ENTREPRENEURSHIP

NEU Dr. Jean Dautrey ENT501

Recognizing an Opportunity
 It is important first to understand
first the differences between
opportunities and ideas
 Idea = a thought, an impression, or
a notion
 Opportunity = a favorable set of
circumstances that creates a need
for a new product, service or business
 Entrepreneurial people are always
generating ideas for potential
businesses (e.g. living on the moon…)
 BUT not all of them represent true
business opportunities

 The recognition of a business opportunity is

the first step in the entrepreneurship process
Where to Look for Opportunities?
 Opportunities for profitable
enterprises are always opening in
free-market economies and..
 Alert entrepreneurs are eager to
identify them…

So, where are the best places to look?

 The answer is to look…
1.Where things are
changing
2.Under the radar of big,
powerful companies
Where to look?…

1.Where Things Are

Changing
2. Under the radar of big, powerful companies
 To uncover entrepreneurial
opportunities, one can look in areas of…
1) New knowledge and
technological change – high-tech
start-ups
2) Changing regulations – regulatory
change creates business
opportunities (e.g. low-cost
airlines…)
Entrepreneurship and Technological Change
3)Social turmoil and civic failure –
When the public sector fails in its
responsibilities (rising crimes,
mediocrity of public school systems)….
 People often take those
responsibilities in their own
hands and patronize companies
that can help them
4) Changing tastes – big companies’ slow
response to changing taste as they
are…
 Consumed with operational details.
This results in unmet needs that
entrepreneurs can exploit (e.g. beer
from micro breweries)
 Watching trendsetters can help
spot opportunities
5) The quest for convenient solutions –
Urban life provides many households
with substantial discretionary income
but has robbed them of discretionary
time. As a result, they are receptive to…
 Convenient solutions to life’s
annoyances and will gladly pay for a
variety of services (many no longer have
servants to handle these many chores so
they outsource them)
6)The pandemic – Everybody is
concerned with being infected and
wants to protect against the disease.
 Key issues are hygiene, health,
germs (behavorial
changes)…
 Time to rethink public toilets,
door opening devices, etc...
Where to look?…
1. Where Things Are Changing

2.Under the Radar of Big,

Powerful Companies
2. Under the Radar
 Another place to look for promising
opportunities is under the radar of huge
corporations as…
 They are handicapped in dealing with
what are, to them, small business
opportunities
 Their human and physical assets are
configured to address large markets
 Thus many worthy projects are rejected
As a result, large companies…
 Often reject profitable
opportunities because they are
“too small”…
 They can be exploited by the
entrepreneurial individual

 A good example is W.L. Gore & Associates an

innovative privately-held company
 The founder, Bob Gore, worked as a
scientist for Dupont Corp., a huge
chemical firm, where he developed
polytetrafluoroethylene (PTFE) BUT…
 Dupont had no interest investing in his
PTFE idea…

 Bob Gore bought the patent and went

into business on his own
 The enterprise was initially set out to
explore market opportunities for
fluorocarbon polymers but a few years
later…
 Bob Gore discovered that PTFE created
a very strong , microporous material
which offered a range of new, desirable
properties
 Gore-Tex was introduced in 1976
 The opportunity discarded by Dupont
turned out to be a gold mine for an
entrepreneurial scientist like Bob Gore…
 He is one of many managers and
engineers who leave their companies to
exploit projects that…
 Their employers have rejected as too
small (revenue potential perceived as too
small)
 New improved methods of making
Gore-Tex fabric were later introduced
 There has been an explosion in
sales of Gore-Tex related
products

 W.L. Gore ranks in the top 200 of the Forbes top

500 privately held companies. It has 7,000
associates over 45 locations around the world
 Ironically, the big, inflexible
corporations that will not pursue small,
entrepreneurial ventures often end
up….
 Writing huge checks to acquire the
same ventures after they have grown
substantially (e,g. Snapple acquired by
Pepsi’s unit, food giant Quaker)
It is also important to note that…
 Large companies also often ignore
existing small markets, niche markets,
those that address….
 The needs of a particular group of
people (e.g. big and tall, most brands
do not want to bother carrying big
sizes as economies of scale are
limited)…
 Opportunities for entrepreneurs
Methodology:

Three Ways to Identify

Opportunities
 There are three approaches that
entrepreneurs can use to identify an
opportunity
1. Observing trends
2. Solving a problem
3. Finding gaps in the marketplace
Observing Trends
 The most important trends to
follow are…
 Economic trends
 Social trends
 Technological advances
 Political action
 Regulatory changes
 Trends are interconnected and even
though we discuss each individually,
they should be considered
simultaneously
 As an entrepreneur, it is important to
remain aware of these changes in these
areas and also…
 To distinguish between trends and
fads…
Solving a Problem
 Recognizing problems and finding ways
to solve them is another possible approach

 Problems can be recognized by…

 Observing the challenges people
encounter in their daily lives and…
 Through intuition, serendipity, or
chance
 There are many problems to be
solved...
 People complain about how it is hard
to sleep through the night, get rid of
clutter in their homes, get rid of
garden weeds…..

“Every problem is a brilliantly disguised

opportunity”
 Advances in technology often result in
problems for people who can’t use the
technology in the way it is sold to the
masses, for example…
 Older people with cell phones (small buttons,
hearing…)
 People using mat for yoga (slippery)…
 Web-based service that helps parents protect
their children’s online reputation and
privacy….
 Businesses Created to Solve a Problem
Problem
People traveling do not have
ready access to their
children’s medical records,
which may be needed if the
child gets injured or sick.
There is no easy way for
residents of a city to report
quality-of-life issues, such as
graffiti or an abandoned car.
Concrete block construction
takes time and requires
water. A building built with
concrete blocks cannot be
occupied immediately
because the building’s mortar
need time to cure.
Solution
Create an online platform that can be pulled
up from any Web browser or on a
smartphone that provides access to a child’s
full medical history.
Create an online platform that allows a
resident to take a photo of the problem,
send it to a central clearinghouse in city
government, who will alert the appropriate
city agency to fix the problem.
Alter traditional methods of concrete block
construction to enable the assembly of the
block to be completed in a manner that
requires no water, has immediate
occupancy, and is faster than current
procedures.
Finding Gaps in the Marketplace
 There are many examples of products
that consumers need or want that are
not available in a particular location or
are not available at all as…
 Large retailers leave gaps in the
market as…
 They focus on the most popular items
targeted toward mainstream
consumers
 Product and service gaps in
the market represent…
 Potentially viable business
opportunities
 Businesses Created to Fill a Gap

Gap in the Resulting New Business Opportunity

Marketplace
Lack of toys and toy Toy stores, toy manufacturers, websites
stores that focus on a that sell educational toys, and toy and
child’s intellectual smartphone app combinations
development

No fitness centers 24-hour fitness centers to accommodate

that are open 24 people who work odd hours
hours a day

Shortage of clothing Retail stores that sell fashionable

stores that sell clothing for hard-to-fit people, including
fashionable clothing plus-sized clothing or clothing for tall or
for hard-to-fit people short people
THANK YOU FOR YOUR ATTENTION