Documente Academic
Documente Profesional
Documente Cultură
Entrepreneurship in Global
Perspective
Introduction
The word 'entrepreneur' is derived from the Old French word
'entreprendre' which was first used by the economic 'theorist' Richard
Cantillon in 1755 in an essay where he used this term to describe a
person who assumed the risk of buying goods in the belief that they
could sell them at a higher price at a later time. So, the term in French
was used to describe 'one who undertakes' this particular risk.
Who Is An Entrepreneur?
Entrepreneur Is A Person Who Brings In Change through Innovation For
the Maximum Social Good.
An entrepreneur is a person with a dream, originality and daring, who
acts as the boss, who decides as to how the commercial organization
shall run, who coordinates all activities or other factors of production,
who anticipates the future trend of demand and prices of products.
The entrepreneur displays courage to take risk of putting his money
into an idea, courage to face the competition and courage to take a
leap into unknown future and create new enterprises/ business. This
creative process is the life blood of the strong enterprise that leads to
the growth and contributes to the national development.
18
Definition of Entrepreneur
Examples:
Computers, mobile phones, washing machines, ATMs, Credit Cards,
Courier Service, and Ready to eat Foods are all examples of
entrepreneurial ideas that got converted into products or services.
The Pakistani state was born out of the partition of India an event that
was characterized by conflict, lasting enmities, a mass migration and
the birth of a theological state. More importantly, the new state of
Pakistan had to deal with an entrenched feudal elite and a largely
migrant professional class borne out of retreating colonial bureaucratic
and military structures. Following the trends of the day, Pakistan also
put in place a planned, closed economy for a big push towards and
industrial take off in its early days of independence. Central planning
quickly assumed the ‘government knows best’ approach and
developed a deep suspicion of the market. The result was a plethora of
legislation put in place for a fully government directed economy.
The military -bureaucratic complex saw itself as the savior of the
country in many different roles: (a) those who had sacrificed for the
new state; (b) the visionary nationalists; (c) the modernizers; and (d)
the ‘deliverers of development’. Contrarily, the professional migrants
were in charge of all the country’s resources and the development
agenda which increasingly demanded a more egalitarian growing
society. The governing elite soon discovered that while direct salary
structures could be compressed to satisfy the egalitarian rhetoric, rent-
seeking activities including direct corruption could enrich them
invisibly. State Owned Enterprises, state led land development,
licenses and controls and development projects were all lucrative
devices for rent-seeking.
The state increasingly moved into developmental functions—
developing infrastructure, providing services, and managing and
curbing markets. This expansion of the state was fuelled by the
growing donor community. The availability of easy financing as well as
expanding control over state resources provided bureaucrats with
incentives to move in the direction of directed development. Given the
resource constraint—both physical and human, the magisterial
functions of government that include law and order, property rights
18
Development of Entrepreneurship in
Pakistan
In Pakistan, policy has always been biased towards the elite. This is
especially true of the economic policy which has been biased towards
the large scale sector. The result is that this sector has developed on
the incentives of rent-seeking rather than entrepreneurship. The
development of small scale sector to some extent reflects the
characteristics of entrepreneurship however this sector has largely
grown up as an informal sector continually besieged by the state in its
quest to protect its favorite child the large formal sector. Below we will
attempt to understand the historical tension between rent-seeking and
entrepreneurship in Pakistan.
a) The Big Push for industry
b) The Neglect of the “Small”
c) Agriculture and the Elite bias
d) Subsidies for Export
This resulted in losses on bad loans for banks to the extent that, for
example, governments had to inject equity of RS.20 billion and RS.7
billion into United Bank Limited (UBL) and Habib Bank limited (HBL)
respectively to make these viable for privatization that took place in
recent past.
1977-88: Zia years of encouragement of private sector, preference still
given to large scale sector.
Conclusion:
Current Scenario:
Entrepreneurship is stifled because of rent seeking.
If entrepreneurship is to develop, deep government reform is needed
which limits rent seeking, encourages innovation and fosters enterprise
The following is recommended:
Case Studies
Evaluation:
NetSol Technologies is a multinational also opertating in Pakistan. It is
categorized as flourished business now due to Saleem Ghauri who has
started the journey in IT sector during 70s and due to his untiring
efforts now it is among the most established IT firms in Pakistan. He
has worked abroad in many counties of Asia and Europe and now
working in Pakistan. His major achievement is Financial applications in
leasing business that is operating in 9 countries . Ghauri’s achievement
have made him a role model for all those who belong to IT sector in
Pakistan and abroad.
18
People read all these stories and gave him money. So from there,
basically for last 8 to 10 years, he have been involved in some best
online projects in world, one is egg.com which is world’s largest online
bank with market capitalization of $1.6 billion. he was also involved in
ESI, which is British online firm which was purchased by E*Trade. he
18
also built and sold two consulting companies. Najam Kidwai built a
portal in 9 different languages. It was a voice portal with very
innovative technology. He have raised lots of VC funding. He have
done lots of work in States by bringing US technology companies in
Europe & South East Asia. Currently Najam Kidwai is in process of
raising a $20M Venture Capital fund in Pakistan to invest in technology
companies in Pakistan. It is a venture capital fund focused on early
stage technology investing, which will be raised in Pakistan. If a
person/company has good ideas, like if he’s setting up a Dot Com
company, they would help them by giving money to develop the
project to completion. More importantly they have a world class in-
house consulting capability (with consultants from the likes of
McKinsey, Accenture, Booze Allen etc.) that will help the entrepreneurs
execute. So the idea is to create jobs and wealth in Pakistan & create a
supportive environment for Pakistani entrepreneurs. His focus would
be on medical devices, wireless technologies, networking and
enterprise software.
Previously he has held a variety of roles such as CEO, VP, Director &
General Manager with a sales focus and has built and launched a
+number of UK & US based technology companies in Europe and South
East Asia. Najam has extensive experience in emerging technologies,
specifically, wireless, CRM, Outsourcing iTV, enterprise software and
natural-language.
18
Najam has raised over $55M in VC funds to date and has built and sold
two technologies/consulting companies for millions of dollars.
Najam was also heavily involved in the development of the first online
funds supermarket of -www.egg.com (most successful online bank in
the world) Egg.com is an online bank, which was created in 1997. They
decided they wanted to make an online bank with no physical
branches. People could deposit their money here and get a very high
interest rate. That was incredibly successful although it cost them a lot
of money to build it. They had a five year business plan to get 1 million
customers. Then they launched an online credit card and within two
years they had 3 and a half million customers. Reason for success was
that everything you got charged on credit card, you got 2% cash back.
You also had 6 months interest free credit.
Evaluation:
Najam kidwai is a famous entrepreneur in IT sector who has been
categorized in the flourishing businessman. His achievements start
from small virtual eye company to currently serving as advisor in
British computer society and Electronic Commerce Association.
The seeds for yello had been germinating in Feroze’ mind from as far
back as 2006. However, it was only in 2008 that he managed to start
18
In the limited time, yellO has been active; it has been used to mark
collection points around Pakistan for the ‘Swat relief fund’ and
highlighted the amazing efforts by ordinary citizens in Pakistan, like
the founders of ‘The Rozgar scheme’, which gives microcredit to the
poorest sections of the population.
Feroze says, “We had always wanted a platform to highlight the
amazing things happening around us which often get overlooked. The
fact that the information in yellO is user-generated means we get to
discover much more through yellO than through traditional media.”
The future is rich and profitable as yellO enters multiple mobile
platforms, better web interfaces, a magazine and seamless SMS
integration.
Evaluation:
Samir Feroze is a young emerging entrepreneur in the IT world who
has started its virtual platform “yellO.pk” in 2008. Now this website is
emerging as a platform for information seekers that contains every
interesting thing happening around in your cities that has provided it
opportunities to grow and making it even more profitable business,
increasing its consumer base and now it has established two offices in
Karachi and Lahore.
Introduction........................................................................................................................1
Who Is An Entrepreneur?................................................................................................1
Development of Entrepreneurship in Pakistan...............................................................6
The Entrepreneurial Process............................................................................................9
Case Studies......................................................................................................................12
Netsol Technologies - Achievements of Flourished Entrepreneur..............................12
Najam Kidwai-A famous Entrepreneur in IT sector (Achievements of Florushing
Entreprenur)
...........................................................................................................................................15