What better topic for this blog than opportunity? But what is opportunity? Perhaps more appropriately, how do opportunities happen? Researchers observe that they come in three main forms: recognition, discovery, or creation. I thought I would define those in simple terms for the fun of it.
Recognition: If a supply (i.e., a product or service) exists and there is a demand (i.e., a market, people want it) that has not been tapped into yet, then that is opportunity recognition. If someone starts a business to sell bread in a town where people already buy bread, then that might be a recoginition opportunity.
Discovery: If a supply exists that has not found a demand, or a demand is looking for something to satisfy it, then an opportunity might be discovered. An example might be a new cleaning product that replaces something most people already use, then the demand for the new cleaning product is not clear and needs to be discovered through attempts to sell it. Alternately, if people are looking for such a cleaning product but it does not exist, then the opportunity exists to create it to meet that demand.
Creation: If neither the supply of a product nor the demand for it is known, then a creation opportunity exists. One idea might be the first cell phone invented, or the personal computer when it first came on the market. The products did not exist, and no one knew whether anyone wanted them. Their designers created an entirely new market when they made the product and got people to buy it.
Entrepreneurs look for any or all of these opportunities. Like the definition from yesterday, whenever the market is not bringing a transaction into existence that should happen, entrepreneurship happens. People who are looking for the chance to make those things happen are therefore entrepreneurs by definition.