Robert Dygas, PhD

Entrepreneurship and education in starting business, relevant factors and

implications for success.

The main goal of this article is to point out main key factors to start business and
get the success. This article was written as inspiration for those students who
want to start a business.

From economic perspective a success means to make profit or when discounted

difference between revenue streams and costs is more than zero1. What does
then success mean in real business life? When there is no profit is it possible to
declare that there is a success? The answer is yes it is. There could be a start-up
company which does not make profit but it is still on the market. The fact that is
not out of the market could be a success (of course in the long run if there are no
profits company is out due to i.e. new entrants to the market). Interesting thing is
the different meaning of the success has for different people, managers, students
etc. (For some students to pass the exam is the success for itself for some get
the “A” mark means to reach the goal). Success should be justified by its scale as
well when the public admires that. Each Nobel Prize can be obvious success in
twofold, one for the owner and other for the human knowledge capital. It mean
that that success is strongly related to the education. Some of the students may
argue that there are examples of people who do not have education or they are
not well educated and they made a fabulous business and got a success (i.e
some music celebrities). It is true, but the number of such people is insignificant
comparing to the number of educated business people. It is worth mentioning
that the biggest music stars have higher education as well.

Another aspect is that pop stars’ success or being on the top is usually true in the
short run and depends on the trends in the music. Are the rich people different?
Let’s take the list of 7 top Forbes billionaires in South Korea2. It came out that all
of them are highly educated people, which is not surprising. All of this support
the thesis that education is strongly related to the success in business. (it is not
always in personal life). If it is so, does it mean that to start a business it is
enough to be well educated or finish a good Business School? The answer is no.
That is why here comes the entrepreneurship, understood as the skills mixed
with personal traits which endow the person to do business. If it is a skill so is it
possible to gain it somehow or learn it? Definitely yes, it can be learnt by doing it!
Even though that the first one not necessarily should be a success, but what is
important that the knowledge of failure can be used for success in the future. So
business skills are gained by starting and running a business. How about
personal traits? This is more sociological issue, but important as well. It is proved
that people who have to take care about themselves in early stage of life are
1

this formula can be found in most study books for economics and management
2
http://en.wikipedia.org/wiki/List_of_Korean_billionaires_and_multi-millionaires
more entrepreneurial from those they were supported by parents long time.
Instinct to survive makes that difference. It does mean that people which were
supported by parents long time till theirs 30-40 should not start a business at all?
Not exactly. This aspect will be analyzed further down in this article so let’s look
first on the relevant factors in starting up a new business.

There are three important issues linked with a decision to start a business :
1.idea of the business, 2. initial capital 3. risk taking. The most important thing is
the business idea which mean what sort of business to start with. Microsoft,
Google, Facebook are the successful businesses due to invention of the “catchy”
ideas. These products have one thing in common that almost everyone is using
them or at least heard of these tools. That is why all the best ideas are patented
and protected from copying them. Capital can be borrowed, and risk can be
limited by insurance etc. Thus the another thesis can be raised here, that the
most crucial item to be successful in starting a business is a right idea then.
There are many good ideas but only a few are successfully implemented mainly
because majority of them requires long time for research and development which
is of high cost especially in pharmaceutical business.

Let’s come back to our example now mentioned earlier and imagine a person
which is well educated and was supported by parents for a long time and these
parents are very rich (i.e. they run a profitable business). Most likely this person
will join their business and learn how to do business. The possible result can be
that this person will hardly become an entrepreneur. Lot of effort depends on
such person to become risk taker and to be on his or her own. Does it mean that
such person should not join the family business at all? The reasonable answer
should be that this person should as soon as possible be on her or his own and
try to start his or her own business (even if there is a failure!!) and after such
business experience then join family business. In this sense another thesis can be
formulated that entrepreneurial skills are strongly correlated with financially
independence and the risk taking as well. To be entrepreneur it means to think
“out-of-box” and take a risk and go the way no one goes before, or as Stephen
Covey named it as to follow your “voice” as unique and personal significance,
which inspires others and leads from dependence through independence to
interdependence3. It means that success should inspire others to do business and
cooperate to use a synergy in business (that is why important to keep the
relations with your desk friends from Business School). This can be understood
not only to combine the skills and resources from different people whom we
would like to do business with but also a correlation between education and
entrepreneurship. These two things together (education and entrepreneurship )
are key relevant factors which should be developed and trained constantly.

Let’s wrap up the most crucial aspects of what is relevant in starting the
business. The most important thing is to be independent and learn by experience
how to do business even if the beginning will be hard and may bring the failure.
Based on that education should be in place and while these two things are linked

3
Stephen R. Covey, The 8th Habit, from effectiveness to greatness, Simon and Schuster
UK Ltd.,2004
together a right business idea will come up together with risk management. For
some students it may sounds as the day-by-day hard work, and in fact it is. There
is no success in business with “easy-come” or “free dinner” case. Based on what
was mentioned here it is worthwhile to state that macroeconomics has also its
influence on the decisions. It may be harder for some people to start business in
the recession as the consumption is falling down and production as well, but
there are still smart entrepreneurs who can use the market opportunity and have
a success even during hard times. The reasonable answer to this can be that they
treat the recession as the source of challenges and not as stoppers for
implementing theirs ideas. They are brave and knowledgeable and know how to
use a synergy. This is like a receipt for a good cake. The receipt is known to many
cooks but only a few can bake a tasty cake.