- Growth.
- Earnings.
- Transfer and inheritance: used for something that they can pass on (transference) to their children (inheritance) to give them a sense of security.
- Challenge: drive to have personal satisfaction, being successful boosts self-esteem.
- Autonomy: being your own boss, making decisions about the business, work hours, holidays etc.
- Security: if you are your own boss, you cannot be made redundant, dismissed, or be replaced with technology.
- Hobbies: just for fun, or because you are passionate about something.
Starting a business is a multifaceted decision driven by various motivations, ranging from personal fulfillment to financial objectives. Entrepreneurs embark on this journey for reasons as diverse as seeking growth and autonomy to turning hobbies into profitable ventures. Understanding these motivations is crucial for IB Business & Management students, offering insights into the entrepreneurial mindset and the challenges and rewards of starting a business. This comprehensive analysis delves into the reasons individuals start businesses, supported by industry examples to illustrate the real-world application of these motivations.
Growth
Motivation: Entrepreneurs are often driven by the desire for business growth, seeking to expand their operations, enter new markets, and increase their market share.
Example: Jeff Bezos started Amazon as an online bookstore but always had a vision for it to become “the everything store.” His drive for growth led Amazon to diversify into various sectors, including cloud computing and entertainment, making it one of the world’s most valuable companies.
Earnings
Motivation: The potential for significant earnings is a compelling reason to start a business. Entrepreneurs can potentially earn far more than what is possible through employment alone.
Example: Sara Blakely founded Spanx with a modest investment, growing it into a billion-dollar brand. Her entrepreneurial journey was driven by the desire to fill a market gap and the potential for high earnings.
Transfer and Inheritance
Motivation: Many entrepreneurs are motivated by creating a legacy or a business that can be passed on to their children, providing them with financial security and a foundation for future success.
Example: Walmart, founded by Sam Walton, has been passed down through generations, becoming the world’s largest retailer. The business serves as a legacy, ensuring financial security for the Walton family for generations.
Challenge
Motivation: The challenge of starting and growing a business, solving problems, and overcoming obstacles offers personal satisfaction and boosts self-esteem for many entrepreneurs.
Example: Elon Musk faces significant challenges in his ventures with SpaceX and Tesla. His drive to solve complex problems and push technological boundaries is a testament to his pursuit of challenge and innovation.
Autonomy
Motivation: Being one’s own boss, making independent decisions about the business, and having control over work-life balance are powerful motivators for starting a business.
Example: Tim Ferriss, author and entrepreneur, advocates for the “4-Hour Workweek,” emphasizing autonomy, flexibility, and efficiency in work and entrepreneurship as pathways to personal and professional satisfaction.
Security
Motivation: Entrepreneurship can offer a sense of security that may not be available through traditional employment, as being one’s own boss reduces the risk of job loss due to redundancy or dismissal.
Example: Reid Hoffman, LinkedIn co-founder, viewed entrepreneurship as a means to control his professional destiny, leveraging technology to create a platform that empowers professionals globally.
Hobbies
Motivation: Passion projects or hobbies can evolve into profitable businesses, allowing entrepreneurs to work on something they love.
Example: Julie Deane started The Cambridge Satchel Company from her kitchen table with just £600, turning her hobby of creating classic school satchels into a globally recognized brand.
Conclusion
The decision to start a business is influenced by a blend of personal, professional, and financial motivations. From seeking growth and earnings to desiring autonomy and the challenge of entrepreneurship, these motivations reflect the varied aspirations driving individuals to embark on entrepreneurial ventures. The examples provided, from Jeff Bezos’ vision for Amazon to Julie Deane’s hobby turned business, illustrate the diverse pathways through which entrepreneurs can achieve success. For IB Business & Management students, understanding these motivations offers critical insights into the entrepreneurial process and the factors that contribute to the successful establishment and growth of businesses.
