1. Entrepreneurship Chapter 5 June 12, 2012

2. Learning Objectives LO1 LO1 Describe why people become entrepreneurs and what it takes, personally LO2 LO2 Summarize how to assess opportunities to start a new company LO3 LO3 Identify common causes of success and failure LO4 LO4 Discuss common management challenges LO5 LO5 Explain how to increase your chances of success, including good business planning LO6 LO6 Describe how managers of large companies can foster intrapreneurship and an entrepreneurial orientation 3-2

3. And others…….. where's your picture?

4. So you want to be an entrepreneur? Small Business Administration Entrepreneur Readiness Small Business Administration Entrepreneur Readiness General assistance Offered by Google

5. What is entrepreneurship? The pursuit of lucrative opportunities by enterprising individuals (your text) Activity of creating new businesses by freewheeling mavericks who operate in a world far removed from corporate life Major source of economic growth and job creation

6. Source of economic development 565,000 new businesses per month (2010) No new companies = negative annual employment growth Micro-firms – 20% of all new jobs each year

7. Demographics and entrepreneurs Greatest increase in Latino start-ups Decline in African-American start-ups Slight increase in start-ups by men Slight decrease in start-ups by women

8. Who is an entrepreneur? Made, not born – “Transitioned entrepreneurs” “Serial entrepreneurs” “Social entrepreneurs” “Lifestyle entrepreneurs”

9. Who is an entrepreneur? Similar problems – Funding – People – know-how (expertise) A rose is a rose……… – Chaos = opportunity – “reality distortion field” Fortune 500 should listen

10. Entrepreneur's “DNA”

11. At the heart and soul ….. A way of viewing the world Ability to act based on those views Locus of control An opportunistic outlook A willingness to take risks (and to fail)

12. Who is The Entrepreneur? 5-12

13. So what business should you start? An idea – But have to be able to implement it The opportunity – Lemons? Then make lemonade Franchises – Careful – Franchisor – Franchisee The next frontiers – To infinity and beyond!!!

14. SpaceX Dragon

15. Interesting video

16. Opportunity Analysis 5-16

17. How to pay for it? Business Plan

18. Planning Business plan – A formal planning step that focuses on the entire venture and describes all the elements involved in starting it. 5-18

19. Outline of a Business Plan 5-19

20. Outline of a Business Plan 5-20

21. And then what???? 50% fail in the first 5 years (SBA) – Lack of experience – Insufficient capital (money) – Poor location – Poor inventory management – Over-investment in fixed assets – Poor credit arrangements – Personal use of business funds – Unexpected growth

22. Corporate entrepreneurship Entrepreneurial orientation – Independent action – Innovativeness – Risk taking – Proactiveness – Competitive aggressiveness 5-22

23. Corporate entrepreneurship Intrapreneurship Two approaches – Bootlegging – Skunkworks High risk/high reward (personally and at corporate level)

25. So why not you? seriously, why not you?