GSHAYO

“The real thrill of entrepreneurship is creating something from nothing. This requires vision, creative thinking, a knack for getting things organized and a lot of hard work. Being an entrepreneur is no easy task and therefore entrepreneurs should be saluted”

(Nelson Mandela)

In recent times the concept of entrepreneurship has become popular in Tanzania and across the world. There are a number of reasons for this. But one I believe to be pivotal is the inspiration we have always received from entrepreneurs. Entrepreneurs have kept us constantly thrilled with innovative ideas, amazing breakthroughs and their admirable courage to face the unknown and come up with solutions and inventions addressing pertinent problems that none of us have thought before and in many cases bringing to life things we have not contemplated possible. I ceaselessly wonder about the insight, conviction, courage, vision, determination and creativity that led the world’s second richest man, Microsoft Boss, Bill Gates to drop out from the most prestigious University in the world, Harvard, and go on to achieve incomparable success in revolutionizing technology which has put computers at the heart of global commerce and social communication. Like other entrepreneurs, Gates’ life story is an enduring example of an entrepreneurial spirit which necessarily entails taking risks and accepting uncertainty to pursue a dream with all the passion, energy and commitment to make it turn into a reality.

But the other side of the story is manifested in entrepreneurs who become ridiculed for their failed dreams or ambitions. The case in point is Thomas Edison, an American inventor who failed 1,000s of times before he invented the electric bulb. Like Edison, there are many successful entrepreneurs who had previously failed so many times before becoming who they are today.In the eye of an entrepreneur, failure is not an end in itself as there is no failure in business but only lessons to learn and challenges to overcome. This is despite numerous credible research findings that indicate that over half of the start-up businesses fail within the first three years and that many of the aspiring entrepreneurs lose hope completely but others stick to their vision but simply change their direction. There are a number of reasons for this and I will explore this interesting matter in several of the forthcoming articles. However, what is most important is to know and be irrevocably convinced of the fact that entrepreneurship is not an easy journey and that one should be more passionate about the journey than about the riches one may receive if becoming successful.

Bill Gates

Bill Gates, Chairman, Microsoft

“Success is neither an event nor a point in time. Rather success is the long journey of achievements, counting one milestone after another. You need to celebrate every step on your way without forgetting that you still have a long way to go. You must also realize that the more you move ahead, the harder and smarter you must work to get to the next milestone”- Paul R.K Mashauri.

In this column, I intend to share my personal experience as an entrepreneur and the many lessons I have learned from other entrepreneurs across a range of sectors, most of whom were self-starters with humble beginnings starting from nothing and eventually building multimillion dollar empires.

I know there has been much debate over time about whether entrepreneurship can be taught or whether it’s an innate ability, a gift or talent that someone has been born with. I do not wish to venture into that debate here, but, I have come to realize through working and dealing with different entrepreneurs that some were born with special talents and opportunities that have helped them excel in the world of business and that others have grown from zero to heroes through a process of learning and acquiring of knowledge from various sources. This is the understanding that has motivated me to share my personal experience and wisdom from other entrepreneurs who I admire. I am eager to spread their business philosophy and experiences in hope that others will receive inspiration and guidance that will make a difference in their life and the society we live in.

We are living in an information age where knowledge is key to excelling in anything you do and it is my belief that everyone needs to constantly upgrade and sharpen his/her skills in order to be more effective and excel in what he/she is attempting to achieve.

My first enterprise, which was a newspaper I started after school before venturing into consulting, printing and car-hire, collapsed after eight months of existence. But there was so much I learnt and gained from that tough but very exciting experience. The practical experience of starting and operating a business taught me a lot including what works and what doesn’t in the entrepreneurship journey and inspired me to redefine my perception of what essentially entails success. Success is neither an event nor a point in time. Rather success is the long journey of achievements, counting one milestone after another. You need to celebrate every step on your way without forgetting that you still have a long way to go. You must also realize that the more you move ahead, the harder and smarter you must work to get to the next milestone.

Entrepreneurship: An Economic Perspective

Entrepreneurship is one of the four main factors of economic development; namely land, labor, capital and entrepreneurship. In economic terms the first factor of production that’s land refers to natural resources used by an enterprise. This includes ores and minerals mined from the ground as well as native plants and animals. The second factor that’s capital is always misunderstood to mean money. So many times I came across situations where I asked aspiring or self made-entrepreneurs of the challenges they face in business and lack of capital would come on top of their list. When I ask further what they mean by “lack of capital” I found that most of them use the term capital to mean financial resources. However, capital is the least form of capital. In economic terms, capital means all human creations used in creating wealth. For instance vehicles for a Car-Hire company or a cab-service company, camera for an audio visual production company and money for a finance company.

The third factor of production is Labor, This refers to human endeavors that produces wealth; both physical and mental, Depending on the level of business engagement, labor can be skilled or unskilled. Unlike the industrial age when human labor was demanded a great deal, modern business practices demand more of skilled than non-skilled labor as the machines can do what were to be done by human beings in a speed, efficient and effective manner that a human being can not.

The fourth factor of production and the most important of all is Entrepreneurship. This is the ability to make connections between the other factors and make them productive. Getting the other factors of production work together to create something that did not exist before. It requires vision, creativity and innovation.

Entrepreneurship: A Historical Overview

“One thing I have come to realize in business is that most of us have a lot of ideas but it takes an entrepreneur to see the window of opportunity, gather the necessary resources, provide the necessary leadership and turn that idea into a commercial output”-Paul R.K Mashauri.

The word “entrepreneurship” has its roots in French word entreprendre, referring to individuals who were “contractors” who bore the risk of profit or loss. Early references to entrepreneurship in the 14th century spoke about tax contractors-individuals who paid a fixed sum of money to the Government for the license to collect taxes in their region. This historical orientation of the word entrepreneurship offers a better understanding of who entrepreneurs were and what created a line of demarcation between business entrepreneurs, intra-preneurs and social entrepreneurs.

While the entrepreneurial attributes of creativity, innovation, vision, passion and perseverance can be seen in individuals working as employees in profit and nonprofit ventures (intrapreneurs and social entrepreneurs), a business entrepreneur based on the historical definition must have identified an opportunity and took the risk of investing his/her resources. That is to say the entrepreneur must have invested his/her capital for the expectation of making profit. This is critical because apart from doing things in a very unique way, an entrepreneur must make decisions regarding allocation of resources. He/she must be able to see the window of opportunity and intelligently allocate his/her scarce resources to maximize the potential.

Defining Entrepreneurship

Different scholars have defined entrepreneurship differently and the evolution of entrepreneurship itself has generated various definitions across disciplines. I however wish to use the definition offered by Robert Ronstadt of Boston University. He defined entrepreneurship as a dynamic process of creating incremental wealth. This wealth is created by individuals who assume the major risks in terms of equity, time and/or career commitment of providing value to some product or service. Ronstad’s definition of entrepreneurship encompasses various aspects of the entrepreneurial process that is necessary to transform a vision into reality. One thing I have come to realize in business is that most of us have a lot of ideas but it takes an entrepreneur to see the window of opportunity, gather the necessary resources, provide the necessary leadership and turn that idea into a commercial output.

The author of this article is an entrepreneur co-founder of the East Africa Speakers Bureau.
Email:mashauri@eastafricaspeakers.net.