The entrepreneurial activity is part of a complex mechanism involving many activities that seemingly have no direct connection, but are actually indispensable and important part of this mechanism. All the elements that work together to enable entrepreneurship and add value to the economy and society build the entrepreneurship ecosystem.
The definition of entrepreneurship—in the context of understanding its role in economic growth—is as follows:
“Any attempt at new business or new venture creation, such as self-employment, a new business organization, or the expansion of an existing business, by an individual, a team of individuals, or an established business.” (Reynolds et al., 1999, p. 3)
Here is the place to try to answer one question:
Why is entrepreneurship important?
- Entrepreneurial activity creates new jobs, allowing businesses to grow and at the same time gives fulfilment and day job to the employees with the right skills;
2. Where entrepreneurship is thriving, it generates income – income for their owners, but also for public fees and taxes that are used in turn for maintenance of public goods and services;
3. Entrepreneurship essentially seeks and solves existing problems, hence it encourages creative thinking and innovation;
4. In order to run a successful entrepreneurial activity, all processes must be optimised, thereby increasing the effectiveness of the organisation;
5. Thanks to the market mechanism by which guides any entrepreneurial activity, business processes and models in the organisation are constantly improved and available resources are optimised and not wasted;
6. Last but not least, entrepreneurship brings economic growth to its country – from startup to scale up.
There are many reasons why we need to pay attention to entrepreneurial activity. The list above is often underestimated, while indeed those factors bring most value.