17/05/2023

Intended Learning Outcomes

Module 1: Entrepreneurship: Evolutionary
Development -Revolutionary Impact
By the end of this module, you should be able to: INTRODUCTION
INTRODUCTION TO 1.Examine the historical development of entrepreneurship.
ENTREPRENEURIAL 2.Explore and debunk the myths of entrepreneurship, and
MINDSET process approaches to entrepreneurship.
3.Define and explore the major schools of entrepreneurial
thought.

GEE 003 - General Education Elective 3

1 2 3

ENTREPRENEUR CHARACTERISTICS OF
ENTREPRENEURSHIP - an innovator or developer who ENTREPRENEURS
Personal initiative
2 1 The ability to consolidate resources
Management skills
CONVERTS those RECOGNIZES and
from the French word opportunities into
A desire for autonomy
SEIZES opportunities Risk-taking
“entreprendre,” workable or Aggressiveness
marketable ideas 3 Competitiveness
meaning ADDS value through Goal-oriented behavior

“to undertake.” 4 time,effort, money, Confidence

Opportunistic behavior
ASSUMES the risks or skills
Intuitiveness
of the competitive 5 Reality-based action
marketplace to REALIZES the rewards The ability to learn from mistakes
implement these ideas from these efforts
The ability to employ human relations skills

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HISTORICAL DEVELOPMENTS IN ENTREPRENEURSHIP RISKS OF BEING AN ENTREPRENEUR REWARDS OF BEING AN ENTREPRENEUR

No single definition of Recognition of Until 1950,the Over the decade,

an entrepreneur exists entrepreneurs dates majorityof definitions writers have continued
back to eighteenth- and references came to modify the
century France from economists definition

Potential Unexpected Financial Long Hours and Making Your Doing Work You Creating Greater Helping Your
Robert C. Ronstadt said, In the twentieth century, Entrepreneurs serve as In the twenty-first century,
“Entrepreneurship is the the word entrepreneur agents for change, entrepreneurs are considered
Business Failure Obstacles Insecurity Hard Work Own Rules Enjoy Wealth Community
dynamic process of became closely linked provide creative, heroes of free enterprise.
creating incremental with free enterprise and innovative ideas for Many people now regard
wealth.” capitalism business enterprises and entrepreneurship as
help businesses grow “pioneership” on the frontier of
and become profitable business.

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THE ENTREPRENEURIAL MINDSET THE ENTREPRENEURIAL MINDSET

An entrepreneurial mindset is a set of skills that enable
people to:
Reducing the
identify and make the most of opportunities costs of a business Improving the quality
overcome and learn from setbacks and; of products and
ENTREPRENEURS
succeed in a variety of settings services
CREATE VALUE TO
SOCIETY

An entrepreneurial mindset can be developed and

enhanced through entrepreneurial experiences.
Increasing the
number of
customers served by
a product/service
Inventing a new product or service

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ENTREPRENEURS AS RISK-TAKERS ENTREPRENEURS AS VISIONARIES ENTREPRENEURS AS LEADERS

Successful entrepreneurs are not afraid of failure. Entrepreneurship is the ONLY source of new wealth and new
A visionary entrepreneur has the ability to influence
others that their vision is possible and desirable. productive jobs in society.
They acknowledge failure but prepare for it. It only takes a small part of the population, 1-2%, to become
successful entrepreneurs in order to pull the whole society
Visionary entrepreneurs have the unique ability to make
However, if they fail they can quickly learn from their along.
others believe in the vision as much as they do
Throughout history, countries that have nurtured
mistakes and try again. themselves, convincing others that the better future
entrepreneurial culture have been the most successful and
described is one they want to live in. dynamic.
Jeff Bezos quit his well-paying job in order to found Entrepreneurs are at the heart of success of modern
Amazon.com without any guarantees of success. economies.

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ENTREPRENEURS AS LEADERS
The ability to influence has three elements. Module 1: Entrepreneurship: Evolutionary
Development -Revolutionary Impact AVOIDING FOLKLORE:
1.AWARENESS - understanding that every action has
an impact
MYTHS OF
ENTREPRENEURSHIP &
THE MYTHS OF
2.ABILITY - in terms of communication,
conflict resolution, and decision-making
APPROACHES TO
ENTREPRENEURSHIP
ENTREPRENEURSHIP
3.COMMITMENT TO YOUR IDEAS - making decisions
that may not always please everyone and dealing with
the consequences
GEE 003 - General Education Elective 3

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MYTH #1 MYTH #2 MYTH #3

Entrepreneurs are DOERS, Entrepreneurs are BORN, Entrepreneurs are ALWAYS INVENTORS
not THINKERS not MADE

19 20 21

MYTH #4 MYTH #5 MYTH #6

Entrepreneurs are Entrepreneurs must All Entrepreneurs need is MONEY
ANTI-ACADEMIC & SOCIAL MISFITS FIT THE PROFILE

22 23 24

MYTH #7 MYTH #8 MYTH #9

All Entrepreneurs need is LUCK. Entrepreneurship is Most entrepreneurial initiatives FAIL.
UNSTRUCTURED AND CHAOTIC

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PROCESS APPROACHES TO
MYTH #10 ENTREPRENEURSHIP
Entrepreneurs are
APPROACHES TO
1. AN INTEGRATIVE APPROACH
EXTREME RISK TAKERS. ENTREPRENEURSHIP
Includes: Built around the concepts of inputs
to the entrepreneurial process and
Inputs outcomes from the entrepreneurial
Outputs process.

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PROCESS APPROACHES TO PROCESS APPROACHES TO PROCESS APPROACHES TO

ENTREPRENEURSHIP ENTREPRENEURSHIP ENTREPRENEURSHIP
INPUTS OUTPUTS 2. DYNAMIC STATE APPROACH 3. A FRAMEWORK APPROACH
Environmental Opportunities Ventures
The Individual Entrepreneur Value Creation
New products The network of relationships (the dynamic state) converts opportunity Theories or frameworks based on combinations offer a more dynamic view
The Business Concept tension into value, generating new resources that maintain the dynamic of the phenomenon of entrepreneurship. Similar to the “multiple lens”
The Organizational Context New Processes
New Technologies state. approach that characterizes general management, the theories based on
Financial and Nonfinancial Resources combinations can delve into some of the particular aspects of
Profit
Jobs entrepreneurship with greater granularity.
Economic Growth.

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SCHOOLS-OF-THOUGHT TO Three (3) schools of entrepreneurial thought take the Three (3) schools of entrepreneurial thought take the
ENTREPRENEURSHIP MACRO VIEW MICRO VIEW

The MACRO View The MICRO View 1.The Environmental School of Thought 1.The Entrepreneurial Trait School of Thought

+ -
2.The Financial/Capital School of Thought 2.The Venture Opportunity School of Thought
3.The Displacement School of Thought 3.The Strategic Formulation School of Thought

+ -
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0 METACOGNITIVE PERSPECTIVE
M odule 2: 1
COGNITIVE METACOGNITIVE
The Entrepreneurial M ind - ADAPTABILITY MODEL
Set in Individual and in ENTREPRENEURIAL Describes the higher - order c ognitive
COGNITION
The ability to be dynamic,
Organizations:Corporate flexible, and self - regulati ng in
process that results in the
entrepreneur framing a task
Entrepreneurship one ’ s cogni t i ons gi v en dy nami c effectually, and thus why and h o w a
and uncertai n task partic ular strategy was included in a
environment s. set of alternative responses to the
decision task ( metac ognition ) .

1 4 7

ENTREPRENEURIAL COGNITION
Intended Learning Outcomes
SUCCESS
1.Explain entrepreneurial cognition
COGNITION
The mental func tions, processes ( thoughts ) , and
states of intelligent humans Who are
2.Identify the different types of risk entrepreneurs face as well
as major causes of stress for the individuals
Entrepreneurs? RISK-
Posits that k n owl edge structures ( mental models of TAKING
3.Articulate the ethical dilemmas confronting entrepreneurs, SOCIAL COGNITIVE cognitions ) can be ordered to optimiz e pers onal
and the need for entrepreneurial thinking in organizations THEORY effectiveness within given situations.
PL ANNING SPECIAL PERSON
4.Identify the obstacles to corporate entrepreneurship and ENTREPRENEURS

innovation and the critical steps of a corporate ENTREPRENEURIAL The k n o wledge structures that people use to make SOUND
assessments and dec isions involving information J UDGM ENT
entrepreneurship COGNITION related to entrepreneurs hip

2 5 8

0
METACOGNITIVE PERSPECTIVE DEAL IN G WITH FAIL URES
ENTREPRENEURIAL COGNITION The metacognitive model of the entrepreneurial mindset integrates
1

0 OPPORTUNITIES!
TOPICS DARK SIDE OF ENTREPRENEURS Dev el opment of Met acogni t i v e
2 Strategies Appl i ed Tolerance
for Failure Realistic to
0 Expect
ETHICAL DILEMMAS
3 Entrepreneurial
Difficulties

0 CORPORATE Motivatio n & Contex t Failure as a

Deal
Learning
ENTREPRENEURSHIP AND Experience Effectively
4 INNOVATION AND STRATEGY wi th Grief
Informati on Processing wi t hi n from Failure
an Entrepreneurial Environment.

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STRESS AND THE ENTREP RENEUR

The Grief Recovery Process WHAT IS ENTREPRENEURIAL STRESS? 0
GRIEF is a negativ e emotional response to the loss of
something i mportant
f unct i on of discrepanci es bet ween a person ’ s
expectations and ability to meet demands.
3

LOSS ORIENTATION
Worsens negativ e emotional reactions to failure
ETHICAL
DILEMMAS
RESTORATION ORIENTATION
Enables entrepreneurs to dis tract
themselves from think ing about the
failure

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DEAL ING WITH STRESS ETHICAL DIL EM M AS

0 Communi-

ETHICS
cating with
2 Networking
Employees

Provides the basic rules or Set of principles pres cribing a

parameters for c o n du c ting any
DARK SIDE OF
behavioral code that explains
activ ity in an “ acceptable ” what is good and right or bad
Finding
Getting man n er and wrong
ENTREPRENEURS Away from
It All
Satisfaction
Outside

Exercising Delegating

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THE ENTREP RENEURIAL EGO

THE ENTREPRENEUR ’ S CONFRONTATION WITH RISK ETHICAL RATIONAL IZATIONS
OVERBEARING NEED FOR CONTROL
strong desire to c ontrol b o t h Decision - makers use one of four rationalizations to justify questionable c o n duct that:
their v enture and their destiny
FINANC IAL FAMILY AND
CAREER RISK PSYCHIC RISK
RISK SOCIAL RISK
SENSE OF DISTRUST It is in the
The ac tivity is not
could cause to lose s ight of reality indiv idual ’ s or the it will never be
01 “ really ” illegal or 02 corporation ’ s best 03 found out
Should I put a Will I expose my
immoral
family to the risk Will there be a interest
signific ant What if the OVERRIDING DESIRE FOR SUCCESS
portion of my
of h av i n g risk to my well -
venture failed? i n c o mp l ete family
danger of the individual becoming
savings or other being?
experienc e and more important than the v enture itself
Morally ques tionable acts can be
resources at the possibility of Because it helps the
p erman en t scars? classified as non - role, role failure, 04 compan y , the c o mp an y
stake
UNREALISTIC OPTIMISM will c o n d o n e it
role dis tortion, and role assertion.
Can lead to a fantasy approach
to the business.

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ONL INE ETHICAL DIL EM M AS IN E - C OM M ERC E THE NEED FOR CORPORATE ENTREPRENEURSHIP INNOVATION METHODOLOGIES
AND INNOVATION
The slow demise of face - to - face interactions causes CHECK FIT
1 Implementing a corporate entrepreneurship program provides companies with IDEATE Checking if your idea fits
entrepreneurs to f i nd ways to bui l d trust. Generating and choosing
a systematic way of increasing their innovation capabilities, the benefits of your personal and
original relevant ideas corporate priorities.
which can be huge:

Entrepreneurs recogniz e that onl i ne consumer reviews are

2 used to inform purc has i ng decisions and are pos t ed to
reput at i on management systems ( Amazon and Yelp ) . CREATE
FOCUS CONDITIONS
Defining your innovation Organizing the right moment, the right
Entrepreneurs f i nd it far greater to exhibit strong ethical center of interest team, the right pace and the right

3 responsi bility in their actions. DISCOVER

funding for your innovation initiative

Grow th Increased Source of Employee Discovering trends,

productivity and competitive recruitment and
markets, technologies and
employee morale advantage retention
customer insights

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0 THE CHALLENGE INNOVATION METHODOLOGIES

OF CORPORATE CHECK FREEDOM TO
4 ENTREPRENEURSHIP CREATE BUSINESS
OPERATE
Checking if you do not
MODEL infringe the intellectual
Creating a viable business property rights of others
Companies must create,
CORPORATE develop, and sustain
model

ENTREPRENEURSHIP innovative new businesses:

SELECT
AND INNOVATION How to generate new
EXPERIMENT
Carrying out a systematic research or
TECHNOLOGY
Identifying and selecting the right
ideas and opportunities. test which validates the adoption and technology to deliver your new
attractiveness of your new product, product, service, process or experience
No clear strategy CREATE NEW
service, process or experience.
BUSINESS CASE
Creating a well-founded convincing
business case for your new product,
service, process or experience.

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W H A T IS I N N O V A T I O N ?
DEFINING THE CONCEPT OF CORPORATE INNOV A T IO N FOCUS TYPES
ENTREPRENEURSHIP A N D INNOVAT I ON

4
The creation of a viable INNOVATION TYPES ARE FOCUSED ON THE INNERMOST WORKINGS
conversion of a new idea
new offering OF AN ENTERPRISE AND ITS BUSINESS SYSTEMS
into revenues and profits
concept of supporting employees to
INTRAPRENEURSHIP think and behave like entrepreneurs
process that turns an idea

2
INNOVATION TYPES ARE FOCUSED ON AN ENTERPRISE’S CORE
into value for the customer
CORPORATE PRODUCT OR SERVICE
innovations tend to be led by A product, process or service new
E NTRE P RE NE URS HIP
employees, rather than being to the firm, not only new to the
PROGRAMS Promising ideas that are
implemented by management world or marketplace
transformed into powerful new

4
ways to create value and wealth INNOVATION TYPES ARE FOCUSED ON MORE CUSTOMER-FACING
ELEMENTS OF AN ENTERPRISE AND ITS BUSINESS SYSTEM

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5 CRITICAL STEPS OF A
IN NOV A T IO N FOCUS TYPES 0 CORPORATE
ENTREPRENEURSHIP DE VE L OP ING
5 THE VISION
4
INNOVATION TYPES ARE FOCUSED ON THE INNERMOST WORKINGS STRATEGY
OF AN ENTERPRISE AND ITS BUSINESS SYSTEMS

Profit model – How you make money CORPORATE E NCOURAGING DEVELOPING

INNOVATION VENTURE TEAMS
Network – How you connect with others to make ENTREPRENEURSHIP
money
AND STRATEGY
Structure − How you organise and align your talents
and assets S TRUCTURING PREPARING INDIVIDUAL
FOR AN MANAGERS FOR
Process – How you use signature or superior ENTREPRENEURIAL CORPORATE
CLIMATE INNOVATION
methods to do your work

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IN NOV A T IO N FOCUS TYPES CORPORATE ENTREPRENEURSHIP

DEVELOPING THE VISION

2
INNOVATION TYPES ARE FOCUSED ON AN ENTERPRISE’S CORE
PRODUCT OR SERVICE The first step in planning a strategy of corporate
Corporate E ntrepreneurship ( CE ) strategy is about
entrepreneurship is sharing the vision of innovation that
Product Performance – How you develop creating self-renewing organizations through the corporate leaders wish to achieve.
distinguishing features and functionality
unleashing and focusing of entrepreneurial
potential that exists throughout those The vision must be clearly articulated by the organization’s
Product System – How you create complementary
leaders; however, specific objectives are developed by
products and services organizations.
managers and employees.

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5 CRITICAL STEPS OF A 5 CRITICAL STEPS OF A

IN NOV A T IO N FOCUS TYPES CORPORATE CORPORATE
ENTREPRENEURSHIP DE VE L OP ING ENTREPRENEURSHIP DE VE L OP ING
INNOVATION TYPES ARE FOCUSED ON MORE CUSTOMER-FACING THE VISION THE VISION
4
STRATEGY STRATEGY
ELEMENTS OF AN ENTERPRISE AND ITS BUSINESS SYSTEM

Service – How you support and amplify the value of E NCOURAGING DEVELOPING E NCOURAGING DEVELOPING
your offering INNOVATION VENTURE TEAMS INNOVATION VENTURE TEAMS
Channel – How you deliver your offerings to
customers and users
Brand – How you represent your offerings and S TRUCTURING S TRUCTURING
PREPARING INDIVIDUAL PREPARING INDIVIDUAL
business FOR AN MANAGERS FOR FOR AN MANAGERS FOR
ENTREPRENEURIAL CORPORATE ENTREPRENEURIAL CORPORATE
Customer Engagement – How you foster compelling CLIMATE INNOVATION CLIMATE INNOVATION
interactions

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5 CRITICAL STEPS OF A
ENCOURAGING INNOVATION
CORPORATE
ENTREPRENEURSHIP DE VE L OP ING M odule 2:
STRATEGY
THE VISION
Two distinct types of innovation exist:
The E ntrepreneurial M ind -
E NCOURAGING DEVELOPING
1.Radical innovation — This type of innovation takes INNOVATION VENTURE TEAMS S et in Indiv idual and in
experimentation and determined vision, which are not Organizations: Corporate
necessarily managed. Entrepreneurship
2.Incremental innovation — This type of innovation refers to the
S TRUCTURING PREPARING INDIVIDUAL
systematic evolution of a product or service into newer FOR AN MANAGERS FOR
markets. ENTREPRENEURIAL CORPORATE
CLIMATE INNOVATION

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5 CRITICAL STEPS OF A
PREPARING MANAGEMENT
CORPORATE
ENTREPRENEURSHIP DE VE L OP ING Key decision -makers must find ways to explain the purpose of using a corporate

STRATEGY
THE VISION innovation process to those from whom entrepreneurial behaviors are expected.

E NCOURAGING DEVELOPING
INNOVATION VENTURE TEAMS
DEVELOPING VENTURE TEAMS

The primary elements of a new venture team are the company founders, key
employees, the board of directors, the board of advisors, lenders, and investors, and
S TRUCTURING PREPARING INDIVIDUAL other professionals.
FOR AN MANAGERS FOR
ENTREPRENEURIAL CORPORATE
CLIMATE INNOVATION

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5 CRITICAL STEPS OF A
STRUCTURING THE W O R K ENVIRONMENT CORPORATE
Five factors critical to the internal environment of an organization seeking to have its ENTREPRENEURSHIP DE VE L OP ING
managers pursue innovative activity: STRATEGY
THE VISION
The extent to which people are encouraged to look at the organization from a broad 5. ORGANIZATIONAL
perspective BOUNDARIES
E NCOURAGING DEVELOPING
The extent to which individuals have time to incubate ideas
INNOVATION VENTURE TEAMS
4. TIME AVAILABILITY

Rewards are contingent on performance, providing challenges, increasing

responsibilities, and making the ideas of innovative people known to others in 3. REWARDS/REINFORCEMENT
the organizational hierarchy

Workers are able to make decisions about performing their 2. AUTONOMY/WORK S TRUCTURING PREPARING INDIVIDUAL
own work in the way they believe is most effective DISCRETION FOR AN MANAGERS FOR
ENTREPRENEURIAL CORPORATE
Encourages employees to believe that innovation
CLIMATE INNOVATION
is a part of the role set for all organization members
1. MANAGEMENT SUPPORT

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Opportunity
‘NEW PRODUCT DEVELOPMENT’
Identification: SOURCES OF
The first step for any The product or opportunity identification and
INNOVATIVE selection process starts with the
THE SEARCH entrepreneur is the IDEAS GENERATION OF IDEAS
INNOVATION FOR NEW
IDEAS
identification of a “good idea”. that can be generated or discovered from
various sources.
Module 3

1 2 3

INNOVATION is a key function of the

THE ROLE OF CREATIVE THINKING
entrepreneurship process. PRODUCT INNOVATION
ENTREPRENEURIA The process by which entrepreneurs convert Product innovation can come in three different
L IMAGINATION INNOVATION opportunities into marketable ideas. forms.
TYPES OF
AND CREATIVITY CREATIVITY is the generation of ideas that results in AND THE
INNOVATION
The key to innovation is blending
imaginativeandcreativethinkingwitha the improved efficiency or effectiveness of system. ENTREPRENEUR THE INNOVATION PROCESS 1) The development of a new product,
systematic,logical processability.
Innovation combines the vision to create a good 2)An improvement of the performance of the
idea with the perseverance to implement the existing product,
concept. 3) A new feature to an existing product.

4 5 6

Process Innovation
Business Model Innovation
TYPES OF The process is the combination of facilities, skills, TYPES OF
INNOVATION and technologies used to produce, deliver, and INNOVATION Probably the most challenging of the innovation ENTREPRENEURIAL
support a product or provide a service. types as it will likely present an organization with
major requirements for change
OPPORTUNITIES
Within these broad categories, there are
Module 3
countless ways the process can improve.

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GROUPACTIVITY
Three major categories of causes for failure: Create a PowerPoint presentation containing the
WHY NEW 1. Product/Market problems
following:

VENTURES 1.Company Name (Explain where the name was

2. Financial Difficulties
FAIL? ACTIVITY derived)
2.1 product proposal (include all thenecessary
3. Managerial Problems information about the product)
Module 3
Thursday, September 8, 2022, 4:30pm

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CREATING NEW VENTURES ACQUIRING AN ESTABLISHED ENTREPRENEURIAL VENTURE

New-New Approach New-Old Approach

PURCHASE AN RATHER THAN
ENTREPRENEURIAL EXISTING BUSINESS STARTING ONE

VENTURES
MODULE 4 Personal Preferences Examination of Opportunities
Introduction of New Improving a Product or • Background • Business Brokers
Products/Services into a Offering a Service in an Area • Skills • Newspaper Ads
Market Where it is not Currently • Interests • Trade Sources
Available.
• Experience • Professional Sources

1 2 3

ADVANTAGES OF ACQUIRING AN ONGOING VENTURE EVALUATION OF THE SELECTED VENTURE FRANCHISING: THE HYBRID
Key Questions to Ask: Asking the right questions is critical.

How many of the

employees will What does the firm’s
What is the current
physical condition of remain? financial picture look A franchise is an
Reduced Time & like?
Effort the business? arrangement in which the
owner of a trademark, trade
What is the condition
Less Fear about the Successful
Future Operation
A Good Price of the inventory? What type of
competition does the
name, or copyright has
business face? licensed others to use it in
Why is the business
selling goods or services.
being sold? What is the state of the
company’s other
assets?

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ADVANTAGES OF FRANCHISING ADVANTAGES OF FRANCHISING

HOW FRANCHISING WORKS

The Franchisor usually provides: The Franchisee usually contracts for the The franchisor gives you The risk of business
following business package: support failure is reduced
•The company name You usually have exclusive Financing the
•Symbols, logos, designs, and facilities •Make a financial investment in the operation rights in your territory. business may be easier.
•Professional management training •Obtain and maintain a standardized inventory
•Sale of specific merchandise necessary for and/or equipment package
the unit’s operations at wholesale prices •Maintain a specified quality of performance A franchise enables a small Products and services will
•Financial assistance •A franchise fee business to compete with have already established a
•Continuing aid and guidance •Engage in a continuing business relationship big businesses market share.
You can benefit from Relationships with
communicating and suppliers have already
sharing ideas with, been established.
No prior experience is You can use a recognized and receiving support
needed brand name and trade from other franchisees in
mark. the network.

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DISADVANTAGES OF FRANCHISING DISADVANTAGES OF FRANCHISING

Costs may be higher than The franchise agreement Thorough recruitment You may find it difficult
you expect usually includes process to sell your franchise
restrictions on how you
can run the business
3 take-aways from the
discussion
You may find that after The franchisor might A percentage of sales is The inflexible nature of a
some time, go out of business. usually shared with the franchise
ongoing franchisor franchisor.
monitoring becomes
intrusive

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THE SEARCH FOR CAPITAL DEBT VERSUS EQUITY FINANCING

The use of DEBT to finance a new venture requires a

payback of funds plus a fee.

SOURCE OF CAPITAL CAPITAL EQUITY FINANCING involves the sale of some of the

ENTREPRENEURS ownership in the venture

MODULE 4

1 2 3

PEER-TO-PEER LENDING (P2P) OTHER DEBT-FINANCING SOURCES

FINANCE COMPANIES
TRADE CREDIT

Peer-to-peer (P2P) lending is the

DEBT FINANCING?
practice of lending money to unrelated
individuals, or “peers”, without going
through a bank or other traditional
financial institution.
EQUITY FINANCING?
ACCOUNTS RECEIVABLE
ACCOUNT RECEIVABLE
FINANCING
FACTORING

4 5 6

INFORMAL RISK CAPITAL: ANGEL FINANCING

Types of Angel Investors

•CORPORATE ANGELS

•ENTREPRENEURIAL ANGELS

•ENTHUSIAST ANGELS

•MICROMANAGEMENT ANGELS

•PROFESSIONAL ANGELS

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LEGAL CHALLENGES FOR ENTREPRENEURIAL VENTURES LEGAL CHALLENGES FOR ENTREPRENEURIAL VENTURES

INCEPTION OF THE THE ONGOING INCEPTION OF THE

VENTURE VENTURE VENTURE • Laws governing intellectual
LEGAL CHALLENGES FOR property: patents, copyrights,
trademarks
ENTREPRENEURIAL LEGAL • Forms of business organization:

VENTURES CONCEPTS
sole proprietorship, partnership,
corporation, franchise
MODULE 5 • Tax considerations
• Capital formation
GROWTH AND CONTINUITY OF • Liability questions
THE VENTURE

1 2 3

LEGAL CHALLENGES FOR ENTREPRENEURIAL VENTURES LEGAL CHALLENGES FOR ENTREPRENEURIAL VENTURES INTELECTUAL PROPERTY PROTECTION

THE ONGOING Patent

• Tax considerations: federal, state and local,
VENTURE
payroll, incentives Provides the owner with exclusive rights to
• Governmental regulations: property, hold, transfer, and license the production and sale of
• Personnel law: hiring and firing the product or process as an intellectual property right.
administrative agencies, consumer law
policies, equal employment
• Continuity of ownership rights: property
opportunity, collective bargaining What Items Qualify for Patent Protection?
laws and ownership, wills, trusts, and
• Processes
ownership, bankruptcy • Machines
• Contract law: legal contracts,
sales contracts, leases • Products
• Plants
GROWTH AND CONTINUITY OF • Compositions of elements (chemical compounds)
THE VENTURE • Improvements on already existing items

4 5 6

INTELECTUAL PROPERTY PROTECTION INTELECTUAL PROPERTY PROTECTION INTELECTUAL PROPERTY PROTECTION

The copyright owner has the rights to:

Copyright •Reproduce the work
Trademark
•Prepare derivative works based on it
Provides exclusive rights to creative •Distribute copies of the work by sale or otherwise
individuals for the protection of their •Perform the work publicly A distinctive name, mark, symbol, or
literary or artistic productions. •Display the work publicly motto identified with a company’s
•Sell or transfer individual rights product(s) and registered at the Patent
Copyright Protection and Trademark Office
•The material must be in a tangible form so it can be communicated or reproduced.
•It also must be the author’s own work and thus the product of his or her skill or
judgment.
•Formal registration of a copyright is with the Copyright Office of the Library
of Congress.

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INTELECTUAL PROPERTY PROTECTION TRADEMARK PROTECTION ON THE INTERNET FORMS OF BUSINESS ORGANIZATIONS

Trade Secret
Cyberlaw Sole Proprietorship
•Business processes and information that cannot be •The emerging body of law governing cyberspace.
patented, copyrighted, or trademarked but makes an •A business that is owned and operated by
individual company unique and has value to a Domain Names (Internet Addresses)
one person.
competitor could be a trade secret. •The principles of trademark law apply to domain names (Cybersquatters).
Information Is Considered a Trade Secret: •Unauthorized use of another’s mark in a domain name may constitute
•The enterprise has no existence apart from
•If it is not known by the competition. trademark infringement.
its owner.
•If the business would lose its advantage if the
competition were to obtain it.
•If the owner has taken reasonable steps to protect
the secret from disclosure.

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DEBT FINANCING ADVANTAGES AND DISADVANTAGES FORMS OF BUSINESS ORGANIZATIONS DEBT FINANCING ADVANTAGES AND DISADVANTAGES

Advantages Disadvantages Advantages Disadvantages

•Ease of formation •Unlimited liability Partnership •Ease of formation •Unlimited liability of at least
•Sole ownership of profits •Lack of continuity •Direct rewards one partner
•Decision making •Less available capital •An association of two or more persons acting •Growth and performance •Lack of continuity
and control vested in •Relative difficulty as co-owners of a business for profit. facilitated •Relative difficulty obtaining
one owner obtaining long-term •Flexibility large sums of capital
•Flexibility financing •Relative freedom •Bound by the acts
•Relative freedom from •Relatively limited viewpoint from governmental of general partner
governmental control and experience control and regulation •Difficulty of disposing
•Freedom from •Possible tax advantage of partnership interest
corporate business taxes

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FORMS OF BUSINESS ORGANIZATIONS DEBT FINANCING ADVANTAGES AND DISADVANTAGES

BANKCRUPTCY
Advantages Disadvantages
Corporation
•Limited liability •Activity restrictions
•“An artificial being, invisible, intangible, and existing •Transfer of ownership •Lack of representation When a venture’s financial obligations are
only in contemplation of the law”. –Supreme Court •Unlimited life •Regulation greater than its assets and it is unable to meet
Justice John Marshall •Relative ease of securing •Organizing expenses its obligations.
•As such, a corporation is a separate legal entity apart capital in large amounts •Double taxation
from the individuals who own it. •Increased ability and
expertise

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BUSINESS MODEL CANVAS

BUSINESS MODEL

A plan for the successful operation of a business, identifying sources of revenue,

the target customer base, products, and details of financing. Key Key Value Customer Customer
Partners Activities Proposition Relationships Segments

BUSINESS MODEL
Key Channels
BUSINESS MODEL CANVAS Resources

Cost Structure Revenue Streams

MODULE 5 A business model canvas provides us a way to create a clear business model using
just a single sheet of paper

1 2 3

BUILDING BLOCKS
1. Customer – Who are the customers? BUILDING BLOCKS BUILDING BLOCKS
2. Value Proposition – Why do customers buy from you 2. Value Proposition
1. Customer
3. Channels – How your products and services are delivered to the market?
Key Key Value Customer Customer Value you deliver to each Key Key Value Customer Customer
4. Customer Relationships – How do you get your customers? Who are your customers? Partners Activities Proposition Relationships Segments
customer segment? Partners Activities Proposition Relationships Segments

5. Revenue Streams – How does your business earn money?

Common value Propositions:
6. Key Resources – What strategic resources does your business have? Key Channels • Newness Key Channels
Resources Resources
• High performance
7. Key Activities – What business activities do you perform to deliver your value
Cost Structure Revenue Streams • Ability to customize Cost Structure Revenue Streams
proposition? • Design
8. Key Partnerships – What are the non-key activities can you exhaust to enable • Brand/status
• Price
you to focus more on your key activities? • Cost reduction
• convenience
9. Cost Structure – What are the major costs incurred by your business?

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BUILDING BLOCKS BUILDING BLOCKS BUILDING BLOCKS

3. Channels 4. Customer Relationships 5. Revenue Streams

Key Key Value Customer Customer Key Key Value Customer Customer Key Key Value Customer Customer
Describes how you reach Partners Activities Proposition Relationships Segments Answers how you get, keep Partners Activities Proposition Relationships Segments Where does the money come Partners Activities Proposition Relationships Segments
customers. and grow your customers. from?

Key Channels To answer this question, walk Key Channels What strategy will you use to Key Channels
Will you use your own Resources
through the entire customer
Resources
capture the most value from
Resources

channels or partner? journey in detail. your customers?

Cost Structure Revenue Streams Cost Structure Revenue Streams Cost Structure Revenue Streams

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BUILDING BLOCKS BUILDING BLOCKS BUILDING BLOCKS

6. Key resources
7. Key Activities
Key Key Value Customer Customer Describes your most important Key Key Value Customer Customer Key Key Value Customer Customer
Partners Activities Proposition Relationships Segments strategic assets Partners Activities Proposition Relationships Segments What are the most important Partners Activities Proposition Relationships Segments
strategic things you must do
Typically a combination of:
to make the business model
Key Channels • Physical – building, vehicles, Key Channels work? Key Channels
Resources Resources Resources
machines
• Intellectual – brands, knowledge,
Cost Structure Revenue Streams copyrights Cost Structure Revenue Streams Cost Structure Revenue Streams
• Human – people through in the
creative industries
• Financial – lines of credit or cash
balances

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BUILDING BLOCKS BUILDING BLOCKS BUILDING BLOCKS

8. Key Partners Cost structure

Key Key Value Customer Customer Key Key Value Customer Customer Key Key Value Customer Customer
Those tasks and activities Partners Activities Proposition Relationships Segments List the key costs and Partners Activities Proposition Relationships Segments Partners Activities Proposition Relationships Segments
that are important but ensure they are aligned with
which you will not do your value proposition.
yourself Key Channels Key Channels Key Channels
Resources Resources Resources

Cost Structure Revenue Streams Cost Structure Revenue Streams Cost Structure Revenue Streams

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BUSINESS MODEL CANVAS (GOOGLE) BUSINESS MODEL CANVAS (SKYPE) BUSINESS MODEL CANVAS (GILLETTE)
Key Partners Key Activities Value Customer Customer Key Partners Key Activities Value Customer Customer Key Partners Key Activities Value Customer Customer
Proposition Relationships Segments Proposition Relationships Segments Proposition Relationships Segments
Platform Marketing
Platform Management Software Manufacturers R&D BAIT:
Free & Fast Search User Payment development Free Internet Self Service Logistics Razor Handle Built in “Lock-In”
OEMS R&D Search Providers and Video Calling
Advertiser Users Retailers Customers
Key Resources Search Ads Channels Telecom Key Resources Channels Key Resources HOOK: Channels
Content Owners Partners Cheap Calls to Blades
Platform Display Ads Software Phones Skype.com Brand Retail
Developers Patents
Headset
Software Partnership

Cost Structure Revenue Streams Cost Structure Revenue Streams Cost Structure Revenue Streams
Free Free Marketing
Platform Costs Ad Revenue Platform Costs Prepaid Calls Logistics 1x Handle Purchase
Content Owners Display Ad Revenue Content Owners Hardware Sales R&D Frequent Blade Replacements
Manufacturing

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MARKET MARKETING RESEARCH RESEARCH PURPOSE

A group of consumers The gathering of information AND OBJECTIVES
Products/Services
(potential customers) who about a particular market, Desired

have purchasing power and followed by an analysis of that

Business Promotion
unsatisfied needs. information. Impact

Business
MARKETING CHALLENGES OF Competitors

ENTREPRENEURIAL VENTURES Market Share

MODULE 6

? Where to go?
Why go there?

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GATHERING OF INFORMATION MARKET RESEARCH SUBJECT AREAS CONSUMER BEHAVIOR

PRIMARY DATA
Information that is gathered specifically for the research at hand.
BARGAINING QUALITY VS. PRICE BRAND/TRADEMARK CHANGING CONSUMPTION
CONSCIOUSNESS PATTERNS

SECONDARY DATA MARKETS PRODUCTS

SALES
Information that has already been compiled.

DISTRIBUTION ADVERTISING ROLE OF WOMEN CREDIT AND COMPLAINTS

GUARANTEE

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UNDERSTANDING THE KEY FINANCIAL STATEMENTS UNDERSTANDING THE KEY FINANCIAL STATEMENTS

Balance Sheet: Assets = Liabilities + Owners’ Equity

•Represents the financial condition of a company at a certain
ASSET – something of value the business owns.
date.
FINANCIAL PREPARATION FOR (e.g. Current and fixed assets)

ENTREPRENEURIAL VENTURES • It details the items the company owns (assets) and the
LIABILITIES – the claims creditors have against the company.
amount the company owes (liabilities).
MODULE 6 (e.g. Short- and long-term debt)
• It also shows the net worth of the company and its liquidity.
OWNERS’ EQUITY – the residual interest of the firm’s owners
in the company.

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UNDERSTANDING THE KEY FINANCIAL STATEMENTS UNDERSTANDING THE KEY FINANCIAL STATEMENTS UNDERSTANDING THE KEY FINANCIAL STATEMENTS

Income Statement:
The purpose of a balance sheet and income statement Statement of Cash Flow:
• Commonly referred to as the P&L (profit and loss) statement is to let managers know how their businesses are
from activities of the firm. performing and whether they need to take corrective •An analysis of the cash availability and cash needs of the business
• Provides the results of the firm’s operations. actions. that shows the effects of a company’s operating, investing, and
financing activities on its cash balance.

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