Chapter 6 Starting Y Own Business: The our Entrepreneurship Alternative
Learning Goals1 Define the term entrepreneur and 5 Identify personality traits that distinguish among entrepreneurs, small- typically characterize successful business owners, and managers. entrepreneurs.2 Identify the different types of 6 Summarize the process of starting a entrepreneurs. new venture.3 Explain why people choose to become 7 Explain how organizations promote entrepreneurs. intrapreneurship.4 Discuss factors that support and expand opportunities for entrepreneurs.
W is Entrepreneurship? hats An entrepreneur is a person who seeks a profitable opportunity and takes the necessary risks to set up and operate a business.s Differ from many small-business owners in their strong desire to make their business grow.s Differ from managers through their overriding responsibility to use the resources of the organization to accomplish their goals.s Willing to take risks.
Categories of Entrepreneurss Classic Entrepreneurss Serial Entrepreneurss Social Entrepreneurs
Entrepreneurship as a Careers More than 11% of Americans run their own businesses.s In an average month, Americans start approximately 465,000 new businesses.s The past two decades have shown a heightened interest in entrepreneurial careers.s People choose entrepreneurship for many reasons: s Dissatisfaction with traditional work s Their ideas fulfill customer needs
W Entrepreneurship? hys Being Your Own Boss s Self-management is the motivation that drives many entrepreneurs.s Financial Success s Entrepreneurs are wealth creators.s Job Security s Over the past ten years, large companies have eliminated more jobs than they have created.s Quality of Life s Starting a business gives the founder some choice over when, where, and how to work.
Globalizations The rapid globalization of business has created many opportunities for entrepreneurs.
Education / IT / Demographic and Economic Trendss Education s 100 U.S. colleges and universities offer entrepreneurship majors. s Universities are helping students launch businesses. s Many programs teach entrepreneurship to young people.s Information Technology s Technology has given entrepreneurs tools that help them compete. s Entrepreneurs have used information technology to revolutionize industries.s Demographic and Economic Trends s Aging of U.S. population. s Emergence of Hispanics as nation’s largest ethnic group. s Growth of two-income families.
Entrepreneurial Characteristicss Vision - entrepreneurs begin with an overall idea for how to make their business ideas successfuls High Energy Level - a willingness to work hards Need to Achieve - entrepreneurs work hard because they want to excels Self-Confidence - fearlessness in the face of difficult oddss Tolerance for Failure - entrepreneurs are not easily discourageds Creativity - entrepreneurs devise innovative ways to overcome difficult problems and situationss Tolerance for Ambiguity - entrepreneurs take in stride uncertaintiess Internal Locus of Control - entrepreneurs believe they can control their own fates
Starting a New Ventures Selecting a Business Idea s Find something you love to do and are good at doing s Can your idea satisfy a need in the marketplace?s Entrepreneurs must be sure that the idea they choose has interest in the marketplace.s Business Plan
Buying an Existing Businesss Advantages: s Established customers s Deal with familiar suppliers s Good/service known in marketplace s Necessary permits and licenses are already secured s Financing may be easier s Seller financing
Creating a Business Plans 58% of the most recent Inc. CEOs did not create a formal written plan.s But business plans do help entrepreneurs prepare enough resources and stay focused on key objectives.
Finding Financings Debt Financing s Credit Cards s Family and Friends s Bank Loans (SBA backed)s Equity Financing s Venture Capitalists s Angel Investors
Government Support for New Venturess Business Incubators are a key way government supports new ventures s Clean Energy Incubator (CEI)s Enterprise Zones s Encourage entrepreneurship in specific geographic areass Government Legislation s Immigration Act of 1990
Intrapreneurships Promoting innovation within organizational structuress An idea to promote creativitys Companies promote in a variety of ways s Skunkworks s Pacing Programs