Possibility of new venture creation

However, to have a desire to become an entrepreneur is not enough. There must be possibilities. So the question is: What makes it possible to create a new company? Several factors may exist – government support, professional background, marketing experience, initial finances, and role models.

The government contributes by providing the infrastructure to support a new venture. When we speak about infrastructure, we mean roads, communication and transportation systems, utilities, and so on. It is no wonder that more companies are created in the United States because of highly developed infrastructure and economic stability compared with other countries. Even the U.S. tax rate for companies and individuals is less than in many countries. Countries that have high tax rate, particularly for individuals, can suppress company creation because a significant monetary gain cannot be achieved, but the financial psychic, and social risks are still present.

The entrepreneur should also have the necessary background. As education and previous business experience give a potential entrepreneur the skills that are necessary to overcome all the difficulties in creating and managing a new enterprise. Marketing experience also play a critical role in creating a new company. The only presence of an idea to create a new product or service is not enough. For successful product launching to the market, there should also be a certain practical knowledge of marketing (so called knowhow) necessary to choose the best total combination of product, price, distribution, and promotion. A company is more successful if there is a market demand rather than a demonstration of technological capabilities of the producer.

Financial resources are necessary for a new company creation. While most of the start-up money for a new company come from personal savings, credit, friends, and relatives, there is often a need for additional start – up capital. Each new venture has a common trait – the need for risk capital. Risk-capital investors play an essential role in the development and growth of entrepreneurial activity. When start-up capital is readily available, more new companies create.

Finally, a role model (a live example of entrepreneurial success) can be one of the most powerful influences in making company creation seem possible. To see someone else succeed makes it easier to picture yourself engaged in a similar activity – of course, even more successfully. A frequent comment of entrepreneurs when asked about their motivations for starting their new venture is: ”If that person could do it, so can I!”

Дата добавления: 2014-11-29