Introduction to Entrepreneurship Flashcards
what is an entrepreneur
an individual who thinks, reasons and acts to transform ideas into opportunities, creating value
private value vs social value
private value: economic value for the owner of the firm
social value: benefits for society minus cost for society
entrprenureal venture vs small business
1) small business deal with known and established products, ventures are brand new
2) small business have known risks, ventures do not
3) small business target limited growth and continued profit, ventures want rapid growth and high ROI
4) small business are limited in their operations and domain, ventures transcend and influence numerous sectors
what are the three steps of the entrepreneurial process
1) developing opportunities
2) gathering resources
3) managing and building operations
what are the steps of developing opportunities
identifying an idea
developing a business model
preparing a business plan
what are the steps of gathering resources
organizing business formally and legally - create a firm, building consensus for the ventures authority and ethical framework
acquiring non human assets
strategizing for acquiring seed funding and follow up financing
what are the steps of managing and building operations
running the business to achieve high ROI and rapid growth
what are non human assets
assets that can be owned (physical and intellectual pretty rights, data, software)
what are the two important transformations an innovative firm must go through in its early life
differentiation and standardization
what is differentiation
product needs to remain being unique
what is standardization
set strategy to repeatedly and quickly create product (McDonalds movie example)
firms operations need to be standardized so that key human capital can be replaceable
financiers get a better understand of firms operations and are more willing to invest
what are the 5 stages of a successful venture life cycle
1) development stage
2) startup stage
3) survival stage
4) rapid growth stage
5) early maturity stage
what is a mega trend
huge discoveries that reshape society (internet, Facebook etc.)
what are entrpreneral opportunities
1) new repackaged or repositioned products or services
2) establishment of new markets for goods
3) invention of new production processes or business methods
how do the greatest entrepreneurial opportunities arise
technological changes and large societal or demographic trends
