2 - Entrepreneurial Mindset

8/10/2019 2 - Entrepreneurial Mindset

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INDIVIDUALENTREPRENEURIALMINDSET &

PERSONALITY

Lecture # 2


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Agenda for Today

Some myths Entrepreneurial mindset

Common characteristicsBackgroundComparison of male and female entrepreneurs

Tipping points


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Some Myths


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Myth # 2

Entrepreneurs are born, not made(Trait theory)

Truth is:Some of the most successful entrepreneurs are themost unlikely

It is a lifestyle choice, not an accident


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Myth # 3

Entrepreneurs are doers, not thinkers

Truth is: Although entrepreneurs tend towards action, they arealso thinkersMethodical people who plan their moves carefullyCombination of thinking & doing makes anentrepreneur


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Myth # 4

"I'll have all this free time"

Truth is entrepreneurs work many hours Advantages are:

control of timevariety of tasks


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Myth # 5

It gets easier

Truth is, it gets more challengingOne must work faster, smarter & longerOne must enjoy the battle


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Myth # 6

Entrepreneurs are academic & social misfits

Truth isThis misunderstanding is a result of some businessowners having started successful enterprises afterdropping out of schoolToday the entrepreneur is considered a hero socially, economically, and academically


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Myth # 7

All entrepreneurs need is luck

Truth is luck happens when preparation meetsopportunity!

Prepared entrepreneurs who seize the opportunityoften seem luckyWhat appears to be luck is actually preparation,determination, desire, knowledge and innovativeness


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Myth # 8

Entrepreneurs are extreme risk takers

Truth Entrepreneurs are calculatorsStudies show entrepreneurs take calculated risksonlyMost entrepreneurs plan & prepare to minimize

the risk involved & gain better control


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Myth # 9

You have to have a great idea

Truth isYour idea must be goodYour idea must be doableYour idea must be wanted or needed

Your idea must be priced right


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Myth # 10

It takes a lot of money

Truth Over 50% start for under $10,000 Also look for

Certain business typesTurn-around situations

Possibility of using other peoples money Market Niche


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One Last MythThe key to success is a great idea

Good idea

Great plan. Passion!

The keys are:


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The Entrepreneurial Mindset


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Common Characteristics Associated with Entrepreneurs

Commitment, determination, & perseveranceTotal dedication to success can overcome obstacles &setbacksSheer determination & unwavering commitment to succeed

Drive to achieveSelf-starters; Internally driven by a strong desire to competeThey examine a situation, determine how to increase theodds of winning, and then push ahead

Opportunity orientation

Focus on opportunity rather than on resources, or structureConstant awareness of opportunities that exist in everydaylife

Initiative & responsibilityEffective entrepreneurs actively seek & take initiatives

Willingly put themselves in situations where they arepersonally responsible for success or failure of an operation


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Persistent problem-solvingNot intimidated by difficult situations

Internal locus of controlDo not believe that the success/failure of their venture willbe governed by fate, luck, or similar forces Accomplishments/Setbacks are within their own control

Calculated risk takingCalculated risk takers

Do everything possible to get the odds in their favor

Tolerance for ambiguity

Easily deal with setbacks/changes confronting themThrive on the fluidity & excitement of such an ambiguousexistence


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Tolerance for failureUse failure as learning experiences; Realistic enough toexpect difficulties

Creativity & innovativenessNew ventures often possess a collective creativity thatemerges from the joint efforts of the founders and personneland produces unique goods and services

VisionKnow where they want to go; Have a vision of what theirfirm can beThis vision, at times, also develops over time as theindividual realizes what the firm is and what it can become


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Self-confidence & optimismMaintain confidence during down periods

IndependenceDesire for independence is a driving force behind mostentrepreneursNot all decisions, but they do want to make the importantones

Team buildingMost successful entrepreneurs have highly qualified, well-

motivated teams that help handle the ventures growth anddevelopment

Integrity & reliabilityFind these two characteristics crucial to success


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Entrepreneur Background

EducationFormal education is not necessary for starting anew business

Research shows education provides a goodbackground, although majority of successfulventure owners like Henry Ford, Bill Gates werecollege dropouts

Others do have relevant degrees in engineering,science, etc.


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AgeMost entrepreneurs initiate their entrepreneurialcareers between the ages of 25 and 45

Generally, Male entrepreneurs start their firstventure in their early 30s whereas women do so intheir mid 30s

Work HistoryDissatisfaction with various aspects of ones jobsuch as lack of challenge, or promotionalopportunities, frustration, boredom etc. motivatesthe launching of new venture

Entrepreneur Background(Contd.)


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Dark Side of Entrepreneurship

Entrepreneurs confrontation with risk

Typology ofEntrepreneur ial Styles


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Dark Side of Entrepreneurship(Contd.)

Entrepreneurs face a number of different typesof risks:

Financial risk In most new ventures, an

individual puts a significant portion of his or hersavings or other resources at stakeCareer risk Major concern for managers with asecure job with a high salary and good benefit

packageFamily and social riskPsychic risk Psychological impact in case theventure fails


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Stress and the entrepreneurSources of Stress:

Loneliness Often isolated from people; Longworking hours prevent them from seeking counselfrom friends/familyImmersion in business Most are married tobusinessPeople problems Have to deal with differentkind of people including bankers, employees,customers

Need to achieve



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Six ways to cope with entrepreneurial stress:NetworkingGetting away from it all

Communicating with employeesFinding satisfaction outside the companyDelegating

Exercising rigorously



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Entrepreneurial Ego Negative effects of aninflated ego

Overbearing need for control

Sense of distrustOverriding desire for successUnrealistic optimism



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Are you a High Achiever?

Exercise

C i f M l & F l E


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Comparison of Male & Female Entrepreneurs

Characteristic Male Entrepreneurs Female Entrepreneurs

Motivation Achievement-strive to make

things happen, Personalindependence, Job satisfactionarises from the desire to be incontrol

Achievement- Accomplishment

of a goal, independence-to do italone

Departure point Dissatisfaction with present job,

sideline in college, present job,or outgrowth of present job,discharge or layoff, opportunityfor acquisition

Job frustration, interest in and

recognition of opportunity in thearea, change in personalcircumstances

Sources of funds Personal assets & savings, bankfinancing, investors, loans fromfriends and family

Personal assets & savings,personal loans

Occupationalbackground

Experience in line of work,Recognized specialist orachiever, competent in variety ofbusiness functions

Experience in area of business,Middle management oradministrative level experiencein the field, service relatedoccupational background.

C i f M l & F l E t


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Comparison of Male & Female Entrepreneurs

Characteristic Male Entrepreneurs Female Entrepreneurs

Personalitycharacteristics

Opinionated & persuasive, Goaloriented, innovative & idealistic,High level of self confidence,Enthusiastic & energetic, Mustbe own boss

Flexible & tolerant, goal oriented,Creative & realistic, medium levelof self confidence, enthusiastic &energetic, ability to deal with thesocial & economic environment

Background Age= 25-35, father was self-employed, college educated(degree in business or technicalarea)

Age= 35-45, father was selfemployed, college educated(degree in liberal arts), firstbornchild

Support groups Friends, professionalacquaintances(lawyers,accountants), businessassociates, spouse

Close friends, spouse, family,womens professional groups,trade associations

Type ofbusinessstarted

Manufacturing or construction Service related- educationalservices, consulting or publicrelations


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Set a big dream and put yourtime and thinking into chasing

it, your painful memories willhave no room to bother you

again.(dont know who said it)


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Case Study


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Thank you!

Thats all for today!

2 - Entrepreneurial Mindset

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