Types and forms of entrepreneurship

A type of entrepreneurship is distinguished by the direction of activity, the sphere where capital is invested and the result. In production entrepreneurship a good or service is created, so material resources such as premises, equipment and raw materials are needed most. Commercial entrepreneurship rests on reselling goods: the basic rule is that the selling price is higher than the purchase price, and capital is needed mostly as working funds. Financial entrepreneurship is connected with money and securities and requires special knowledge and permission; insurance activity sells protection against unexpected losses and is one of the highest-risk types. When choosing, you can rate features such as the need for material resources, financial resources, risk level, and special knowledge and permits on a scale of “low — 1, significant — 2, high — 3” and compare the totals. Besides the type, a form must be chosen too: individual, collective and corporate forms exist, which we study in the next lessons.