What is the importance of entrepreneurship?


Quick Answer

Entrepreneurship is important because it helps to drive the economy, it allows people to bring creativity into the marketplace, it creates companies with the potential to hire millions of people and it brings new products and services to market. In addition, impact entrepreneurship, in which businesspeople pay attention to the social impact of their products and investments, aims to improve society and the environment.

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Full Answer

Many entrepreneurs who start small businesses are able to grow those companies into large concerns with a sizable local, national and even global impact. Entrepreneurial businesses are often better able to establish personal relationships with their customers. Because they are often more flexible than big companies, entrepreneurial businesses often create a more welcoming environment for innovation and invention. Entrepreneurial firms are also better suited to cater to niche markets because they do not have to support large overheads. Because many small businesses fail, however, entrepreneurs must be sure to put a viable business plan in place.

Impact entrepreneurs must focus first on how their companies will make money, since a company that isn't financially sound is unlikely to change the world. Investors who are intrigued by impact entrepreneurship also want to see viable business plans and may be skeptical of impact entrepreneurs who pitch their ideas as if they were establishing a non-profit.

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