Transcript The Entrepreneurial Process

What is Entrepreneurship?
Mark T. Schenkel, Ph.D.
Agenda
What is Entrepreneurship?
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Historical development
Definition
Myths
Process
Career Paths
The Entrepreneurial
Revolution
“We are in the midst of a silent revolution – a
triumph of the creative and entrepreneurial spirit
of humankind throughout the world.”
“I believe its impact on the 21st century will equal
or exceed that of the Industrial Revolution on the
19th and 20th.”
“The death knell for brontosaurus capitalism of
yesteryear.”
-- Jeffry A. Timmons (The Entrepreneurial Mind, 1989)
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
The Opportunity
Statistics
– A random national sample (Gallup poll survey, 1994) of high
school students reveals that 70% of these students say they
want to own their own business some day (Timmons, 2004: 7)
– Annual Chronicle survey: 40% of incoming students have
entrepreneurship as major goal for why they are going to
college
– Fortune 500 employment decline: 1970 (20%) – 1996 (8.5%)
– Small firms constitute more than 90 percent of the entire
business population
Virtually of USA’s economic growth is coming
from entrepreneurial ventures of all sizes and
types
Not yet tainted by corporate way of life
Good time to take risk!!!
Entrepreneurship
A process, not a type of person
Creating and/or building something of
value
Identifying an opportunity
Pulling together the needed resources
to pursue the opportunity
Developing and implementing a
Business Plan
Involves uncertainty and the acceptance
of risk
The Nature of
Entrepreneurial Risk
Failure –
“Sinking the Boat Risk”
Opportunity Cost –
“Missing the Boat Risk”
Myths about
Entrepreneurship
The Lone Cowboy Myth.
The Experience Myth.
The I’m Only in it for the Money
Myth.
The Entrepreneurs are Gamblers
Myth.
Myths about
Entrepreneurship
The Entrepreneurs Don’t Have to
Worry about Numbers Myth.
The All You Need is Money Myth.
The I’ve Got a Secret Myth.
The IPO Myth.
Other Opportunities for Learning
Curb event center retail space
Hatchery
Practicing entrepreneurs activities
Entrepreneurship club
Internships
Mentors
Networking!!!
The Entrepreneurial Process
Working Definition of
Entrepreneurship
“Entrepreneurship is a way of
thinking, reasoning and acting that
is opportunity obsessed, holistic in
approach [emphasis added], and
leadership balanced” (Timmons,
1999: 27).
The Entrepreneurial Process
(Timmons, 2000)
Communication
Opportunity
Ambiguity
Resources
Business Plan
Fits and Gaps
Exogenous Forces
Creativity
Team
Uncertainty
Leadership
Capital Market Forces
Founder
The Entrepreneurial Process
Eval., Review,
& Feedback
Implementation
Analysis
Strategy
Formulation
The Entrepreneurial Process
Three Part Process
Planning
Luck
Strategy
Life Cycle of a Business Venture
Pre-Launch Process:
Idea Generation
Understanding the Genesis of New
Businesses in the Economy
Sources of Ideas: Where to Look
The Entrepreneurial Process
Challenge Traditional Definitions of Value
Entrepreneurship thrives on market
inefficiencies
Customers seek improvement in the
following:
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Speed
Convenience
Personalization
Price
Pre-Launch Process:
Evaluating Ideas Generation
Does the Idea = an Opportunity?
– Market
– Margin
– Mission
The Right Team?
The Necessary Resources?
The Start-up Process
Filling the Gaps
The Business Plan
– Executive Summary
– Market Analysis and Marketing Plan
– Operating Plan and Team
– Financial Plan
Growing the Business
CASH FLOW MANAGEMENT
Building a Culture
Marketing
Staffing
Building Management & Administrative
Systems
Exit or Succession
Entrepreneurial Careers
Do it now!
Not necessarily a one shot deal
Sentry Position (in consulting firm or in
industry)
Family or existing Small Business
Corporate Track
Key Takeaway Points . . .
No fully satisfactory definition of
entrepreneurship has been developed to date
(i.e., one that garners collective agreement
among scholars & practitioners alike).
“Entrepreneurship” reflects creative,
innovative, and arbitrage oriented behaviors.
Is a process; involves planning, strategizing,
and a little bit of luck.
Interconnectedness of resources and
opportunities
Key Takeaway Points . . .
 Entrepreneurship can occur – and fail to occur
– in firms that are old and new; small and
large, fast and slow growing; in the private,
not-for-profit, and public sectors; in all
geographic points; and in all stages of a
nation’s development.