CREATING AND STARTING THE

ENTREPRENEURIAL VENTURE
CREATION OF VENTURE IDEAS
GENERATION OF VENTURE IDEAS: BUSINESS
OPPORTUNITY IDENTIFICATION
ENVIRONMENTAL ANALYSIS
 What is the condition of our surroundings

External Environment
Comprises factors out of an organization’s

control
Internal Environment
Comprises resources and capabilities that

could either be tangible or not

EXTERNAL ENVIRONMENT
 DEMOGRAPHIC
 ECONOMIC

 POLITICAL/LEGAL

 SOCIO-CULTURAL

 TECHNOLOGICAL

 GLOBAL

 INDUSTRY

 COMPETITOR
INTERNAL ENVIRONMENT
CAPABILITIES
TANGIBLE INTANGIBLE
FINANCES HUMAN
ORGANIZATIONAL INNOVATION
PHYSICAL REPUTATIONAL
TECHNOLOGICAL
LIMITATIONS
THE SWOT ANALYSIS
• Evaluates both the internal and the
external environments
• Identifies the strengths,
weaknesses, opportunities and
threats
TECHNIQUES TO GENERATE VENTURE
IDEAS
MARKET NEEDS
MARKET NEEDS
 Goods/ services to cater human needs
 Aging, health
 Mobility
 Food and population
 Shelter
 Energy substitute for human effort (automate)
 Communications
 Entertainment/leisure
 Natural environment
 Community
 Learning, lifelong education
TAKE ADVANTAGE OF AVAILABLE RESOURCES
 Raw materials
 Local specialized skills
 Industrial information
 Technology advancements
SUPPLY-DEMAND GAPS
DEMAND
 Determine past demand using any of the
following:
 primary data
 secondary data
 consumption data
 actual sales of target product
 Determine current demand using:

 direct method
 chain ratio method
SUPPLY-DEMAND GAPS
DIRECT METHOD
Total demand = B x Q x P
where: B is the number of buyers
Q is the average quantity purchased per buyer
P is the price per unit of the product
CHAIN RATIO METHOD
Total demand = A x C x I
where: A is the population in a given area
C is the percentage of A who can afford to buy
I is the percentage of C who are interested to buy
SUPPLY-DEMAND GAPS
SUPPLY
 Identify how many competitors are already in business
with similar or substitute products
 Determine your theoretical market share vis a vis
competitors
 Analysis of DEMAND versus SUPPLY will result into
three possibilities:
 Demand is less than supply

 Demand is equal to supply

 Demand is greater than supply

FORWARD-BACKWARD INDUSTRY LINKAGES
 Pick up ideas from existing business operations
SCREENING OF BUSINESS IDEAS

 Capital requirements
 Degree of risk involved

 Technical know how

 Degree of competition

 Potential return on investment

 It should be a business that you enjoy

doing
POSSIBLE TYPES OF BUSINESS VENTURES
 Increasing product/service value
 New applications of technology

 Creating new market/blue oceans

 Customizing

 Increasing reach/presence

 Process innovation

 Supply chain improvement