ENTREPRENEURSHIP 1

CASE
ROXANNE QUIMBY

Members:
 Ivone Mikewaty (01120080070)
 Clarissa Winardi (01120080075)
 Anna Berliana (01120080086)
 Clarissa (01120080166)
 Kelly Santana (01120080309)

UNIVERSITAS PELITA HARAPAN

LIPPO VILLAGE, TANGERANG
Entrepreneurship 1 Case: Roxanne Quimby

BANTEN

Universitas Pelita Harapan / Management 1

Entrepreneurship 1 Case: Roxanne Quimby

2010

ENTREPRENEURSHIP 1
Members:
 Ivone Mikewaty (01120080070)
 Clarissa Winardi (01120080075)
 Anna Berliana (01120080086)
 Clarissa (01120080166)
 Kelly Santana (01120080309)

Case: Roxanne Quimby

1. Who can be an entrepreneur?
There are several definitions of an entrepreneur. Joseph Schumpeter gave the modern definition of an entrepreneur –
the person who destroys the existing economic order by introducing new products and services, by introducing new
methods of production, by creating new forms of organization, or by exploiting new raw materials. Sullivan (2003)
states that an entrepreneur is a person who has possession of a new enterprise, venture or idea and assumes significant
accountability for the inherent risks and the outcome. The other academic defines an entrepreneur as the person who
perceives an opportunity and creates an organization to pursue it (Bygrave and Zacharakis, 2008, p. 2).
Everyone can be entrepreneurs if they have some characteristics, for instance are what David McClelland stated:
they are moderate risk takers and have a higher need for achievement. Another characteristic is they have a higher
internal locus of control of their own fate (Bygrave and Zacharakis, 2008, p. 52). The 10Ds, the most important
characteristics of a successful entrepreneur, include dream, decisiveness, doers, determination, dedication, devotion,
details, destiny, dollars, and distribute (Bygrave and Zacharakis, 2008, p. 53).
Research indicates that most successful entrepreneurs share certain personal attributes, including creativity,
dedication, determination, flexibility, leadership, passion, self-confidence, “smarts” (www.america.gov, n.d.).
Another academic states that a successful entrepreneur has characteristics as follows: self-control, sense of
urgency, comprehensive awareness, realism, conceptual ability, status requirements, interpersonal relationships, and
emotional stability (www.businesstown.com, n.d.).

2. What are the risks, rewards, and trade-offs of a lifestyle business vs. a high potential business – one that will
exceed $5 million in sales and grow substantially?
Lifestyle Business
Lifestyle business is one where the entrepreneur seeks to generate an "adequate" income while living where s/he
wants, doing what s/he loves, or having the flexibility to be around (Sullivan, 2007). Lifestyle entrepreneurs as a
specific breed of business owner who is neither a financially independent hobbyist nor wealth-seeking empire-builder
(Wetzel, n.d.). According to the National Commission on Entrepreneurship, at any given time, 6% to 9% of the United
States adult population is involved in planning for a new business. Most of these aspiring entrepreneurs, they say, will
start a “Lifestyle Business" – primarily providing employment to themselves and their families.
Rewards:
Able to control the company, able to continue to do what the owner loves without having too much risk, have a
positive cash flow from the early going, owner only has to report to himself, have a relatively constant cash flow, able
to take time off whenever the owner wants (www.zeromillion.com, n.d.).
Risks:
Not able to hire top talent (as talented people usually avoid companies that over no stock options and only limited
opportunities for personal growth), not having the chance for huge gains (www.zeromillion.com, n.d.).
Trade-off:
There is a lot of freedom, but the company cannot expect to grow bigger.

High-Potential Business

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Entrepreneurship 1 Case: Roxanne Quimby

These are companies focused on new markets with explosive potential. Often technology-driven, these ventures
require heavy upfront cash investment to quickly gain decisive advantages, so professional investors—particularly
venture capital firms—usually provide funding. High-potential ventures strive to achieve lasting economic and social
impact, and aspire to achieve IPOs, or initial public offerings (getting listed on a stock exchange so they can sell shares
to the public) (Tim, 2008).
Rewards:
Have the possibility for large returns on investment, the ability to attract outside investment, and the ability to build a
great team who will work to make the company succeed (www.zeromillion.com, n.d.).
Risks:
The usual necessity for the company to take on large amounts of debt or lose significant amounts of equity, a loss of
control as investors and employees dilute the founder’s equity, and the long wait to reach positive cash flow
(www.zeromillion.com, n.d.).
Trade-off:
The company can grow bigger, but has no freedom because it depends on the shareholders’ visions too.

Burt’s Bees used to be a lifestyle business when it operated in Maine. But after moved to North Carolina, it became a
high-potential business with sales over $250 million in 2007 (Burt’s Bees’ Official Web Site, n.d.).

3. What is the difference between an idea and an opportunity? For whom? What can be learned from Exhibits C
and D?
According to Oxford Dictionary (2002), idea is plan, thought, or picture in the mind; while opportunity is chance to do
something. So, idea is something inside the mind, plan that has not been implemented yet; while opportunity is the
time when idea is able to be implemented into real action. Moving from an idea to a viable opportunity is an iterative
process (Bygrave and Zacharakis, 2008, p. 83).
Idea is a flash of inspiration. Opportunities are ideas that have been through an analytical wringer. Take an idea,
punch it, pull it, ask the right questions, and if it holds up – it's an opportunity: a chance to build a viable venture
(www.nenonline.org, 2009). In analyzing business ideas, someone must be able to pass them through a test to
determine if they truly are valid opportunities. All of the ideas must have a demonstrated need, ready market, and
ability to provide a solid return on investment (Allis, n.d.).
Idea belongs to every one. Someone who always talks about plenty of ideas but has no action is called a
“cocktail-party entrepreneur” (Bygrave and Zacharakis, 2008, p. 86). However, to become a true entrepreneur requires
continual escalation of commitment (Bygrave and Zacharakis, 2008, p. 86). A true entrepreneur can capture an
opportunity and implement the idea. There are five major areas to evaluate whether an idea is truly an opportunity:
customers, competitors, suppliers and vendors, government, and the broader global environment (Bygrave and
Zacharakis, 2008, p. 89).

From Exhibits C and D, we can learn that toilet preparations are a growing business.

4. Why has the company succeeded so far?

Burt’s Bees most popular product is lip balm. It also sells candle, handmade crafts, and other beeswax-based products.
The deterioration of the natural environment is a major global problem, great opportunities await companies who can
create solutions that reconcile prosperity with environmental protection (Kotler and Keller, 2009 p. 122). That is why
Burt’s Bess environmental ethic by excluding any chemical preservatives and using primarily all natural ingredients in
its skincare products becomes the first reason it has succeeded so far; this is appropriate to Sheth theory (2007) that
companies which innovate solutions and values in a socially responsible way are the most likely to succeed.
Another reason is it sells the products in urban areas where the people cannot step out the front door and get
freshness or simplicity. Burt’s Bees products are down-home and basic which speak to everyone needs of unconscious
desire for more simplicity.
It also has succeeded as Quimby has the motivation to establish a company of her own by using her knowledge
of past experiences. Quimby also has a vision and she really knows what she wants and what she is passionate for.
Because entrepreneurs have to believe in what they are doing before they can convince others how great the vision is.
The important thing when you found something innovative is to share it with someone you can trust, someone
who has the qualifications necessary to help move your idea forward (Warlow, n.d.). Quimby knows what she had to
do; she thought of something innovative such as making candles out of beeswax and shared it with Burt. According to
Quimby herself, the company has succeeded so far because they have the commitment to delighting the consumers,
hard work, and a bit of luck (Riccio and Rowland, n.d.)
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Entrepreneurship 1 Case: Roxanne Quimby

5. What should Roxanne and Burt do, and why?

They should stay in North Carolina because there is a large percentage of the country’s population lives within a 12-
hour drive of North Carolina. There are also more supply of skilled labor in North Carolina than in Maine. Moving
back to Maine is not a good decision because it has high transport costs, high payroll taxes, and lack of expertise. In
addition, if they keep the company in Maine, they will stunt its growth.
North Carolina is already the place of several other internationally-known personal care companies, so it is
proven that North Carolina is a good place for such a business (Burt’s Bees’ Official Web Site, n.d.). Burt’s Bees also
had promising leads in North Carolina on a plant manager from Revlon and a sales and marketing manager with
experience at Lancôme, Vogue, and Victoria’s Secret. Quimby’s expertise deficit could largely be solved with these
two experts.

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Entrepreneurship 1 Case: Roxanne Quimby

Reference

Bygrave, W. and Zacharakis, A. (2008), Entrepreneurship, John Wiley & Sons

 Equity Business vs. Lifestyle Business

Mary Sullivan
(http://www.allbusiness.com/business-planning-structures/starting-a-business/3878259-1.html)
2007

 Entrepreneurship: A Primer
Tim
(http://www.soulshelter.com/2008/05/21/entrepreneurship-a-primer/)
2008

 NEN Online

Ideas & opportunity: What Are Ideas & Opportunities?

(http://www.nenonline.org/jsp/idea_opportunity/idea_opportunity_definition.jsp)

2009

 Interview with Burt’s Bees Founder, Roxanne Quimby

Heather Riccio and Hilary Rowland
(http://hilary.com/career/burtsbees.html)
n.d.

 Burt’s Bee’ Official Web Site

(http://global.burtsbees.com)

Oxford Dictionary (2002)

Kotler and Keller, 2009

Sheth 2007

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