Friday, December 21, 2007

what factors influence in becoming an entrepreneur

in a way, this is the age-old question whether entrepreneurs are born or can be made.

and my answer is (which is vindicated by a cross-section of entrepreneurs of both hues) that some are born, many others are made.

what makes entrepreneurs? some of the factors that influence are culture, family background, government policy, infrastructure, teachers and mentors, peer groups and resources.

some cultures are pro-biz and some are not; those that are, are typically communities which have traditionally engaged in businesses and frown upon their members working for someone as an employee. typically these are family-owned and family-run biz and they tend to hire people from within their family network.

cultures which are not pro-biz typically tend to be less risk-tolerant and therefore encourage members to obtain secure jobs in sectors that are perceived by them as safe and non-risk. the spirit of entrepreneurship in such communities is stifled right from early childhood.

if you are born in a family of businessmen, chances are they will foster your spirit of entrepeneurship as opposed to those families where men have always been 'in jobs'.

sunil mittal as an entrepreneur as we know him today would not have been possible but for the fact that there was a change in government policy with respect to the telecom industry. privatising telecom not only created a superbrand such as airtel but an entrepreneur such as sunil mittal.

if you look at the mutual funds industry today, most of the equities that are performing well are linked to infrastructure. india shining has thrown up not just phenomenal need for infrastructural development but also opportunities for many to become entrepreneurs.

in my experience, the biggest influencers are mentors/peers. typically in a management school, a group comes under the missionary zeal of a teacher who exhorts them to become entrepreneurs and even after knowing that the opportunity cost is very high, some of them do veer towards entrepreneurship, even social entrepreneurship. i know a number of students who have given up cushy jobs to work in social technology space, micro-credit, etc

in the good old days of license raj in india, there was absolutely no incentive to become an entrepreneur because the ambient environment was most unconducive for the spirit of entrepreneurship. the political, economic and social framework actively discouraged freedom of enterprise. non-availablity of capital was the biggest show-stopper, for instance.

not any more, as you see around the world, trade barriers are collapsing, and economies have realised that the surest and fastest way to grow is by encouraging entreprenurship.

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