Transcript Introduction to Entrepreneurship

FM20731 – Executive Leadership
Introduction to Entrepreneurship
Week 1 – October 5, 2004
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Let’s see your schedules!
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Why are you here?
What do you want to do?
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Instructor
• Instructor: Max Minkoff
• Teaching style: Interactive!
• How to contact me:
[email protected]
• Website: http://www.planetminkoff.com
• Other availability: Immediately after class
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Why am I here?
• Education
– MS IE/ Human Factors: Virtual Reality
– MBA in 2001
• Entrepreneur
– Started first business in college
– Joined VR Consumer Products startup
• Went “public” in 1995
• Ceased operations in 1997
– Joined 3D ID Software startup
• Company was sold
– Cookie startup (with Kirk), 2002-2004
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Course Content
• Teaching Strategies
– Interactive Class Discussion
– PowerPoint w/printed notes
– Team exercises
• Textbook:
– Entrepreneurship
• Lambing, Peggy and Kuehl, Charles
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What is an Entrepreneur?
ENTREPRENEURSHIP
Insane perseverance in the face
of total rejection.
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What Is An Entrepreneur?
ENTREPRENEUR
A vision-driven individual who
assumes significant personal and
financial risk to start or expand a
business.
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What Is An Entrepreneur?
ENTREPRENEURSHIP
The pursuit of opportunity through
innovation, creativity and hard work
without regard for
the resources currently controlled.
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Entrepreneurship
• Entrepreneurship: a way of thinking,
reasoning, and acting that is:
– opportunity obsessed
– holistic in approach
– and leadership balanced
(This definition of entrepreneurship has evolved over the past two
decades from research at Babson College and the Harvard Business
School and has recently been enhanced by Stephen Spinelli, Jr., and
John H. Muller, Jr., Term Chair at Babson College.)
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Entrepreneurs: Born or Made?
• Is there inborn talent required?
• Assume that the answer is YES:
– then we can identify the main characteristics
– if we have them, fine - no others need to apply!
– we could start spotting talent in kindergarten
– we could "stream" these people
– we could discourage people without these talents
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Entrepreneurs: Born or Made?
• Assume the answer is NO:
– then schools could teach anyone
– would be a "profession" like law or medicine
– companies could establish "nurseries" for them
– government "incubators" would be successes
• The real answer lies somewhere in-between
– Talent and education is the way
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Who is an Entrepreneur?
Situational more than personality
Flexibility
Ability
Age
Distribution
for
Starting Company
20
25
30
35
40
45
Age
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Who is an Entrepreneur?
Manager’s Opportunities
Future Goals
Possible
Change
Status Quo
Entrepreneur
Satisfied
manager
Frustrated
manager
Classic
bureaucrat
Perceived
Capability
Blocked
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Burch's Entrep. Personality Traits
1.A desire to achieve

Conquer problems, create successful venture
2.Hard work

Their workload is very hard to match
3.Nurturing quality
4.Acceptance of responsibility

Morally, legally and mentally accountable
5.Reward orientation

Want be rewarded for their efforts
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Burch's Entrep. Personality Traits
6.Optimism

Anything is possible
7.Orientation to excellence

Pride in something first class
8.Organization

They are wholly "take charge" people
9.Profit orientation

Profit primarily a gauge of performance
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Failure? So what!
• Failure seen differently in America & Europe.
– In Europe it is a major set-back
– U.S. expected (required even!)
– Canada - in between but tending to U.S.
• “Our” System:
– Many entrepreneurs had been "blue collar"
– Many come from families of entrepreneurs
– Many are immigrants or their children
– But, there are no "rules" that ensure success
• Universally, entrepreneurs shake off failure!
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Failure as “Learning Process”
• Ignore it, then start again
– Some find it easy to blame someone else
• In public, always optimistic
– Especially with funders
– Agonise over what went wrong in private
• Willingness to disregard the rules
– Start from first principles.
• Ability to "bend, not break" rules of life
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Classic Entrepreneurship:
The Startup
• Raw startup company—an innovative idea
that develops into a high growth company
• Qualities of a startup company
– Strong leadership from the main entrepreneur
– Complementary talents and outstanding teamwork of
team members
– Skill and ingenuity to find and control resources
– Financial backing to chase opportunity
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Desirable and Acquirable
Attitudes and Behaviors
•
•
•
•
Commitment and determination
Leadership
Opportunity obsession
Tolerance of
– Risk
– Ambiguity
– Uncertainty
• Creativity, self-reliance, and adaptability
• Motivation to excel
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The Entrepreneurial Process
• It is opportunity/market driven
• It is driven by a lead entrepreneur
and an entrepreneurial team
• It is resource parsimonious and creative
• It depends on the fit and balance among
these
• It is integrated and holistic
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The Timmons Model of the
Entrepreneurial Process
Communication
Opportunity
(2)
Ambiguity
Creativity
Business Plan
Fits and gaps
Team
(3)
Uncertainty
Resources
(4)
Exogenous forces
Leadership
Capital markets
Founder
(1)
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Enlightened Serendipity
•
•
•
•
•
•
Being in the right place
At the right time,
Recognizing it, and
Acting upon it,
APPROPRIATELY and
PASSIONATELY!!!
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Course Evaluation & Technology
• Grading
– 40%: Class Participation (including attendance)
– 10%: Weekly Quizzes on Reading
– 20%: Midterm Exam
– 30%: Project
• Technology Needed:
– Word Processing
– Spreadsheet
– Graphics and PowerPoint
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Attendance Policy
•
•
•
•
Two absences = one full grade drop
A third absence = an additional grade drop
Four absences = Failure
NOTE:
– There are NO excused absences.
– 2 lates and/or early departures = 1 absence.
I WILL FAIL YOU IF I HAVE TO!
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Cellphone Policy
• OK if it rings
– I don’t expect you to remember to turn it off
• BUT!
– Don’t answer your phone in class!
– Don’t step into the hall to talk
• Also
– No text messaging
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Next Class
• Homework
– Read Chapter 11: Buying an Existing Business
– Read Chapter 12: Franchises & Other
Alternatives
• October 12
– Recognizing Opportunities
– Buy an Existing Businesses
– Open a Franchise
– Other Alternatives
– Quiz on Chapters 11 & 12!
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