in groups. The typical brainstorming group
comprises six to ten people.

3. Mindmapping:

Mindmapping is a graphical technique for imagining connections between various pieces of

information or ideas. Each fact or idea is written down and then connected by curves or lines to
its minor or major (previous or following) fact or idea, thus building a web of relationships. It
was Tony Buzan, a UK researcher, who developed the technique “mind mapping” discussed in
his book ‘Use your Head’ (1972). Mind mapping is utilized in brainstorming, project planning,
problem solving and note taking.

4.Storyboarding:

Storyboarding has to do with developing a visual story to explain or explore. Storyboards can
help creative people represent information they gained during research. Pictures, quotes from the
user, and other pertinent information are fixed on cork board, or any comparable surface, to stand
for a scenario and to assist with comprehending the relationships between various ideas.
5.Role playing: In the role playing technique, each participant can take on a personality or role
different from his own. As the technique is fun, it can help people reduce their inhibitions and
come out with unexpected ideas.

6.Daydreaming:

Though mostly not met with approval, daydreaming is truly one of the most fundamental
ways to trigger great ideas. The word “daydream” itself involuntarily triggers an uninhibited and
playful thought process, incorporating the participant’s creativity and resourcefulness to play
around with the present problem. It enables a person to establish an emotional connection with
the problem, which is beneficial in terms of coming up with a wonderful idea.

7.Reverse thinking:

As the term ‘reverse thinking’ itself suggests, instead of adopting the logical, normal
manner of looking at a challenge, you reverse it and think about opposite ideas. For example:
‘how can I double my fan base?’ can change into ‘how do I make sure I have no fans at all?’ You
may notice that the majority of participants would find it easier to produce ideas for the ‘negative
challenge’ simply because it is much more fun. However, don’t spend too much time on the
reverse idea-generation – about 10 to 15 wrong ideas is fine.

8.Brainwriting:

Brainwriting is easy. Instead of asking the participants to shout out ideas, they are told to
pen down their ideas pertaining to a specific problem or question on sheets of paper, for a small
number of minutes. After that, each participant can pass their ideas over to someone else. This
someone else reads the ideas on the paper and adds some new ones.

9.Collaboration:

As the term indicates, collaboration is about two or more people joining hands in working
for a common goal. Designers frequently work in groups and engage in collaborative creation in
the course of the whole creative process.

Entrepreneurship Development Programme

(EDP) is a programme which helps in developing the entrepreneurial abilities. The skills that
are required to run a business successfully is developed among the people through this
programme. Sometimes, people may have skills but it requires polishing and incubation. This
programme is perfect for them. This programme consists of a structured training process to
develop an individual as an entrepreneur. It helps the person to acquire skills and necessary
capabilities to play the role of an entrepreneur effectively. As per National Institute of Small
Industry Extension Training, Hyderabad, an EDP is an effort of converting a person to an
entrepreneur by passing him through a thoroughly structured training. An entrepreneur is
required to respond appropriately to the market and he/she is also required to understand the
business needs

Objectives of EDP:

The objective of this programme is to motivate an individual to choose the entrepreneurship as a

career and to prepare the person to exploit the market opportunities for own business
successfully. These objectives can be set both in the short-term and long-term basis.

Short-term objectives: These objectives can be achieved immediately.In the short-term, the
individuals are trained to be an entrepreneur and made competent enough to scan existing market
situation and environment. The person, who would be the future entrepreneur, should first set the
goal as an entrepreneur. The information related to the existing rules and regulations is essential
at this stage.

Long-term objectives: The ultimate objective is that the trained individuals successfully
establish their own business and they should be equipped with all the required skills to run their
business smoothly.

An Entrepreneurship Development Programme primarily plays four roles to help an individual to

become an entrepreneur. They are:

Stimulatory Role: It aims at influencing people in large number to be the entrepreneur. This
includes:

 Developing managerial, technical, financial, and marketing skill

 Inculcating personality traits
 Promotes and reforms entrepreneurial behaviour and values
 Identifying potential entrepreneur applying scientific methods
 Motivational training and building proper attitude
 Strengthening the motive of a person and giving recognition
 The valuable know-how of the local products and the processes help in selection of
products, preparation of project reports

Supportive Role: It helps in the following ways:

 Registration of the business

 Procurement of fund
 Arrangement of land, power, water, shed etc.
 Support in purchase of right kind of machinery and equipment
 Supply of raw materials and common facilities
 Providing tax relief, subsidy etc.
 Guidance in product marketing
 Support for management consultancy
Sustaining Role: It aims at providing an effective safeguard to businesses to sustain against the
cut-throat market competition. This includes:

 Help in modernisation, expansion, and diversification

 Additional financing for further development
 Deferring interest payment
 Creating new marketing processes
 Helping access to improved services and facility centres

Socio-economic Role: It aims at upgrading the socio-economic status of the public and includes:

 Identifying entrepreneurial qualities in practicality

 Creating employment opportunities in micro, small, and medium industries on an
immediate basis
 Arresting concentration of industries by supporting regional development in a balanced
manner
 Focusing on the equal distribution of income and wealth of the nation
 Channelizing the latent resources for building an enterprise

Introduction to e-Business

E-business or Online business means business transactions that take place online with the
help of the internet. The term e-business came into existence in the year 1996. E-business is an
abbreviation for electronic business. So the buyer and the seller don’t meet personally.

Features of Online Business

Some of the features of Online Business are as follows :

 It is easy to set up

 There are no geographical boundaries

 Much cheaper than traditional business

 There are flexible business hours

 Marketing strategies cost less

 Online business receive subsidies from the government

 There are a few security and integrity issues

  There is no personal touch

 Buyer and seller don’t meet

 Delivery of products takes time

 There is a transaction risk

 Anyone can buy anything from anywhere at anytime

 The transaction risk is higher than traditional business

Venture management is a business management discipline that focuses on being both

innovative and challenging in the realm of introducing what could be a completely new product
or entering a promising newly emerging market.

The discipline is focused on the skills, practices and technology required to manage the rapid
growth of new business in highly dynamic environments. These environments are often
characterized by rapid technology change.

Venture Capital: It is a private or institutional investment made into early-stage / start-up

companies (new ventures). As defined, ventures involve risk (having uncertain outcome) in the
expectation of a sizeable gain. Venture Capital is money invested in businesses that are small; or
exist only as an initiative, but have huge potential to grow. The people who invest this money are
called venture capitalists (VCs). The venture capital investment is made when a venture capitalist
buys shares of such a company and becomes a financial partner in the business.

Venture Capital investment is also referred to risk capital or patient risk capital, as it includes
the risk of losing the money if the venture doesn’t succeed and takes medium to long term period
for the investments to fructify.

Venture Capital typically comes from institutional investors and high net worth individuals and
is pooled together by dedicated investment firms.

Features of Venture Capital investments:

 High Risk
 Lack of Liquidity
 Long term horizon
 Equity participation and capital gains
 Venture capital investments are made in innovative projects
 Suppliers of venture capital participate in the management of the company
 Methods of Venture capital financing
 Equity
 participating debentures
  conditional loan

Types of Venture Capital funding:

The various types of venture capital are classified as per their applications at various stages of a
business. The three principal types of venture capital are early stage financing, expansion
financing and acquisition/buyout financing.

Seed money: Low level financing for proving and fructifying a new idea

Start-up: New firms needing funds for expenses related with marketingand product
development

First-Round: Manufacturing and early sales funding

Second-Round: Operational capital given for early stage companies which are selling products,
but not returning a profit

Third-Round: Also known as Mezzanine financing, this is the money for expanding a newly
beneficial company

Fourth-Round: Also calledbridge financing, 4th round is proposed for financing the "going
public" process

Advantages of Venture Capital:

1. They bring wealth and expertise to the company

2. Large sum of equity finance can be provided
3. The business does not stand the obligation to repay the money
4. In addition to capital, it provides valuable information, resources, technical assistance to
make a business successful

Disadvantages of Venture Capital

As the investors become part owners, the autonomy and control of the founder is lost

1. It is a lengthy and complex process

2. It is an uncertain form of financing
3. Benefit from such financing can be realized in long run only