1. Intro to Entrepreneurship
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2. Introduction to Entrepreneurship
Chapter 1
Introduction to Entrepreneurship
Bruce R. Barringer
R. Duane Ireland
Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall

3. What is Entrepreneurship?
Academic Definition (Stevenson & Jarillo)
Entrepreneurship is the process by which individuals pursue opportunities without regard to resources they currently control.
Venture Capitalist (Fred Wilson)
Entrepreneurship is the art of turning an idea into a business.
Explanation of What Entrepreneurs Do
Entrepreneurs assemble and then integrate all the resources needed – the money, the people, the business model, the strategy – to transform an invention or an idea into a viable business.
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4. Corporate Entrepreneurship 1 of 2
Is the conceptualization of entrepreneurship at the firm level.
All firms fall along a conceptual continuum that ranges from highly conservative to highly entrepreneurial.
The position of a firm on this continuum is referred to as its entrepreneurial intensity.
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5. Entrepreneurs—Challenging the Unknown
Recognize opportunities where others see chaos or confusion
Are aggressive catalysts for change within the marketplace
Challenge the unknown and continuously create the future
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6. Entrepreneurs versus Small Business Owners: A Distinction
Small Businesses Owners
Manage their businesses by expecting stable sales, profits, and growth
Entrepreneurs
Focus their efforts on innovation, profitability and sustainable growth
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7. Entrepreneurship: A Perspective
Entrepreneurship is more than the mere creation of business.
The characteristics of seeking opportunities, taking risks beyond security, and having the tenacity to push an idea through to reality combine into a special perspective that permeates entrepreneurs.
Entrepreneurship is an integrated concept that permeates an individual’s business in an innovative manner.
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8. Our Entrepreneurial Economy— The Environment for Entrepreneurship
Entrepreneurship is the symbol of business tenacity and achievement.
Entrepreneurs are the pioneers of today’s business successes.
Two perspectives on entrepreneurship:
Statistical: numbers that emphasize the importance of entrepreneurs to the economy.
Academic: trends in entrepreneurial research and education.
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9. Predominance of New Ventures in the US Economy
New business incorporations average 600,000 per year
There are 25 million businesses; the number continues to grow 2% annually.
U.S. firms have over $20 trillion in annual revenues.
Small businesses
More 50% of all businesses employ fewer than 5 people.
Almost 90% of firms employ fewer than 20 people.
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10. Effects of Entrepreneurship
Entrepreneurs lead to growth by:
Entering and expanding existing markets.
Creating entirely new markets by offering innovative products.
Increasing diversity and fostering minority participation in the economy.
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11. Entrepreneurs Worldwide
Reasons for the exceptional entrepreneurial activity include:
A national culture that supports risk taking and seeking opportunities.
People’s alertness to unexploited economic opportunity and a low fear of failure.
U.S. leadership in entrepreneurship education at both the undergraduate and graduate level.
A great percentage of individuals with professional, technological or business degrees which register as the highest entrepreneurial activity rate.
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12. Entrepreneurial Firms’ Impact
Entrepreneurial firms make two indispensable contributions to the economy:
They are an integral part of the renewal process that pervades and defines market economies.
They are the essential mechanism by which millions enter the economic and social mainstream of society.
Visit the National Federation of Independent Business (NFIB) website for more information about entrepreneurs.
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13. Research and Education
The entrepreneurial and managerial domains are not mutually exclusive.
Venture financing (venture capital and angel capital financing) and other innovative financing techniques strengthened in the 1990s.
Intrapreneurship (entrepreneurship within large organizations) and the need for entrepreneurial cultures has increased.
Entrepreneurial entry strategies have been shown to share common denominators, issues, and trade-offs.
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14. Research and Education
Entrepreneurs have been the subject of keen research interest.
Women and minority entrepreneurs have emerged in unprecedented numbers.
The entrepreneurial spirit is universal.
Entrepreneurs’ economic and social contributions of are significant for job creation, innovation, and economic renewal.
Entrepreneurial education is one of the hottest topics at U.S. business and engineering schools.
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15. Types of Start-Up Firms
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16. Changing Demographics of Entrepreneurs 1 of 3
Women Entrepreneurs
There were 6.2 million women-
owned businesses in 2002 (the
most recent statistics available)
This number was up 20% from
1997.
There are a growing number of
organizations that support and
advocate for women-owned
businesses.
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17. Changing Demographics of Entrepreneurs 2 of 3
Minority Entrepreneurs
Senior Entrepreneurs
There has been a substantial
increase in minority
entrepreneurs in the U.S. from to 2010.
The biggest jump has come in Latino entrepreneurs, which
increased from 11% to 23%
from 1996 to 2010.
The percentage of U.S.
entrepreneurs who are seniors
jumped from 15% to 23% from
1996 to 2010.
The increase is attributed to
corporate downsizing, a desire
among older workers for more
fulfillment in their lives, a need
for additional income, and
similar factors.
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18. Changing Demographics of Entrepreneurs 3 of 3
Young Entrepreneurs
Interest among young people in entrepreneurial careers
is high.
According to a Harris Interactive survey, 40% of people eight
to 21 years old said they’d like to start their own business
someday.
A total of 59% of the 8- to 21- year olds said they know
someone who has started their own business.
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19. Economic Impact of Entrepreneurial Firms
Innovation
Is the process of creating something new, which is central to the entrepreneurial process.
Several studies have found that small businesses outperform
their larger counterparts in terms of obtaining patents.
Job Creation
Small businesses are the creators of most new jobs in the U.S., and employ half of all private sector employees.
According to a Kauffman Foundation survey, 92% of Americans say entrepreneurs are critically important to job creation.
Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall

20. Entrepreneurial Firms’ Impact on Society and Larger Firms
The innovations of entrepreneurial firms have a dramatic impact on society.
Think of all the new products and services that make our lives easier, enhance our productivity at work, improve our health, and entertain us in new ways.
Impact on Larger Firms
Many entrepreneurial firms have built their entire business models around producing products and services that help larger firms become more efficient and effective.
Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall

21. The Entrepreneurial Process
The Entrepreneurial Process Consists of Four Steps
Step 1: Deciding to become an entrepreneur.
Step 2: Developing successful business ideas.
Step 3: Moving from an idea to an entrepreneurial firm.
Step 4: Managing and growing the entrepreneurial firm.
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22. Steps in the Entrepreneurial Process 1 of 2
Developing Successful Business Ideas
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23. Steps in the Entrepreneurial Process 2 of 2
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24. Emerging Trends: The Internet and E-Commerce
U.S. businesses spent $120 billion to build their Internet capabilities in 2000.
Smaller ventures use the Internet for a variety of operations:
Customer-based identification
Advertising, consumer sales
Business-to-business transactions
and private internal networks for employees
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25. Discuss the Advantages And Challenges Of E-Commerce For Entrepreneurial Firms
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26. Table 1.5 Advantages And Challenges Of E-Commerce For Entrepreneurial Firms
1. Ability of small firms to compete with other companies both locally and nationally (promotional tools)
2. Creation of the possibility and opportunity for more diverse people to start a business
3. Convenient and easy way of doing business transactions (not restricted to certain hours of operation, open 24 hours a day, seven days a week)
4. An inexpensive way (compared to the cost of paper, printing, and postage prior to the Internet) for small business to compete with larger companies and for U.S. firms to make American products available in other countries
5. Higher revenues for small businesses that utilize the Internet, averaging $3.79 million compared to $2.72 million overall (IDC research)
CHALLENGES
1. Managing upgrades (anticipating business needs/application)
2. Assuring security for a Web site and the back-in integration with existing company systems
3. Avoiding being a victim of fraudulent activities online
4. Handling the costs required to maintain the site
5. Finding and retaining qualified employees
Source: E-Commerce: Small Business Ventures Online (Washington, D.C.: U.S. Small Business Administration, Office of Advocacy, July 1999).
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27. E-Names: The Web Address
Choosing an Internet Name
Choosing an Internet brand (domain) name isn’t easy
Should be short ,snappy, and memorable.
Registering the Domain Name
Internet Corporation for Assigned Names and Numbers (ICANN) is responsible for coordinating the domain name system.
Problems
Availability of domains
Cybersquatters
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28. Table 1.6 Five of the Most Expensive Domain Names Sold
DOMAIN PRICE
Bingo.com (Bingo-based community) $ 1.1 million
WallStreet.com (online “wagering” on stocks) $ 1 million
Drugs.com (pharmaceutical and drug portal) $ 823,456
University.com (a training and education “super-portal”) $530,000
Blackjack.com (online gambling) $460,000
Source: The Wall Street Journal (E-Commerce Special, November 22, 1999).
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