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CREATING ANDLEADING
ENTREPRENEURIALVENTURES MODULE
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THE CONTEXT OFENTREPRENEURSHIP
Entrepreneurship – the process of starting
new usinesses, genera!!y in response to
opportunities.
" Entrepreneurial ventures – organi#ationsthat pursue opportunities, are characteri#ed
y inno$ati$e practices, and ha$e growth and
profitai!ity as their %ain goa!s.
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THE CONTEXT OF ENTREPRENEURSHIP(CONT.)
Small business – an organization tati! in"#$#n"#nt%& o'n#" o$#rat#"an" nan*#"+ a! ,#'#r tan -
#/$%o#!+ "o#!n0t n#*#!!ari%&#ngag# in an& n#' or inno1ati1#$ra*ti*#!+ an" a! r#%ati1#%& %itt%#
i/$a*t on it! in"2!tr&.
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3H4 IS ENTREPRENEURSHIPI5PORTANT6
&nno$ation
– Engage in the creati$e destruction process
– 'ct as agents of change
" (u%er of (ew )tartups
– &ncreasing nu%ers of new fir%s
" *o Creation
– (ew $entures create 60+0- of the net new os
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THE ENTREPRENEURIAL PROCESS
Entrepreneurs %ust address four /ey
steps as they start and %anage their
entrepreneuria! $entures.
1. Ep!oring the entrepreneuria! contet
2. &dentifying opportunities and possi!e
co%petiti$e ad$antages
. )tarting the $enture4. anaging the $enture
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3HAT DO ENTREPRENEURS DO6
(o two entrepreneurs are eact!y the
sa%e. 3enera!!y, entrepreneurs Create so%ething new, so%ething different.
)earch for change, respond to it, and ep!oit it.
5esearch feasii!ityunco$ering usiness ideas,
!oo/ing at co%petitors, and ep!oring financing
options.
Launch and %anage new $entures.
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SOCIAL RESPONSI7ILIT4 AND ETHICSISSUES
7ow i%portant are ethics and socia!
responsii!ity issues to entrepreneurs8 – 9:;-< in a study of s%a!! co%panies e!ie$ed that
de$e!oping a positi$e reputation and re!ationshipin co%%unities where they do usiness is
i%portant for achie$ing usiness goa!s.
– 7owe$er, =0 percent ad%itted that they fai!ed to
consider co%%unity goa!s in their usiness p!ans.
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START8UP AND PLANNING ISSUES
&dentifying En$iron%enta! >pportunities and
Co%petiti$e 'd$antage – Entrepreneurs %ust e a!e to identify en$iron%enta!
opportunities.
– Peter ?ruc/er identified se$en potentia! sources of
opportunity that entrepreneurs %ight !oo/ for in the eterna!
contet
" the unepected, the incongruous, the process need,
industry and %ar/et structures, de%ographics, changesin perception, and new /now!edge.
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START8UP AND PLANNING ISSUES(CONT.)
5esearching the @entureAs Beasii!ity – G#n#rating I"#a! – !o2r*#! o, t#ir i"#a! ar#
2ni92# an" 1ari#".
– 3or:ing in t# !a/# in"2!tr& i! a /a;or !o2r*# ,or/an& i"#a!.
– 3at !o2%" #ntr#$r#n#2r! %oo: ,or6
" %i/itation! o, 'at0! *2rr#nt%& a1ai%a
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EXHI7IT EV8-EVALUATING POTENTIAL IDEAS
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START8UP AND PLANNING ISSUES(CONT.)
E$a!uating &deas
– Feasibility study – an ana!ysis of the
$arious aspects of a proposed
entrepreneuria! $enture designed to
deter%ine its feasii!ity.
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EXHI7IT EV8?FEASI7ILIT4 STUD4
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EXHI7IT EV8?FEASI7ILIT4 STUD4 (CONT.)
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EXHI7IT EV8?FEASI7ILIT4 STUD4 (CONT.)
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START8UP AND PLANNING ISSUES(CONT.)
5esearching the @entureAs Beasii!ity
Co%petitors, so%e possi!e uestions
" Dhat types of products or ser$ices are co%petitors offering8
" Dhat are the %aor characteristics of these products or
ser$ices8
" Dhat are their productsA strengths and wea/nesses8
" 7ow do they hand!e %ar/eting, pricing, and distriuting8
" Dhat do they atte%pt to do different!y fro% other co%petitors8
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RESEARCHING THE VENTURE0SFEASI7ILIT4@CO5PETITORS (CONT.)
uestions aout co%petitors . . .
" ?o they appear to e successfu! at it8 Dhy or why not8
" Dhat are they good at8
" Dhat co%petiti$e ad$antage9s< do they appear to ha$e8
" Dhat are they not so good at8
" Dhat co%petiti$e disad$antage9s< do they appear to ha$e8
" 7ow !arge and profita!e are these co%petitors8
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START8UP AND PLANNING ISSUES(CONT.)
5esearching the @entureAs Beasii!ity
Binancing" Fecause funds !i/e!y wi!! e needed to start
the $enture, an entrepreneur %ust researchthe $arious financing options.
" enture !apitalists – eterna! euity
financing pro$ided y professiona!!y
%anaged poo!s of in$estor %oney.
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RESEARCHING THE VENTURE0SFEASI7ILIT4@FINANCING (CONT.)
"n#el $nvest%rs – a pri$ate in$estor 9or
group of pri$ate in$estors< who offers
financia! ac/ing to an entrepreneuria!
$enture in return for euity in the $enture.
" $nitial publi! %&&erin# '$()* – the first
pu!ic registration and sa!e of a
co%panyAs stoc/.
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EXHI7IT EV8POSSI7LE FINANCING OPTIONS
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START8UP AND PLANNING ISSUES(CONT.)
P!anning the @enture ?e$e!oping a
Fusiness P!an
– +usiness plan – a written docu%ent that
su%%ari#es a usiness opportunity and
defines and articu!ates how the identified
opportunity is to e sei#ed and ep!oited.
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PLANNING THE VENTURE@DEVELOPINGA 7USINESS PLAN (CONT.)
' good usiness p!an co$ers si %aor
areas
" 'na!ysis of opportunity
" 'na!ysis of the contet
" ?escription of the usiness
" Binancia! data and proections
" )upporting docu%entation
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ORGANIBING ISSUES
Lega! Bor%s of >rgani#ation
– S%le pr%priet%rship – a for% of !ega!
organi#ation in which the owner %aintains
so!e and co%p!ete contro! o$er the usinessand is persona!!y !ia!e for usiness dets.
– ,eneral partnership – a for% of !ega!
organi#ation in which two or %ore usiness
owners share the %anage%ent and ris/ of the
usiness.
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LEGAL FOR5S OF ORGANIBATION(CONT.)
imited liability partnership '(* – a for% of
!ega! organi#ation consisting of genera! partner9s<
and !i%ited !iai!ity partner9s
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LEGAL FOR5S OF ORGANIBATION(CONT.)
S !%rp%rati%n – a specia!i#ed type of
corporation that has the regu!ar characteristics of
a C corporation ut is uniue in that the owners
are taed as a partnership as !ong as certaincriteria are %et.
imited liability !%mpany '.* – a for% of
!ega! organi#ation thatAs a hyrid etween a
partnership and a corporation.
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LEGAL FOR5S OF ORGANIBATION(CONT.)
)peratin# a#reement – the docu%ent
that out!ines the pro$isions go$erning the
way an LLC wi!! conduct usiness.
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EG7&F&H E@+4
LE3'L B>5) >B FI)&(E)) >53'(&J'H&>()
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ORGANIBING ISSUES (CONT.)
>rgani#ationa! ?esign and )tructure
– >rgani#ationa! design decisions in
entrepreneuria! $entures re$o!$e around the
si /ey e!e%ents of organi#ationa! structure" wor/ specia!i#ation, depart%enta!i#ation, chain of
co%%and, span of contro!, a%ount of
centra!i#ationKdecentra!i#ation, and the a%ount of
for%a!i#ation.
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ORGANIBING ISSUES (CONT.)
7u%an 5esource anage%ent &ssues in
Entrepreneuria! @entures
– E%p!oyee 5ecruit%ent – one of the iggest
cha!!enges that entrepreneurs face.
– E%p!oyee 5etention – 'n entrepreneur wants
to /eep the peop!e he or she has hired and
trained.
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ORGANIBING ISSUES (CONT.)
)ti%u!ating and a/ing Changes –
during any type of organi#ationa! change, an
entrepreneur %ay a!so ha$e to act as chief
coach and cheer!eader." Hhe &%portance of Continuing &nno$ation –
organi#ations %ust continua!!y inno$ate new
products and ser$ices if they want toco%pete successfu!!y.
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LEADING ISSUES
Persona!ity Characteristics of
Entrepreneurs
– (r%a!tive pers%nality – a persona!ity trait
that descries indi$idua!s who are %ore prone
to ta/e actions to inf!uence their en$iron%ents.
– E%power%ent – gi$ing e%p!oyees the power
to %a/e decisions and ta/e actions on theirown to so!$e pro!e%s.
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LEADING ISSUES (CONT.)
Leading the @enture
– Hhe way an entrepreneur !eads the $enture
shou!d e %uch !i/e the a## !eader drawing
the est out of other indi$idua!s, e$en gi$en
the unpredictai!ity of the situation.
– Leading E%p!oyee Dor/ Hea%s –
entrepreneurs %ust shift fro% the traditiona!co%%and+and+contro! sty!e to a coach+and+
co!!aoration sty!e.
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CONTROLLING ISSUES
P!anning for 3rowth – I"#a%%& i! $art o, t# 1#nt2r#0! o1#ra%%
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EXHI7IT EV8 ACHIEVING A SUPPORTIVE
GRO3TH8ORIENTED CULTURE
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EXITING THE VENTURE
arvestin# – eiting a $enture when an
entrepreneur hopes to capita!i#e financia!!y
on the in$est%ent in the $enture.
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5ANAGING PERSONAL LIFECHOICES AND CHALLENGES
>ne of the %ost i%portant things an
entrepreneur can do is become a good time
manager.
" 'nother suggestion is to seek
professional advice in those areas of
usiness where itAs needed.
" &tAs i%portant to deal with conflicts asthey arise.
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