An entrepreneur is “a person who sets up a business or businesses, taking on financial risks in the hope of profit” (Das, 2018). When an entrepreneur sets out to start a business, they tend to start off small; small businesses within the UK are an essential factor to the UK’s economy as they account for 99.3% of employment (Dept for Business, Energy and Industrial Strategy, 2017). The turnover for small businesses within the UK in 2017 was £1.4 trillion (Dept for Business, Energy and Industrial Strategy, 2017). Just looking into the statistics of small businesses it is prominent that they are an important factor towards our economy. This essay will discuss the importance of entrepreneurial skills which are required within the creation as well as the success of a business and what resources will help launch an innovative and enterprising project. There are many skills and characteristics that are common to successful entrepreneurs and this essay will consider the resilience that an entrepreneur should have, the importance of networking and relationships which will help an entrepreneur succeed, as well as the ideal financial support options than an entrepreneur can use to help launch a project.
The personal resilience of an entrepreneur when linked alongside the ‘lemonade’ principle will ensure an entrepreneur when starting up a new project will be on the road for success. Resilience itself refers to “the human ability to adapt in the face of tragedy, trauma and other adversity (Connor, Davidson, 2003). Personal resilience is used to state what type of person can overcome setbacks which are related to their life as well as their business ventures. It is an important quality in which entrepreneurs should possess; it is a dynamic and evolving process (Ayala, Manzano, 2014) where entrepreneurs will gain skills which will help face uncertain events in the future with a positive attitude. Resilience itself can be linked to the Lemonade principle, which is where an entrepreneur will embrace surprises that may arise from uncertain situations and they will remain flexible, rather than tethered to their existing goals. Resilience and the ‘lemonade’ principle have a few similarities, such as, both will enable the entrepreneur to adapt and change in the face of uncertain/tragic events or circumstances. Both qualities are important for an entrepreneur to have as being able to adapt and change your business plans or ideas to suit arising issues and problems ensure that the project is still able to move forward into a successful business. Resilience is a quality most entrepreneurs will have within their persona and it enables them to adapt and face challenges, which is an essential characteristic to have and the ‘lemonade’ principle will add to this resilience by helping the entrepreneur take any surprises that enter or arise within the project and the entrepreneur will be able to figure out a correct solution enabling them to move forward in a positive manner rather than halting the process of becoming a successful business.
Relationships are important for an entrepreneur to have and having relationships with suppliers or customers will the entrepreneur succeed. The importance of strong relationships with suppliers, customers as well as staff is significant; by making good contracts with these groups of people it will help an entrepreneur to achieve what they want for themselves and their business. By having a loyal clientele, it can guarantee the entrepreneur a steady income on a regular basis. With regards to customers and a loyal customer base you can link this to lean start-ups; a lean start-up is a technique where ‘building a new business based upon the belief that an entrepreneur will need to investigate, experiment, test and iterate as they begin to develop their products’ (Rouse, 2018). Customer feedback for a project is vital as without the feedback of a projects customers the entrepreneur is unable to alter their products in order to satisfy their customers and bring back repeat purchasers. The feedback of a clientele base ensures that an entrepreneur will always be able to see what their products are doing well with and what they are lacking; with the results of feedback they can then upgrade or alter issues and therefore increase their success and customer satisfaction. As well as customers, having a good and loyal group of staff will definitely help a project succeed; the staff are the ‘back-bone’ of an organisation and by having good relationships with these members of staff, the entrepreneur will be guaranteeing a strong and reliable workforce that will contribute to the success of a project. Relationships within a business will directly link to the ‘patchwork quilt’ principle; this principle is where ‘entrepreneurs will build partnerships with self-reflecting stakeholders’ (University of West Virginia, 2011). By forming good partnerships or relationships with staff members the entrepreneur will reduce any uncertainty, for example, staff leaving unexpectedly, if there is a good relationship between the entrepreneur and their staff, they will not want to leave the project. Also, with having a good and reliable staff they will want to be a part of this growing project leading it into success.
Financial support at the start of a project for an entrepreneur is essential as it will help launch their project and later on lead them to the success that they want to achieve. Entrepreneurs at the start of their project appear to prefer a low risk strategy with regards to financing their venture such as, borrowing from friends or family members; by lending money for the start of their project from friends or family the entrepreneur will not have as much pressure on them to pay it back straight away like you would possibly have with a bank loan. Many entrepreneurs will also seek out Angel Investors, they will invest in small start-up businesses and they will offer ‘more favourable terms regarding paying back their investment when compared to other lenders such as, banks’ (Investopedia, 2018). However, some entrepreneurs will try the method of ‘bootstrapping’. Bootstrapping is where a project will ‘start off with little to no money’ (Campbell, 2018). Many entrepreneurs who start a project this way will rely on their customers and by them purchasing the project’s produce the entrepreneur will put that money directly back into the business. Bootstrapping can be used in the early stages of a start-up as well as working at an affordable loss. An affordable loss is where ‘entrepreneurs limit any risk by understanding what they can afford to lose. They will choose goals and actions where there will be an upside even if the downside ends up happening (University of West Virginia, 2011); by working at an affordable loss the entrepreneur minimises many risks and maximises their success.
Resilience, relationships and financial options, if done in the correct way will guarantee an entrepreneur’s success when starting a new project. Resilience is an important quality for an entrepreneur to have due to the fact that without the ability to adapt to situations that are out of your control you will struggle to find solutions and move forward with your project and therefore, the entrepreneur may not be able to find success with their project. Relationships with staff and customers as well as suppliers are crucial to a project’s success; without the correct relationships and connections, an entrepreneur will find it difficult to source materials and find staff that are willing to cooperate and assist with the venture for success. Customers play a large role in the success of a business due to the fact that without them, an entrepreneur has no sales and therefore no profit, so the project will fail rather than become successful. With the financial options that are available to an entrepreneur they are better branching towards low-risk options such as angel investors and family members. Finding financial resources by other means such as getting bank loans can lead to a project failing, if customers are not purchasing goods and sales are not coming in, the entrepreneur will not be able to pay back the loan and will then risk losing their whole business because of their inability to finance their project successfully. Low risk options are definitely a better option for entrepreneurs at the start of a project, if they received their finances from family members or friends, they may be more lenient with paying it back, therefore, the entrepreneur will not have the weighing worry of paying back their loan straight away. Without these three helpful management skills, an entrepreneur would struggle to get their project off of the ground and they will certainly struggle to find success when attempting to sell their product.