Btec Higher National Diploma In Business Entrepreneurial Ventures November 2024 PDF

BTEC Higher National Diploma in Business ENTREPRENEURIAL VENTURES NOVEMBER 2024 Ms.Mamta Panjwani LEARNING OBJECTIVE 1 ► Examine what it takes to be an entrepreneur and the scope of entrepreneurial ventures DEFINE ENTERPRISE ► A business enterprise is any t...

BTEC Higher National Diploma in Business ENTREPRENEURIAL VENTURES NOVEMBER 2024 Ms.Mamta Panjwani LEARNING OBJECTIVE 1 ► Examine what it takes to be an entrepreneur and the scope of entrepreneurial ventures DEFINE ENTERPRISE ► A business enterprise is any type of operation that is involved in providing goods or services with the anticipated outcome of earning a profit. ► Its broad nature allows the term to be applied to any type of company or firm that is geared toward generating revenue by selling products of any type. ► The terms company, firm, and business enterprise are often used interchangeably. DEFINE ENTREPRENEURIAL ACTIVITY ► Entrepreneurial activity is the enterprising human action in pursuit of the generation of value, through the creation or expansion of economic activity, by identifying and exploiting new products, processes or markets. ► Entrepreneurship is the phenomenon associated with entrepreneurial activity. DEFINE ENTREPRENEURSHIP ► “Entrepreneurship is any kind of innovative function that could have a bearing on the welfare of an entrepreneur.”-Joseph A. Schumpeter ► “Entrepreneurship entails bearing the risk of buying at a certain price and selling at uncertain prices.”- Ricardo Cantillon. ► “Entrepreneurship is the purposeful activity of an individual or a group of associated individuals, undertaken to initiate, maintain or aggrandize profit by production or distribution of economic goods and services.” – A.H.Cole VARIETIES OF ENTREPRENEURS ► CLASSICAL ENTREPRENEUR: HANDS-ON IN THE BUSINESS ► INNOVATIVE ENTREPRENEUR: THE NEXT BIG DISRUPTOR ► SOCIAL ENTREPRENEUR: DOING GOOD IN THE WORLD ► SERIAL ENTREPRENEUR: LAUNCHES BUSINESSES REPEATEDLY ► SOLOPRENEUR: THE LONE WOLF CLASSICAL ENTREPRENEUR: HANDS-ON IN THE BUSINESS ► Usually works in a business that has been around for years. ► His work function is easy to describe – ► he would call himself a "joiner" or "baker" or a "small business owner" rather than an "entrepreneur." ► Plays an important role in the day-to-day management of the business. The entrepreneur knows everything about the job, but may need help with the strategic and governance parts of the business (choosing the right location, marketing, expansion, making the best use of technology, financing, tax returns and so on). ► His main goal is to feed the family, serve the customers well and create jobs. Development and growth may not be a huge priority and change may not occur until a younger generation takes over. INNOVATIVE ENTREPRENEUR: THE NEXT BIG DISRUPTOR ► Business ideas often (but not always) fall in the fields of software, apps, communication, marketing, business intelligence and similar fields. ► Innovative entrepreneurs may be straight out of graduation and/or have little practical experience in the business area they're innovating. ► There's a strong focus on trend-spotting, marketing and scalability. Few have direct contact with customers. ► A big part of the role is looking for investors ► These businesses are not usually suitable for bootstrapping. The entrepreneur is motivated to blaze new trails and imagine new ways to create value. SOCIAL ENTREPRENEUR: DOING GOOD IN THE WORLD ► Driven to achieve large-scale social change. ► Operate from a "triple bottom line" perspective of people, planet and profit. ► Combines elements of innovation to find and act on an opportunity and elements of classical entrepreneurship as the entrepreneur tends to be hands-on with the business and the cause it's supporting. ► Profits tend to be reinvested in the enterprise rather than distributed to shareholders. ► Social entrepreneurs are motivated to find meaning in their work and make a difference to others. SERIAL ENTREPRENEUR: LAUNCHES BUSINESSES REPEATEDLY ► Launches businesses repeatedly. ► Is skilled in the art of business creation – ► developing a strategy, securing investment, manufacturing or distributing a product, mobilizing teams and setting up the operational and management function. ► Plays little or no role in the day-to-day management of the business. The main difference between a serial entrepreneur vs entrepreneurs of other types is the exit strategy. ► Serial entrepreneurs plan to exit their ventures before they even start them, according to a predetermined strategy, either by selling the business or handing it over to managers. SOLOPRENEUR: THE LONE WOLF ► Works alone. ► Usually sells his professional skills as a service (graphic designer, transcriber, PR consultant). ► May not think of himself as an entrepreneur or as a business, but rather as someone who earns money in a different way to an employee. ► The business often reflects what the solopreneur finds interesting and gives him the lifestyle he desires. ► The motivation to start the business may be dissatisfaction with the conventional work experience or the desire to take back control. The importance of the social economy and social entrepreneurship ► Social entrepreneurs are among a nation's most innovative thinkers. ► They are entrepreneurs who develop creative solutions to help solve the problems that society faces. ► Social entrepreneurs are not business people in the more traditional sense of the term. ► Instead, they are ideologues who stick to their vision and are concerned primarily with the transformation of society and the elimination of its problems. ► Social entrepreneurs are essentially problem solvers who help to eliminate or alleviate the predicaments that societies face. THE TRANSFORMATION BENEFITS OF SOCIAL ENTREPRENEURSHIP ► The definition of social entrepreneurship can really encompass many different types of innovations. Any innovation that transforms or changes society in a profound way may be said to be a social innovation. ► American society was transformed in the 1920s by Henry Ford's perfection of the assembly line to create automobiles. This made automobiles accessible and affordable to the American family and transformed the tourism, labor and related industries by making the American public more mobile. PROBLEM-SOLVING ADVANTAGES ► Going hand-in-hand with leaving behind a legacy is the level of impact a social entrepreneur can have on other peoples' lives by finding and solving problems. ► For instance, Scott Harrison, founder of "charity: water," a nonprofit organization created to provide quality drinking water to millions of people, has been able to transform the lives of countless people by helping to solve one of the most basic health needs that all people have – the need for clean, drinkable water. STANDING AT THE CUTTING EDGE ► One advantage of working as a social entrepreneur is that you can be on the cutting edge of the industry in which you decide to work and offer solutions. Social entrepreneurs use their creativity to establish their niche in the business world and in society in general. ► The innovation they bring to their industries generally carries with it a tremendous amount of respect and recognition from the rest of business community and from society as a whole. ► The social revolution started by Apple's Steve Jobs and Steve Wozniak changed the face of modern technology, especially in the way it affected the use of personal computers and communication devices. In the retail world, Sam Walton's innovations changed the face of retail shopping. ENTREPRENEURS BRING ECONOMIC CHANGE ► As innovators, social entrepreneurs create entire industries where none existed before. In doing so, they may create hundreds or even thousands of jobs and establish industries in cities where industry may have been nonexistent. ► For example, PATH, a Seattle-based nonprofit health innovation organization has developed new technologies to be used to promote greater levels of public health in communities throughout the world. This has led to jobs for health care professionals in many under-served communities where no health care industry even existed. In ways like this, the social entrepreneur often has an impact that grows far beyond the immediate impact of solving a problem. TYPES OF ENTREPRENEURIAL VENTURES ► Small Business Entrepreneurs ► Large Company Entrepreneurs ► Scalable start-up Entrepreneurs ► Social Entrepreneurs ► Innovators ► Hustlers ► Fabian Entrepreneurs ► Researchers ► Drone Entrepreneurs ► Buyers Small business entrepreneurship ► A majority of businesses are small businesses. People interested in small business entrepreneurship are most likely to make a profit that supports their family and a modest lifestyle. ► They aren't seeking large-scale profits or venture capital funding. Small business entrepreneurship is often when a person owns and runs their own business. ► They typically hire local employees and family members. Local grocery stores, hairdressers, small boutiques, consultants and plumbers are a part of this category of entrepreneurship Large company entrepreneurship ► Large company entrepreneurship is when a company has a finite amount of life cycles. This type of entrepreneurship is for an advanced professional who knows how to sustain innovation. ► They are often a part of a large team of C-level executives. Large companies often create new services and products based on consumer preferences to meet market demand. ► Small business entrepreneurship can turn into large company entrepreneurship when the company rapidly grows. This can also happen when a large company acquires them. Companies such as Microsoft, Google and Disney are examples of this kind of entrepreneurship. Scalable startup entrepreneurship ► This kind of entrepreneurship is when entrepreneurs believe that their company can change the world. They often receive funding from venture capitalists and hire specialized employees. ► Scalable start-ups look for things that are missing in the market and create solutions for them. Many of these types of businesses start in Silicon Valley and are technology-focused. ► They seek rapid expansion and big profit returns. Examples of scalable start-ups are Facebook, Instagram and Uber. Social entrepreneurship ► An entrepreneur who wants to solve social problems with their products and services is in this category of entrepreneurship. ► Their main goal is to make the world a better place. They don't work to make big profits or wealth. ► Instead, these kinds of entrepreneurs tend to start nonprofits or companies that dedicate themselves to working toward social good. Innovative entrepreneurship ► Innovative entrepreneurs are people who are constantly coming up with new ideas and inventions. They take these ideas and turn them into business ventures. ► They often aim to change the way people live for the better. Innovators tend to be very motivated and passionate people. They look for ways to make their products and services stand out from other things on the market. ► People like Steve Jobs and Bill Gates are examples of innovative entrepreneurs. Hustler entrepreneurship ► People who are willing to work hard and put in constant effort are considered hustler entrepreneurs. They often start small and work toward growing a bigger business with hard work rather than capital. ► Their aspirations are what motivates them, and they are willing to do what it takes to achieve their goals. They do not give up easily and are willing to experience challenges to get what they want. ► For example, someone who is a hustler is willing to cold call many people in order to make one sale. Imitator(Fabian) entrepreneurship ► Imitators are entrepreneurs who use others' business ideas as inspiration but work to improve them. They look to make certain products and services better and more profitable. ► An imitator is a combination between an innovator and a hustler. They are willing to think of new ideas and work hard, yet they start by copying others. ► People who are imitators have a lot of self-confidence and determination. They can learn from others' mistakes when making their own business. Researcher entrepreneurship ► Researchers take their time when starting their own business. They want to do as much research as possible before offering a product or service. They believe that with the right preparation and information, they have a higher chance of being successful. ► A researcher makes sure they understand every aspect of their business and have an in-depth understanding of what they are doing. They tend to rely on facts, data and logic rather than their intuition. ► Detailed business plans are important to them and minimize their chances of failure. Buyer entrepreneurship ► A buyer is a type of entrepreneur who uses their wealth to fuel their business ventures. Their specialty is to use their fortunes to buy businesses that they think will be successful. ► They identify promising businesses and look to acquire them. Then, they make any management or structural changes they feel are necessary. Their goal is to grow the businesses they acquire and expand their profits. ► This kind of entrepreneurship is less risky because they are purchasing already well-established companies. Lifestyle vs Growth Entrepreneur ► A lifestyle entrepreneur optimizes for his or her lifestyle while the growth entrepreneur focuses on growth at any reasonable any cost. ► Lifestyle entrepreneurs look to company profitability for personal income, keeping in mind growth goals, while growth entrepreneurs put all the emphasis on growth ► Lifestyle entrepreneurs are averse to raising outside money while growth entrepreneurs always try to raise money ► Lifestyle entrepreneurs are more comfortable with the status quo while growth entrepreneurs are constantly looking to shake things up and reinvent their business to grow faster Replicative Vs Innovative ► Innovative entrepreneurs who "act as destabilizing influences triggering 'creative destruction' — the simultaneous creation of new industries through innovation and elimination of sectors of prior economies.“ ► Replicative entrepreneurs, on the other hand, "function as efficient coordinators of resource usage, starting small businesses that mimic predecessors.“ ► "The businesses to do so are most often replicative — dry cleaners, movie rental shops, and grocery stores." Replicative businesses are focused on serving a growing population; they most often stay small and don't export their products or services outside the boundaries of the area they serve. ► This contrasts those entrepreneurs with innovators, who "don't focus on serving population growth, but are interested in selling to customers both inside and outside the population centre. For that reason, we call them export entrepreneurs." These entrepreneurs, are the ones who create wealth — increasing standards of living. CHARACTERISTICS OF ENTREPRENEURSHIP ► They take risks ► They are innovative ► They possess visionary and leadership quality ► They are usually open-minded ► They are flexible ENTREPRENEURSHIP AND CULTURE ► Entrepreneurs are not robots blindly fulfilling an economic function. ►  They cannot pursue opportunities, or strive for economic efficiency without exhibiting some concern for wider issues. ►  Entrepreneurs are human beings operating within societies which define, and are defined by, cultures. ► Clearly, an American entrepreneur tends to act differently from a Japanese one who, in turn, behaves differently from a Peruvian one. ► There are not only great differences between these cultures which influence the way entrepreneurs work, there is also a wide variety of ways in which individual entrepreneurs work within these cultures. ► Culture is expressed in both the value judgments an individual makes and the value system of their wider community. RELIGIOUS BELIEFS ► Religious belief is a very important factor in shaping a culture. It leads to a view of the world which will influence the individual`s approach to entrepreneurship. PERSONAL RELATIONSHIPS ► The type and scope of personal relationships that a culture encourages will be a critical factor in the way entrepreneurial behavior is expressed ATTITUDE TOWARDS INNOVATION ► Innovation lies at the heart of entrepreneurship, yet to believe in innovation we have to see the world in a certain sort of way. We have to believe in a future that will be different from the present.  ► Many West Europeans will regard these things as `obvious`. However, they are beliefs which are sensitive to culture. While a West European sees the future as something which brings uncertainties `towards` them. Some west Africa, have different perspective. ► They draw a distinction between a `potential time` which is full of things that must happen and a `no-time` of things which might or might not happen.  THE CULTURAL DIVERSITY OF ENTREPRENEURSHIP YOUNG ENTREPRENEURS ► Young people are choosing entrepreneurship as their primary career path. About 30% of all entrepreneurs are age 30 or younger. ► Young entrepreneur camps are popping up all around the world to teach youngsters how to launch and run a business. ► Young entrepreneurs are aimed straightforwardly at these youthful business- building wannabes ► Shawn Brennegman, 15, took a test to finish high school early so he could give more time to running Shattered Paradigm, his computer graphics design company. WOMEN ENTREPRENEURS ► Increasing numbers of women are discovering that the best way to break the `glass ceiling` that prevents them from rising to top of many organizations is to start their own companies. ►  Although the business women start tend to be smaller than those men start, their impact is anything but small. 72% of women-owned businesses are concentrated in retailing and services, female entrepreneurs are branching out rapidly into previously male- dominated industries. ►  The fastest-growing industries for women-owned companies are construction, wholesale trade, transportation MINORITY ENTREPRENEURS ► Hispanics, Asian, and African Americans are the minority groups most likely to become entrepreneurs. ► After several banks rejected their loan request, Daymond John, Alexander Martin, Keith Perrin and Carl Brown refused to give up their plan to create an apparel company. To raise the capital they needed. John mortgaged his house and then converted part of it into a factory. The partners approached hometown friend, hip-hop star L.L. Cool J. who agreed to wear their fashions in his music videos, and sales of more than $200 million. IMMIGRANT PARTNERS ► The United States has always been a `melting pot of diverse cultures, and many immigrants have been drawn to this nation because of its economic freedom. Although many of them come to the United States with few assets, their dedication and desire to succeed enable them to achieve their entrepreneurial dreams. ► After a harrowing escape from their native Iran, brothers Frank and Payam Zamani landed in the united States with just $75 in their pockets. The Zamanis worked at various jobs while earning advanced college degrees, but their inspiration for a business came as a result of negative car-buying experiences. After buying eight clunkers, the brothers decided to use the WWW to research a car purchase but found it to be of limited use. In 1995, they decided to create a Web site that would streamline the car-buying process www.autoweb.com. Within three years, their site had become the most visited automotive site on the web. Today Autoweb.com counts more than 4.000 dealers in its network and tallies $700 million in auto sales per month.www.autoweb.com PART-TIME ENTREPRENEURS ► Starting a part-time business is a popular gateway to entrepreneurship. A major advantage of going into business part time is the lower risk in case the venture flops. ► Charles Manning Jr. ran a part-time business in an unusual niche: accident investigation, a skill he learned in the Air Force during the Korean War. Manning investigated the causes of everything from plane crashes and auto accidents to train derailments and medical accidents. In 1980, Manning`s son, Charles III, convinced him to make Accident Reconstruction Analysis a full-time business. Their company has worked on high-profile cases such as the Challenger space shuttle disaster and the ValueJet explosion and generates annual revenues of $3.6 million.  HOME-BASED ENTREPRENEURS ► Home-based business are booming. Entrepreneurs operate 27.1 million business from their homes. ►  Operating a business from home keeps start-up and operating costs to a minimum. ►  Home-based companies allow owners to maintain a flexible lifestyle and work style. ►  Technology, which is transforming many ordinary homes into `electronic cottages`, allows entrepreneurs to run a variety of business from their homes. ► Eric Schaberg and Derek Parnell found that home was the perfect location from which to start their computer programming and training company, Digital Resource Providers. At age 25, They and their wives decided to rent a house in suburban Orlandi that would serve as a low-cost headquarters for their fledgling business. In its first full year of operation, DRP generated $100.000 in revenues and was growing rapidly. Two years later, the company was profitable enough to allow them to earn $100.000 each. FAMILY ENTREPRENEURS ► A Family Business is one that includes two or more members of a family with financial control of the company. ►  Family businesses face a major threat, a threat from within: management succession. Only 30% of family business survive to the second generation, and just 10% make it to the third generation. ►  To avoid such senseless destruction of valuable assets, founders of family businesses should developed plans for management succession long before retirement looms before them ► Bob Baugh knew that his son Ken would take over the family business one day, but after his son earned an MBA, Baugh insisted that he work elsewhere first.`Experience with other companies is valuable, it offers a different perspective` says Baugh. Five years later, Ken joined the family office furniture store and blossomed under his father`s guidance. When the elder Baugh retired, Ken made a smooth transition into the top position at Space Designs, which has grown into a $50 million business under his leadership. Are Entrepreneurs Born or Made? Critically Discuss ► An entrepreneur is a person or an individual who creates a business that could either be a big or a small business venture. He or she is an innovator with great business plans, new ideas, and services. This helps in the development of a countries economy and also providing employment opportunities. The three most important resources that an entrepreneur requires are capital, land, and labor. Without these, he or she will not be able to achieve their dream venture. Are Entrepreneurs Born? ► To some extent, there is truth in this statement that an entrepreneur is born. There are two types of entrepreneurs born. ► First is the one who is born into a family that already owns a business. ► The second type of entrepreneur is the one who has no resources and no knowledge when it comes to investment, but he or she is full of ideas. ► It is not necessary that an entrepreneur’s son or daughter has to become an entrepreneur. However, it becomes easy for an individual who is born in a family that already runs a business venture to get into the family business. It is because entrepreneurship runs in the family. ► Entrepreneurs require resources like capital, land, and labor. It is usually not that difficult to achieve these since these resources are already available in the family business. ► In such situations the drawback is that the entrepreneur born in a business family shy’s away from starting their own business. He or she focuses only on running the family business and carrying forward the name attached to the business for generations to come. Are Entrepreneurs Made? ► Yes, Entrepreneurs are made. These are individuals who are positive and with powerful self-confidence. They want to be admired as a self- made man or woman. ► Such individuals do not grow overnight, but they grow with time. It could be a dream or a vision that they have always wanted to achieve since their childhood. ► Over the years, they have successfully observed the surrounding environment. Maneuvered through many obstacles and experiences in life which has helped them to become an entrepreneur. ► It is their passion to create something new which makes them an entrepreneur. It can also be said that an entrepreneur is created through education. The knowledge that he or she receives through lessons helps the individual to be exposed to new ideas. ► Education helps individuals discover the skills and the natural talents that they already possess. It helps them to successfully use those skills in becoming an entrepreneur. ► However, there is one thing that education cannot teach, and that is to take risks. A self-made entrepreneur can bear risks and take up new challenges.