Summary Patterns of Entrepreneurship Management

ISBN-10 1118358538 ISBN-13 9781118358535
180 Flashcards & Notes
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This is the summary of the book "Patterns of Entrepreneurship Management". The author(s) of the book is/are Jack M Kaplan Anthony C Warren. The ISBN of the book is 9781118358535 or 1118358538. This summary is written by students who study efficient with the Study Tool of Study Smart With Chris.

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Summary - Patterns of Entrepreneurship Management

  • 1 The Entrepreneurial process

  • What is Entrepreneurship?
    The process of planning, organizing, operating, and assuming the risk of a business venture.
  • What are commonly shared Entrepreneurial Characteristics?
    • Ability to deal with Ambiguity
    • Self-starters, optimist, perseverant, energetic, and action-oriented
    • Persuasive leaders, people-oriented, natural networkers, and communicators
    • Creative and highly imaginative
    • Passionately seek New Opportunities and are always looking for the chance to profit
    • Tolerate Risk
    • Work with Urgency but balance this with a focus on Long-term goals
    • Focus on Execution
    • Open to Change and do not hang on to old plans when they are not working
  • What are the types of Entrepreneurs?
    1. Aspiring entrepreneurs 
    2. Lifestyle entrepreneurs 
    3. Growth entrepreneurs
  • Aspiring entrepreneurs dream of starting a business; they hope for the chance to be their own bosses, but they have not yet made the leap from their current employment into the uncertainty of a start-up.
  • Lifestyle entrepreneurs have developed an enterprise that fits their individual circumstances and style of life. Their basic intention is to earn an income for themselves and their families. 
  • Growth entrepreneurs have both the desire and the ability to grow as fast and as large as possible. These firms are the most dynamic job generators in the economy.
  • Which subtypes are there within the type of Entrepreneurs?
    • Social entrepreneurs
    • Technology entrepreneurs
  • Social entrepreneurs are individuals with innovative solutions to society's most social problems. They are ambitious and persistent, tackling major issues and offering new ideas for wide-scale change.
  • Technology entrepreneurs have ideas triggered by developments in science and engineering. They usually have a strong education in those fields, an advantage that opens up opportunities for them that might not see.
  • Which path are there?
    • Lifestyle company
    • High-growth equity-financed company
    • Growth bootstrapped
  • Growth bootstrapped: a lifestyle company that manages the grow fairly rapidly without taking in outside investors.
  • The first decision that an entrepreneur should make is whether personal  lifestyle and control are more important than growth and eventual wealth creation.
  • What are the decision that have to be taken?
    • Partners 
    • Hired managers
    • Financing options
    • Opportunity selection
  • What are the basic five-stage entrepreneurial process?
    1. Conducting Opportunity Analysis
    2. Developing the Plan and Setting up the Company
    3. Acquiring Financial Partner/Sources of Funding
    4. Determining the Resources required and implementing the Plan
    5. Scaling and Harvesting the venture
  • What are the activities in Stage 1: Conducting opportunity analysis? 
    • Innovative and Create the Vision
    • Develop a Business Model to maximize value retention
    • Conduct Market Analysis and Research
    • Evaluate the Competition
    • Research Pricing and Sales Strategies
  • Stage 1 takes at least a year because it details the pricing and sales strategies required.
  • What are the activities in Stage 2: Developing the Plan and Setting up the Company?
    • Set Goals and Objectives
    • Start writing the Plan 
    • Determine Pricing, Market, and Distribution Channels
    • Prepare the full Business Plan
  • What are the activities in Stage 3: Acquiring Financial Partner/Sources of Funding?
    • "Bootstrap" the company
    • Secure Early-stage Funding
    • Secure Growth Funding
  • What are the activities in Stage 4: Determining the Resources required and implementing the Plan?
    • Manage the Finances
    • Determine value of Licenses, Patents, and Copyright
    • Prepare the Organization for Growth
  • What are the activities in Stage 5: Scaling and Harvesting the venture?
    • Communicate the Opportunity
    • Discuss Options and Alternatives
    • Sell or Merge
    • Transfer Ownership to your family
    • Go Public
    • Form a Strategic Alliance
  • 2 The Art of Innovation

  • What is a business model?
    The frameworks in which a sustainable, high-profit company is constructed.
  • Why is Innovation important?
    • The growth of the Internet and access to Knowledge and Ideas
    • The Internet and Customer expectations
    • Barriers to Trade are being dismantled
    • Access to Capital
    • Technological Obsolescence
  • What can Entrepreneur learn from Innovation?
    • It is dificult to build a company around a single porduct idea without strong patent protection.
    • Protective barriers must become part of any business model.
    • Innovation is not a single event.
    • Always imagine that there is someone having the same idea.
    • Entrepreneur needs to solve customers' problems.
  • What is the definition of Innovation?
    Successful innovation is the use of new technological knowledge, and/or new market knowledge, employed within a business model that can deliver a new product and/or service to customers who will purchase at a price that will provide profits.
  • What are the main two types of Innovations?
    1. Incremental
    2. Radical
  • Incremental innovations are continual improvements on an existing product or service or in the ways that products ar manufactured and delivered.
  • Radical innovations are the result of major changes in the ground rules of competition, culminating in either a cutomer satisfying her needs in an entirely new way or in a totally new need being created through innovation.
  • Discruptive innovation is often used to describe innovations that discrupt the status quo.
  • What are the various Methods of Researching a Business Opportunity?
    Looking at:
    • Analogs
    • Technology confluence/intersection
    • Points of pain
    • The Like
  • Analogs is to help transfer innovations from one field to another.
  • What are the various ways to generate business ideas?
    1. Develop ideas as an extension or redesign an existing service
    2. Resegment and create an improved service
    3. Redifferentiate and market the product at lower price
    4. Add value to an existing product or service
    5. Develop or redesign a new version of an existing product
  • An Entrepreneur need not be the Developer of the technology.
  • What is the five-step model that help Entrepreneurs know a winning business area(Opportunity)?
    1. Seize the Opportunity
    2. Investigate the Need through Market Research
    3. Develop the Plan
    4. Determine the Resources needed
    5. Manage the business
  • Phase 1: The basic objective is to define the criteria that would make a business opportunity worthwhile to pursue.
  • What must be done in the Phase 1: Seize the opportunity?
    • Know what the Factors create Opportunity
    • Calculate the Opportunity Costs
    • Access the Risks and Rewards
  • What are the questions Entrepreneurs must ask themselves?
    • What are the indicators that lead to this idea and opportunity?
    • What are the conditions that permit the opportunity to occur?
    • How will the future of this new product or service change the idea?
    • How long time is the window of opportunity?
  • What are the Factors that Create Opportunity?
    • Technology factors
    • Economic factors
    • Demographic factors
  • A window of opportunity is a time horizon during which opportunities exist before something else happens to eliminate them.
  • Opportunity costs are the value of benefits lost when one decision or idea alternative is selected over another.
  • Phase 2: Identify, measure, and document the need for the product or service.
  • What must be done in the Phase 2: Investigate the Need through Market Research?
    • Ask prelimanary questions
    • Prepare data collection
    • Execute a study to get answers
  • What are the Preliminary questions?
    • Need
    • Niche/Competition
    • Proprietary questions
    • Cost and Manufacture
    • Advertisement and Packaging
    • Sales
    • Transport
    • Employees
  • What are the Sources for finding answers for the Preliminary questions?
    • Experts in the field
    • Internet searches
    • Library research
    • Questionnaires/surveys
    • Existing research
    • Trade associations
    • Market research firms
  • What must be done in the Phase 3: Develop the Plan?
    • Ask the right questions
    • Prepare the Business Plan
  • The result of the business plan should fully capitalize on all of the company's assets while maintaining flexibility. A business plan charts the current and future components of the business in about thirty to forty pages.
  • What will a good Business Plan do?
    • Determine the viability of the business and application in selected markets.
    • Provide guidance in planning and organizing the activities and goals.
    • Serve as a vehicle to obtain financing and personnel for the business.
  • What are the three Critical Junctures that the Business Plan guides?
    1. It simplifies decision making during times of crisis.
    2. It is the roadmap at points of indecision.
    3. It is a motivational guide during setbacks or downturns.
  • What are the Aspects of assessing Resource capabilities in Phase 4: Determine the Resources needed ?
    1. Personal contacts and networking
    2. Financing requirements 
    3. Sources of technical skills
  • What must be done in the Phase 5: Manage the business?
    • Keep planning
    • Deliver a total solution
    • Cultivate advanced resources
  • What two Events involves in Phase 5: Manage the business?
    1. Deliver a total Solution
    2. Culivate advanced Resources
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Latest added flashcards

What are the various Validation Methods to value a business?
  • Venture Capital Model
  • Milestone Methods
What are the two fundamental ways of making calculation for Venture Capital Model?
  1. Cash Flow Estimates
  2. Strategic Sale
What are the "Four Cs" of credit?
  • Character
  • Cash Flow 
  • Collateral
  • Contribution
What seven keys does a Loan Proposal consist of?
  1. Summary 
  2. Management Team Profiles 
  3. Business Description
  4. Financial Projections
  5. Financial Statements
  6. Amount and Purpose 
  7. Repayment Plans
What is the guide to selecting a Venture Capitalist?
  1. Scrutinize your business with a critical eye
  2. Beef up management 
  3. Keep a high profile so the VCs will visit
  4. Target the search
  5. Keep a lookout 
  6. Investigate possible venture partners
What are the factors that might influence a Venture Capital firm's funding decisions?
  • Specialized Industries for the venture
  • Location of the venture
  • Stage of Fund
  • Stage of Development
What are important terms in Preferences and Covenants?
  • Board Membership
  • Management Decisions
  • Registration Rights
  • Later Rounds
  • Antidilution Rights
  • Forcing Exit
  • Piggybacking
What is Preferences and Covenants?
Terms negotiated by investors when making an investment.
What are the fundamental sections that Investors analyze?
  1. Management team
  2. Business model
  3. Context 
  4. The Deal
What are the Legal Agreements?
  • Employment agreement
  • Consulting agreement
  • Separation agreement
  • Sales and Marketing agreement
  • Confidentiality agreement