Entrepreneurial Motives & Characteristics (Edexcel A Level Business)

Revision Note

Steve Vorster

Written by: Steve Vorster

Reviewed by: Jenna Quinn

Characteristics & Skills Required by Entrepreneurs

  • Entrepreneurs require a unique set of characteristics and skills

1-5-2-characteristics-and-skills-required-by-entrepreneurs

The skills and characteristics required by entrepreneurs

  • The characteristics have been explained through the different sections in 1.5.1

  • Perhaps one of the most valuable skills of an entrepreneur is the ability to communicate persuasively

    • Persuade potential financial backers of the merits of their idea

    • Persuade people to join them in creating the product/service

    • Persuade customers of the value of their product/service

  • All of the skills work together to create and drive an innovative idea towards success

Reasons Why People Set up Businesses

  • People set up businesses for a variety of financial and non-financial reasons

Financial & Non-financial reasons for Setting up a Business

Financial Reasons

Explanation

Example

Profit maximisation

  • People want to create a profitable business that generates substantial revenue and profit for themselves and their shareholders

  • Amancio Ortega, the founder of Zara,  built a fast-fashion empire that has become one of the most profitable clothing retailers in the world

Profit satisficing

  • Occurs when the entrepreneur is not solely focused on maximising profits but rather achieving a satisfactory level of profit 

  • This is common among small businesses, where the owner may prioritise their work-life balance

  • Yvon Chouinard, the founder of Patagonia, created a successful outdoor clothing and gear company that was initially built to help finance his climbing expeditions

Non-financial Reasons

Explanation

Example

Ethical stance

  • Some entrepreneurs may have a particular ethical stance (e.g. environmental sustainability or social justice) that they want to build their business around

  • Anita Roddick, started The Body Shop, as she wanted to create a company that would promote environmental sustainability, fair trade and human rights

Social entrepreneurship

  • These entrepreneurs aim to create a business that seeks to address a social or environmental problem while also earning a living

  •  Blake Mycoskie, the founder of TOMS Shoes, created a business model that donates a pair of shoes to a child in need for every pair sold

 Independence

  • Many people want to be their boss and have control over their work

  • They may be dissatisfied with traditional employment structures or desire the freedom and flexibility that comes with running their own business

  • Travis Kalanick and Garrett Camp, the co-founders of Uber, started their business with a desire for independence and the ability to work from anywhere

 Home working

  • With the advent of technology, many people have started businesses from their homes and this offers them more flexibility and a better work-life balance

  • Sara Sutton, the founder of FlexJobs, had a desire for independence and the ability to work from home and this led her to create a successful online job board that specialised in remote and flexible work opportunities

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Steve Vorster

Author: Steve Vorster

Expertise: Economics & Business Subject Lead

Steve has taught A Level, GCSE, IGCSE Business and Economics - as well as IBDP Economics and Business Management. He is an IBDP Examiner and IGCSE textbook author. His students regularly achieve 90-100% in their final exams. Steve has been the Assistant Head of Sixth Form for a school in Devon, and Head of Economics at the world's largest International school in Singapore. He loves to create resources which speed up student learning and are easily accessible by all.

Jenna Quinn

Author: Jenna Quinn

Expertise: Head of New Subjects

Jenna studied at Cardiff University before training to become a science teacher at the University of Bath specialising in Biology (although she loves teaching all three sciences at GCSE level!). Teaching is her passion, and with 10 years experience teaching across a wide range of specifications – from GCSE and A Level Biology in the UK to IGCSE and IB Biology internationally – she knows what is required to pass those Biology exams.