Everything changes with the times as per the law of nature . Successful people and businesses foresee a situation, prepare themselves, and adapt to it. Accordingly, entrepreneurship has evolved and transformed the way companies are run during 2024.
From the last 100 years, the world is rapidly progressing in all ways possible. Moreover, the transformation of entrepreneurship has led to a complete face-lift of the way businesses are setup. What entrepreneurs think today is very different from those thoughts in the 1950s.
The concept of entrepreneurship has evolved dramatically over the past two centuries. However, the key fact remains same that entrepreneurship is on the rise. Let us examine the reasons for this surge, and compare the ways that today’s entrepreneur think contrast to their predecessors.
What is entrepreneurship?
In a nutshell, entrepreneurship is the activity of establishing businesses, overcoming financial risks, to generate revenues and earn profits.
Irish-French economist Richard Cantillon was among the first persons to iterate the concept of entrepreneurship in 1723. Scottish economist Adam Smith linked this concept with capitalism in the late 1700s. In 1803, French economist Jean-Baptiste Say defined entrepreneur as an economic agent who performs the following activities.
- Utilizes means of production (land, labor, capital) to develop a product
- Sells his product to gain revenue which will cover cost of production and remaining will be profit
- Entrepreneur also develops means to increase his profits either by lessening cost of production or by relocating the means of production
This definition though narrow but sounds familiar. Subsequently, the business owners on the enterprising journey are commonly practicing it as a costs cutting strategy. This concept is important in the relocation of economic resources for entrepreneurs as well.
Harvard Business School’s former business professor Howard Stevenson defines entrepreneurship as follows.
“Entrepreneurship is the pursuit of opportunity without regard to resources currently controlled.”
Howard H. Stevenson – Harvard Business School’s former business professor
This means that entrepreneurs can identify a business opportunity even if they do not have means to achieve it. Likewise, it is not about utilization of available resources to develop a product. Rather, it relates to having a vision to produce something and then work for ways to obtain required resources.
Read more: Top places for foreign entrepreneurs to start a business in the UAE
Evolution of entrepreneurship
Here is how entrepreneurship has evolved globally over the years to 2024.
- Trade
- Agricultural revolution
- Expansion of trade routes
- Invention of money
- Beginning of the markets
- Industrial revolution
- Modern entrepreneurship
Now, we take a look on the phases of entrepreneurship.
Trade
Although, not known back then, trade was the first form of entrepreneurship, starting nearly 20,000 years ago. Humans were exchanging goods for the overall benefit of their tribes. Known as barter trade, it let people to give their excess items to others to receive some valuable things in return.
Agricultural revolution
With time, people learnt to domesticate plants and animals. Group of people cultivated food and exchanged it with people who provided valuable goods. New areas of specialization began to emerge such as pottery, carpentry, wool-making, and masonry.
Expansion of trade routes
Cities started to appear from 2000 BCE. As population rose, people got an idea that they can earn profits by trading between cities and cultures. Popular trade at that time was of salt, fruits, rice, wheat, and paper making (by China).
Invention of money
The key development in the history of entrepreneurship was a shift from barter system to currency. Coins were the first mode of payment. Later, paper money as a medium of exchange, became a way to store value.
Beginning of the markets
Large marketplaces became more popular to cater large population. Economic regulations and banking became more efficient. Consequently, small businesses and entrepreneurs could purchase goods from abroad.
Innovation, mercantilism, and explorers was on the rise at that time. Afterward, market economy has led to a boost in the global trade. Luca Pacioli formulated standardized principles to keep track of a company’s accounts.
Industrial revolution
The shift from small scale to large scale production led to the industrial revolution. Afterwards, it gave rise to some of the world’s great entrepreneurs such as J. Morgan and John D. Rockefeller.
Modern entrepreneurship
Nowadays, entrepreneurship serves as lifeblood of all economies of the world. Entrepreneurs innovate the businesses processes and meet the needs of the users. Therefore, countries worldwide value their contribution in the economy.
Further reading: Habits of successful entrepreneurs
Entrepreneurship in the UAE
Global developments are leading conservative countries to become more socially progressive. Similarly, the UAE is open to international trade, providing best tax incentives to new startups. Particularly, the UAE is ranked best for “ease of doing business” in Middle East by World Bank Report.
Free zones in Dubai and across the UAE promote foreign investment. In the same vein, mainland companies make the most of the business friendly policies. Overall, benefits for entrepreneurs have been startling in the UAE.
Here are some statistics that showcase that entrepreneurship has evolved in the UAE through 2024.
- National Entrepreneurship Context Index of Global Entrepreneurship Monitor sees UAE retain 1st place for two consecutive years (2021 and 2022).
- The UAE aims to have 10 unicorns startup companies by 2031.
- Entrepreneurs are eligible for the golden visa of the UAE.
- The UAE has a target of 1 million companies by 2030, growing from 558 thousand companies in 2022.
- Middle East had an investment of $1 billion in 2020 on startups, 35% of which had headquarters in the UAE.
Tip: RAK introduces business packages for women entrepreneurs
Change drivers for entrepreneurship
These are the drivers that are transforming entrepreneurship in 2024.
- Technology
- Diversity
- Entrepreneurial education
- Location
Next, we briefly look upon the drivers that are powering entrepreneurship.
Technology
Technological entrepreneurship is progressing rapidly across the world and in the UAE. According to 2017 MENA Venture Report, tech companies in UAE made up 29% of new businesses. Even if a business is not a tech startup, it will utilize technological tools like social media, apps, and websites.
More than 60% of people in Middle East have access to internet. Technology helps people access essential business knowledge and tools for their low cost startup which were not possible before. Also, new technologies boost entrepreneurial potential and provide a plethora of opportunities to start new businesses.
Diversity
Nowadays, we can see more women taking in charge of new startups. A report by the global entrepreneurship research association is a testimony to this progress. It reveals there are some countries such as Qatar where females have equal or higher entrepreneurship rates than men.
Entrepreneurship diversifies in the terms of age as well. Also, minority owned businesses are on the rise. Many new entrepreneurs are starting out at a young age.
Entrepreneurial education
Entrepreneurship is a concept that you can learn. So, entrepreneurial education is a must to develop enterprising culture and drive business. Universities in the UAE like NYU Abu Dhabi and Dubai Entrepreneurs Academy offer courses on business and career development.
Those who cannot learn in universities can gain access to this information via internet. For example, free online courses, podcasts, YouTube videos, etc. It is one of the main reasons that many entrepreneurs are starting out young.
Location
Entrepreneurship has evolved in terms of location as well. Thanks to the internet, in entrepreneur can work from anywhere and with great speed. Hence, big companies are widening their workforce to take benefit out of small startups in developing nations.
A study by risk management and brokerage firm Willis Woers Watson is right on the money. It discloses that 55% of multi-national companies are looking for ways to effectively handle their workforce. Besides, they can use external contractors for the next three years.
Ethical entrepreneurship
There are people who are no longer profit driven. Rather they want to build their corporate empire that is socially aware and returns something to society. They are known as ethical entrepreneurs.
An example is of TOM, a shoe store which has a “one for one” policy. When you buy one pair of shoes, the store donates another pair to a person in need. Ethical entrepreneurship is beneficial for both the business owners and the community.
Bonus: Start a low-cost business in Dubai
Future of entrepreneurship
Entrepreneurship will continue to sustain its special position in society and economy. Through the years, only the means of entrepreneurship have evolved, but not its core. After all, the global economy has made modern entrepreneurship quite challenging but rewarding as well.
The provision of state-of-the-art infrastructure, communication systems, cheap labor, and means of production are playing a great part in it. Also, entrepreneurs address the demand by providing supply. They are the innovators who solve problems that no one has solved before.
Idea: Start a tourism business in Fujairah
Conclusion
Promising entrepreneurs are the ones who have the ability to lead from the front. Furthermore, they show creativity, move with the time and never give up. Entrepreneurship is the vehicle that is driving the modern businesses internationally.
United Arab Emirates as a global economic hub is the place to start your entrepreneurial journey. Business consultants in the UAE can help you in setting up an enterprise. So, connect with experts at KWS to make your transition to entrepreneurship as smooth as possible.
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