Contenu connexe
Similaire à Week 1 - Lecture 1 - The Entrepreneurial Life (18)
Week 1 - Lecture 1 - The Entrepreneurial Life
- 2. After studying this chapter, you should be able to…
• Define the terms entrepreneur and small business owner, and
explain how the terms are related.
• Explain the basic characteristics of
entrepreneurial opportunities, and give
examples of individuals who successfully
started their own businesses.
• Describe some motivators or rewards for
owning your own business.
• Identify some of the basic types of entrepreneurs
and entrepreneurial ventures.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–2
- 3. After studying this chapter, you should be able to…
5. Describe five potential competitive advantages
of small entrepreneurial companies compared
to large firms.
6. Discuss factors related to readiness for
entrepreneurship getting started in an
entrepreneurial career.
7. Explain the concept of an entrepreneurial
legacy and the challenges involved in
crafting a meaningful legacy.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–3
- 4. The Contributions of Small Business
• Small Businesses:
Represent 99.7% of all firms with employees.
Employ over 50% of employees in the private sector.
Account for 45% of private payrolls.
Generated 60 to 80% of net new jobs in past decade.
Hire 40% of high-tech employees
Represent 97.3% of all exporters.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–4
- 5. Who Are Entrepreneurs?
• Entrepreneurs are:
A person who starts and/or operates a business.
Individuals who discover market needs and launch new firms to meet
those needs.
Risk takers who provide an impetus for change, innovation, and
progress.
All active owner-managers
(founders and/or managers
of small businesses).
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–5
- 6. What Is a Small Business?
• Criteria for Defining Smallness in Business
1. Small in size relative to larger competitors (fewer than 100
employees)
2. Localized business operations (except marketing)
3. Financing supplied by one person or small group
4. Has the potential to become more
than a “one-person show”
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–6
- 7. Entrepreneurial Opportunities
• Entrepreneurial Opportunity
An economically attractive and timely opportunity that creates value for
interested buyers or end users.
• Success Stories
Ace Hotels (Seattle, Washington)
Late Model Restoration (Waco, Texas)
Five Guys Burgers and Fries (Lorton, Virginia)
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–7
- 8. So You Want to Be an Entrepreneur
• Being an entrepreneur:
Is extremely challenging.
Takes undying love and passion to keep going.
Can run in a family.
Can help make the world a better place.
Can make meaning in your life.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–8
- 9. EXHIBIT 1.1 Entrepreneurial Incentives
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–9
- 10. Why People Become Entrepreneurs
• Reluctant Entrepreneur
A person who becomes an entrepreneur as a result of some severe
hardship.
• Refugee
A person who becomes an entrepreneur to escape an undesirable
situation.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–10
- 11. Is Owning a Small Business a Good Fit for You?
1. Am I passionate about my product or service?
2. What is my tolerance for risk?
3. Am I effective in making decisions?
4. Am I willing to take on numerous responsibilities?
5. Will I be able to avoid burnout?
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–11
- 12. The Many Varieties of Entrepreneurship
• Founder (“Pure” Entrepreneur)
A person who brings a new firm into existence
• “Second Stage” Entrepreneur
An administrative entrepreneur who overseas the operations of a
ongoing business
• Franchisee
An entrepreneur whose power is limited by the contractual relationship
with a franchising organization
• Entrepreneurial Team
Two or more people working together as entrepreneurs
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–12
- 13. Small Business Growth Potential and Profits
• High-Potential Venture (Gazelle)
Has great prospects for growth
• Attractive Small Firm
Provides substantial profits
to its owner
• Microbusiness
Provides minimal profits
to its owner
• Lifestyle Business
Permits the owner to follow
a desired pattern of living
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–13
- 14. Artisan Entrepreneurs
• Artisan Entrepreneur
A person with primarily technical skills and little business knowledge
who starts a business
• Characteristics:
Take a paternalistic approach
Are reluctant to delegate
Use few sources of capital
Have a traditional marketing strategy
Focus on personal sales effort
Have a short planning horizon
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–14
- 15. Opportunistic Entrepreneurs
• Opportunistic Entrepreneur
A person with both sophisticated managerial skills and technical
knowledge who starts a business
• Characteristics:
Broad-based education
Scientific approach to problems
Willing to delegate
Broad view of strategy
Diversified marketing approach
Longer planning horizon
Sophisticated accounting and financial control
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–15
- 16. Ten Mistakes Made by Startup Entrepreneurs
1. Going it alone.
2. Asking too many people for advice.
3. Spending too much time on product development, not
enough on sales.
4. Targeting too small a market.
5. Entering a market with no distribution partner.
6. Overpaying for customers.
7. Raising too little capital.
8. Raising too much capital.
9. Not having a business plan.
10. Overthinking your business plan.
Source: Adapted from Rosalind Resnick, “10 Mistakes That Start-Up Entrepreneurs Make,” Wall Street Journal, September 2, 2010, p. B2. http://www.abcbizhelp.net
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–16
- 17. Women Entrepreneurs
• More Women Entrepreneurs
More women than men are starting new businesses
Many businesses are now majority female-owned
Movement of women into nontraditional industries
• Problems Facing Female Entrepreneurs
Discrimination and difficulties
related to gender
Lack of access to credit
Lack of networking connections
Balancing work and family life
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–17
- 18. Entrepreneurial Teams
• Entrepreneurial Team
Is a two or more people who work together as entrepreneurs on one
endeavor.
Is becoming more common.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–18
- 19. The Competitive Edge of Entrepreneurs
Customer
Focus
Special Competitive Quality
Niche Advantages of Performance
Entrepreneurial
Firms
Innovation and Integrity and
Globalization Responsibility
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–19
- 20. Getting Started
• Age and Entrepreneurial Opportunity
Early Career Concerns Late Career Concerns
1. Getting an education 1. Fulfilling family
responsibilities
2. Gaining work experience
2. Attaining seniority
3. Acquiring financial in employment
resources 3. Earning investment in
a retirement program
20 25 35 45+
Age
Generation Y Generation X Baby Boomers
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–20
- 21. Millennial Entrepreneurs (Gen-Y)
• Have no fear of technology
• Are idealistic and optimistic
• Are more collaborative
• Build elements of community in the business
• Start companies while studying entrepreneurship
• Fail fast, learn a lot, and
keep going
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–21
- 22. Strong Commitment Strong Internal
to the Business Locus of Control
(Tenacity) (Self-Reliance)
Characteristics of
Successful
Entrepreneurs
Moderate Risk Takers
(Financial, Career,
Psychic Risks)
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–22
- 23. Entrepreneurial Characteristics
(Timmons and Spinelli)
Commitment and
Determination
Motivation to
Excel Leadership
Attitudes and
Behaviors of
Entrepreneurs
Creativity, Self-
Opportunity
Reliance, and
Obsession
Adaptability
Tolerance of Risk,
Ambiguity, and
Uncertainty
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–23
- 24. How to Fail as an Entrepreneur
1. Overestimate what you can do
2. Lack an understanding of the market
3. Hire mediocre people
4. Fail to be a team player
5. Be a domineering manager
6. Not share ownership in the business in an equitable way
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–24
- 25. The Importance of Mentors
• Mentors
Are knowledgeable persons who can offer guidance from their
experience in a given field.
Teach entrepreneurs what and how to do.
Provide entrepreneurs encouragement
when needed.
Show them how to avoid mistakes.
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–25
- 26. Success in Business and Success in Life
• Looking Back At An Entrepreneurial Life
Proper values and actions lead to a good exit.
Evaluating accomplishments
• Winning the Wrong Game
The nature of the entrepreneurial endeavor reflects personal goals and
values.
• Crafting a Worthy Entrepreneurial Legacy
The tangible items and intangible qualities passed on not only to heirs
but also to the broader society.
• Beginning with the End in Mind
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–26
- 27. • attractive small firm
• entrepreneur • microbusiness
• bootstrapping
• small business
• lifestyle business
• entrepreneurial opportunity • artisan entrepreneur
• reluctant entrepreneur
• opportunistic
• refugee
• founder
entrepreneur
• franchisee • entrepreneurial team
• high-potential venture (gazelle) • niche market
• mentor
• entrepreneurial legacy
© 2012 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as
permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1–27