13 Summary Acquiring and Organizing Resources To get profit without risk, experience without danger, and reward without work, is as impossible as it is to live without being born. A.P. Gouthev Summary How can entrepreneurs efficiently acquire and organize the resources needed to launch their venture? Successful entrepreneurs are good at locating and acquiring the resources they need to start and build their firm. They need capital, people, and intellectual and physical assets to launch and grow their business. Chapter 13: Summary Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources Another useful definition of entrepreneurship is the pursuit of opportunity without regard to resources currently controlled. Chapter 13: Entrepreneurship Technology Ventures: From Idea to Enterprise

Sources of Capabilities Sources of Financial Capital Acquiring and Organizing Resources 13 The Credibility Cycle Physical Assets Sources of Capabilities Suppliers Sources of Financial Capital Talent-People Customers The Credibility Cycle Chapter 13: Figure 13.1 Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources Sources of Legitimacy •Regulatory — Legal actions, accreditation, credentials •Social — Fair treatment, endorsements, networks, image •Industry — Attractive, respected industry, known and understood business model •Talent — Known, respected people •Location — Within an industry cluster, good location, visible •Intellectual Property — Trade secrets, patents or copyrights Chapter 13: Table 13.1 Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources Principles of Persuasion Cialdini, 2008. Consistency •People adhere to their verified commitments •Ask for voluntary, public commitments Authority •People highly regard experts •Show and state your expertise. Scarcity •People want scarce products. •Describe unique benefits Liking •People like those who like them. •Uncover shared bonds and offer sincere praise and compliments Reciprocity •People respond in kind to others •Give to others what you want to receive Social Proof •People respond to a display of endorsements by people they trust •Use testimonials and endorsements from trusted leaders Chapter 13: Table 13.2 Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources Criteria for Location Selection Availability of potential employees and consultants Availability of complementor firms Road and airplane transportation Quality of life — education, culture, recreation Costs of doing business Availability of suitable facilities Proximity to markets Availability of support services Affordable housing Chapter 13: Table 13.3 Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources A cluster is a geographic concentration of interconnected companies in a particular field. Clusters can include companies, suppliers, trade associations, financial institutions, and universities active in a field or industry Chapter 13: E-commerce Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources Characteristics for innovation in a cluster setting Chapter 13: Table 13.5 – clusters Technology Ventures: From Idea to Opportunity

13 Acquiring and Organizing Resources E-commerce: digitally enabled commercial transactions between and among organizations and individuals. Chapter 13: E-commerce Technology Ventures: From Idea to Opportunity

13 Acquiring and Organizing Resources Value chain: a sequence of business activities for transforming inputs into outputs that customers value, as depicted below. Chapter 13: Value Chain, Figure 13.2 Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources Questions for Selecting Value Chain Activities that will be carried out by the New Venture Firm 1. Value: Is the activity a primary source of product value for the firm? 2. Rarity: Does the activity include a resource or capability controlled by the firm and rarely available to competing firms? 3. Imitability:Do competing firms have a cost disadvantage when imitating the scarce resource or capability held by the new venture firm? 4. Organizational Mission: Is the activity critical to the mission of the firm and is the firm organized to exploit this valuable, rare, and costly to imitate resource or capability? Chapter 13: Table 13.7 Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources Virtual organization: manages a set of partners and suppliers linked by the Internet, fax, and telephone to provide a service or product. Chapter 13: Virtual Organization Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources The Seven Key Characteristics of a New Basic Technology • Functional Performance — an evaluation of the performance of the basic function • Acquisition Cost — initial total cost • Ease of Use — use factors • Operating Cost — cost per unit of utility provided • Reliability — needs for service and useful lifetime • Serviceability — time and cost to restore a failed device to service • Compatibility — fit with other devices within the system Chapter 13: Table 13.9 Technology Ventures: From Idea to Enterprise

13 Acquiring and Organizing Resources Effective new ventures use their persuasion skills and credibility to secure the required resources for their firm in order to build a well coordinated mix of outsourced and internal functions. Chapter 13: Principle Technology Ventures: From Idea to Enterprise

VENTURE CHALLENGE 13 How do you plan to attract talent and resources? Acquiring and Organizing Resources 13 VENTURE CHALLENGE How do you plan to attract talent and resources? What location have you selected? Describe your use of online commerce. Describe what functions your venture will outsource. Chapter 13: Venture Challenge Technology Ventures: From Idea to Enterprise

DVD Video 13 “Outsourcing” Jeff Hawkins (Palm) Acquiring and Organizing Resources 13 DVD Video “Outsourcing” Jeff Hawkins (Palm) Chapter 13: DVD Video Technology Ventures: From Idea to Enterprise