APT2053

CHAPTER 1
ENTREPRENEURIAL PROCESS
Demystifying Entrepreneurship

 Entrepreneurship is a way of thinking, reasoning, and acting that

is opportunity obsessed, holistic in approach, and leadership
balanced for the purpose of value creation and capture. – Jeffry
A.Timmons

 Entrepreneurship results in the creation, enhancement,

realization, and renewal of value, not just for owners, but for all
participants and stakeholders.
Demystifying Entrepreneurship

 Today entrepreneurship has evolved beyond the classic start-up

notion to include companies and organizations of all types, in all
stages.

 Entrepreneurial leaders inject imagination, motivation,

commitment, passion, tenacity, integrity, teamwork, and vision
into their companies
 VALUE CREATION : THE
DRIVING FORCES
 Fundamental entrepreneurial process accounts for the substantially greater
success pattern among higher potential ventures.

 Dynamic entrepreneurial process:

- It is opportunity driven
- It is driven by a lead entrepreneur and an entrepreneurial team
- It is resources parsimonious and creative
- It depends on the fit and balance among these
- It is integrated and holistic
- It is sustainable
VALUE CREATION : THE
DRIVING FORCES
 Founders and investors focus on these forces during their careful
due diligence to analyze the risks and determine what changes
can be made to improve a venture’s chance of success.
THE TIMMONS MODEL: where
theory and practice collide in the real
world
 How can aspiring entrepreneurs-and the investors and associates who
join the venture-get the odds of success on their side?

 What do these talented and successful high-potential entrepreneurs,

their venture capitalists, and their private backers do differently?

 What is accounting for their exceptional record? Are there general

lessons and principles underlying their successes that can benefit
aspiring entrepreneurs, investors, and those who would join a venture?
If so, can these lessons be learned?
THE TIMMONS MODEL: where theory and
practice collide in the real world

Sources : The Timmons Model of the Entrepreneurial Process, New Venture

Creation, Stephen Spinelli Jeffry A.Timmons, 9th Edition
 THE TIMMONS MODEL: where theory
and practice collide in the real world

 In the entrepreneurial process depicted in the

Timmons Model, the shape, size, and depth of the
opportunity establish the required shape, size, and depth of both the resources
and the team.
 The Opportunity : Successful entrepreneurs and investors know that a good
idea is not necessarily a good opportunity. (market segment)
 Resources: Creative and Parsimonious: Need to have all the resources in
place, especially the money, to succeed with a venture. (relationship)
 THE TIMMONS MODEL: where
theory and practice collide in the real
world
 The Entrepreneurial Team-
entrepreneurial team is a key ingredient in the higher potential venture.
(passion)
 THE DEFINITION OF NEW
VENTURE
 New venture creation is the organizing (in the Weickian sense) of new organizations. "To organize is
to assemble ongoing interdependent actions into sensible sequences that generate sensible outcomes"
(Weick, 1979, p. 3).

 The definition of new venture creation is synonymous with the definition of the new organization
developed by the Strategic Planning Institute (1978, p. 1-2): a new business venture launched as one
of the following:
 1. An independent entity
 2. A new profit center within a company which has other established
businesses, or
 3. A joint venture which satisfies the following criteria:
- Its founders must acquire expertise in products, process, market and/or
technology.
-Results are expected beyond the year in which the investment is made.
- It is considered a new market entrant by its competitors.
- It is regarded as a new source of supply by its potential customers.
 THE DEFINITION OF NEW
VENTURE

Sources: A Conceptual Framework for Describing the Phenomenon of New Venture

Creation, Author(s): William B. Gartner, Vol. 10, No. 4 (Oct., 1985), pp. 696-706
 Difference between new venture, start-
up & enterprise
NEW VENTURE
Sources A Conceptual Framework for
Describing the Phenomenon of
New Venture Creation, Author(s):
William B. Gartner, Vol. 10, No. 4
(Oct., 1985), pp. 696-706
Definition Processes have used different
terminology to describe the
temporal sequences of events or
activities that occur as
entrepreneurs create a new
organization
START-UP
The Role of Knowledge in Business
Start-up Activity, Dirk De Clercq
and Pia Arenius , International
Small Business Journal 2006; 24;
339
Business in the form of a company,
a partnership or temporary
organization designed to search for
a repeatable and
scalable business model. These
companies, generally newly created,
are in a phase of development and
research for markets
ENTERPRISE
The Lean Entreprise : How
Corporations Can Innovate Like
Startup, Trevor Owens, Obie
Fernandez, Published By
Wiley,2013.
An undertaking, especially one of
 some scope, complication, and ri
sk. A business organization.
Willingness to undertake new ven
tures; initiative: "Through want of
 enterprise and faith men are whe
re  they are, buying and selling
and spending their lives like serfs
"  (Trevor Owens)
 REFERENCES
  Lussier R.N., Corman J. & Kimball, D.C. (2015). Entrepreneurship New Venture
Skills, 3rd Edition. Routledge Taylor & Francis Group

 Spinelli, S. & Adam (2012). New Venture Creation: Entrepreneurship for the 21th
Century, 9th Ed. McGraw Hill International Edition.

 Gartner (1988)- “Who is an entrepreneur?” Is the wrong question.