Entrepreneurship
Strategic thinking and risk taking behaviour that results in new opportunities
Entrepreneur
Risk taking individual who takes action to pursue opportunities others fail to recognize or view as problems or threats
Characteristics of Entrepreneurs
- Internal Locus of Control
- High Energy Level
- High need for achievement
- Tolerance for Ambiguity
- Self Confidence
- Passion and Action Oriented
- Self relience and desier for independence
- Flexibility
Necessity-Based Entrepreneurship
Takes place because other employment options don’t exist
Small Business
Has fewer than 100 employees, in independently owned and operated, and does not dominate its industry.
Franchise
A form of business where one business owner sells to another the right to operate the same business in another location
Family Business
Owned and controled by members of a family
Family Business Feud
Family members have major desagreements over how the business should be run
Succession Problem
Issue of who will run the Business when the current head leaves
Succession Plan
Describes how the leadership transition and related financial matters will be handled
Why Many Small Business Fail
- Lack of experience
- Lack of Expertise
- Lack of Stratergy and Stratergic leadership
- Poor financial control
- Growing too fast
- Insufficient commitment
- Ethical Failure
First Mover Advantage
Comes from being first to exploit a niche or enter a market
3 Stage of Entrepreneurial Firms
- Birth Stage
- Breakthrough Stage
- Maturity Stage
Challange of Birth Stage
- Establishing the firm
- Getting Customers
- Finding the money
Challanges of Breakthrough Stage
- Working on Finances
- Becoming Profitable
- Growing
Challanges of the Maturity Stage
- Refining the strategy
- Continuing Growth
- Managing for success
Business Plan
Discribes the direction for a new business and the financing needed to operate it
Sole Proprietorship
A form of business where an individual pursues a profit
Partnership
A form of business where two or more people agree to contribute resources to start and operate a business together
Corporation
A lagal entity that exists separately from its owner
Limited Liability Corporation
A hybrid business form combining adventages of the sole proprietorship, partnership, and corporation
Debt Financing
Involves borrowing money that must be repaid over time, with interest
Equity Financing
Involves exchanging ownership shares for outside investment monies
Venture Capitalists
Make large investment in new ventures in return for an equity stake in the business
