chapter 6: entrepreneurship and small...

Entrepreneurship and small business management

Why does it matter? 2

Entrepreneurship represents a dominant paradigm of economic development, job creation, national competitiveness

Absent entrepreneurship, economies would go stagnant

Changing societal views of entrepreneurs

Who is an entrepreneur?

Depends on who you ask

Entrepreneurs are people who run their own companies, the self-employed or small-business owners

Entrepreneurs are innovators: people who come up with new ideas and embody those ideas in high-growth companies

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An intellectual confusion

Based on number of small businesses or the number of people who are self-employed or the number of startups, Egypt tops the list (comes out as more entrepreneurial than the US)

Based on innovative, high growth companies - HK tops the list. Followed by Israel, US, … Canada (9th)

(measured as “entrepreneurial density” or number of self made billionaires per million population)

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How about failed attempts?

Is entrepreneurship only about successful enterprises?

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Entrepreneurship dissected-three essentials pillars

Pro-activeness

Risk

Innovation (Nybakk and Panwar, 2015)

Perseverance?

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Is Judson Belmaunt an entrepreneur? Or is he running a small business?

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Two dominant views on new venture creation

Entrepreneurship is a controlled experiment

Entrepreneurship is a “chance” game

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Entrepreneurship as a delicately controlled process

https://www.youtube.com/watch?v=_ve4M4UsJQo

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Control oriented entrepreneurs: The business-plan camp

All risks can be anticipated and mitigated

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Speaking of business plans…

You know all the elements of a business plan!

(Assignment 2)a. Company’s history, mission and visionb. Scope of activitiesc. Human Resource policiesd. Product portfolioe. Markets servedf. Marketing and sales organizationg. Sustainability managementh. Financial snapshoti. Future plans and strategyj. Key competitive advantage factors

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Business plans

Banks always want it!

A key piece for small businesses

Cookie-cutter templates available

(e.g., CBN-CAN, SBA-US)

A key component for small business management courses

Has certain advantages

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How much business plans matter?

“How to write a great business plan?”

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Always have a plan B….

Because you are likely going to need it

Hate me for being rude… but your business- yes, yours- will likely fail.

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Odds are not in your favor

25% of small businesses fail in the first two years

52% of small businesses fail within four years

If that’s not somber enough…

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Two dominant views on new venture creation

Entrepreneurship is a controlled experiment

Entrepreneurship is a “trial and error” game

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Beating the odds

Deal killer risks

Path-dependent risks

Risks that can be revolved with little money and time

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Key lessons in entrepreneurship

“ the curse of too much capital”

Initial strategy is part-right, part wrong

Founder’s syndrome

“Perfection is sometimes the enemy of the good”

Find your blue ocean

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