Topic 5 - Managing Start-Up and New Ventures

Entrepreneurship def

starting a business, organising resources, taking on risks and rewards

Entrepreneur def

someone who recognises a viable idea for a product and carries it out

What are the types of entrepreneurs

idealists, optimisers, hard workers, juggler, sustainers

Idealists

rewards by chance to work on something new and creative, main type of entrepreneur

Optimisers

get personal satisfaction from being a business owner

Hard workers

thrive on the challenge of building a larger, more profitable business

Juggler

high-energy people who enjoy handling every detail of their own business

Sustainers

enjoy the chance to balance work and personal life, least likely entrpreneur

Why has the number of entrepreneurs has increased due to

advances in tech, rapid expansion of middle class, people in lower-income countries are beginning to partake, rise of female entrepreneurship

Entrepreneurship and the business environment

economic changes, globalisation, increased competition, technology, new opportunities, market niches

What is the advantage of a small business

cheaper, faster, more flexible

What do you need to do to be an entrepreneur

analyse new trends and rising needs, what products or services that satisfy those needs

Social entrepreneurship def

committed to both good business and positive social change

Social entrepreneurship def

creating social value with a secondary purpose of profit

Launching an entrepreneurial firm

start with the new-business idea, writing the business plan, choosing a legal structure, arranging financing

What are the sources for starting a business

to create something new, to control my life

Business plan def

a document specifying the business details before opening a business

Success business plan includes

clear vision, realistic financial projections, good writing and formatting

What are the different types of legal structure

solo proprietorship, partnership, company

Solo proprietorship def

unincorporated business owner owned by an individual for profit

Solo proprietorship pros

easy to start, total control

Solo proprietorship cons

owner has liability, financing can be harder

Partnership def

unincorporated business owned by two or more people for profit

Partnership pros

relatively easy to start, shared responsibility and resources

Partnership cons

liability of the partners, disagreements

Company def

a legal entity that exists apart from owners and is registered with the government

Company pros

owners don’t have liability

Company cons

expensive and complex

What are the different ways to arrange finance

debt financing and equity financing

What are the main sources of debt financing

family and friends, personal credit cards, bank loans, angel financing

Angel financing def

Angels are wealthy individuals, typically with business experience and contacts and are willing to invest their personal funds

Equity financing def

funds that are invested in exchange for ownership in the company

Equity financing - venture capital firm def

a group of organisations or individuals that invest money in new or expanding businesses for ownership and potential profits

Equity financing - crowdfunding def

raising capital by receiving small amounts of money from a large number of investors, usually through social media and the internet

What are the different stages of growth for an entrepreneurial business

Existence, survival, success, take-off, resource maturity

Stages of growth - Existence

start to provide products and service

Stages of growth - Survival

demonstrated as a workable business entity; growing in size and profitability

Stages of growth - Success

company is solidly based and profitable

Stages of growth - Take-off

pivotal point, properly managed, becoming a big business

Stages of growth - Resource maturity

start to lose the advantages of small businesses

Growing through entrepreneurship

as the firm grows in size, it tends to lose its innovative spirit, keep innovation by creating conditions that intrapreneurs can flourish

Intrapreneurs def

the process of recognising the need for innovation and promoting it within an organisation

What are the general rules for intrapreneurship

persistence, informality, innovation, planning