Entrepreneurial Environment PDF

Module 1- The Concept of Entrepreneurial The entrepreneur is commonly seen as Enterprise= OUTCOME Environment an innovator, a source of new ideas, goods, services, and bu...

Module 1- The Concept of Entrepreneurial The entrepreneur is commonly seen as Enterprise= OUTCOME Environment an innovator, a source of new ideas, goods, services, and business/or Who is an entrepreneur? procedures If you ask someone to picture an The are people who enter into new and entrepreneur and describe their pioneering ventures. background, there’s a good chance It is also the whole-brained, meaning you’ll hear a variation on one of two he/she uses both the left brain (logical) responses. and right brain (creative). First up is the tech wizard, majoring They invest, transform and make in computer science, who may profit or loss. graduate or might just drop out after It is the ability and readiness to getting a billion-dollar idea. develop, organize and run a business The other is the pedigreed business enterprise, along with any of its major who knows everything about the uncertainties in order to make a profit. business world. They may or may not The most prominent example of have an MBA, and the more entrepreneurship is the starting of new prestigious the school, the better. businesses. Types of Entrepreneurship Etymology of Entrepreneur Difference Between Entrepreneur and Entrepreneurship Economists have never had a 1. Small and Mid-size Enterprise consistent definition of "entrepreneur" An entrepreneur is someone who (SME) or "entrepreneurship" (the word locates the need of society and tries to play an important role in the "entrepreneur" comes from the French meet the same, with his/her innovative economy, employing few verb entreprendre, meaning "to idea. people and helping to shape undertake"). ‘entrepreneurship’ which refers to innovation the process of establishing a business a firm with 50 or fewer entity, intending to get profit, as a employees return in the future. are often considered to be the Entrepreneur Defined Enterprise is the outcome of the heartbeat of both emerging An entrepreneur is an individual who entrepreneurs through the process of and developed economies creates a new business, bearing most entrepreneurship. are businesses that maintain of the risks and enjoying most of the revenues, assets or a number rewards. Entrepreneur= PERSON of employees below a certain Entrepreneurship= PROCESS threshold  2. Innovation-Led Enterprise Entrepreneurship is high-risk, but also 1. Self – Motivation Business in which research and can be high-reward as it serves to o You aren’t answerable to anyone else development brings forth an generate economic wealth, growth, as an entrepreneur, and that sometimes innovate product or process. and innovation. means that it’s hard to get moving typically involves intellectual without anyone to make you. property that contributes to a o You need to be dedicated to your plan strong competitive advantage in Three thinkers were central to the ideas of and keep moving forward — even if the marketplace and serves as a entrepreneurs: you aren’t receiving an immediate foundation for a high rate of paycheck. growth Joseph Schumpeter 8 STEPS TO CONTINUOUS SELF often formed around life sciences o suggested that entrepreneurs—not just MOTIVATION or technology innovations, can companies—were responsible for the require significant funding and 1. Start Simple creation of new things in the search of specialized facilities. 2. Keep Good Company profit. owners are willing to give away 3. Keep Learning equity to investors to secure the Frank Knight 4. Stay Positive financial resources they need to 5. Stop Thinking grow. o focused on entrepreneurs as the 6. Known Yourself businesses may cluster around bearers of uncertainty and believed 7. Track Your Progress research institutes and universities they were responsible for risk 8. Help Others as technology is transferred from premiums in financial markets. research labs into the marketplace Israel Kirzner technology is transferred from 2. Understand What You Offer research labs into the marketplace o thought of entrepreneurship as a o As an entrepreneur, you need process that led to the discovery to know what you offer, and how it fits into the market. Key Take Aways of Being an Entrepreneur Whether it’s a product or a 7 Characteristics of Successful service, you need to know A person who undertakes the risk of Entrepreneurs where you fit in. starting a new business venture is 1. Self-Motivation o That means you need to know called and entrepreneur. 2. Understand What You Offer when it’s time to tweak things An entrepreneur creates a firm, which 3. Take Risks a little bit. This also includes aggregates capital and labor in order to 4. Know How to Network knowing whether you are produce goods or services for profit. 5. Basic Money Management high end, middle of the road Entrepreneurship is an important Skills & Knowledge or bargain. driver of economic growth and 6. Flexibility innovation. 7. Passion  Being able to position yourself and product or service or mission. then adjust as needed is an important Passion is what will help you part of entrepreneurship. 5. Basic Money Management Skills find motivation when you are and Knowledge discouraged and it will drive o We often think of successful your forward. entrepreneurs as “big picture” o Passion is fuel for successful 3. Take Risks people who don’t worry so o Successful entrepreneurs entrepreneurship. If you find much about managing the yourself losing your passion, know that sometimes it’s day to day. important to take risks. that might be the clue that it’s o Understand how money time to move on to something Playing it safe almost never works so that you know leads to success as a business else (that stokes your where you stand, and so that passion). owner. you run your business on o It’s not about taking just any o There are many serial sound principles. entrepreneurs that create risk, though. Understanding calculated risks that are more successful businesses, sell likely to pay off is an them, and then create important part of being an 6. Flexibility something else. entrepreneur. You’ll need to o To a certain degree, you need be willing to take a few risks to be flexible as an to succeed. entrepreneur. Be willing to Entrepreneurship Involves: change as needed. o Stay on top of your industry 1. Magic–the soft skills involved and be ready to adopt a. Creative thinking 4. Know How to Network changes in processes and b. Time management o Knowing how to network is product as they are needed. c. Networking an important part of o Sometimes, you also need d. Teamwork entrepreneurship. Sometimes flexibility in your thinking. e. Conflict resolution who you know is an This is an essential part of 2. Logic-the hard or legal issues important part of success. problem-solving. You want to involved o Being able to connect with be able find unique and a. Intellectual property others and recognize effective solutions to issues. b. Employment partnership opportunities can c. Torts – wrongful act or take you a long way as a infringement of right business owner. d. Anti trust- refers to a group of o Figure out where to go for 7. Passion o Finally, successful businesses that team up or form a networking opportunities and monopoly in order to dictate pricing in make it a point to learn how entrepreneurs are passionate. They feel deeply about their a particular market to be effective.  e. Fraud-wrongful or criminal Opportunity to do what you enjoy Aspects of Mastery of Self The10 D`s of deception intended to result in doing Entrepreneur`s Traits financial or personal gain Opportunity to contribute to society f. Contracts-a legally binding and be recognized for your efforts agreement between 2 or more persons - Dream Opportunity to gain control over your or entities - Determined own destiny - Details - Dollar (peso in our case) Characteristics of Entrepreneurs - Decision According to George Gilder – from - Doer “The Spirit of the Enterprise” Initiative - Distribute “It is making the world forever new. It is taking Sees and acts on opportunities - Destiny aggressive actions.” Persistence - Devotion Information seeking - Dedication According to Joseph Schumpeter - Concern for high quality work and output – increased The 9 F`s “It is destroying the old order and creating new productivity - Founder ones.” Commitment to Work Contract - Faith Efficiency Orientation - Focused Systematic and organized - Frugal It is about: planning - Fast NEW: Problem Solving - Fun Business ideas Self Confidence - Flexible Products Assertiveness – negotiation with - Flat Processes suppliers & customers - Forever improving Persuasive & influential – peers ENTREPRENEURSHIP: and stakeholders Inspirational – employees Anatomy of an Entrepreneur A mindset Effective communicator –external About a forever innovating mindset & internal of organization. 1. The Entrepreneurial Mind Frame - Allows the entrepreneur to Benefits of Entrepreneurship see things in a very positive The three masteries for an entrepreneur: and optimistic light in the Opportunity to make a difference midst of crisis or difficult Mastery of Self Opportunity to reach your full situations Mastery of Opportunity potential Mastery of the Enterprise Opportunity to get unlimited profits  2. The Entrepreneurial Gut Game Mastery of the Enterprise attached and kickback expected in - Refer to the ability of the return. entrepreneur sense without - This means how to run a business. - They can provide other much-needed using five senses. This pertains to the knowledge of the services like office space, professional - This is also known as different enterprise disciplines such as: seminars, access to industry “Intuition” 1. Creating the business professionals, or access to the means - The gut game also connotes 2. Marketing Management – when of production to give startups of all courage or in the local dialect you start a venture, start with kinds an opportunity to accomplish “Lakas ng Loob” (strong marketing. Marketing is creating a their mission. intestinal fortitude promise. 3. Operations Management operation is keeping the promise and how to make the perception a 3. Quality content 3. The Entrepreneurial Heart Flame reality. - The networking websites allow for - Is also about emotional 4. Financial Management – the best quality designers and filmmakers to intelligence or EQ, which is way to protect your invention or sell their work to businesses looking to often manifested in the technology is to put only a small creatively reach out and connect with entrepreneurs efforts to margin on your product. their customers. nurture relationships with 5. Risk Management - have the - Producing good content is an customers, employees and ability to take measure or opportunity that every startup owner suppliers calculate hazards involved should be jumping on to give his or her business an edge. Mastery of Opportunities 7 Awesome Opportunities for - Develop an effective business Entrepreneurs 1. Crowd funding 4. Invest in Multiple Businesses map - Most self-made billionaires are people - Constant and Strategic - It is possible for entrepreneurs to circumvent the need for traditional who invested in many different Innovation business opportunities at once instead - Optimization of available loans and investors and instead go straight to their customers to inquire of focusing on just one idea. resources - While there are also plenty of business - Identify raving fan customers about interest level and garner the funds necessary to produce. owners who have focused on one idea - Recognize the distribution and succeeded, it is harder to do this channels and if you fail, many more of your resources are lost. 2. Startup Incubators - They provide many resources for to begin its journey with very few strings 5. Angel Investor Entrepreneurial Strategy Timeless Strategies - Is there an app that could - These investors are becoming That Drive Successful Entrepreneurship` help you manage your time more popular than venture more efficiently or a service capitalists in some industries, and 1. Study the competition that lets you delegate the money that comes from them - As an entrepreneur, you need to ordinary tasks to free up more generally has far fewer strings know who your competitors are. time for priority projects? attached or expectations than bank - Understand the rival product or loans and money from venture service that is being offering. 4. Don’t tackle huge markets at first. capitalists. - This knowledge will help you - Avoid expanding into large - These investors can be great better market your product or markets in the initial stages. resources for the entrepreneur service to stand out, perhaps even - Niche marketing can be looking to stress less about using your competition’s extremely cost effective if funding and focus on product and weaknesses to your advantage. you keep three things in customer loyalty and service. mind: 2. Conserve cash no matter how good - Meet the market’s unique 6. The Social Power of the Internet business is. needs by offering something - Strategically placing your - Frankly put, live as cheaply new and compelling. business and brand in the center as possible. - Speak the market’s language of conversations and creating a - Entrepreneurs should be as and understand its hot culture around your brand will conservative with their buttons. effectively separate your business money as possible to be able - Your language should be in from your competition's by truly to deal with any rough patch synch with that niche even connecting to customers on issues that arises. for the minor aspects of a they care about - Conserving several months' marketing campaign like the worth of operating expenses company's slogan. 7. Foreign Markets in the bank will help you - Especially the Chinese one, have survive most unforeseen 5. Listen to customer feedback and seen exponential growth in the circumstances adapt. past few years. Any start up - Salespeople know the adage owners that know how to 3. Research new products and services "always be closing," referred recognize this opportunity for - Understand emerging to by the acronym ABC. what it truly is--access to the products or services on the - Entrepreneurs have an largest market on earth--will be horizon that could improve acronym, too: Always be thanking themselves all the way your company's operations. adapting, or ABA. to the bank - Do your homework. Are you - Whether you're adapting your taking advantage of all marketing plan, simplifying a technology has to offer? product or responding to new  trends, pay attention to - It is a constant need to improve your - Confidence- it can be learned through customer feedback. Be all skills, learn from your mistakes, and constant practice ears. take continuous action on your ideas. - Anyone willing to do the work can - Accountability- taking responsibility 6. Respond to change. develop an entrepreneurial mindset. for your actions and outcomes - In business change is inevitable and those capable - Resilience- deal with making mistakes of responding are flexible and The Differences Between a Growth Mindset and failing versatile. and a Fixed Mindset - Be flexible. If a shift in your - Humility- freedom form pride and product or service is arrogance warranted, don't be left behind. - Understand that the world is Common Pitfalls for New Enterprise evolving rapidly. Even a 1. Insufficient capital company founded a year ago - Startups usually have trouble could change the world today. finding the resources to start - Entrepreneurship in emerging for tourism & hospitality markets could very well be a related businesses - either major factor in the return of a finding funding, attaining - The biggest killer of the hearty global economy. Why credit or pooling personal entrepreneurial mindset is not what couldn’t you be a part of that financial resources to try and you would expect. change? make ends meet. - It’s not failure, the economy, or bad ideas. - More experienced companies - It’s doubt – in ourselves, our usually suffer from Module 2: Planning in the Real World of an surroundings, and our abilities. insufficient capital when their Entrepreneur - Self-doubt kills many dreams, long spending starts to outweigh before any external factors can come their revenue. into play. 2. Poor growth speed What is an entrepreneurial mindset? - Not growing fast enough - It is a way of thinking that enables you means you’ll be expending Factors affecting an entrepreneurial mindset to overcome challenges, be decisive, lots of money, but you won’t and accept responsibility for your - Decisiveness-to gain the ability to have the customers or the outcomes. look at a problem or situation revenue to exceed it.  - Growing too fast comes with condition that allows for the - Successful innovation should a different set of problems- company to be successful. be built into the business demand becomes too high, strategy, where you can resources become create a culture of innovation overworked or poorly trained, The Venture Idea in Entrepreneurship and drive forward creative and your customers have Business idea problem-solving. inconsistent experiences. - It is a concept that can be 2. Unique Selling Proposition 3. Competition woes used for financial gain that is - The factor that makes a - Competition can crush your usually centered on a product company or a product business totally if you aren’t or service that can be offered stand out from its careful. for money. competitors, whether it is - Competition isn’t necessarily An idea is the base of the through; pricing, a bad thing, but you need to pyramid when it comes to the quality, customer make sure you differentiate business as a whole. service or innovation. yourself in a way that makes The characteristics of a promising business your company seem like the 3. Problem solving idea are: more appealing service. - Business ideas that solve 1. Innovative problems are 4. Internal strife - For businesses, this could fundamental to - If there is a disagreement mean: creating new ideas, developing the world and between department heads new product development companies. over the direction of the through research and - Always find solutions in company, the entire development, or improving all aspect of your enterprise could be thrown in existing services. Innovation business turmoil, and customers could can be the central focus of a suffer as a result. business and this can help 4. Profitable them to grow and become a - It is the ability to 5. Dependence market leader if they execute generate earnings - Too many companies fail their ideas properly. compared to its costs because they were overly over a certain period of dependent on one thing. Innovation time. Maybe that’s a highly - The most important - Businesses that are focused valuable customer. Maybe it’s aspect of any business on innovation are usually a very talented and idea in the long term. more efficient, cost- experienced worker. Maybe Profitable ideas need a effective, and productive. it’s just an environmental strong revenue stream  against its costs and this - is often used as a teaser to awaken the Mission Statement tends to create the interest of potential investors, success of the business customers, or strategic partners. - It is a short statement of why an - It is as such because it is supposed to organization exists, what its overall Business Plan be a content that can be explained to goal is, identifying the goal of its someone else quickly in an elevator. operations: what kind of product or - It is a formal written document service it provides, its primary containing business goals, the methods - The elevator pitch should be between 30-60 seconds customers or market, and its on how these goals can be attained, geographical region of operation. and the time frame within which these - It includes a short statement of such goals need to be achieved. fundamental matters as the - It also describes the nature of the Typical structure for a business plan for a start organization's values or philosophies, business, background information on up venture a business's main competitive the organization, the organization's advantages, or a desired future state- financial projections, and the strategies the "vision". it intends to implement to achieve the - A mission is not simply a description stated targets. of an organization by an external - In its entirety, this document serves as party, but an expression, made by its a road map that provides direction to leaders, of their desires and intent for the business. Executive Summary the organization. - It is a decision-making tool. - The purpose of a mission statement is - It is a short document or section of a - The content and format of the business to communicate the organization's document produced for business plan are determined by the goals and purpose and direction to its purposes. audience. employees, customers, vendors, and - It summarizes a longer report or - Preparing a business plan draws on a other stakeholders. proposal or a group of related reports wide range of knowledge from many - A mission statement also creates a in such a way that readers can rapidly different business disciplines: finance, sense of identity for its employees. become acquainted with a large body human resource management, of material without having to read it intellectual property management, all. supply chain management, operations Business Description - It is intended as an aid to decision- management, and marketing. making by managers and has been - It is a description that provides an described as the most important part of overview of key aspects of your a business plan. business, like what you do and what What is an “Elevator pitch”? makes your business unique. - It is a short summary of the plan's - Anyone reading your business executive summary. description should have no problem  understanding the scope of your of all the factors involved in making a You need to know: business. business decision. - Lenders and investors should see how - what markets or market segments your your business has a place in the competitors serve; market, as well as its benefits to future - what benefits your competitors offer; customers. - why customers buy from them; - as much as possible about their products and/or services, pricing, and promotion Business Environment analysis - It will identify all the external and internal elements, which can affect the Market Analysis organization’s performance. Industry background - The analysis entails assessing the level - It is a quantitative and qualitative - It enables a company to understand its assessment of a market. It looks into of threat or opportunity the factors position relative to other companies the size of the market both in volume might present. that produce similar products or and in value, the various customer - These evaluations are later translated services like it. While taking into segments and buying patterns, the into the decision-making process. account the strategic planning process, competition, and the economic - The analysis helps align strategies a company has to specifically environment in terms of barriers to with the firm’s environment. understand the forces at work in the entry and regulation. PESTLE ANALYSIS overall industry. - When assessing the size of the market, - It helps them to focus their resources your approach will depend on the type P- political on developing unique capabilities of business you are selling to which can help them to gain a investors. E- ecological competitive advantage. - There are two factors you need to look S- socio cultural at when assessing the size of a market: the number of potential customers and T- technological Competitor Analysis the value of the market E- economic - This means assessing and analyzing L- legal the comparative strengths and Marketing Plan weaknesses of competitors; may include their current and potential - The marketing plan section of the SWOT Analysis product and service development and business plan explains how you're marketing strategies. going to get your customers to buy - The primary objective of it is to help your products or services. organizations develop a full awareness  The marketing plan will include these 2. Industry Association Memberships sections: - Show your awareness of your industry's local, regional, 2. Management Team - Products and services & your unique or national standards and - Who will oversee the selling proposition (USP) regulations by telling which company? If you're forming a - Pricing strategy industry organization is it corporation, who will make - Sales and distribution plan 3. Supply chains: up the Board of Directors? - Advertising and promotions plan - An explanation of who your An organizational chart can suppliers are and their prices, be a good visual to use to terms, and conditions. illustrate this element. Operations Plan 3. Other Personnel - Describe what alternative - It describes the physical necessities of arrangements you have made - Aside from your Board and your business' operation, such as your or will make if these employees, what external physical location, facilities, and suppliers let you down. support will help the business equipment. 4. Quality control: function? This could include - Depending on what kind of business - An explanation of the quality attorneys, accountants, public you'll be operating, it may also include control measures that you've relations professionals, information about inventory set up or are going to administrative support and requirements, suppliers, and a establish. even an external advisory description of the manufacturing board. process. 4. Personnel Growth Plan - What are the salaries of each What an operational plan section should Management Summary person to be involved with include: - This part describes how your the company for the next business is structured, three years? This should Start by explaining what you've done to provide a bottom line cost for date to get the business operational introduces who is involved, outlines external resources personnel expenditures 1. Production workflow: and explains how the - A high-level, step-by-step business is managed. description of how your Financial Plan product or service will be The management summary should include: made, identifying the 1. Business Structure - This part determines whether problems that may occur in - What business structure will or not your business idea is the production process. your company take, a sole viable and will be the focus Follow this with a subsection proprietorship, a partnership of any investors who may be titled “risks," which outlines or a corporation? attracted to your business the potential problems. idea.  - It is composed of three 9. Who will run the company and what - With so many market players, it is financial statements: the makes them qualified to do so? impossible for any one participant to income statement, the cash 10. What are the risks and threats alter the prevailing price in the market. flow projection, and the confronting the business, and what - If they attempt to do so, buyers and balance sheet. can be done to mitigate them? sellers have infinite alternatives to - It also should include a brief 11. What are the company's capital and pursue. explanation and analysis of resource requirements? these three statements. 12. What are the company's historical and 2. Monopoly with One Producer projected financial statements? - It is the exact opposite form of market system as perfect competition. Achievements and milestones - In a pure monopoly, there is only one - These are concrete, specific producer of a particular good or The Market Research achievements, such as a product service, and generally no reasonable launch, some number of customers, - In market economies, there are a substitute. opening of a new location, number of variety of different market systems - In such a market system, the reviews, presence in some list and that exist, depending on the industry monopolist is able to charge whatever overcoming some legal hurdle and the companies within that price they wish due to the absence of industry. competition, but their overall revenue Typical questions addressed by a business - It is important for small business will be limited by the ability or plan for a start-up venture owners to understand what type of willingness of customers to pay their market system they are operating in price. 1. What problem does the company's product or service solve? when making pricing and production decisions, or when determining 3. Oligopoly with a Handful of 2. What niche will it fill? whether to enter or leave a particular Producers 3. What is the company's solution to the industry. - oligopoly is similar in many ways to a problem? monopoly. The primary difference is 4. Who are the company's customers, and 5 Different Types of Market Systems that rather than having only one how will the company market and sell producer of a good or service, there its products to them? 1. Perfect Competition with Infinite are a handful of producers, or at least a 5. What is the size of the market for this Buyers and Sellers handful of producers that make up a solution? - It is a market system characterized by dominant majority of the production in 6. What is the business model for the many different buyers and sellers. the market system business (how will it make money)? - In the classic theoretical definition of - While oligopolists do not have the 7. Who are the competitors and how will perfect competition, there are an same pricing power as monopolists, it the company maintain a competitive infinite number of buyers and sellers. is possible, without diligent advantage? government regulation, that 8. How does the company plan to oligopolists will collude with one manage its operations as it grows?  another to set prices in the same way a legal structure after you've registered other hand, require a signed agreement monopolist would. your business, so give it careful to define the roles and percentages of analysis in the early stages of forming profits. 4. Monopolistic Competiton with your business Numerous Competitors - Flexibility - Is a type of market system combining - Complexity 3. Liability elements of a monopoly and perfect - Liability - A corporation carries the least amount competition. - Taxes of personal liability since the law - Like a perfectly competitive market - Control holds that it is its own entity. system, there are numerous - Capital Investment - This means that creditors and competitors in the market. - License, permit and regulations customers can sue the corporation, but - The difference is that each competitor they cannot gain access to any is sufficiently differentiated from the personal assets of the officers or others that some can charge greater shareholders prices than a perfectly competitive firm. 1. Flexibility - Where is your company headed, and 4. Taxes 5. Monopsony with One Buyer which type of legal structure allows - All profit is considered personal - Market systems are not only for the growth you envision? income and taxed accordingly at the differentiated according to the number - Turn to your business plan to review end of the year. of suppliers in the market. your goals, and see which structure Individuals in a partnership also claim - They may also be differentiated best aligns with those objectives. their share of the profits as personal according to the number of buyers. - Your entity should support the income. Whereas a perfectly competitive possibility for growth and change, not - A corporation files its own tax returns market theoretically has an infinite hold it back from its potential. each year, paying taxes on profits after number of buyers and sellers, a expenses, including payroll. monopsony has only one buyer for a particular good or service, giving that 2. Complexity 5. Control buyer significant power in determining - When it comes to startup and - If you want sole or primary control of the price of the products produced. operational complexity, nothing is the business and its activities, a sole more simple than a sole proprietorship might be the best choice Factors to consider before choosing a proprietorship. for you. You can negotiate such business structure - You simply register your name, start control in a partnership agreement as doing business, report the profits, and well. - You need to consider your startup's pay taxes on it as personal income. - A corporation is constructed to have a financial needs, risk and ability to - However, it can be difficult to procure board of directors that makes the grow. It can be difficult to switch your outside funding. Partnerships, on the major decisions that guide the  company. A single person can control Stages of Enterprise Development d. acquiring financial and human a corporation, especially at its resources inception, but as it grows, so, too, does 1.Incubation or Pre-Start up e. establishing their place in the market the need to operate it as a board- 2.Start up f. becoming operational directed entity. 3.Development 4.Growth 6. Capital investment 5.Expansion Stage 3:Development Stage - If you need to obtain outside funding, a. generally occurs during its second or such as from an investor, venture third year capitalist, or bank, you may be better Stage 1: Incubation or Pre-Start up Stage b. be able to attract more external off establishing a corporation. a. has a product/service or venture idea financing Corporations have an easier time b. needs further development or c. management at this stage remains obtaining outside funding than sole commercialization such as: essentially a hands-on operation proprietorships. - product/service testing d. the company settle into a comfortable - design or refinement position, directing their efforts to - Corporations can sell shares of stock - packaging maintaining the marketplace and secure additional funding for c. enterprise has no official status in the growth, while sole proprietors can marketplace only obtain funds through their Stage 4: Growth Stage d. an entity perception is on the drawing personal accounts, using their personal board a. firmly established in the marketplace credit or taking on partners. e. no paid employees and no production b. occurs generally during the fourth and activities fifth year of operation f. business formation may require: c. primary objectives are to build 7. Licenses, permits and regulations - acquiring business partners physical asset to increase sales - The structures discussed here only - preparing business plan d. management is marked by greater apply to for-profit businesses. If - gathering venture capital delegation of decision making & you've done your research and you're - mapping start up strategies establishment of more professionally still unsure which business structure is inclined systems right for you e. human resources capability are built - Placed have different requirements for Stage 2: Start up Stage up, preparing the firm for future different business structures. a. begins with official registration and expansion Enterprise Development incorporation of the undertaking b. for some cases it will take a year Stage 5: Expansion Stage - every business moves through several the primary activity is offering a stages product or service to potential buyers a. can fall everywhere between sixth to of growth c. many worked their way from a tenth year planned loss to a break even point  b. managers have a high degree of economy increases the gross domestic professionalism and decision making product per capita of the country. c. very hands on style of management is 3. Entrepreneurs Raise Standards of - An improving gross domestic product strictly observed Living is an important goal for economic d. every asset must be carefully saved - Entrepreneurs see a need in the development because it means that and utilized marketplace and use their innovative each individual is becoming more talents to find a solution. They start a productive and earning more money. new business and hire employees. The workers earn an income, which they 5. Entrepreneurs are Philanthropists Key Roles of Entrepreneurs in Society spend in the local economy. - Entrepreneurs give back to their - When one company comes out with a communities. They not only earn 1. Entrepreneurs are Innovators better product or service, the - Entrepreneurs observe these changes money for themselves and their competition has to improve its game employees, they donate to local and step in to fill the voids. They see or go out of business. The increased the negative consequences and the organizations and charities too. competition forces everyone to - Other recipients of entrepreneurs' losses of some occupations caused by become more efficient and better at technology, but they sense generosity are libraries, veterans' their jobs. groups, homeless shelters and health opportunities in the new landscape. - They create new products and services organizations. None of this would be 4. Entrepreneurship Creates Economic possible if entrepreneurs didn't start that advances in technology have Growth made possible. new businesses and hire employees. - It starts with new businesses - Innovators look for consumers' needs generating wealth for the population. and find ways to fulfill them. It's this 6. Entrepreneurs Change the - New markets add wealth to the Community innovation that creates employment. economy when entrepreneurs invest - The new company reduces their own money to develop unemployment by hiring employees 2. Entrepreneurs Create Jobs innovative products and services. - As entrepreneurs start new businesses, who spend their income in local stores, - Lenders and other investors contribute generating more business for those they need to hire employees. These more capital to the new ventures to put new companies become engines of job owners. The success of one business more funds at work. drives the progress of other creation. - Businesses pay taxes on their profit, - Entrepreneurs create entirely new organizations. and employees pay taxes on their - Entrepreneurs invest in community industries and opportunities for income. The government takes this employment. projects by giving to local charities, added income and spends it to volunteering for food drives, working - Entrepreneurs are at the leading edge stimulate the economy. of the economy. They are the source of at soup kitchens and building houses. - The gross domestic product is a - They sponsor cleanups to create green the energy that drives economic measure of the economic status and growth. spaces and parks. improvement of a country. A stronger - These community-minded businessmen may even continue to make donations for park and roadway maintenance. Over time, these entrepreneurs become active members in the chamber of commerce and encourage other business people to develop and grow their community 7. Entrepreneurs Help Other Entrepreneurs - Entrepreneurs have an enthusiasm and passion for their businesses that they like to share with other aspiring innovators. - Seasoned entrepreneurs can tell newcomers about the mistakes they made that could have been avoided if forewarned by someone already experienced in a startup. When guided by a mentor, a neophyte can avoid wasting time on mistakes as a result of ignorance or business immaturity. - They form local groups that meet to discuss the problems of starting a business, finding employees and overcoming the hurdles of introducing new markets for products and services. - These entrepreneurial booster groups serve as motivators. Success breeds success.