test Flashcards
to slay test
different types of entrepreneurs
the inventor, the hustler, the imitator, the buyer
the inventor
Have a vision
They often create their own crowd
First to market
Ex. Pierre Omidyar, CEO of Ebay
the hustler
Start small and work hard
Focus on current task with the goal of growing it in the future
Focused and remove distractions
Favour risks over short term comfort
Ex. Mark Cuban
the imitator
Copy existing ideas and improve them
Make the product/service better to gain market share
Mix of innovator and hustler
Using their knowledge to gain momentum in the market
Ex. Instagram stories and snapchat
the buyer
Use their money to buy or fund an already existing company
They can buy the company outright and hire someone to run it or be a part owner
Ex. Warren Buffett
He buys underpriced businesses and holds them for the long term
6 leadership styles
Directive, Authoritative, Affiliative, participative, pacesetting, coaching
directive leadership style
Primary objective is to achieve complete compliance from employees
Manager tells everyone what to do
Actions of employees are closely watched
Motivates employees with threats/discipline
authoritative leadership style
Primary objective is to provide long-term direction and vision for employees
Strict, but fair management style
Gives employees clear instruction and steps to follow
Motivates by feedback and persuasion
affiliative leadership style
Primary objective is to create harmony and peace between managers and employees
Needs of people are placed above task
Strives to achieve good relationships among employees and tries to avoid conflict
Motivates by keeping people happy
participative leadership style
Primary objective is to build commitment and allow employees to have a voice
Manager ensures that everyone will be heard
Encourages employee opinions when coming to decisions
Motivates by rewarding employees for team effort
pacesetting leadership style
Primary objective is to complete tasks to a high standard above anything else
Manager will do it themselves if needed
Manager will perform a lot of the tasks, but expects employees to follow suit
Motivates by setting high standards for employees and expects independence
coaching leadership style
Primary objective is to give long-term professional experience and direction for employees
Manager who wants to help employees develop their skills
Helps and encourages employees to improve and become better
Motivates with opportunities for professional development
4 main types of business models and 2 others
main: B2B, B2C, C2B, C2C
others: B2A, C2A
B2C business model
Most common business model
Buying clothes, household supplies, entertainment, is usually a B2C model
Typically spends less money marketing
PRO: easy to buy from
CON: lots of competition
B2B business model
A business sells products/service to another business who typically will sell to consumers
Typically has higher order value and more repeating purchases
This model is currently growing and B2B businesses are becoming more important online
PRO: Businesses will buy supplies in bulk from these businesses
CON: Limited market since businesses find one vendor and stick with them
C2B business model
An individual/consumer who offers a product/service to a business
Common with social media and influencers (ex. sponsorships)
Influencers use their platform to promote products which helps marketing of business
PRO: Allows businesses to see products through consumer views
CON: Unpredictable
C2C business model
Common in online marketplaces like Facebook Marketplace, and Ebay
Allows consumers to sell products/services to other consumers
PRO: Lower cost (typically)
CON: Quality control and scams
B2A business model
E-commerce specific business model
Example: business providing an employment site/portal for government
PRO: Direct communication between government and business
CON: Security breaches can affect business and government
C2A business model
Includes all electronic transactions between consumer and government
Examples: filing taxes, payment of health services
PRO: Money goes directly from consumer to government
CON: Government Administration could be corrupted
invention vs innovation
Invention: Creating something that has never been done before
Innovation: Improving something that already exists with different features/fixes
example strengths in SWOT analysis
Experience, Special Marketing, Location, Quality, etc.
example weaknesses in SWOT analysis
Lack of marketing, Location, High prices, Lack of quality, etc.
example opportunities in SWOT analysis
Merges, Joint Alliances, New international market, Technology, etc.
example threats in SWOT analysis
Eg. New competitors, Price wars, Weather, Taxation, etc.
rules when creating SWOT
Be realistic
It should distinguish where your business is today vs where it could be in the future
Be specific
Always apply SWOT to your competitors (i.e. are you better or worse than your competition)
smart goals, what does it stand for
specific, measurable, achievability, relevant, time-bound
parts of a venture plan
executive summary, business overview, market analysis/market plan, physical+ human resources, operating strategies, financial strategy
executive summary, venture plan
Arguably most important part of venture plan
Write last as ideas change
Brief overview of contents of venture plan, including brief description of business (name, product/service, industry)
Should captivate reader and make them want to read the rest of the venture plan
business overview, venture plan
Describe business (product/service, industry, uniqueness ect)
Also clarify if your business is completely new or an extension of existing
Use simple terms to make it easy to understand
market analysis/market plan, venture plan
Describe service/product
Outline plans regarding marketing (goals, budgets, in-depth target market analysis, marketing strategies ect)
Provide future roadmap + vision of company (in-depth sales forecast, possible competitors)
physical + human resources, venture plan
Introduce the team
Explain job roles in company (hiring process, job descriptions, training plans, ect)
Detailed description of product (cost of production, source of materials ect)
operating strategy, venture plan
Outline daily operational requirements (ex. facility, information ect)
Prove why location of business is the ideal location
Add information about assets/production/suppliers
Provide risk assessment
financial strategy, venture plan
Monthly cash flow forecast ← important
Add financial statements(balance sheet, cash flow statement ect
Outline possible financial risks
Develop contingency plans
who needs venture plans
- most if not all investors want to see before giving money
- helps owner understand business better
different types of investors that need venture plans
venture capitalists, bankers, angel investors, potencial partners, strategic allies, managers
venture capitalists
Need a venture plan to evaluate the profitability of a business
Investors making small/limited investments typically when a startup starts to earn money
This money gives them a stake in the business and gives startup a boost
Investors can give mentorship and guidance + has connections to grow business
Ex. Dragons in Dragon’s Den
bankers
Need a venture plan to evaluate the risks before investing with the bank’s money/giving loans
Without a plan, bankers don’t know if the business is serious
Can provide both personal and commercial financial advice + give information about industries
Bankers are incredibly valuable when it comes to financials ← can help structure business deals, navigate markets, provide insight on future industry trends
angel investors
Needs a venture plan to see when they can earn their money back, to look for potential success, and plan an exit strategy
Provides money at early stages of business in exchange for equity
Could be main source of money for entrepreneurs who don’t want bank loans
Can be found through family, mutual connections, or startup event
potential partners
Needs a venture plan to ensure partners that business isn’t just idea, but a well thought out and worthy investment
Usually an entrepreneur who sees potential in a business and profit
Usually provides financial help or advice
Typically, these people will reach out to you for partnerships
strategic allies
Needs venture plan so that the other business can know what this alliance will entail
An arrangement that allows businesses to benefit from each other while remaining independent
Companies give each other opportunities, businesses can access new markets, share information
Some types of strategic allies are joint venture, equity strategic alliance, and non-equity strategic alliance
managers
Needs business plan to guide business in the right direction and to quickly make decisions based on company goals
Management is the group of leaders who takes on the leadership role in a business
Can help make decisions, hire new employees, build company culture
common mistakes in venture plans
poorly written, unprofessional look, details are too vague, doesn’t touch on potential risks, doesn’t consider competition, no future plans
csr, what it stand for and 3 ps it follows
corporate social responsibility
- people
- planet
- profit
4 categories of CSR
environmental responsibility
- belief that business should take care of environment
philanthropic responsibility
- business actively makes world better (donating)
economic responsibility
- make financial decisions wanting to do good (investing in clean energy)
ethic responsibility
- ensures all stakeholder are treated fairly
what does it mean to have competitive advantage
to have an edge over competitors in any aspect of business
examples of competitive advantages
cost
- low cost vs high cost
quality
- good quality vs bad quality
niche
- niche vs broad
what is a mission statement, what should it reveal
A mission statement is a written, easy-to-remember sentence; a short list of bullet points; or paragraph illustrating a business’ goals and purpose.
should reveal:
What a company want to be and whom it want to serve
Action-oriented vision statement, declaring the purpose an organization serves to its audience.
Its purpose revolves on what we need to do now to get to our goal in our future
what should a mission statement include
General description of business
Function
Objectives
What, Who, Why
what does a good mission statement have
The product of services it delivers
The overall philosophy or purpose of your company
Explains how the venture will meet the needs and wants of customers
Distinguishes a given organization from others
what is a vision statement, what should it be
An answer to the question; “What do we want to become?”
should be:
short(one sentence), created with managers
types of businesses
service providers, retailers, merchandisers, manufacturers
types of business ownership
sole proprietorship, partnership, corporation, franchise
sole proprietorship
- owned by single person
pro: owner keeps profit, easy to end/start
cons: owner responsible for all debts, time commitment
partnership
- verbal or written agreement b/w 2 +ppl
pros: more resources, share responsibilities
cons: conflict, share profit + debts
coporate
- owners are shareholders
- owners let others operate business
pros: lost of money, owner die = keeps going
cons: complicated to start, expensive
3 types of corporate
crown, public, private
