ENTREPRENEURIAL

MANAGEMENT

Definition of Entrepreneurship

 The art or science of innovation and risk-

taking for profit in business.

 The practice of starting new organizations or

revitalizing mature organizations, particularly
new businesses generally in response to
identified opportunities.
 Great Moments in
Entrepreneurship
 According to Inc. Magazine, the following are
the significant events happened in the field of
entrepreneurship for the past 30 years:

 1979: MIT researcher David Birch

concluded that a large percentage of new
U.S. jobs are created in small companies.

 1980: Apple goes public thus becoming the

biggest IPO since Ford in 1956.
 1981: Michael Bloomberg is forced out of
Salomon Brothers after a merger.
Fortunately he has this idea for a financial
news service.

 1982: Innovation rate for small companies

is 322 per million against 225 per million
for large companies.
 Great Moments in
Entrepreneurship
 1983: Trip Hawkins prepares to introduce
Electronic Arts games just as Atari collapses
and videogame retailers declare the category
- and themselves - dead.

 1984: Domino’s founder Tom Monaghan buys

the Detroit Tigers who would go on to win the
World Series.

 1985: Wendy’s Old-Fashioned Hamburgers

asked “Where’s the Beef?” and surges against
industry whoppers McDonald’s and Burger
King.

 1986: Michael Dell offered the first toll-free

technical support service.

 1987: Richard Branson crosses the Atlantic in a

hot-air balloon, a stunt he estimates is worth
$40 million in advertising for Virgin.
 Great Moments in
Entrepreneurship
 1988: in a survey of 3000 entrepreneurs
with businesses less than 18 months old,
one-third rates their chances of success as
10 out of 10.

 1991: Starbucks was the first private

company to introduce an ESOP that includes
part-timers.

 1992: U.S. woman-owned businesses employ

more people than the aggregate Fortune
500.

 1993: Microsoft overtakes IBM in market

value.

 1994: Service-company startups surpass

manufacturing startups.

 1995: the first MIT-Lemelson Award goes to

William Hewlett and David Packard.
 Great Moments in
Entrepreneurship
 1997: The Palm Pilot control 2/3 of the
handheld market.

 1998: Research in Motion introduces the

Blackberry.

 2001: idea marketplaces where companies

can go for product concepts and problem
solutions start popping up online.

 2002: as business travel declines,

videoconferencing, web-casting and
satellite services boom.

 2003: Donald Trump’s “The Apprentice”

premieres.

 2004: Burt Rutan’s Scaled Composites

becomes the first private company to build
and launch human beings into space.
 Great Moments in
Entrepreneurship
 2005: Kevin Rose’s content-sharing
website Digg takes off after linking to the
downloaded cellphone address book of
Paris Hilton.

 2006: One million people uses Skype to

make calls over the internet. Founders
Niklas Zennstrom and Janus Friis sold it to
eBay for $2.6 billion.

 2007: Mark Zuckeberg’s 3 year-old

FaceBook is valued at $15 billion.

 2008: Apple releases the developer’s kit

for the iPhone which made the
aftermarket boom.

 2009: Electricity is the future of

automobiles. Tesla Motor’s $109,000
electric roadster caused a buzz at the
Detroit Auto Show.
 Common Themes in
Definitions of
Entrepreneurship

o Individual

o Innovation

o Organization creation

o Creating value

o Profit or not-for-profit

o Growth

o Uniqueness

o Process
 Misconceptions About
Entrepreneurship

o Successful entrepreneurship needs only a great

idea.

o Entrepreneurship is easy.
o Entrepreneurship is a risky gamble.
o Entrepreneurship is found only in small
businesses.

o Entrepreneurial ventures and small businesses

are the same thing
 Men Behind
Entrepreneurship
Eighteenth Century

 Richard Cantillon – originator of the term

entrepreneur

 the risk bearing concept of entrepreneur was

expanded

Nineteenth Century

 Jean Baptiste Say - proposed the difference

between the profits of entrepreneurship from
the profits of capital ownership

Twentieth Century

 Joseph Schumpeter – entrepreneurship involved

innovation and untried technologies or creative
destruction

 Peter Drucker - entrepreneurship involves

maximizing opportunities
 Importance of
Entrepreneurship
o Innovation
 process of creating, changing,
experimenting, transforming, and
revolutionizing.

o Number of New Start-ups

 new firms contribute to economic
development .

o Job Creation
 new ventures created new jobs
 Entrepreneurial Process

Scaling and Conducting

harvesting the opportunity
venture analysis

Determining
Developing
the resources
the plan and
required and
setting up the
implementing
company
the plan

Acquiring
financial
resources
 Types of Entrepreneurs
o Novice Entrepreneur
 no prior experience in business ownership
o Habitual Entrepreneur
 has prior business ownership experience
o Nascent Entrepreneur
 in the process of starting a new business
and can be either a novice or a habitual
entrepreneur
o Serial Entrepreneur
 continues closing of an original business
and then establishing another new
business
o Portfolio Entrepreneur
 retains an original business and builds a
portfolio of additional businesses
 Characteristics of
Entrepreneurs
Demographic Profile of Entrepreneurs
o Family birth order and gender
o Work experience
o Education
o Entrepreneurial family

Personality Profile of Entrepreneurs

o High level of motivation
o Abundance of self-confidence
o Ability to be involved for the long term
o High energy level
o Persistent problem solver
o High degree of initiative
o Ability to set goals
o Moderate risk taker
 The Rewards and
Challenges of Being an
Entrepreneur
Rewards

o High degree of independence

o Opportunity to use a variety of skills and

talents

o Freedom to make decisions

o Accountability to yourself alone

o Opportunity to tackle challenges

o Experiencing feeling of achievement and pride

in accomplishing goals

o Potential for greater financial rewards

 The Rewards and
Challenges of Being an
Entrepreneur
Challenges

o Be comfortable with change and uncertainty

o Make a bewildering number of decisions

o Face tough economic choices

o Be comfortable with taking risks

o Need many skills and talent

o Be comfortable with potential of failure