The entrepreneurial process involves the pursuit of a new venture, such as new p

Question

The entrepreneurial process involves the pursuit of a new venture, such as new products or new companies. The individuals that undertake this process must possess unique characteristics, abilities, and backgrounds. These individuals must also be willing to accept the possibility of failure as they take on risks that others avoid. Consider the risks that are particular to entrepreneurs and how they can be dealt with.

----------------Based on your reading for this week: -----------------(Chegg Expert the textbook is: Hisrich, R.D., Peters, M.P., & Shepherd, D.A. (2017). Entrepreneurship (10th ed.). New York:McGraw-Hill Irwin.)-----------------------------

Chapters 1, 2, and 6.

What risks do you see in becoming an entrepreneur, and how will you mitigate these risks?

(Expert this is the question to answer, see above question).

Explanation / Answer

Some of the major risks in becoming an entrepreneur are:

1. Risk of losing all the capital invested in the business. Hence, it is good for an entrepreneuer to begin with a small setup.
2. Many times financial instability generates stress and develops work pressure which results in unhappy life and unhealthy relationships with family and friends. Hence, it is highly recommended to keep some time for self.
3. Putting up a new venture is always risker and complicated too. An entrepreneur should take the risk by learning more about the new venture, new market and customer expectations, have a business plan for decision making.
4.Once the business starts giving profits, many risks in order to expand the business , may start evolving such as hiring more employees, office at another place, new infrastructure, new product, funding etc.
5.In case of partnerships exists in business, sometimes there may be difference in opinions.

So here are steps which helps in mitigating the risks :

1. Choose a business and its structure that controls the personal liability.
2. Most recommended to transfer the risk by insuring the business.
3. To have the risk assessment and analysis plan in place.
4. To have proper quality assurance plan in place.
5. To have risk management plan in place and review it more frequently.
6. Keep the financial accounts up to date; minimum loans.

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