We are entrepreneurship career advocates, passionate about education, books, entrepreneurship, career development and technology! As Entrepreneurs, Researchers, Authors, Trustees, degrees in International Relations, Trade & Transport, Economics, Research, Business, Management, Entrepreneurship. Founder, of the ECC & Leaders and Entrepreneurs Advanced Development (LEAD). Pioneer, Encourage Youth Entrepreneurship (E.Y.E campaign) & 1MillionBookDonation campaign 2017-2026.
Motives are combinations of goals, self-efficacy, and vision (Baum et al., 2001). Generally, motivations are both extrinsic and intrinsic; money, status, recognition, and social acceptance are extrinsic rewards (Ellerman, 2009). While achievement, knowledge, skill, autonomy, self-respect, and solutions to problems are examples of intrinsic rewards (McGregor, 1966). Over seventy years ago Schumpeter expresses the following regarding entrepreneurial motives:
"First of all, there is the dream and the will to found a private kingdom, usually, though not necessarily, also a dynasty. … Then there is the will to conquer, the impulse to fight, to prove oneself superior to others, to succeed for the sake, not of the fruits of success, but of success itself. From this aspect economic action becomes akin to sport-… The financial result is a secondary consideration, or, at all events, mainly valued as an index of success and as a symptom of victory, the displaying of which very often is more important as a motive of large expenditure than the wish for the consumers’ goods themselves. … Finally, there is the joy of creating, of getting things done, or simply of exercising one’s energy and ingenuity.... Our type seeks out difficulties, changes in order to change, delights in ventures" (Schumpeter, 1934, p. 93-94).
Furthermore, Beeka (2015) and Carter et al. (2003) identify six career motives:
1) Innovation- New accomplishment intentions and creativity
2) Independence- Freedom, control and flexibility of one’s' time
3) Recognition- Status or approval from family, friends and society
4) Role- Family tradition or emulate example of others.
5) Financial success- Increase earnings or financial independence.
6) Self-realisation- Pursuing personal goals
Given the above do you recognise what motivates your career or the entrepreneurs career, and is this worth being studied? Carsrud and Brannback (2011, p. 11) argue over the past two decades entrepreneurial motivation studies are being ignored like traits research since motives appear similar between entrepreneurs and non-entrepreneurs, which is unfortunate because motivation research explicates the intention-action link and answers questions regarding:-
(a) What activates a person?
(b) What makes the individual choose a behaviour over another? and
(c) Why people respond differently to the same motivational stimuli?
Furthermore, the normative theory of decision-making drawn from the concept of expected utility (EU) maximisation (Hardman and Connolly, 2009) state individuals are motivated by utility anticipated from pursuing entrepreneurship (Douglas and Shepherd, 2000). Thus, additional to the motives above from Beeka (2015) and Carter et al. (2003), the quest for the identity motivates entrepreneurial behaviour (Akerlof and Kranton, 2000). When faced with opportunity, individuals perceive and decide through a rational process that clarifies going ahead against abandoning the opportunity; those who become entrepreneurs their subjective return to entrepreneurship is positive (Minniti and Bygrave, 1999, p. 41). Their self-employed decision outweighs being employed which is often a rational process of expected utility (Beeka, 2015; Campbell, 1992; Douglas and Shepherd, 2000, 2002).
Finally, looking at the 6 career motives above, what will motivate #You to pursue your chosen career as an employee, intrapreneur or become an entrepreneur?
7.
Beeka, B. H (2015) Entrepreneurship as a Viable Career Choice for
Nigerian Youth. Sheffield Business School, Sheffield Hallam University
Doctor of Philosophy Thesis.
10. Beeka, B. (2011) Entrepreneurship as a career choice: Opportunity recognition model from an emerging economy. In Lee, B and Palmer, N.J (Eds) Sheffield Doctoral Conference Proceedings, pp. 19-36. Sheffield: The University of Sheffield Management School Research Office.
Disclaimer: Every
possible effort has been made to ensure that the information contained
in this article is accurate. While every precaution has been taken in
the research but it is advised that names, places, narratives and quotes
be independently confirmed by the reader. The publisher and the author
cannot accept responsibility for any errors or omissions, however
caused. The editor, publisher or author can accept no responsibility for
loss or damage occasioned to any person acting, or refraining from
action, as a result of the material in this publication.
Entrepreneurship is a feasible career and a legitimate way to earn and build wealth.
Advocate entrepreneurship or starting a business and for
many people the first thing asked is “Where is the money?” when appropriate
questions could be focused on sweat equity “How can I start small, sell and build a
business to a stage where investors chase after me?” or “How do I develop a viable pitch or write a business plan to source finance?”
A reality voiced by countless
entrepreneurs is that the person with a great idea, a credible pitch, business plan or network can always attract the money needed to start or at least expand. Thus, it is not
prudent to procrastinate because of money. When an idea or dream is in your
head and needs to come out, it will get developed regardless of initial
financial situation. Hence, a feasible plan and a sales strategy are
required; start selling on a small scale as your start-up strategy rather than
waiting too long for money.
Daymond John the founder of FUBU in
America was rejected by 27 banks while seeking a loan, and advises that new
founders need to concentrate on more unconventional sources of finance. After
an interview with 80 African entrepreneurs we discovered none had started with
a bank loan, although some tried they were rejected, and years later after prospering
the banks were offering them expansion funds. Muhammad Yunus was inspired to
start Grameen bank due to lack of conventional bank loans available in
Bangladesh. Grameen’s micro-finance project successfully had higher repayment
rates than the traditional banks. Much research shows that bootstrapping is
usually an avenue for entrepreneurs to start small, because the
traditional banks hardly lend money to new entrepreneurs. Thus, you may or may
not get a conventional bank loan so combine your sourcing methods by trying
unconventional avenues too.
To start and sustain a profitable
business; the initial requirements include passion, sweat equity, focus, marketing, networks, entrepreneurial skills, Brains, Energy and Time and not only Money.
What this also implies is that if you don’t have a clear plan how to
judiciously apply money, too much of it can be bad for you. If you are
traveling to London from a far continent by road and sea without directions or
a map, likely even if you get a million you would probably waste it and not get
there and vice versa. Any source of finance does not want to throw money down
the drain. You have to prove that you have considered all angles and you know
what you are doing by starting operations, showing revenue figures, existing
customers or client orders. Furthermore, evidence your commitment through
researching your business sector to develop a strong business and career plan.
These are the roadmap to how you will judiciously apply money, time, effort
(sweat equity), in fact, all the factors of production to start and grow your
business.
There are different avenues for
business finance. Debt financing involves funds borrowed by a business to
operate e.g. bank loans. While equity financingindicates raising capital
through selling company shares e.g. investors. Also, funds can flow from unconventional
sources like personal savings, friends and family, strangers, crowd funds
additional to grants. Explore the following non conclusive (there are more) finance sources to start or grow
your business:
1)Savings: Use your personal savings to start. Will Smith said
“Whatever your dream is, every extra penny you have needs to be going to that”.
2)Earnings: Sweat equity
andrevenue earned from any skill, trade, work, contract can be
used to fund your business.
3)Pre-sales:This
involves planning and selling your products or services before the official
release date.You could offer a discount to potential customers such as
10-50% if they can commit to buying in advance.
4)Networks: Family and friends
are principal sources for many start-up finance. So pitch your close network
and gain from family or friends contributions. For instance, get everyone you
know to contribute about 5% or 10% into raising your start-up capital. An
entrepreneur we interviewed said regarding start-up finance “My dad helped, I
had personal funding. Some of my friends brought in a bit of money. The money’s
we borrowed were always from individuals never from the banks, and I think we
were lucky there. One, the banks wouldn’t have given us money for an idea”.
5)Partnership:
Go into a partnership, form a strategic alliance or joint venture. For example,
where profit share is agreed based on everyone’s investment and equity.
6)Bank Lending or Overdraft:
Many new entrepreneurs are unable to access bank loans, but some banks offer
finance through an overdraft facility or credit card. For a secured or
unsecured loan banks assess your cash turnover, collateral, credit history,
character and capacity to repay, your personal investment into the business may
also be considered.
7)Government-Enabled Loans:
Countries worldwide have different programs to support business finance, but
you have to research extensively to find them. These programs covered in this section may change so update your knowledge. First,
research the Start-up Loans United Kingdom where Lee Boyce wrote in 2014 that a
Start-up Loans director said the relevance of the scheme was due to enable a fact
that with little capital many United Kingdom entrepreneurs, such as, Sir Philip
Green, Sir Richard Branson, Mike Ashley of Sports Direct and so on were able to
start and build up business empires. The Start Up Loans U.K is a
government-funded scheme which also enables mentorship. The delivery partners
assigned by the Start Up Loans Company assist applicants with their business
plans, which are assessed and if approved subsequently funded by the
Start Up Loans Company through a low-cost unsecured loan. The founder
consequently benefits from business mentorship and other business support
products. The loan is paid back through monthly instalments and matures within 5
years after a fixed interest rate of interest. Capital repayment holidays are
possible but interest must be paid monthly. Second, America proposed The Jumpstart Our Business Start-ups Act or JOBS Act a law
designed to encourage funding of United States small businesses through ease of
various securities regulations. Third, there is NPower and existed a Small and Medium Enterprises Equity
Investment Scheme (SMEEIS) in Nigeria a voluntary bank initiative designed
for applicants to show a fantastically viable business plan and competency to
undertake a business project. The fact is, there are many past and current schemes in different countries. You will have to research and find the schemes still in existence and relevant to your business. During any finance arrangement, if board member support is offered, consider it because
you could benefit from additional financial and non-financial advice. Don’t
think of lose of control, because the agreement between you and any investor
could be that they will give 100% control back as soon as you pay back what you
have borrowed. Find out the different targeted types of finance available in your continent, region, community e.g. youth empowerment etc.
8)Cooperative or Peer Lending: Some
cooperatives, trader or peer-group associations in your community could lend
you money at a cheaper rate than the banks.
9)Micro-Finance:
This is a type of debt finance for a business. Every country has small firm’s
loan schemes or micro-credit finance institutions, find them and research if
their terms are beneficial for your business.
10)Private/EquityFinance: Business angels, Venture capitalists, Private equity,
Private investors; represent those willing to invest and sponsor
innovative and great ideas probably for an equity share of the business, or
outright buy-out in some private equity cases. The finance sources mentioned
here can fund large scale projects, assist take companies to IPO and contribute
non-financial benefits of time and experience. They will enrich your board
which is a welcome change for some because rather than thinking about loss of
control, a percentage and share of a successful company is better than zero
percent of nothing.
11)Crowdfunding: Another
finance prospect is to raise cash through selling some of the share capital in
your business. There are numerous crowdfunding platforms find them and evaluate
if relevant to your business. Indiegogo or Kick-starter are examples of platforms that have enabled the funding of creative projects in film, music, comics, video games, journalism, food
and technology projects.
12)Inventory Financing:This is a line of credit or short-term loan offered by a
supplier allowing your company to take products/inventory to sell with promise
to pay at a future date.
13)Loan and Grant Funding:
Some grants are available for innovative projects or research and development
(R&D). Many governments, regional bodies and regional banks, provide funds
such as agricultural, capacity building loans or grants etc find them.
Similarly, learn about international finance institutions such as the
International Finance Corporation (IFC) a member of the world bank they advice,
loan and fund large-scale projects e.g. infrastructure, mining and other
industrial private sector projects.
14)Sponsorship:This involves pursuing and accessing
financing in-cash, and sometimes in-kind (any personality, celebrity, industry
or famous person) to support your person, project, event or organisation. The
benefactor needs to show the sponsor that their support will result in positive
publicity or commercial gains. The returns include more personal and company
brand exposure, or awareness that encourages future buyers. Organisations
sponsor arts, entertainment, sports or other non-profit social causes.
Below is a comparison table showing
the advantages and challenges of some secondary sources of funding. Create your
own table like the one below incorporating your chosen sources of finance.
Founder benefits from additional
feedback to improve product or test business feasibility
Founder discloses business idea and information, such as, business plan,
intellectual property/patents which may be copied
2
Debt
Director receives cash and retains
full control of business operations
Loan benefit is only finance, no
other non-financial benefits are often included
3
Equity
Equity exchanged for finance and
non-financial benefit of experienced directors on the board, enabling faster
growth or working toward IPO
Enriched board members/ director
disagreements, or loss of much equity may lead to founder loss of control or
founder ousted from the business
4
Grant
No repayment, good sources for technology,
innovation, Research & Development
projects
Grants are specialised and directly
focused, requirements may be too stringent for your project e.g. science,
professional researchers needed etc
Investigate different finance
sources and find the best fit to start or grow in business. Aim for clarity concerning your business idea, develop a solid pitch, a feasible business and sales revenue plan to assist your journey and start with ‘the money at hand’ i.e. sweat equity and
the minimum you can get. If you have to wait till you have “Enough money” you
may never start, because there is never enough money.Start trading small if you can’t raise all
the money you want.Dream big, start small, grow big and wealthy.
a)Start saving towards funding your business today.
b)Start
a contribution scheme and get your friends and family to help you raise funds,
sell them a realistic business idea.
c)Find out who related private investors, business angels and venture
capitalists are and what they can do for you, develop a fantastic pitch, business and
equity plan for investment.
d)There
are corporative, peer-2-peer or micro-finance institutions in your region
approach them about your requirements.
e)Research information about grants or funding
provisions for MSME’s.
f)Find out related finance schemes and how they
can benefit you.
g)Join a crowd-funding site and raise funds or
learn from the process.
7.
Beeka, B. H (2015) Entrepreneurship as a Viable Career Choice for
Nigerian Youth. Sheffield Business School, Sheffield Hallam University
Doctor of Philosophy Thesis.
10. Beeka, B. (2011) Entrepreneurship as a career choice: Opportunity recognition model from an emerging economy. In Lee, B and Palmer, N.J (Eds) Sheffield Doctoral Conference Proceedings, pp. 19-36. Sheffield: The University of Sheffield Management School Research Office.
Disclaimer: Every
possible effort has been made to ensure that the information contained
in this article is accurate. While every precaution has been taken in
the research but it is advised that names, places, narratives and quotes
be independently confirmed by the reader. The publisher and the author
cannot accept responsibility for any errors or omissions, however
caused. The editor, publisher or author can accept no responsibility for
loss or damage occasioned to any person acting, or refraining from
action, as a result of the material in this publication.
