KSU ENTR 27056 - Chapter 1: Understanding Entrepreneurship

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Introduction to EntrepreneurshipLaunching New Ventures (Allen 5th Edition)Chapter 1: Understanding Entrepreneurship Entrepreneurship is a mindset that is- Opportunity focused- Innovative- Growth orientedAnd is a set of behaviors:- Recognizing opportunities- Gathering resources to act on opportunities- Driving opportunities for to completionThe entrepreneurial process affected by 3 major categories1) The individual entrepreneur (what they bring to the process)2) The entrepreneurial environment (markets, industries, suppliers)3) The organization Entrepreneurs contribute to : - Technological change- Higher productivity - Economic growthby discovering: - Emerging consumer segments- New customer needs- Unsatisfied existing needs- New methods of distribution/manufacturingOutcomes of Entrepreneurship1) Economic growth (technological innovation= engine of growth)2) Job Creation(99.7% of U.S employees make up small businesses)3) New industry formation (new industries born when technological change produces new opportunities- Disruptive technologies destroy previous technologies and create new industriesEx) vinyl 8 track cassette tape cd digital musicPrimary Characteristics of Entrepreneurial Venture1) Innovative2) Value Creating3) Growth Oriented*entrepreneurship process= nonlinear, nonsystematicMilestones to Measure Progress of Venture:- Deciding to start a business- Researching the concept- Obtaining business/licenses/formal administrative set up - Preparing launch- Securing the first customer- Other activities that signal business Is in operationENTEPRENEURSHIP- the act of starting a new business or revitalizing business activities of an existing organizationINTRAPRENEUR- person already with in a firm/company in charge of developing new products/business ideas for the company*2/3 of new businesses survive at least 2 years- Failure rates tend to decline with age of business - long term firm display superior levels of reliability, accountability in performance, processes, and structureNew Business Survival Attributed:1) Sufficient capital2) Having employees3) Intentions/goals in starting the business*CRITICAL- minimizing cost of possible failure INSTEAD OF avoiding failure itself Entrepreneurial Evolution1960’s- Bigger=better- Diversification- Job security1970’s- Macroeconomic turmoil- International competition- Technological revolution - Deregulation1980’s- Decade of entrepreneurship- Solo entrepreneur- Lean and mean- Takeovers- Small firm innovationToday’s Entrepreneurial Trends- Women make up 1/3 of global entrepreneurial activity- Minorities make up 15% of all U.S business- Business efforts towards social responsibility/ accountability to society- Internet entrepreneurial activity (access to info; personalization)- Globalization(increased competition and ability to compete globally)1990’s- Age of Information- No job security- Fewer benefits- Service firm growth- Creative financing - Team entrepreneurship 2000’s- Knowledge of econ- Rebirth of commercial internet- Renewed biotech/medical interests- Low transfer costs- Emergence of news media


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KSU ENTR 27056 - Chapter 1: Understanding Entrepreneurship

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