L6 Entrepreneur

Question 1

Badgers, forestallers, engrossers

Answer 1

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• described unacceptable methods of influencing the market to create local monopoly for a certain good, usually good
• a king/ruler set all the important prices

Question 2

Forestallers are Cantillon’s entrepreneurs

Answer 2

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• entrepreneurs are managers of risk

Question 3

Cantillon’s agents

Answer 3

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1. landowners = financially independent
2. entrepreneurs = chance-takers
3. hirelings = fixed wage contractors

Question 4

Joseph Schumpeter’s economic heroes

Answer 4

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• argues against static equilibrium approach of economic analysis
• sees development as a dynamic process, disturbing the economic status quo
• entrepreneurs = agents of change, create market disequilibrium, creative destruction, role of outsiders and first mover

Question 5

First mover advantage

Answer 5

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• sustainable competitive advantage from being a pioneer in a specific market
• time to build brand recognition and customer loyalty
• control key resources
• high cost of later switching

Question 6

First mover disadvantage

Answer 6

• can be first to fail
• followers can learn from first mover’s mistakes
• bear the cost of creating the market
• followers can use new technologies or more efficient processes

Question 7

“Ceaseless and self-generated change”

Answer 7

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“getting things done”

Question 8

Entrepreneurs and the basic biotech strategy

Answer 8

see onenote diagram

Question 9

Venture capital

Answer 9

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New type of money

• Georges Doriot, father of venture capitalism, advocates more democratic finance system
• encourages private sector investments in businesses run by soldiers returning from WW2

Venture capital(VC) is a type of private equity, a form of financing that is provided by firms or funds to small, early-stage, emerging firms that are deemed to have high growth potential, or which have demonstrated high growth (in terms of number of employees, annual revenue, or both).

Question 10

Entrepreneurs are…

Answer 10

• concerned with decisions surrounding new profit opportunities
• concerned with assembling resources
• all in the midst of uncertainty

Question 11

General entrepreneurial attributes

Answer 11

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1. desire to control own destiny/make a difference/reach full potential
2. sense of invulnerability
3. outsiders with few responsibilities
4. physical and emotional strength
5. availability of resources

Question 12

Frank Lowy’s Story

Answer 12

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Question 13

Distinctive features of the biotech sector

Answer 13

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1. based around institutional research
2. intrapreneurs - entrepreneurs within an organisation
3. complex regulatory environment
4. long-term investment
5. networked organisations

Question 14

Cultivating ties in the bitotech sector

Answer 14

see onenote diagram

Question 15

Some general attributes of university academics

Answer 15

• middle-aged with research or technical expertise
• good, steady incomes and benefits
• risk adverse due to family responsibilities etc.
• rewards arise through academic activities, not business activities

Question 16

The biotech entrepreneur paradox

Answer 16

1. technically skilled uni academics are reluctant entrepreneurs/intrapreneurs
2. entrepreneurship rarely arises from research
3. biotech entrepreneurs “get things done” by providing access to finance but need technical skills as well

Needs someone to come in and identify the opportunity
- E.g. A young person may have the energy and drive to start up a business, the older person teaches them how the technology works

Question 17

Summary of key concepts

Answer 17

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