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Entrepreneurial Traits (Maryland Study)

-Tenacity (Industriousness) Perseverance, determination, resilience Dealing with failures-constantly -Passion (Passion) For the product, chasing the opportunity Intrinsic drive -Tolerance of Ambiguity Within uncertainty & risk failure Risk taking -Vision Ability to spot opportunities Curiosity to see & fix problems See the future of the market -Self-belief Self-confidence Product & Self -Flexibility Adaptation Recognition & Ability to pivot -Rule Breaking

Distinguishing features of an entrepreneurial ecosystem ?

A core of large established businesses - can include entrepreneurial blockbusters (large, entrepreneur-led businesses) Entrepreneurial recycling - successful cashed out entrepreneurs reinvest their time, money, and expertise in supporting new entrepreneurial activity An information-rich environment in which information is accessible and shared Presence of large firms, universities, and service providers

entrepreneurial ecosystem

A specific configuration of the environment that reflects the components that are most central to developing a strong and active community of start-up businesses. The components are entrepreneurs, government, universities, investors, service people, mentors, and large organizations.

What do these traits mean for you?

Action: No Business Plan; plan on the go; plan change Insecurity is good to take risks Crafty: Resourceful, create resources yourself Hot water: Take risks Malleable: accept changes Navel gazing: feedback Outsider: excluded As an entrepreneur, important to know yourself Know your strengths - what you do well Know your limits & Identify: What challenges you need to change (strengthen) When you need to bring in a partner (complement)

Intrapreneur

Anyone who engage in entrepreneurial initiatives is an entrepreneur. :with role of creating new ventures/products They know the company politics and they are able to make things happen in large organizations

Validated Learning

Ask key questions: Should this product be built? Can we build a sustainable business around it? Try to find the real insights Zero results (complete failure) can help validated learning; small results can lead to escalation of commitment Adopt an experimental approach Launch an early prototype, charge customers from day one, have low-volume revenue targets for accountability

Tips about customer interviews

Build a frame around learning, not pitching -only a brief and objective explanation of your idea is enough Let the customer do the talking! Don't lead them to a certain response; don't correct them. Don't ask customers what they want. Measure what they do! Don't try to catch their lies Probe for further insights

Lean Startup

Building a start-up is an exercise of institution building; thus it necessarily involves management. Entrepreneurs are skeptical of using traditional management practices because they will invite bureaucracy and slow down creativity and innovation Entrepreneurship still requires a managerial discipline to harness the opportunity. Lean Startup asks people to start measuring their productivity differently. The goal of a startup is to figure out the right thing to build - the thing that customers want and will pay for - as quickly as possible.

Innovation vs. Creativity

Creativity: ability to generate new ideas Innovation: systematic process of creating value out of creative ideas

Myths about entrepreneurs

Doers not thinkers Born not made Must be inventors Social misfits Fit a "profile"

Members of the ecosystem?

Entrepreneurial actors within the ecosystem Resource providers within the ecosystem Entrepreneurial connectors within the ecosystem Entrepreneurial environment of the ecosystem

Why is Creativity Important?

Good that results: individual, org/group effectiveness & survivability, successful ventures, economic well-being "Core necessity for success in profoundly changing organizational world." Generator, facilitator, "savior" of ambiguous new world Enables us to INNOVATE and CHANGE

Zappos

Hypothesis: customers are ready and willing to buy shoes online Test: ask local stores to take pictures, in return purchased item at full price if the item is bought online Experimentation process: to sell had to interact with customers: payments, returns, customer support * This is way different than market research or survey: more accurate data on demand, interactions with real customers, learned unexpected reactions from customers Outcome: customers were in fact ready to shop shoes online

Where do ideas come from in an organization?

Ideas come from everywhere Top-down (strategic motives) Down-top (individual interests in solving personal problems) External networks (acquisitions, strategic alliances) Need enablers (systems to identify ideas and enable focusing on best ones)

How is innovation a survival imperative?

If an organization doesn't change what it offers the world and the ways in which it creates and delivers its offerings it could well be in trouble. Innovation contributes to competitive success in many different ways: it's a strategic resource to getting the organization where it is trying to go, whether it is delivering shareholder value for private sector firms, or providing better public services, or enabling the start-up and growth of new enterprises.

Experimentation

If you 'just do it' without experimenting to see what happens, you will definitely see what happens; but it is likely to be a failure and won't lead to validated learning

What is innovation about?

Innovation is about growth- about recognizing opportunities for doing something new and implementing those ideas to create some kind of value. At its heart is the creative human spirit, the urge to make change in our environment.

Entrepreneurship

It is a dynamic process of vision, change, and creation. It requires an application of energy and passion toward the creation and implementation of new ideas and creative solutions. Essential ingredients include the willingness to take calculated risks, the ability to formulate an effective venture team, the creative skill to marshal needed resources, the fundamental skill of building a solid business model, and finally the vision to recognize opportunity where other see chaos.

Where do innovations come from?

Knowledge push & need pull Absorptive capacity Making processes better Identifying niches Users as Innovators Mass Customization External shocks to the system Watching others Recombinant innovation Regulations Alternative futures and forecasting Accidents

Where to find a good problem?

Look at what we already have/know Tap into nature Go to the unfamiliar

Factors Defining Abilities of a Firm

National system of innovation in which the firm is embedded in. Firm's power and market position within the international value chain Capability and processes of the firm Firm's ability to identify and exploit external sources of innovation

Validated Learning

Not after the fact realization or a good story to hide failure It is a rigorous method for demonstrating progress when one is embedded in the soil of extreme uncertainty Demonstrate empirically that team is discovering valuable truths about start-up's prospects More concrete, accurate & faster than market forecasting or classical business planning

Solution Interview

Objectives: Customer risk: Who has the pain? (early adopters) How will you identify early adopters? Product risk: How will you solve these problems? (solution) What is the minimum feature set to launch? Market risk: What is the pricing model? (revenue streams) Will customers pay for a solution? What price?

Problem Interview

Objectives: Product risk: What are you solving? - problem Market risk: Who is the competition? - existing alternatives Customer risk: Who has the pain? - customer segments Formulate falsifiable hypotheses and test them

Entrepreneurial Motivation

Personal Characteristics Personal Environment Personal Goals Business Environment IDEA

What is the profile of an Entrepreneur?

Personality type = All kinds Certain traits = more prevalent More Open to experience (curiosity, innovation) Higher Conscientiousness (self-discipline, motivation) Lower Neuroticism (tolerating stress) Face challenging environments . . . Resource shortages Extreme Uncertainty Rapid change

What is Market Research Techniques

Primary data: Survey In-depth interview Secondary data: Public sources (state and metropolitan area data book, statistical abstract of the US, US industry and trade outlook) Commercial sources (research and trade associations, banks, financial institutions, publicly traded corporations) Educational institutions (universities, colleges, and technical institutes) Online sources (e.g., marketresearch.com)

Marketing & Distribution Plan

Projecting market share (look at industry growth rate and conversion of users from the total market) Pricing (consider costs, demand, competitors' prices, customer expectations, product utility & differentiation) cost-plus pricing, demand pricing, competitive pricing, markup pricing Distribution Direct sales, manufacturer's representatives, wholesale distributors, brokers, retail distributors, direct mail, website, mobile devices Promotion Advertising, packaging, public relations, sales promotions, personal sales, online marketing, mobile marketing, social media Sales Potential (conclusions of market research and plan) Total number of people you project to sell * average revenue per customer = Sales Projection

What are the characteristics of a Good problem?

Significant Socially responsible Comprehensible Open to experimentation Ambitious yet achievable Authentic

Globalization of Innovation

Technology and innovation are not evenly distributed across the world. Different national contexts have different implications on firms' ability to absorb and exploit innovation. Position of firms in international value chains has crucial implications on their ability benefit from their innovative efforts. Global changes democratizes environment for entrepreneurship Non-traditional entrepreneurship

What is Market Research?

The process of gathering, analyzing and interpreting information about a market, about a product or service to be offered for sale in that market, and about the past, present and potential customers for the product or service; research into the characteristics, spending habits, location and needs of your business's target market, the industry as a whole, and the particular competitors you face.

Innovation definition

The process of translating ideas into useful - and used - new products, processes or services.

Creativity

The tendency & ability to generate or recognize ideas, alternatives, or possibilities that may be useful in solving problems, communicating with others, and entertaining ourselves and others

Why not surveys or focus groups? How to get out of the building?

You don't know the right questions and answers You can't see the customers Focus groups are group thinking! (remember Asch experiment) Surveys can be used to verify interview findings (validation: qualitative followed by quantitative) Get out of the building! Life is too short to build sth nobody wants! How?

A core competency is

a competency of the business that is essential or central to its overall performance and success.

A startup is:

a human institution designed to create a new product or service under conditions of extreme uncertainty Whole startup ecosystem is important regardless of company size, sector, or stage of development.

What is globalization?

a process of interaction and integration among the people, companies, and governments of different nations, a process driven by international trade and investment and aided by information technology. This process has effects on the environment, on culture, on political systems, on economic development and prosperity, and on human physical well-being in societies around the world.

A competency is

anything a business does well.

A distinctive competency

is any competency that distinguishes a company from its competitors. While a distinctive competency can be any competency, core or otherwise, it is typically a core competency that truly distinguishes a company from the rest of the competition

Prerequisites for Entrepreneurship:

proper team structure, good personnel, strong vision for future, and an appetite for risk taking

Scientific experimentation:

should be falsifiable, should have clear hypothesis (predictions of what you expect to happen), empirically test predictions, theory is vision of the startup

What are the domains of an entrepreneurial ecosystem?

• Conducive culture • Enabling policies and leadership • Availability of appropriate finance • Quality human capital • Venture-friendly markets for products • A range of institutional and infrastructural supports