Analyzing IT Industry Entrepreneurship: Issues and Probabilities

This report provides a comprehensive overview of entrepreneurial activities within the IT industry. It begins with an introduction to the subject, followed by a description of the industry's current state and its significance. The report then delves into the significant issues and challenges faced by entrepreneurs in the IT sector, including heavy investment requirements, intense competition, ethical considerations, and the rapid pace of technological advancements. It further explores the level of entrepreneurial activity in the IT industry, highlighting the factors that influence the probability of success for new ventures, such as competition, innovativeness, product value, societal need, and available resources. The report concludes by summarizing the key findings and emphasizing the importance of understanding market trends and the various factors affecting entrepreneurial success in the IT industry. The report is a valuable resource for students seeking insights into the dynamic and evolving landscape of IT entrepreneurship, and it provides a detailed analysis of the challenges and opportunities in the sector.

ASSIGNMENT
PROBLEM

1
Contents
Introduction...........................................................................................................................................2
Description of the industry................................................................................................................3
Significant issues facing entrepreneurs in IT.....................................................................................3
Level of entrepreneurial activity in the IT industry...........................................................................4
Factors that influence the probability of new venture success...........................................................5
Conclusion.............................................................................................................................................6
References.............................................................................................................................................6
Introduction
From the age of industrialisation the entrepreneurial ventures have made their place in
various industries. All around the world there are many new entrepreneurial ventures that are
coming up (Ashe-Edmunds, 2018). Entrepreneurs have an idea of changing the society and
later develop that idea into the business. Such ventures have helped the society in many ways
especially in lifting their standards of life style. This has led to coming up of any new
business. It is also to be understood that since the business has transformed a lot over the

2
years. This has created many issues for the entrepreneurs that are present in the industry. The
major challenges are occurring for the new entrepreneurs that are planning to come up in the
industry. In the modern times most of the entrepreneurial ventures are coming up in the IT
industry. This report highlights the entrepreneurial ventures that are coming up in the society
and the challenges that they are facing while establishing their business. It also describes the
factors that influence the probability of new venture achieving success.
Description of the industry
IT industry in the current times is the biggest industry in the whole world. IT
mediums have become an integral part of the lives of individuals as well as for the operations
of every organisation. Most of the companies in this industry are working either in secondary
sector or tertiary sector (Bailetti, 2012). There have been shift in the number of
entrepreneurial ventures from the automobile industry in the start of the 20th century to IT
industry towards the end of the same century. Since the speed of research that is going on the
IT industries are larger in number. This has led to emergence of new ideas as per the
requirements of the society which have been successfully transformed the new business. The
dependence on IT mediums for completing most of the operations in other industries has also
boosted up new ventures in this industry. Some of the most successful entrepreneurs are from
this industry who is also great innovators like Steve smith co-founder of Apple or Sergey brin
and Larry page founders of Google Inc.
Significant issues facing entrepreneurs in IT
In spite of having so many new entrepreneurial ventures this fact cannot be denied
that there are significant amount of issues that are faced by them in the information and
technology sector. All these issues are pulling down the success ratio in the longer run. Some
of the issues faced by entrepreneurs are as follows:
 Heavy investment: Since the number of researches that are going on in this industry is
large in number. This has compelled entrepreneurs to invest a lot on the various kinds
of research related to their business (Chakravarty, Grewal & Sambamurthy, 2013).
The research must be in terms of the demands the consumers have as well as the need
of the technology industry. This has forced entrepreneurs to be more selective while
carrying on with any idea. Although comparative to other industry, the amount of
investments that is needed by this industry is less.

3
 Existing competition: The competition in the IT industry is getting tougher and
tougher. The survival of the ventures has not remained any easy task. There are lot of
bigger companies who have control over the larger part of the market and hence
coming up with the new idea and making it count for the business is a difficult task
(Del Giudice & Straub, 2011). Bigger and smaller firms that are doing extensive
research in the same fields and hence they have more power to influence the demands
of the market.
 Ethics: The penetration of the IT industry in the personal lives of the people have
increased significantly, there are lot of ethical issues that are also coming up. One of
the most significant challenges that entrepreneurs are facing is about the security of
the personal data of billions of people on their servers (Drucker, 2014). There are
many hackers that are operating in different parts of the world and are working for
either stealing or corrupting the data. They sometimes also intend to destroy the
system. This is a matter of concerns for the entrepreneurs in this sector.
 Technological advancements: Technology in the fields of IT sector has been
advancing at very fast rate. This has created many new challenges for the
entrepreneurs as they need to raise funds for making technological advancements
(Ejermo & Xiao, 2014). It is a challenge for most of the entrepreneurs as the cost of
the new technologies and their implementation is very high. It is also to be understood
that bigger companies that are already established has large amount of resources and
hence they can easily make these changes but for the new firms it is a bigger
challenge.
Level of entrepreneurial activity in the IT industry
There are large numbers of entrepreneurial activities that are going on in the IT
industry. This has also been possible due to the fact that there are huge amount of researches
that are going on in this industry (Lundqvist, 2014). Due to this there are many new
entrepreneurs that are coming up. It was also possible due to larger numbers of investors
interested for investing in the new ideas. It is a result of the new entrepreneurial ventures that
the cost of the technology and the software being used inside the industry has decreased
considerably. It has also resulted in making sure those things that was considered to be
impossible some decades back is possible in the present scenario.
New kinds of entrepreneurial ventures are coming up is based on the idea that can resolve
some of the problems existing in the society. There are many challenges that are faced by the

4
societies and the entrepreneurs are trying to resolve those. There are many new ventures at
the local levels are coming up that are promoting the expansion of this industry in the lives of
the people. They are easily getting investments by the investors or government based on the
ideas of their. In most of the parts of the seeing the socio-cultural benefits of entrepreneurial
activity the governments are also promoting it in different ways (Martín-Rojas, García-
Morales & Bolívar-Ramos, 2013). On the larger platform there are many entrepreneurs that
have made their name but are investing in the new technologies of Future like the Virgin
group and some more. On the smaller levels there are small entrepreneurs that have emerged
in many countries. These smaller entrepreneurs are basically providing services to the bigger
firms. Most of them are just the entrepreneurs that are utilising someone else ideas for
continuing with their business.
Factors that influence the probability of new venture success
It is crucial to understand the probability of new venture gaining success in the
industry without which investments can go in loses (Nambisan, 2013). There are many
factors that are influencing the success of the new ventures. Some of them are as follows:
 Competition: The more the competition in the market the lesser the chances to
achieve success in new ventures. Bigger competitors always tend to influence the
trends in the market which has a direct impact on the performance of the new
entrepreneurs coming in the industry (Onetti, Zucchella, Jones & McDougall-Covin,
2012).
 Innovativeness: The higher the innovativeness in the idea of the entrepreneur’s, the
higher the probability of gaining success. This is due to the reason that innovativeness
in the idea always helps in satisfying the needs of particular sections of the society.
Innovative products always find its place in the market as they create blue ocean
strategy for the company.
 Value of the product: More valuable a product is for the market more is the chances of
it getting success. It is also crucial that entrepreneurs make an operational mechanism
where in stage value is added to the products because it is only thing for which a
company pays (West, 2012).
 Need of the society: There are many entrepreneurial ventures that get failed. This is
due to the reason that they are unable to fulfil the need of the society or they are many
a time unnecessary and fall short of fulfilling the needs of the consumers.

5
 Resources: The amount of resources and the quality of the resources an entrepreneur
has arranged for doing their business has impacts the probability of their success
(Ratten, 2013). In IT industry entrepreneurs needs to make sure that they have most
advanced technologies and an excellent talent pool for developing their business.
Conclusion
From the above report it can summarised that there are many entrepreneurial ventures
that are coming up in the IT industry. Many of these entrepreneurs come with the original
ideas while most of them copy the ideas of others. IT industry is one of the fastest growing
industries and many new kind of smaller entrepreneurs are also coming up in the industry.
Apart from this there are many issues that are faced by the entrepreneurs in this industry.
Understanding the trends in the IT market is one of the most essential aspects in any
entrepreneurial venture. It is crucial that many of the new entrepreneurial ventures are
coming up at different levels of IT industry. There are several factors that are affecting the
probability of success for the entrepreneurial ventures.
References
Ashe-Edmunds, (2018) What Factors Affect the Entrepreneur's Success?. [Online]. Retrieved
from: https://yourbusiness.azcentral.com/factors-affect-entrepreneurs-success-
21409.html.
Bailetti, T. (2012). Technology entrepreneurship: overview, definition, and distinctive
aspects. Technology Innovation Management Review, 2(2), 5.

6
Chakravarty, A., Grewal, R., & Sambamurthy, V. (2013). Information technology
competencies, organizational agility, and firm performance: Enabling and facilitating
roles. Information Systems Research, 24(4), 976-997.
Del Giudice, M., & Straub, D. (2011). Editor's comments: IT and entrepreneurism: an on-
again, off-again love affair or a marriage?. MIS Quarterly, 35(4), iii-viii.
Drucker, P. (2014). Innovation and entrepreneurship. Routledge.
Ejermo, O., & Xiao, J. (2014). Entrepreneurship and survival over the business cycle: how do
new technology-based firms differ?. Small Business Economics, 43(2), 411-426.
Lundqvist, M. A. (2014). The importance of surrogate entrepreneurship for incubated
Swedish technology ventures. Technovation, 34(2), 93-100.
Martín-Rojas, R., García-Morales, V. J., & Bolívar-Ramos, M. T. (2013). Influence of
technological support, skills and competencies, and learning on corporate
entrepreneurship in European technology firms. Technovation, 33(12), 417-430.
Nambisan, S. (2013). Information technology and product/service innovation: A brief
assessment and some suggestions for future research. Journal of the Association for
Information Systems, 14(4), 215.
Onetti, A., Zucchella, A., Jones, M. V., & McDougall-Covin, P. P. (2012).
Internationalization, innovation and entrepreneurship: business models for new
technology-based firms. Journal of Management & Governance, 16(3), 337-368.
Ratten, V. (2013). Cloud computing: A social cognitive perspective of ethics,
entrepreneurship, technology marketing, computer self-efficacy and outcome
expectancy on behavioural intentions. Australasian Marketing Journal (AMJ), 21(3),
137-146.
West, D. M. (2012). How mobile technology is driving global entrepreneurship. Brookings
Policy Report.