The Nature and Importance of Entrepreneurs 1 Chapter The Nature and Importance of Entrepreneurs

Development of Entrepreneurship Earliest Period- Marco Polo Middle Ages- Theater, Architectural Works 17th Century- Mississippi Company 18th Century- Edison & Whitney 19th & 20th Centuries Organize/Operate Innovation

Environmental Factors Affecting Organizations Hypercompetition Changing Technology Short Product Life Cycles New Markets Changing Employee Drives/Motives Focus on Sales/Profits Available Capital

Innovation Orientation Entrepreneurship Culture Economies Market-Oriented Controlled UNITED STATES CUBA Market Conditions Innovation Orientation Investment Community Entrepreneurship Culture

Market Conditions Large Market Easy To Form Company Positive Tax Structure Positive Media Coverage Code of Business/Contract Law Strong Gov’t Agencies- No Corruption Standard-Setting Associations Individual Investment Mentality

Principles for Successful New Venture Define Market Durable Products- 18 Month Customer Payback Market Growth = 30-50% in 5 Years Patent Protection No Product Substitutions Available Products Variants No Strong Competition Present Quick Market Dominance Gross Margin 30-50% Staged Financing ROI = 10X in 5 Years (25-30%/Year) Positive Cash Flow in 18 Months Strong Management in Industry

Infrastructure Needed for Innovation Long-Term Thinking Investment Community Banks Venture Capitalists Informal/Informed Private Investors (Angels)

Entrepreneurship Culture More New Ventures Than Anywhere In The World Concentrated Areas

Successful Entrepreneur Initiates Creation Process Devotes Time/Effort Assumes Risk Receives Rewards Independence Satisfaction Money

Entrepreneurial Decision Present Lifestyle Catalyst New Enterprise Desirable Possible

Drivers of New Venture Formation Desirability Influences Culture/Subculture Family/Peers Teachers Possibility Factors Government Background Marketing Role Models Finances

Types of Startups Lifestyle Foundation High Potential Gazelles

Entrepreneur & Economic Development Product-Evolution Process Iterative Synthesis Innovation Technological Breakthrough Government Technology Transfer Intrapreneurship vs. Entrepreneurship

Product Evolution Need Recognition Industrial Initiate Innovation Development Press To Invent

Careers/Education Life Space Skills Required Work/Occupation Individual/Personal Nonwork/family Skills Required Technical Business Management Personal

Skills Required of Entrepreneur Technical Business Management Personal Writing Planning Inner Control Oral Communication Decision Making Risk Taking Monitoring The Environment Human Relations Innovative Use Technology Marketing (Selling) Change-Oriented Visionary

Ethics & Social Responsibility Ethics- Behavior/Morals in Business Value System Peer Pressure Social Norms Competitors Individual vs. Community

Future Entrepreneurial Education Government- Promotion Society’s Support Corporate Intrapreneurship

Entrepreneurial Universities Activities Seminars Consulting Research Case Development Technology Development & Transfer Joint Ventures & Strategic Alliances Structures Business Assistance Centers Incubators Innovation Centers Industrial Parks Enterprise Development Centers Venture Capital Exchanges Inputs Guest Lectures Board of Advisors/Trustees Internships Student Projects Source of Funds