Chapter 1: Entrepreneurial Revolution PDF

TTV6133 Chapter 1: Entrepreneurial Revolution 1–1  The idea that the rules that created The Entrepreneur commercial success Revolution in the past have radically changed 2 ...

TTV6133 Chapter 1: Entrepreneurial Revolution 1–1  The idea that the rules that created The Entrepreneur commercial success Revolution in the past have radically changed 2  Doing what worked yesterday may not The Entrepreneur bring you success Revolution tomorrow 3  For some people this will be a time of great uncertainty and loss The Entrepreneur Revolution For others it will be the greatest opportunity in history 4  An entrepreneur is simply someone who spots an opportunity The Entrepreneur and acts to make it into Revolution a commercial success 5 Recognize opportunities where others see chaos or confusion Are aggressive catalysts for change within the marketplace Challenge the unknown and continuously create the future 6 Entrepreneurs versus Small Business Owners Small Business Owners Entrepreneurs Manage their businesses Focus their efforts on by expecting stable sales, innovation, profitability profits, and growth and sustainable growth 7 Entrepreneurs versus Small Business Owners Small Business Owners Entrepreneurs Follow the decision made Use their creativity in by others and invests only producing and creating in a tested and proven innovative products which market has not been tested before 8 Entrepreneurship is more than the mere creation of business. An integrated concept that permeates an individual’s business in an innovative manner The characteristics of seeking opportunities, taking risks beyond security, and having the tenacity to push an idea through to reality combine into a special perspective that permeates entrepreneurs 9  Our Entrepreneurial Economy— The Environment for Entrepreneurship Entrepreneurship is the Entrepreneurs are the symbol of business pioneers of today’s tenacity (persistence) business successes. and achievement Presentation Title 10  numbers that Statistical emphasize the importance of entrepreneurs to the Two perspectives economy on entrepreneurship trends in entrepreneurial Academic research and education  Effects of Entrepreneurship Entering and expanding existing markets Entrepreneurs lead to growth by Creating entirely new markets by offering innovative products Increasing diversity and fostering minority participation in the economy 12 A national culture that supports risk taking and seeking opportunities Americans’ alertness to unexploited economic opportunity and a low fear of failure U.S. leadership in entrepreneurship education at both the undergraduate and graduate level A great percentage of individuals with professional, technological or business degrees which register as the highest entrepreneurial activity rate 1–13 1 2 3 Entrepreneurs have Women and minority The entrepreneurial been the subject of keen entrepreneurs have spirit is universal research interest emerged in unprecedented numbers 4 5 Entrepreneurs’ economic and Entrepreneurial education is social contributions of are one of the hottest topics at significant for job creation, U.S. business and innovation, and economic engineering schools renewal 14  A business establishment with at least 20% sales growth in each year for A “Gazelle” five years, starting with a base of at least $100,000 in annual sales 15  Produce twice as many product innovations per employee as do larger firms. Gazelles as leaders in innovation Have been responsible for 55% of the innovations in 362 different industries and 95% of all radical innovations 16 Some gazelles keep bounding along, some get tired and slow down, and some get eaten by big cats Gazelle companies Apple Facebook Amazon 1–17 Gazelle Companies With their rapid and flashy Social media giant Instagram strides in the open field, may makes a good example, having attract the attention of big been acquired by Facebook predatory cats. Facebook bought Instagram These larger cats could jump in 2012 for $1bn and on them and eat them WhatsApp in 2014 for $19bn 18 Mythology Associated with Gazelles Gazelles are the goal of all entrepreneurs Gazelles receive venture capital Gazelles were never *mice Gazelles are high-tech Gazelles are global 19  The simple answer is “none.” Sooner or How many gazelles later, all companies survive? wither and die Presentation Title 20  85% of all firms fail in the first year (not true) The Common Myth of Failure In actuality, about half of all start-ups last between 5 and 7 years 21  Past 20 years, huge emergence of Emerging entrepreneurial activity in the US. Tr e n d s : For the past 10 years, new business start- ups numbered nearly 600,000 per year 22 Emerging Tr e n d s : The Most Well-Funded Tech Startup In Every US State 23 E m e r g i n g Tr e n d s : Smaller ventures use the Internet for a variety of operations: Advertising, consumer sales Business-to-business transactions E-mail and private internal networks for employees U.S. businesses spent hundred billion dollars to build their Internet capabilities 24  DEVE LOPING A W EBSITE A great website is essential for your company’s success A few keysteps: 1 Display a clear description of your business It is important to let people know who you are and what you do right away so they don’t feel confused when they visit your small business website Create an interesting, memorable and engaging website 2 user interface Make sure your small business website interface leaves a positive impression. Use beautiful graphics and easy-to-read fonts 1–25  DEVE LOPING A W EBSITE A great website is essential for your company’s success A few keysteps: 3 Optimize your website for search engines SEO is a set of practices you apply to your website to ensure search engines index and rank your website appropriately and then show it to search engine users. The better your website design and content is, the higher your site will show up on search engine result pages. 4 Regularly create and publish quality content If you want to rank highly in search engine results and encourage people to return to your site again and again, you will have to update your website with new and relevant content as frequently as 1–26 possible 27 Entrepreneurial opportunities The economic basis for all entrepreneurial activity. It means that Free Enterprise any individual is free to transform an idea into a business 28 Entrepreneurial opportunities Opportunities for potential entrepreneurs are unlimited Opportunities during this century will be extremely great Entrepreneurial opportunities will continue to arise for individuals willing to take the risk 29  MARK ZUCKERBERG’S WORDS OF WISDOM The biggest risk is not taking any risk… In a world that is changing really quickly, the only strategy that is guaranteed to fail is not taking risks. The evolution of Entrepreneurship Entrepreneur is derived from the French entreprendre, meaning “to undertake.” 31 The evolution of Entrepreneurship The entrepreneur is one who undertakes to organize, manage, and assume the risks of a business Although no single definition of entrepreneur exists and no one profile can represent today’s entrepreneur, research is providing an increasingly sharper focus on the subject 32 A summary description of entrepreneurship The dynamic process of creating incremental wealth This wealth is created by individuals who assume major risks in terms of equity, time, and/or career commitment of providing value for a product or service. The product or service itself may or may not be new or unique but the entrepreneur must somehow infuse value by securing and allocating the necessary skills and resources. 33 An integrated definition of entrepreneurship A dynamic process of vision, change, and creation Requires an application of energy and passion towards the creation and implementation of new ideas and creative solutions 34 An integrated definition of entrepreneurship Essential ingredients include The willingness to take calculated risks—in terms of time, equity, or career The ability to formulate an effective venture team; the creative skill to marshal needed resources The fundamental skills of building a solid business plan The vision to recognize opportunity where others see chaos, contradiction, and confusion 35 The myths of entrepreneurship Myth 1 Myth 2 Entrepreneurs are Doers, Not Entrepreneurs are Born, Not Thinkers Made 36 The myths of entrepreneurship Myth 3 Myth 4 Entrepreneurs are Always Entrepreneurs are Inventors – Ray Kroc Academic and Social (Mc D) Misfits 37 The myths of entrepreneurship Myth 5 Myth 6 Entrepreneurs Must Fit the All Entrepreneurs Need Is “Profile” Money need proper management 38 The myths of entrepreneurship Myth 7 Myth 8 All Entrepreneurs Need Ignorance Is Bliss For Is Luck Entrepreneurs 39 The myths of entrepreneurship Myth 9 Myth 10 Entrepreneurs Seek Entrepreneurs Are Success But Experience Extreme Risk Takers High Failure Rates (Gamblers) 40  School of thought The study of the basic theories helps to form a foundation Which can build an understanding of the process and practice of entrepreneurship The study is divided to Macro view Micro view 41  SCHOOL OF ENTREPRENEURIAL THOUGHT Macro View Micro View of of Entrepreneurship Entrepreneurship Entrepreneurial Environmental Trait School of School of Thought Thought Financial / Capital Venture School of Thought Opportunity ENTREPRENEUR School of Thought Displacement School of Thought Strategic Formulation School of Thought  School of entrepreneurial thought – macro view Factors that relate to success or failure in the venture Includes external processes Beyond the control of the entrepreneur 43  Considers the external Macro view- factors that affect a external potential entrepreneur’s locus of lifestyle control Eg: social group The Environmental The atmosphere of School of Thought friends and families can influence the desire to become an entrepreneur 44  Based on the Macro view- capital-seeking external process—the search locus of for seed and growth control capital The Financial/Capital School of Thought The search for seed and growth capital is the entire focus of the entrepreneurial emphasis 45  Prevented from doing other Macro view- activities Alienation drives external entrepreneurial pursuits – locus of feels out of place control Political Cultural The Displacement displacement displacement School of Thought Economic displacement 46  School of entrepreneurial thought – micro view Factors that relate to success or failure in the venture Includes internal processes Entrepreneur has the ability to control 47  Micro view- Focuses on external identifying traits locus of common to control successful entrepreneurs The Entrepreneurial Trait School of Thought Achievement, creativity, determination and technical knowledge 48  Micro view- Focuses on the opportunity external aspect of venture locus of development—the search for control idea sources, the development of concepts, The Venture and the implementation of Opportunity School of Thought venture opportunities 49  Micro view- external Emphasizes the locus of control planning process in The Strategic successful venture Formulation School of Thought development 50 T H E S T R AT E G I C F O R M U L AT I O N SCHOOL OF THOUGHT Ronstadt’s View Strategic formulation is a leveraging of unique elements Unique Unique Unique Unique Markets People Products Resources identifying skills of innovation to gather major individuals special market around resources segments the venture 1–51 Multimedia University (MMU) 1–52