Process of Entrepreneurship

Because entrepreneurship is a process rather than a single event, it can be broken down into a sequence of stages. The exact number of stages varies slightly between authors, but the AP Inter II year Commerce syllabus expects a student to be able to describe the following broad sequence, in order:

1. Idea generation -- the process begins with a business idea, drawn from personal experience, a market gap, a hobby, new technology, or a problem the entrepreneur has personally faced.
2. Environmental scanning -- the raw idea is tested against the surrounding economic, social, technological, legal, and market environment, to see whether conditions are favourable.
3. Opportunity identification and evaluation -- not every idea is a genuine opportunity; the idea is screened for whether it solves a real, unmet need for a large enough group of customers who are willing to pay for the solution.
4. Feasibility study -- a more detailed technical, financial, market, and legal feasibility analysis is carried out to check whether the opportunity can realistically be converted into a viable venture.
5. Preparation of the business plan -- a written business plan is drawn up, covering the proposed product/service, the target market, the organisation structure, the finance required, and projected revenues and costs; this plan doubles as the document used to raise funds and to guide early decisions.
6. Mobilisation of resources -- capital, land, labour, technology, and raw material are assembled, whether from the entrepreneur's own savings, family, or the external sources of start-up funding described later in this chapter.
7. Launching the enterprise -- the legal form is chosen, necessary registrations and licences are completed, and the venture formally commences operations. …