ENTREPRENEURSHIP & VENTURE DEVELOPMENT (BBMHRM 41044)
BY: Alosha Herath
Day 1 – Lesson 01
Learning Outcomes
At the end of the session, students should be able to:
1. Define Entrepreneurship and analyze the major schools of entrepreneurial thoughts.
2. Assess different types of entrepreneurs with their common traits and internalize main
characteristics of entrepreneurs.
3. Evaluate different entrepreneurial processes and entrepreneurial mindsets.
4. Illustrate the importance of entrepreneurship for the development of business activities
in a country.
5. Compare and contrast the practical implication of Entrepreneurship with theories by
listening to an Entrepreneur.
Entrepreneurship as a Concept
“It is rather difficult to define an elephant, but you are not in doubt when you see one.” –
Winston Churchill
“The best way to predict the future is to create it.” – Peter Drucker
“Entrepreneurship is living a few years of your life like most people won’t, so you can spend the
rest of your life like most people can’t.”
Entrepreneurship is the process of starting and running a new business venture to address a
market need or problem.
Definition and Importance of Entrepreneurship
Definitions
• Joseph Schumpeter: Entrepreneurship is about "creative destruction", where
entrepreneurs innovate new products or processes that replace outdated ones.
• Peter Drucker: Entrepreneurship is about "deliberate innovation", using resources to
create value.
Importance
• Economic Growth: Drives innovation, creates new markets, and enhances productivity.
• Job Creation: Entrepreneurs are significant contributors to job creation globally.
• Society Impact: Solves societal problems through innovative solutions.
Major Schools of Entrepreneurial Thought
1. Kirzner’s “Entrepreneurial Discovery”
• Entrepreneurs are alert individuals who discover and exploit unnoticed opportunities.
• They help equilibrate markets by correcting inefficiencies.
Examples:
• Sam Walton (Walmart): Identified the need for discount retail in rural areas; optimized
supply chain.
• Howard Schultz (Starbucks): Brought café-style culture from Italy to the US, creating a
social coffee shop experience.
2. Schumpeter’s “Creative Destruction”
• Focuses on disruptive innovation leading to replacement of old by new.
• Entrepreneurs drive economic development by being catalysts for change.
Examples:
• Steve Jobs (Apple): Revolutionized tech with the iPhone and iPad, rendering older
devices obsolete.
• Elon Musk (Tesla, SpaceX): Disrupted auto and space industries, encouraging innovation
and private sector involvement.
Common Traits and Characteristics of Entrepreneurs
1. Risk-Taking:
o Willing to venture into uncertainty.
o Example: Elon Musk – invested personal fortune into Tesla and SpaceX.
2. Leadership:
o Inspiring and guiding teams toward a vision.
o Example: Oprah Winfrey – led a media empire with empowering messages.
3. Creativity:
o Innovative ideas and problem-solving.
o Example: Steve Jobs – product design focus reshaped consumer tech.
Understanding Entrepreneurial Processes
The entrepreneurial process includes the steps of identifying opportunities, launching ventures,
and managing growth.
Key Components
1. Opportunity Recognition: Spotting unmet needs or inefficiencies.
2. Idea Development: Refining ideas through research and feedback.
3. Resource Acquisition: Getting funding, people, and technology.
Importance
• Sparks innovation and competitiveness.
• Boosts economic development and job creation.
Stages of the Entrepreneurial Process
• Opportunity Exploration
Mindset: Growth vs. Fixed (Carol Dweck’s Theory)
• Growth Mindset:
o Belief that abilities can be developed through effort and learning.
• Fixed Mindset:
o Belief that intelligence and talent are static traits.
CCS3302: Entrepreneurship & Start-up Culture
By: Alosha Herath
Day 02: Start-up Ideas, Success Stories, Brainstorming, Market Research Basics
The Engine of Economic Growth: The Power of Start-ups
• Start-ups are the backbone of innovation and economic growth in any nation.
• They create jobs, generate wealth, and increase competition.
• In Sri Lanka, a strong start-up ecosystem helps diversify the economy and supports
sustainable development goals.
• This lecture explores generating innovative start-up ideas and how to navigate towards
success.
Disrupting the Status Quo: The Power of Start-up Innovation
• Start-ups bring new perspectives and challenge traditional business methods.
• They often drive technological progress and expand the boundaries of what’s possible.
• Many major businesses began as small start-ups.
• This session provides tools to identify and grow your own innovative ideas.
Unleash Your Potential: The Entrepreneurial Journey
• Entrepreneurship is transformative and offers independence and fulfillment.
• It allows individuals to pursue passions and shape their own futures.
• The process: brainstorming → market validation → execution.
• Learn from real-world success stories to shape your journey.
The Foundation of Success: Essential Factors for Start-up Growth
1. Strong Team (Synergy & Expertise):
o Diverse skill sets (tech, marketing, finance, etc.) and strong teamwork.
2. Innovative Product/Service (Value Proposition):
o Must offer something unique with significant value to customers.
3. Market Need (Problem-Solution Fit):
o There must be clear demand for the product/service.
o Market research is essential.
4. Effective Strategy (Execution & Planning):
o Clear business plan, target market, and competitive strategy.
o Execution is as critical as planning.
5. Adaptability (Resilience & Learning):
o Must adapt to market feedback and pivot when needed.
Start-up Success Stories
Crepe Runner
• Started as a food truck in 2019; now has 10+ branches.
• Known for quality and affordability.
• A national award-winning SME brand in Sri Lanka.
Surge Global
• Founded by Bhanuka Harischandra.
• Originated from a YouTube network focused on esports.
• Evolved into a digital media and consulting firm.
Lassana Flora
• Started in 1998 by Dr. Lasantha Malavige.
• Grew from a florist into Lassana Group: event management, e-commerce, retail.
• Known for service excellence and sustainability.
Airbnb
• Founded by Brian Chesky, Joe Gebbia, Nathan Blecharczyk in 2008.
• Online platform for lodging that disrupted the hotel industry.
• Faced regulatory challenges, but scaled globally.
• Built a strong community, offering income to hosts and variety to travelers.
Spotify
• Founded by Daniel Ek and Martin Lorentzon in 2006.
• Digital music streaming platform with millions of tracks and podcasts.
• Known for its freemium model and user personalization.
• Overcame licensing and profitability challenges.
• Changed music consumption to a subscription model.
Brainstorming Techniques – Idea Generation
1. Mind Mapping:
o Visualize ideas branching from a central theme (e.g., "reduce plastic waste").
2. SCAMPER:
o Explore existing ideas via: Substitute, Combine, Adapt, Modify, Put to other uses,
Eliminate, Reverse.
3. Reverse Brainstorming:
o Think of ways to worsen a problem, then flip ideas into solutions.
4. Lateral Thinking (Edward de Bono):
o Break conventional thought patterns.
Reverse Brainstorming Process
1. Identify the problem
2. Reverse the problem (e.g., “How can we make this worse?”)
3. Brainstorm causes
4. Reverse those causes into solutions
5. Evaluate and select feasible ideas
Tools: Ideanote.io | Ideamap.ai
Lateral Thinking Techniques (de Bono)
1. Generation of Alternatives
2. Challenging Assumptions
3. Innovation
4. Suspended Judgment
5. Design (intentional creation)
6. Dominant Ideas & Crucial Factors
7. Fractionation (breaking down problems)
8. Reversal Method
9. Brainstorming
10. Analogies
11. Choice of Entry Point & Attention Area
12. Random Simulation
13. Concepts / Divisions / Polarization
Market Research Methods
1. Surveys:
o Collect large-scale data (tools: Google Forms, SurveyMonkey).
2. Focus Groups:
o Rich qualitative feedback through guided discussions.
3. Interviews:
o In-depth insights from individuals (structured/semi/unstructured).
4. Secondary Research:
o Use existing reports, articles, stats.
5. Observations:
o Watch real-world user behavior to find patterns.
Day 03 – Pitching & Marketing Your Idea; Developing a Business Model Canvas
By: Alosha Herath
Overview
In today’s competitive environment, having a great idea isn’t enough. Success depends on your
ability to pitch that idea persuasively and build a viable business model. This session equips
you with essential tools:
• Crafting a persuasive pitch to win over investors, customers, and partners
• Using the Business Model Canvas (BMC) to design and communicate your idea
effectively
Lesson Outline – From Concept to Reality
1. Why Pitching Matters
o It's your gateway to funding, customers, and partnerships.
2. The Power of a Great Pitch
o A good pitch can turn an idea into a successful venture.
3. Understanding Your Audience
o Customize your message for investors, customers, etc.
4. The Art of Storytelling
o Present your idea as a compelling narrative.
5. Structuring Your Pitch
o Use a clear structure: problem → solution → market → impact
6. The Business Model Canvas (BMC)
o A visual framework to define and validate your business model.
7. BMC and Pitch Alignment
o A solid BMC strengthens your pitch with data and strategy.
8. BMC Building Blocks
o Customer Segments, Value Propositions, Channels
o Customer Relationships, Revenue Streams
o Key Resources, Key Activities, Key Partnerships, Cost Structure
Real-World Example: Airbnb
• Pitch Focus: Emphasized unmet need for unique, affordable travel experiences;
highlighted trust (reviews) and opportunity for homeowners.
• BMC Elements:
o Two-sided marketplace: hosts and guests
o Technology platform: app and website
o Revenue: commission on bookings
o Key challenge: building trust
Airbnb’s early pitch was crucial in securing investment and user traction.
Understanding Your Audience – Facebook Example
• Initial Target: College students—focused on connection and simplicity.
• Expansion: Leveraged data to understand user behavior, introduced targeted features
for broader demographics.
• Ad Success: Advanced targeting based on user behavior, demographics, interests, etc.
• Takeaway: Constantly adapting to audience needs is key to long-term success.
Crafting a Compelling Narrative
1. Start with the Problem
o Make it relatable and impactful.
2. Introduce Your Solution
o Clear, simple, and appealing.
3. Showcase the Value Proposition
o What’s unique? Quantify benefits.
4. Create a Narrative Arc
o Tell a story: beginning (problem), middle (solution), end (results/impact)
Mastering the Narrative – Dollar Shave Club Example
• Problem: Overpriced, over-marketed razors.
• Solution: Affordable, high-quality razors delivered to your door.
• Value Proposition: Simplicity, affordability, and convenience.
• Storytelling Style:
o Humor
o Relatable tone
o Breaking the fourth wall
o Clear Call to Action
• Outcome: Viral video → Massive customer and investor interest.
Here’s the full note as a single text covering everything from your file:
Registering a Company in Sri Lanka: Legal Processes & Requirements; Types of Companies
By Alosha Herath
Introduction
• One of the most important steps for local entrepreneurs is registering their business in
Sri Lanka.
• Two key questions:
1. What type of business to register as?
2. How to register?
• Different business types have unique pros and cons, making informed decision-making
critical.
Types of Business Registrations in Sri Lanka
1. Sole Proprietorship
2. Partnership
3. Private Limited Company
4. Public Limited Company
5. Company Limited by Guarantee
Identifying the Difference
• Sole Proprietorships and Partnerships are unincorporated: business and owner are one
entity legally.
• Private Limited Companies, Public Limited Companies, and Companies Limited by
Guarantee are incorporated: business and owners are separate entities legally.
How to Choose the Right Business Type
Factors to consider:
• Number of owners/partners
• Capital investment
• Industry
• Taxes
Example: Private Limited Companies require audited financials, whereas Sole Proprietorships
only need certification by a Chartered Accountant.
1. Sole Proprietorship
Key Features
• Owned by one person.
• No separate legal identity.
• Owner takes all decisions and is fully responsible.
Why Register as a Sole Proprietorship
Pros
• Easy and inexpensive to start.
• Full control and flexibility.
• Privacy due to fewer regulations.
• Full retention of profits.
Cons
• Unlimited liability: personal assets at risk.
• Difficult to raise capital.
• No continuity after owner's death.
• Potentially unstable taxes at higher profit levels.
2. Partnership
Key Features
• 2–20 partners.
• Governed by a Partnership Agreement drafted by a lawyer.
• Shared legal and financial liability.
• Shared profit (terms defined in the agreement).
Why Register as a Partnership
Pros
• Easy and inexpensive to set up.
• Shared management and skills.
• Shared responsibilities.
• Easier capital raising.
Cons
• Unlimited liability.
• Lack of continuity (death or change of partners ends partnership).
• Potential partner conflicts.
• Joint liability for partner actions.
3. Private Limited Company
Key Features
• Ideal for small businesses.
• Minimum 2 members (1 shareholder + 1 director).
• Maximum 50 shareholders.
• Cannot publicly trade shares.
• Limited liability with separate legal identity.
Why Register as a Private Limited Company
Pros
• Limited liability.
• Professional business status.
• Protection of company name.
• Fewer disclosure obligations compared to public companies.
Cons
• Higher legal compliance requirements (annual returns, audits).
• Strict accounting/bookkeeping rules.
• Limited ability to raise capital.
• Share transfer restrictions.
How to Register a Private Limited Company
1. Get business name approved.
2. Submit company registration forms.
3. Submit Articles of Association.
4. Give public notice of incorporation.
4. Public Limited Company
Key Features
• Shares can be traded on the stock exchange.
• Unlimited number of shareholders.
• Minimum 7 shareholders and 2 directors.
Why Register as a Public Limited Company
Pros
• Limited liability.
• Easier to raise large amounts of capital.
• Easy share transferability.
Cons
• Expensive to go public.
• Strict regulatory transparency.
• Market-driven share value.
5. Company Limited by Guarantee
Key Features
• Owned by "Guarantors" rather than shareholders.
• Cannot issue shares.
• Formed for specific purposes like commerce, art, science, religion, charity, or sports.
• Profits must promote the company’s objectives, not distributed among members.
• Example: NGOs like the United Nations.
Why Register as a Company Limited by Guarantee
Pros
• Separate legal identity.
• Limited liability to guaranteed amount.
• High trustworthiness for donors.
• Potential tax concessions.
Cons
• Strict registration requirements.
• High registration cost (over Rs 60,000).
• Strict operational compliance.
How to Register a Company Limited by Guarantee
1. Check company name.
2. Get name approval.
3. Draft Objectives and Articles of Association.
4. Publish Objectives and Articles.
5. Submit Forms 05, 18, and 19.
6. Submit approved Articles of Association.
7. Give public notice of incorporation.
Here’s the full text note from your Day 5 file, organized clearly:
Navigating the Startup Landscape: Key Challenges for IT Entrepreneurs
By Alosha Herath
Lecture Outline
• Managing initial operations and cost factors
• Innovative ideas for minimizing cost (e.g., work from home)
• Finding and managing resources
• Work-life balance
The Allure and the Harsh Realities
• The tech industry is booming; building an IT company offers freedom and innovation.
• Rewarding to solve real-world problems with technology.
• However, the startup failure rate is high — due to poor planning, resource issues, and
operational hurdles.
• Proactively understanding and addressing these challenges is crucial.
Challenge 1: Managing Initial Operations – Setting the Foundation
• Legal Structure: Choose the right entity (sole proprietorship, LLC, corporation).
• Registration & Licensing: Understand local regulations.
• Office Space: Choose between traditional office, co-working, or remote.
• Essential Equipment: Hardware, software, cloud infrastructure.
• IT Infrastructure: Secure, reliable servers, networks, and security.
Operational Planning – The Blueprint for Success
1. Detailed Task Breakdown: Use Work Breakdown Structures (WBS).
2. Risk Assessment & Mitigation: Identify and plan for risks.
3. Communication & Reporting: Set up clear channels.
4. Process Documentation: Ensure consistency and efficient onboarding.
Work Breakdown Structure (WBS) in Project Management
• WBS is a hierarchical decomposition of total work.
• Organizes project scope into manageable tasks ("work packages").
• Can be based on phases, deliverables, or activities.
Risk Assessment & Mitigation
Key Risks in Tech Startups
• Market Risk
• Financial Risk
• Operational Risk
• Technological Risk
• Legal and Compliance Risk
• Human Resource Risk
Risk Assessment Strategies
1. Identify Risks: Brainstorm with stakeholders.
2. Assess Probability & Impact: Use risk matrices.
3. Develop Risk Scenarios: Test resilience.
4. Monitor Continuously: Keep assessments dynamic.
Risk Mitigation Strategies
• Market Risk: Market research, agile models.
• Financial Risk: Lean cost structures, diverse funding.
• Operational Risk: Streamlined processes, DevOps.
• Technological Risk: Tech updates, cybersecurity.
• Legal & Compliance Risk: Protect IP, ensure data law compliance.
• Human Resource Risk: Strong company culture, equity incentives.
Conclusion
• Risk management must be continuous.
• Proactive planning boosts resilience and investor confidence.
• Helps startups scale and compete effectively.
Innovative Ideas for Minimizing Cost
1. Work from Home & Remote Teams: Save on rent/utilities.
2. Outsourcing & Freelancing: Specialized tasks contracted out.
3. Open-Source & Cloud Solutions: Cost-effective technology.
4. Bootstrapping & Lean Operations: MVPs, multifunctional teams.
5. Barter & Partnerships: Service exchanges and shared resources.
6. Performance-Based Compensation: Stock options, commissions.
Finding Resources for Tech Startups
• Talent Acquisition: LinkedIn, GitHub, AngelList, university collaborations.
• Funding Sources: Bootstrapping, accelerators, VCs, crowdfunding.
• Technology & Infrastructure: Cloud services, open-source tools, no-code platforms.
• Networking & Partnerships: Startup communities, tech events, collaborations.
Managing Resources Effectively
Human Resource Management
• Remote policies, project management tools, performance incentives.
Financial Management
• Lean budgets, automated accounting tools.
Technology & Product Development
• Agile/DevOps, automation, cybersecurity.
Scalability & Growth Management
• Build scalable systems, grow with market feedback, outsource non-core functions.
How Startups Can Maintain Work-Life Balance
1. Set Clear Boundaries: Define work hours, prevent burnout.
2. Promote Remote & Hybrid Work: Flexibility, stress reduction.
3. Encourage Regular Breaks & Time Off: PTO, no-meeting days.
4. Automate & Delegate Tasks: Reduce repetitive workload.
5. Foster a Healthy Work Culture: Team activities, mental health support, results-oriented
culture.
Here’s the full text note from your Day 7 file, all organized:
Ethics for Start-ups and Securing Funding
By Alosha Herath
Lecture Outline
• Importance of Ethics in Startups
• Key Ethical Principles for Startups
• Securing Funding
• Self-funding and Bootstrapping
• Angel Investors
• Venture Capital
• Crowdfunding
• Government Grants and Subsidies
• Ethical Considerations in Securing Funding
Ethics and Funding in Startups
• Startups drive innovation and economic growth.
• Ethics and funding are two critical pillars for startup success.
Importance of Ethics in Business
• Building Trust: With investors, customers, employees, and partners.
• Reputation Management: Vital in today's fast-information era.
• Sustainability: Ethics lead to better long-term navigation and alignment with responsible
consumers.
Critical Role of Securing Funding
• Fueling Growth: Necessary for scaling and expanding.
• Facilitating Innovation: Financial backing enables R&D.
• Strategic Partnerships: Investors often offer mentorship and networks.
Ethics and Funding Together
• Ethics build trust and reputation.
• Strategic funding ensures growth and innovation.
• Both are essential to startup survival and success.
Introduction to Ethics in Startups
• Ethics serve as a startup’s moral compass.
• Essential for building strong stakeholder relationships and ensuring sustainability.
Building Trust with Stakeholders
• Investors: Trust built via transparency and integrity.
• Employees: Ethical environments boost morale and retention.
• Customers: Ethics create loyalty, advocacy, and organic growth.
Sustainability and Risk Management
• Operational Sustainability: Ethical startups think long-term.
• Avoiding Legal Issues: Ethics ensure compliance and minimize risk.
• Reputation Management: Ethical businesses avoid scandals.
Case Study: Patagonia
• Built $1B+ business based on environmental ethics.
• Advocacy for sustainability strengthens brand and customer loyalty.
Introduction to Ethical Principles
Four key ethical principles startups must adopt:
• Transparency
• Integrity
• Fairness
• Accountability
Transparency
• Open, honest communication with stakeholders.
• Builds confidence and trust.
• Example: Buffer (open salaries, financials, and metrics).
Integrity
• Adherence to moral principles.
• Promotes a reliable, ethical brand image.
• Example: Salesforce commits to ethical marketing.
Fairness
• Equity and impartiality in treatment of all stakeholders.
• Encourages loyalty and a positive workplace.
• Example: Slack focuses on diversity and inclusion.
Accountability
• Responsibility for decisions and actions.
• Improves trust and organizational learning.
• Example: Microsoft upholds high accountability standards.
Conclusion on Ethics
• Prioritizing these principles creates stronger stakeholder relationships and supports
sustainable growth.
Introduction to Buffer’s Transparency Policy
• Buffer embraces radical transparency:
o Public financials
o Transparent salaries
o Open decision-making
o Sharing of company metrics
Introduction to Funding for Startups
• Capital is vital for scaling, innovating, and surviving.
• Knowing different funding types is crucial.
The Necessity of Capital
• For hiring, product development, marketing, and infrastructure.
• For R&D to stay competitive.
Overview of Funding Sources
1. Self-Funding and Bootstrapping
2. Angel Investors
3. Venture Capital
4. Crowdfunding
5. Government Grants and Subsidies
Self-Funding and Bootstrapping
• Pros: Full control, no external debt.
• Cons: Limited resources, high personal financial risk.
Angel Investors
• Pros: Mentorship, networks, flexible terms.
• Cons: Equity dilution, time-consuming match process.
Venture Capital (VC)
• Pros: Large capital, strategic support.
• Cons: Loss of control, pressure for rapid growth.
Crowdfunding
• Pros: Community building, validation, non-dilutive (rewards-based).
• Cons: Highly competitive, intensive marketing needs.
Government Grants and Subsidies
• Pros: Non-dilutive capital, R&D support, possible tax benefits.
• Cons: Strict eligibility, long application processes.
Ethical Considerations in Securing Funding
1. Due Diligence: Vet investors for ethical alignment.
2. Disclosure: Honest and transparent communication.
3. Sustainable Growth: Prioritize long-term ethical development over short-term profits.
Due Diligence
• Investigate potential investors’ ethics and past investments.
• Ensure alignment in values to avoid future conflicts.
Disclosure
• Full transparency about risks, financials, and business challenges.
• Builds credibility and prevents disputes.
Sustainable Growth
• Use funds in a way that supports ethics and the startup’s mission.
• Integrate social and environmental goals.
Conclusion
• Balancing funding with ethics preserves reputation and integrity.
• Proactive ethical practices build resilience and position startups for success.
Case Study: Warby Parker
• Ethical direct-to-consumer business model.
• Attracted customers and investors with a strong social mission.
The Foundational Role of Ethics
• Ethics = Reputation + Long-Term Sustainability + Risk Mitigation.
Strategic Approach to Securing Funding
• Understand different funding types.
• Align funding choices with startup ethics and vision.
• Diversify funding for resilience.
Call for Action
• Let ethics guide every startup decision.
• Carefully choose funding partners aligned with your mission.
• Build a reputation for trust, transparency, and responsibility.
