ENTREPRENEURSHIP AND BUSINESS PLANNING

Academic Year 2011-2012

Instructor: Francesco Castellaneta, Assistant Professor Short Biography : Education: PhD in Business Administration (Bocconi University, Italy), B.A. in Management of Public Administration and International Institutions (Bocconi University, Milan, Italy) Research interests: using a unique proprietary database covering more than 11,000 investments made by 334 private equity firms from 1973 to 2005, I explore the impact of private equity firms experience on the performance of buyouts. Experience is both an enabling and a constraining factor an obstacle and a resource for change. My work disentangles the negative and positive effects of experience, and explains the conditions under which private equity firms fail to learn from their experience and mistakes, due to overconfidence and superstitious learning. COURSE DESCRIPTION Entrepreneurial activity requires much creativity, and benefits much from personal experience, but there is no substitute for organization, foresight and structured work in the development of a successful entrepreneurial venture. The Bachelors in Business Administration curriculum gives students a basic set of important tools in diverse areas such as strategy, finance, human resource management, and marketing (among others). This class provides the students with the opportunity to use, in an integrated fashion, most of those tools to prospect, select, organize and develop an entrepreneurial project. As a vehicle to integrate this knowledge and as a practical exercise in entrepreneurial initiative, the students must develop a complete business plan. During the term the students will prospect for and select a business idea, present and debate their business ideas with the class, submit and discuss several drafts of the business plan. In the final section of the course, students must present (with Power Points) the business plan amenable to the creation of a new firm. The fully

 documented business plan must be completed and submitted after the final section. Developing a business plan is an iterative and interactive process. This reflects in the class sessions which provide the student with opportunity to have a forum where their business ideas, plan development, and strategies will be challenged and collectively enhanced (iteration), in a process that requires the students interaction with the both with the instructor and his/her colleagues. Most sessions will begin with a lecture on the days topic, followed by a class discussion of the subjects and their application to the business projects being developed. As need be, and depending on availability, some of the classes will use the case study methodology. COURSE CONTENT The course revolves around four main areas: 1. Analyse the fundamental issues: ponder some fundamental issues related to venturing and learn to assess the risks, challenges and rewards involved in the venturing process. 2. Learn to transform ideas into action: bridge the gap between theory and practice, and learn from your colleagues and guest speakers on how to be both thoughtful and effective. 3. Develop a hands-on experience of the process: identify and pursue a business opportunity in either an independent or corporate setting with a team of motivated colleagues. 4. Learn to write a Business Development Plan (BDP): develop a business plan for a new venture.

COURSE OBJECTIVES The main learning objectives are: thinking in a creative way and solving problems in highly unstructured circumstances improving ones ability to spot and evaluate opportunities for a new business venture acquiring the concepts and spirit for business venturing

examining a business proposal as a whole, rather than concentrating separately on its functional aspects experiencing the benefits of peer-group review and feed-back throughout the planning phases of a new business venture.

COURSE MATERIAL / BIBLIOGRAPHY Main Textbook: Bygreve & Zacharakis (2009): Entrepreneurship. John Wiley and Sons, 2010 BZ in the course outline Additional reading: Stutely, R. (2007) The definitive business plan. The fast-track to intelligent business planning for executives and entrepreneurs. Prentice Hall Financial Times. Revised 2nd Edition. ISBN: 978-0-273-71096-7 ST in the course outline Chapter 3 (Industry Analysis: the fundamentals) from Grant, R. Contemporary Strategy Analysis. John Wiley and Sons, 2010 (7th edition). A old version of the book chapter can be downloaded from the website of the 5th edition from this link: http://www.blackwellpublishing.com/grant/pdfs/CSA5eC03.pdf The class website is an important additional resource, besides current posting of general interest. I will include and update links to other entrepreneurial sites and resources. ASSESSMENT Grades will be assessed in conformity with the business plan quality, the partial and final presentations, as well as with the quality of individual class participation. There will be no final exam. However, there might be individual and group in-class graded exercises. The progress of the business plan drafts will be evaluated after each partial presentation and the final exam consists of a formal presentation of the business project. Grades will be as follow Group: business plan project: 80% Individual: individual class participation and in class performance: 10% individual contribution to the teams work and effort (blind peer evaluation): 10% More details on the group and individual required activities will be provided in class.

 COURSE ACTIVITIES: THE BUSINESS PLAN DEVELOPMENT Course participants are required to form new venture teams of four students whose talents, skills and knowledge are as complementary as possible. We will discuss about how to form teams in class. Extensive group work outside of class is an essential part of this course. Other factors which are extremely relevant to your teams functioning are the management and coordination of group effort by appropriate means (telephone, e-mail, Skype, meetings, etc.). Each team will produce an original and comprehensive Business Development Plan (BDP) as its major final product and will make periodical presentations of its progress in class. The content and organization of the BDP will be discussed in class. Important Note: If your business development plan has been the subject of class projects in other classes, it is your responsibility to inform the instructor, and to explain how the work performed for this class will be original. Intermediate submission requirements: Each team will have to submit, at due dates which are indicated in the course outline, intermediate parts of its BDP. These due dates might be changed to accommodate particular needs of the class (i.e.: give less or more time to the develop of particular BP sections). Teams will be required to illustrate some of the intermediate parts to the class. Feedback will not be provided after the turn in of the assignment, but after the planned intermediate presentations. In fact, the presentation is considered part of the assignment and necessary to better clarify issues not fully analysed in the written document. Feedbacks will be provided during office hours. Failing to submit intermediate assignments at due dates will negatively affect the final evaluation of the teams BDP. BDP Presentation: Teams will make a formal presentation of the final BDP during the exam weeks in June.

COURSE OUTLINE
1 2 3 4 5 Topics Introduction / Course Overview/ Opportunity identification Presentations of Group Venture Ideas / Opportunity evaluation The Business Plan Competitive system analysis The business model: revenues model and strategy Marketing your product Activity BZ Textbook: Ch. 1 - 2 BZ Textbook: Ch. 3 BZ Textbook: Ch. 7 On-line chapter BZ Textbook: Ch. 4 Submissions due Venture teams formed by this date Individual presentation: your own idea Group presentation: BP idea Due: business idea and competitive system analysis

BZ Textbook: Ch. 5

Business Plan intermediate presentation The funding team and other venture resources Building your Financial Statement Financing your business Quantifying the risk

Business Plan intermediate presentation

BZ Textbook: 6

BZ Textbook: Ch. 8

Due: Sections on business model, marketing, founding team and other venture resources

10

BZ Textbook: Ch. 10-11 ST Textbook: Ch. 11 BZ Textbook: Ch. 14 Articles (to do, not to do)

11 12

Business escalation Selling the business idea

Due: financials

Final presentations (3 paper copies of the slides, printed 3 per page)