Chapter 3 Opportunity Recognition, Shaping and Re-shaping Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Idea-to-opportunity transition Seed of idea Idea Viable Opportunity Passion Professional Experience Idea Multiplication Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Idea multiplication – IDEO technique Gather Stimuli Observe 1 Multiply Stimuli Brainstorm/brain-write 2 Create Customer Concepts Build a simple mock up 3 Optimize Practicality Add/remove features 4 Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Government Regulations The opportunity space Global Business Environment Competitors Suppliers Your Company Customers Competitors Competitors Government Regulations Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Target Audience Categories The customer Target Audience Categories Primary Target Audience Secondary Target Audience Tertiary Target Audience Common Demographic/Psychographic Categories Demographics Psychographics Age Gender Household Income Family Size/Family Lifecycle Occupation Education Level Religion Ethnicity/Heritage Nationality Social Class Marital Status Social group (e.g., white collar, blue collar, etc.) Lifestyle (e.g., mainstream, sexual orientation, materialistic, active, athletic, etc.) Personality Traits (Worriers, Type A’s, Shy, Extroverted, etc.) Values (Liberal, Conservative, Open-Minded, Traditional, etc.) Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. © Macro trends Important Trends over the Last 50 Years Trend Impact Baby Boom Generation Pampers, Rock & Roll, Television, Minivans, Real Estate, McMansions, etc. Personal Computing Internet, media on demand, electronic publishing, spreadsheets, electronic communication Obesity Drain on healthcare system, growth of diet industry, changes in food industry, health clubs, home gyms Dual-Income households Child care, Home services – landscaping, house cleaning, prepared foods Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. © S-curve Obsolescence Phase Competitors New Enter Market Adoption Window of Opportunity 1 2 3 Time Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. © Setting prices Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Reaching customer – the value chain Example - Value Chain of Gourmet Chili Base Ingredients Gourmet Chili Food Distributors Grocery Stores Beef, Sauce, etc. From Food Distributor 80% 90% 85% 75% - - 30% - - 30% 25% 35% - - - COGS 70 - COGS 75 COGS 65 COGS 70 GM 20 GM 25 GM 10 GM 15 Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Learning about “stealth” competitors Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©

Opportunity checklist Customer Competition Vendors Government Global Environment Price/ Frequency/ Value Trends Market size Market Growth Distribution Key Success Factors Bygrave & Zacharakis, 2007. Entrepreneurship, New York: Wiley. ©