Engaging Immigrant Entrepreneur. What we need to know?

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Presentation to the MAPC & Chelsea Collaborative - Engaging Immigrant Entrepreneur

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Engaging Immigrant Entrepreneur. What we need to know?

  1. 1. Engaging Immigrant Entrepreneurs What we need to know? Alvaro Lima Director of Research, BRAMAPC& The Chelsea Collaborative March 2013
  2. 2. We need to know: Why they are in businessWhat are their development pathsWhat are the enablers and barriersfor success
  3. 3. SOCIAL FORMS OF PRODUCTION Production for Profit – How do they differ?  Ownership Structure 1. Single owner or not incorporated 2. Independently or family owned 3. Limited liability & more complex legal structure  Employment & Revenue Size & Capital Structure 1. 1-2 people & < 10K & < $100K 2. < 500 people & < $20M … 3. > 500 people … production production  Financial Structure & Ability to Leverage for direct for income 1. Simple cash flow & no ability to leverage 2. Bank financing use 3. External financing, investors, VC, investment banks Self-  Management Structure employment 1. Hands-on worker & control everything (micro- businesses) 2. Management across all functions 3. Professional management, board, investors  Skill Sets production 1. Finding & servicing customers 2. Detailed understanding of industry for profit 3. Financial and organizational skills  Employment Size & Structure Small Growth businesses businesses  Technology, Production & Markets 1. Low to no technology 2. Single technology, production & markets 3. Multiple products, technology & markets  Success 1. Make enough individual income & control lifestyle 2. Salary & Profits & Value of Company 3. IPO/share price
  4. 4. DEVELOPMENT PATHS Domestic & Self- Small Growth Wage Labor employed Employer Business progressionentry points ? BENEFITS • Independence • Limited liability ENABLERS • Easy to start (easy to exit) ? • Ability to gain BENEFITS – easy to reach more than wage • Improved stability customers ENABLERS • Higher profit – little skill training CHALLENGES/ LIMITATIONS • Build reputation and steady client • Improved customer ? – low capital base reach • Volatility/high requirements • More capital - ENABLERS BENEFITS failure rate CHALLENGES/ • Lower failure rate • Fast breakeven fixed costs • Expand client • Limitations to LIMITATIONS • Get licenses/ base • Steady profit profit • Increased • Further customer permits • Expand org. • Limited capacity competitive threat structure reach • More difficult to • Get mgmt. • Scale economies exit training • Higher managerial • Get loans CHALLENGES/ involvement needs LIMITATIONS • Limited capacity • Management delegation • Attracting skilled managersvariable costs fixed costs • Growing IT/ computer needstechnical skills managerial skillsincome target return on capital
  5. 5. DRIVERS AND DRIVERS OF SUCESSO SUCCESS DRIVERS BARRIERS TO OVERCOME Available demand: Limited access to appropriate resources: • Easy to reach customers • Financing: • Substantial untapped demand - reduce initial business volatility • Easy to target customers (niche) - expansion capital • Networking, referrals • Training: - managerial training for owner Personal skills: - advanced skill training for employees• Entrepreneurial drive, motivation, courage, persistence Capacity constraints: • Hard working • Financial constraints • Past business experience • Regulatory environment • High employee turnover Limited resource needs: • Finding/training skilled managers• Limited seed capital requirements • Limited additional skill training Lack of managerial skills and strategic vision: • Difficulty delegating Other: • Lack of vision• Visibility of prior business success • Risk aversion (and/or limited business failure rates) • Ability to break even fast Competition • etc… • From larger, more established businesses • From similar, small businesses
  6. 6. DRIVERS AND DRIVERS OF SUCESSO SUCCESS DRIVERS BARRIERS TO OVERCOME Available demand: Limited access to appropriate resources: • Easy to reach customers • Financing: • Substantial untapped demand - reduce initial business volatility • Easy to target customers (niche) - expansion capital • Networking, referrals • Training: - managerial training for owner Personal skills: - advanced skill training for employees• Entrepreneurial drive, motivation, courage, persistence Capacity constraints: • Hard working • Financial constraints • Past business experience • Regulatory environment • High employee turnover Limited resource needs: • Finding/training skilled managers• Limited seed capital requirements • Limited additional skill training Lack of managerial skills and strategic vision: • Difficulty delegating Other: • Lack of vision• Visibility of prior business success • Risk aversion (and/or limited business failure rates) • Ability to break even fast Competition • etc… • From larger, more established businesses • From similar, small businesses

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