so you want to be an entrepreneur
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So You Want To Be an Entrepreneur. Are You REALLY Ready?. So you want to be an Entrepreneur. Developed by. To provide you a brief overview to help you determine if you want to start your own business. ABOUT THIS WORKSHOP. - PowerPoint PPT PresentationTRANSCRIPT
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www.scoreknox.org
(865) 692-0716
So You Want To Be an Entrepreneur
Are You REALLY Ready?
www.scoreknox.org
(865) 692-0716
So you want to be an Entrepreneur
Developed by
To provide you a brief overview to help you determine
if you want to start your own business
www.scoreknox.org
(865) 692-0716
ABOUT THIS WORKSHOP
Today, we will challenge your thinking about being an entrepreneur.
There are critical questions you need to answer, BEFORE you go into business.
Today, our focus is on four key areas, not on the technical aspects of business. SCORE has lots of additional workshops and handouts on those topics that you may wish to investigate.
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Four Critical Questions
Do you have an entrepreneurial personality?
Do you have adequate resources to start a business?
Do you have a viable business idea?
Is your partner/family committed?
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Complete a thorough self-assessment
Identify your financial resources
Define your business objectives
Research the market for your “idea”
Develop a Business Plan
Five Steps before opening your doors...
So you want to be an Entrepreneur
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10 Questions to Ask Yourself
• What initial steps have you taken• Will you work full time or part time• Who are your partners• What are your assets• What kind of help do you need
Assessing yourself and your idea
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10 Questions to Ask Yourself
• What is your experience in business• What is your market?• Who is your customer• Who is your competition • Can you give a 10 second elevator talk
Assessing yourself and your idea
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Self-Assessment is Difficult!
SCORE 10 for “Absolutely” and a 7 for “Probably”• Are you a self-starter? ___• Do you enjoy competition?
___• Do you have will power and self-discipline?
___• Do you enjoy making decisions?
___• Are you a good planner?
___• Do you manage your finances well?
___• Are you willing to work 12-14 hour days?
___• Are you physically and emotionally strong?
___• Is your family supportive of your proposal?
___• Do you easily interact with other people?
___
The Entrepreneurial Personality
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DID YOU SCORE A 90 OR MORE?
If so, your decision to Begin Business is off to
THE RIGHT START!
But, there are more questions!
So you want to be an Entrepreneur
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Do the Princeton Check List Handout
See Feb 2009 WSJ article
“So, You Want to Be an Entrepreneur”
SBA Readiness Assessment Tool
https://eweb1.sba.gov/cams/training/business_primer/assessment.htm
Here
Here
Homework! More to do and read...
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Assuming you are comfortable with your answers in the self-assessment . . .
The next task
IDENTIFY YOUR FINANCIAL RESOURCES
What about Money?
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CASH TRULY IS KING!
• 70% of 1st year business failures caused by poor cash flow.
• Majority of small businesses are under capitalized
Lack of cash leads to disaster
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$Cash needs before launch
$
So you want to be an Entrepreneur
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Launch Fund
• Have a Cash Cushion at Start Up–Six months family living expenses–Six months business expenses
This is minimum***12 months better
So you want to be an Entrepreneur
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Fill in the BlanksHow much cash and savings do you have? $ ---------
What is the value of your real estate? $ ---------
Do you have life insurance? If so, what is it’s cash value? $ ---------
What is the value of your vehicles? $ ---------
How much money do you owe:On accounts? $ ---------On credit cards? $ ---------On real estate loans? $ --------- On taxes? $ ---------To family members? $ ---------
Do you have any other liabilities? Amount? $ ---------
So you want to be an Entrepreneur
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What are Start Up Costs?
• Equipment, supplies and inventory
• Rent, utilities, licenses, deposits
• Insurance premiums and security costs
• Promotional costs and office supplies
• Professional fees (accountants & lawyers)
• Payroll & payroll taxes for the start-up period
• Your own compensation (living expenses)
So you want to be an Entrepreneur
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Type of Start Up Cost: Month Month Month Month Month Month Land Purchase (a) Building Purchase (b) Building/Office Rental (c) Equipment Purchases (d) Equipment Rentals (e) Utilities & Phone (f) Inventory (g) Property Taxes (h) Leasehold improvements (j) Autos & Trucks (k) Advertising & Promotion (l) Licenses (m) Tax Deposits (n) Equipment Maintenance (o) Insurance (p) Professional Services (q) Payroll & Benefits (r) Office Supplies (s) Opening Promotional Costs (t) Other Start Up Costs (v) Total Start Up Costs 0 0 0 0 0 0 Cumulative Start Up Costs 0 0 0 0 0 0
So you want to be an Entrepreneur
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Define your Business Objectives
(a new concept, an invention, a better product or more
efficient service, that satisfies customer needs or wants)
an organized and realistic approach to a new business venture.
Answer the following questions:
Create a Business Plan
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What need or want will your business satisfy?
What services or products will you sell?
Are you considering a franchising operation?
What will make your product or service unique in the marketplace?
Is your proposed product or service capable of being priced at least equal to or above the competition?
How will you sell your product or service?
Define Your Business
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What will be the legal structure . . Proprietorship, Partnership, Corporation or LLC?
How will your business records be maintained?
What insurance coverage will you need?
How will you hire, train and motivate employees?
How will you compensate yourself?
What will you name your business and where will it be located?
What are the applicable Federal, state and local laws and licensing requirements?
Structure, Staff, and Resources
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Business Forms
• Sole Proprietorship• Partnership• Limited Liability Company (LLC)• “C” Corporation (Conventional)• “S” Corporation (Sub-chapter “S”)
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LLC or Sole Proprietor are common
• Simple & easy to start• Low start-up expenses• Owner is sole manager• Profits are not shared• Income taxed on
owner’s individual return
• Unlimited personal risk
• Not difficult or expensive to form
• Limited liability protection for owners
• Fewer rules and restrictions than corporations
• Profits taxed only once at owner’s level
LLC Sole Proprietor
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Evaluate the MARKET
A CRITICAL step in finalizing your decision to begin business is . . .
EVALUATING THE MARKET
Perform sufficient research to be able to answer the following questions:
Is there really a demand for your idea ?
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? Can you make a living ?
• Will your business be VIABLE ??–Big enough idea–Profitable –Survey SurveyMonkey.com
• Market Research Leads to Answers
Evaluating the Market
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Research Questions
• Who are your customers, how many are there and where are they located?
• Who are your competitors and what are their strengths and weaknesses?
• How will you advertise and/or promote your business?
• Will you source your product?
• How will you deliver your product or service?
• Can you price your product/service to make an adequate profit?
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Research Help
Knox County Public Library Catherine Moirai
Business Reference Manager
Greater SCORE Web Site
Article “Before You Start a Business”
http://scoreknox.org/before-you-start-a-business/
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Library References
Small Business Sourcebook profiles providing• Start-up information• Associations• Licensinginformation• Reference works• Trade periodicals
Reference USA• Find your competitors• Find your prospective customers
Other Business BooksHow to Start a Business. How to Make a Business Plan
Misc Information Demographic Data, Business Name Research
More Help
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Develop a BUSINESS PLAN
Contrary to popular belief, a Business Plan is not only a primary tool with which to seek financing . . .
It is YOUR PLAN for the
SUCCESSFUL BEGINNING and
CONTINUED MANAGING OF YOUR BUSINESS!
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Business Plan Essential Elements
1. Company Description2. Market Analysis3. Price Analysis4. Marketing Plan5. Sourcing & distribution6. Business Team7. Funding & Financials
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ADVISORS
• CPA• Lawyer (business law)• Insurance provider• Mentors
So you want to be an Entrepreneur
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You are in this together
Lack of family commitment is usually fatal
Your family is a source of support, advice, and ideas
Family Commitment and Support
A Final Essential Element
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With most of the ESSENTIALS
NO Complete a thorough self-assessment
YES Identify your financial resources
YES Define your business objectives
YES Research the market for your “idea”
YES Develop a Business Plan
SCORE can help you
The Next Step is Yours
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http://www.score.org/online_workshops.html
SCORE’s Online Resources
The Next Step is Yours
Specific workshops on starting, structuring, marketing, growing a business, and managing cash flow, finances, and partners, with featured webinars you can take anytime.
A special startup seminar with Steve Forbes!
A 2-minute readiness assessment workshop from e-myth
Access to SCORE counselors via social media
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Who is SCORE
• History– SCORE Is Part Of The Small Business Administration – Established By Act Of Congress in 1964– Over 389 Chapters Throughout The United States– Over 10,500 Volunteers Nationwide
• SCORE Knoxville Chapter– Provides Service To 18 Counties – 3,000 Counseling Sessions Per Year (#25 out of 389)– www.scoreknox.org Has 16,000 Unique Visitors Per Month
• Purpose– To Help Entrepreneurs Start A Business– To Help Small Business Improve Operations
Counselors to America’s Small Business
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Free Services for America’s Small Business
Greater Knoxville SCORE provides:• Personal counseling for start ups• Educational Workshops• Personal counseling for existing businesses• Mentoring for owners and managers• Profit improvement program planning• Company guidance for strategic planning
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Available from SCORE A GUIDE FOR STARTING A BUSINESS IN TENNESSEE
A detailed discussion of what’s needed to get started
® Entrepreneurship
® Pitfalls
® Startup Business Plan example
® 50+ pages, written by Knoxville SCORE, includes additional materials and financial spreadsheet examples
® Order on web at http://scoreknox.org/ebook/
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1. KNOW YOURSELF: DO YOU HAVE WHAT IT TAKES TO BECOME AN ENTREPRENEUR? …...Page 4• Entrepreneurship – An Alternate Career Choice …………..………………………………….…….....Page 4• Let the Countdown Begin: A Six-Month Plan for Transitioning from Employee to Entrepreneur….Page 6• Entrepreneur Self Assessment Tests ………………………………………..………………………….Page 7• Princeton Entrepreneurial Evaluation Checklist ……………………………..…………………………Page 8• So, You Want To Be An Entrepreneur ……………………………………..……………….…………..Page 132. SEEK PROFESSIONAL HELP BEFORE YOU SCREW UP YOUR NEW BUSINESS! …………..…Page 17• Business Owners Should Take A Lesson From The Pros …………..……….……..………………..Page 17• What Are You Worth? ………………………………………………………………………………….…Page 20• The Seven Pitfalls of Business Failure and How To Avoid Them ..………………..……………..….Page 21• Assessing Your Business Idea ………………………………………..…………………………………Page 24• The 10 Second Elevator Pitch ……………………………………………………………….……..……Page 25 3. I’VE GOT WHAT IT TAKES? NOW IT’S TIME TO DO A BUSINESS PLAN …………………..…….Page 27• Business Plan for A Startup Business ………………………..………….……………..………………Page 27• What Pitfalls Should I Avoid For A Business Plan? …………………………………………….……..Page 434. DO I NEED TO SEE A LAWYER TO FORM MY COMPANY? ..………………………………….……..Page 45• Selecting The Legal Structure For Your Business …………………………...………….……………..Page 45• Tab le 1 – Comparison of Legal Structures for a Business ……………………………………………Page 495. HELPFUL INFORMATION TOIMPROVE YOUR CHANCES FOR A SUCCESSFUL LAUNCH…..… Page 50
A GUIDE FOR STARTING A BUSINESS IN TENNESSEE
TABLE OF CONTENTS
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Free Services for America’s Small Business
For FREE mentoring
Register at www.scoreknox.orgor
Email [email protected]
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INFORMATION SOURCES for this presentation
• Statistics Data – The Kaufmann Foundation of Entrepreneurship
• Funding Data– SBA
• Website Data– Gartner Inc.
So you want to be an Entrepreneur