Entrepreneurship and innovation are increasingly important in all areas of business and government. Entrepreneurial start-ups galvanize the economy by identifying new opportunities and redirecting resources to them. Established firms innovate in order to outmaneuver or respond to their competition. The Importance of Innovation in Entrepreneurship. Innovation is important in entrepreneurship. In the highly competitive world that we live in, innovative ideas are what will separate you from the rest. In order to create an outstanding product, strong brand, and to build your customer network, you need to innovate.