into. to e-ship

make adjustments

Most entrepreneurs' ideas change and evolve over time. Their success comes from being able to execute their vision and ____ as necessary.

Economic Forces

•State of the economy ~ Are people spending or saving right now? •Even if people aren't spending right now, is there an opportunity to help consumers and businesses save money? Ex: GasBuddy •Who has the money and how are they spending it? Ex: More women in the workforce = more online retailers Ex: Baby Boomers retiring with more disposable income = more spending on travel, healthcare

Earth's Resources

Sustainable businesses should consider the impacts of their actions on four key resources: •Energy, biodiversity, water, and soil Biodiversity strengthens the overall health of the planet and provides vital benefits to humans. It also protects other natural resources, including water and soil.

NOT linear

The Entrepreneurial Process is

Business Concept

The Product/Service •What does the customer need? •What solution am I providing for the customer? •What is the founding team's core competency (can it create and deliver the product/service)? •The Distribution Channel •How will the benefit be delivered to the customer? •Is the distribution channel the innovation in and of itself?

Research has failed to identify a "stereotypical" entrepreneur.

The Truth About Entrepreneurs

Financial Sustainability

The ability of private firms to generate the profits and cash flow needed to sustain their business operations

risk averse

The best entrepreneurs are extremely ___, testing everything before they make a move to make sure they're making the best decisions.

•An Entrepreneurial Venture brings something NEW to the marketplace

The difference between a typical small business and an entrepreneurial venture:

independence create something new

The number one reason entrepreneurs start businesses is to fulfill their need for _____ or their need to ________.

Reconciling Limits and No Limits to Growth

The relevance of these theories to sustainable business: •The earth does have limited resources and human activity can negatively impact these resources •Because of the interference of government, market forces do not always effectively provide signals to society of resource scarcity (Example: Low government-set grazing fees on federally-owned land) •Markets often fail to properly price natural resources that are treated as free goods (Example: Water provided by glacial melt)

•Innovative •Value-creating •Growth-oriented

The three primary characteristics of an Entrepreneurial Venture:

can

There is a lot about entrepreneurship that ____ be taught.

•Government actions are constantly changing and are part of the dynamic environment for all businesses.

They have specific and important impacts on businesses focused on sustainability.

Downstream Activities

Those associated with selling the product or service such as customer acquisition, sales transactions, installation and delivery logistics

Upstream Activities

Those related to the production of a product or service, which may include product development, raw material procurement, manufacturing, and warehousing

not essential

While there is no question that lenders and investors want to see a business plan, it is, in fact, _____ to have a formal plan in place before starting a business.

The Science of Sustainability

•Sustainability requires an understanding of the complex cultural, environmental, and economic interrelationships existing among humans, human organizations and natural systems •Two contrasting perspectives of human economic interaction with environment: •Ecological limits to growth •No limits to growth

Technological Forces

•Technological forces are usually responding to economic and social forces. Ex: A focus on health and wellness + time poverty = wearable technology (Fitbit) •Technological advances provide opportunities to help consumers better perform their tasks. Ex: GPS

Business Concept: Definition of the Customer

•The customer is the one who pays. •The end user is as important as the intermediary customer. •Example: Medical devices. Products are developed for the end user (patients) but the doctors/hospitals buy the equipment. •The customer determines all of the other components - what will the entrepreneur offer, what will the value proposition be, and how will the benefit be delivered.

Public Policy

•The decisions made and actions taken by government in regard to a particular issue or set of issues

Hole or Gaps in the Market

•There are many customer needs and wants in the marketplace that large businesses don't fulfill due to economies of scale. Ex: No guitars for left handed people = Southpaw Guitars •Customers become frustrated because they can't find a product or service that they want or need Ex: No 24 hour fitness places = Anytime Fitness

"Entrepreneurship will give me complete control over my schedule."

•Well, yes and no. •While founders may not have to punch a time clock, they are often slaves to their businesses for the first few years. •However, most who dive into entrepreneurship are passionate about their mission and love what they do, so working long hours often doesn't matter to them.

Areas To Be Analyzed andQuestions To Ask: Industry and Market

•What are the demographics, trends, patterns of change, and life cycle stage of the industry? •Are there any barriers to entry? If so, what are they? •What is the status of technology and R&D expenditures? •What are typical profit margins in the industry? •Who are the opinion leaders in the industry and how do they affect the industry? •What are distributors, competitors and retailers saying about the industry? •What are the demographics of the target market? •What is the profile of the first customer? Are there other potential customers? •What do potential customers say? •Who are your competitors, and how are you differentiated from them?

Areas To Be Analyzed andQuestions To Ask: Product and Service Development and Intellectual Property

•What are the features and benefits of the product or service? •What product/service development tasks must be undertaken and what is the timeline for completion? •Is there the potential for intellectual property? •How is the product or service differentiated from others in the market?

Areas To Be Analyzed andQuestions To Ask: Start-up Financials

•What are your start-up capital requirements? •What are your working capital requirements? •When will revenue first be generated? •How long will it take to achieve positive net income and positive cash flow once revenues are generated? •What is the break-even point for the business?

Areas To Be Analyzed andQuestions To Ask: The Founding Team

•What experience and expertise does the team have? •What are the gaps and how will you fill them?

Areas To Be Analyzed andQuestions To Ask: Business Model

•What is the value proposition? •Who is the customer? •What is the product/service being offered? •What does the value chain look like? •Which distribution channel alternatives are available, and which customers will be served by each? •How exactly will this business make money?

Greenwashing

•When a product or service is sold as green or environmentally-friendly using deceptive claims

Entrepreneurial Trends

•Women and minority-owned businesses •Senior Entrepreneurs •Young Entrepreneurs •The Internet •Globalization •Social Responsibility

Women and minority-owned businesses

•Women-owned businesses comprise 1/3 of all entrepreneurship activity globally •15% of all U.S. businesses are minority-owned.

Sustainability Reporting

•You can only manage what you measure •Two goals of sustainability reporting: •Document and assess an organization's environmental, economic and social impact •Communicate a company's sustainability efforts and progress to its stakeholders •Sustainability reporting is challenging; not an easy or low-cost activity •The most visible form of sustainability information communication is in a company's annual corporate sustainability report

Globalization

•brings global competition, but also the opportunity to compete globally!

Government and public policies

•establish the legal system and the specific rules under which all businesses operate

feasibility analysis

an assessment of a potential business rather than strictly an assessment of a product or service idea.

In the 1960's

big companies thrived and job security was at its historical height. Circuit City, Walmart, Pizza Hut and Toys R Us were thriving after starting in the 1950's

The 1980's (the modern decade of entrepreneurship)

brought continued deregulation at a time when many talented people in their most productive work years were suddenly finding themselves unemployed.

The 1970's

brought international competition and economic turmoil, ultimately resulting in massive layoffs.

The 2000's

brought mass use of the internet and related technologies and made the world a much smaller place, and a much more competitive business environment.

The 1990's

brought us the internet and a much increased number of service firms vs. product firms.

Sustainability Entrepreneurship

builds on the basics of entrepreneurship and extends it to additionally addressing ecological and social concerns through the creation of new enterprises and innovation in existing enterprises • •A key for successful sustainability entrepreneurs is to ensure that their innovations provide real value • •Social entrepreneurs engaged in for-profit ventures are those most concerned with creating shared value - real value to both society and the customer that benefits the for-profit venture

The Internet

certain to be the center of major entrepreneurial trends for a long time to come

Social Responsibility

important to companies, their employees and their customers

The quick look

is an effective way to choose between several business ideas. The quick look doesn't deal with financial projections because the purpose of the quick look is to weed out concepts that don't meet the market test. Only after completing a successful quick look is it time to do the serious research it takes to complete a feasibility analysis.

Definition of Entrepreneurship

the pursuit of opportunity without regard to resources currently controlled

Enlightened Self-Interest

•A business philosophy where a business "does well" (is successful financially) by "doing good" (helping others and the environment)

Creating Shared Value

•Acting to provide meaningful benefit to society as well as value to the business

Sustainability

•An idealized state of human fulfillment, satisfaction, health and prosperity that exists from generation to generation •Meets the needs of the present generation without compromising future generations •Balanced interaction of society, environment and economics •

Intrapreneurship

•Applies the entrepreneurial mindset characterized by innovation, risk taking and flexibility to an established firm •The objective is to enhance the ability of an established firm to react to market opportunities in a timely and effective manner, much like start-up ventures do •Intrapreneurship is entrepreneurship from within

Moving From Thinking to Doing

•Asking questions •Observe trends •Find "holes" or "gaps" in the marketplace •Stop complaining and start solving problems

Ask lots and lots of questions!

•Be inquisitive again....think back to kindergarden! •Question the status quo •Think about questions Google can't answer for you •Remember that: Q (questioning) - A (action) = P (Philosophy).....simply a thought BUT Q (questioning) + A (action) = I (Innovation)

Industry Life Cycle(mimics the product life cycle)

•Birth phase (a new industry is born; examples: "horseless carriages" and cellphones) •Growth and adaptation phase (many entrepreneurs create new companies/new products based on the fundamental aspects of the new industry) •Differentiation and competition phase (competition and the need for a clear competitive advantage intensify) •Shakeout (marginal ventures fail; the strongest/largest companies acquire their competition) •Maturity and decline

Triple Bottom Line

•Businesses consider a broader bottom line that takes into accountprofits, people, and the planet •Success is "more than just the numbers"

Factors affecting the choice of strategy:

•Cost (i.e., Amazon's free shipping for prime members) •Market coverage ~ are you leaving gaps? •Speed and reliability (does slower really = cheaper?)

Feasibility Analysis Outline for a Written Report

•Cover page •Executive summary, including the feasibility decision •Table of contents •Business Concept •Industry Analysis •Market Analysis •Product/Service Development Plan •Management Team •Financial Plan •Timeline to Launch •Endnotes, Bibliography •Appendices

Pre-Feasibility Analysis Quick Look Assessment:

•Draft a description of the business •Examine the industry •Identify the product's customer benefit •Examine the capabilities and experience of management team

Observing Trends

•Economic Forces •Social Forces •Technological Forces •Political or Regulatory Forces

Outcomes of Entrepreneurship

•Economic Growth - Technological innovation is the primary engine of U.S. economic growth (and entrepreneurs drive technological innovation). •Job Creation - The SBA has established two widely used size standards: 500 employees for most manufacturing and mining industries and $7.5 million in average annual receipts for many non-manufacturing industries. Most U.S. employers are small businesses. Annual data indicates that small businesses create about 2 million net new jobs per year as compared to about 1 million for large firms.* •New Industry Formation •Impact on Society •Impact on Larger Firms

Why bother with any of this sustainability stuff at all?

•Entrepreneurship is the process of recognizing and acting on opportunities to create and capture value. • •The key here is the idea of opportunity. Entrepreneurs see it - others don't. Entrepreneurs act on it - while others do nothing. • •In this light, sustainability is an opportunity. Is that self-interested? Maybe. But at the end of the day, what really matters is the outcome. • •Hopefully, through a collective and virtuous cycle of innovation and disruption, the next wave of business will make the world an even better place than it is today - socially, environmentally, and economically

Developing a distribution strategy:

•Evaluate strategies of similar companies •Look for the opportunity gaps ~ are there customers not being served?

Why do businesses fail?

•Flawed logic (thinking 1+1 =3), ex: Product on the shelves of Walmart = success •Limited strategic choices (no "Plan B") •Imperfect value creation and capture assumptions (the value actually created is less than the value that was planned) •Incorrect assumptions about the value chain (inaccessibility of raw materials, commodity inflation, poor distribution strategy)

The Business Model

•How to make money from the products and services offered: •How will value be created for stakeholders? (Jobs? Dividends? Capital gains? Timely loan payments? Superior product or service?) •How will competitive advantage be achieved? (What are you going to do that's different from what everyone else is doing?) •How can the efficacy of the model be sustained over time? (Will this business model sustain over time and is it flexible enough to be changed?)

The Path to a Great Product

•Identify a Need ~ Identify a product or service that people need, rather than trying to sell what you have created ... which may not be what people need •See an Opportunity to Create a Solution ~ Will people buy it? •Execute the Next Great Product or Service

Market Failures

•Instances in which the private market fails to allocate scarce societal resources in the most economically efficient manner •Usually justifies government intervention •Government support (taxes, tax credits, subsidies, etc.) can encourage greater entrepreneurial pursuit and investment in innovation and new technologies in renewable energy and energy efficiency

Motivations for Sustainable Business Practices

•Internal •Profit maximization •External •Legal and regulatory •Potential to lower energy and material costs •Opportunity to improve reputation and sales •Founder/owner concerns and values •Part of company strategy for competitive advantage (Ex:lean manufacturing)

Characteristics of an effective distribution channel:

•Inventory (control) - knowing what you own and knowing where it is •Clear ownership (F.O.B. shipping point vs. F.O.B. destination) •Accessible financing and on time payment •Risk management (shrinkage, breakage) •Member power - key partners

What does it mean to be a sustainable business?

•Main concerns are viability and profitability. If they don't make money, they won't stay in business which isn't good for society, right? •Manage operations to reduce environmental impact (Think McDonalds here) •Lower legal risk and insurance costs •Differentiate products •Innovate to create new products to serve new markets •Improve their company image and reputation.

over age 65

•Men and women aged 45-64 are responsible for 36% of all entrepreneurial activity in the U.S. • •Men and women between the ages of 25-44 are responsible for 50%. • •The other 14% are below age 25 or ____!!

Political or Regulatory Forces

•New laws can ignite startups. Ex: Affordable Care Act = new startups to help manage massive data (CareCloud) •Industries can be created by the passage of one regulation. Ex: Drone startups are anxiously awaiting regulations from the FAA that will expand how drones can be used (Amazon wants to deliver packages using drones!)

"If my product or service is good, my business will be successful."

•Not necessarily. •Providing a great product or service and figuring out how to market it are two different things. •Relationships and connections can make a huge difference particularly early on when you haven't yet built a brand and need someone to give you a break. •It's easy to overestimate the demand for your product or service.

"The more customers, the better."

•Not really. •Early on it's tempting to take on any customer who shows interest, but spreading yourself too thin can be risky. •Also, let's face it: All customers aren't good customers. Some are extremely high maintenance, unrealistic, unreliable or price hagglers. You definitely want to be selective and weed out customers who may become more of a problem than they're worth.

Entrepreneurship is a mindset (a way of thinking) that is

•Opportunity-focused •Innovative •Growth-oriented

Carrying capacity

•Population of a species that the environment can sustain indefinitely •Economic collapse could be avoided with changes in policy, behavior and technology

Social Forces

•Products and services often exist more to satisfy a social need than a transparent need. Ex: Fast food chains, even fast casual dining (Chipotle, Panera), satisfy "time poverty" not necessarily our love for fast food Ex: Twitter isn't for posting information...it's for staying connected with each other •Some trends: Aging population, obesity, "trysumers," sustainability, urban living, health and wellness

Entrepreneurship is also a set of behaviors. Entrepreneurs:

•Recognize opportunity •Gather resources to act on that opportunity •Drive the opportunity to completion ~ Execution!

human resources (founding team, contacts, strategic alliances, mentors)

•Research has determined a key element to an entrepreneur's success is not the amount of capital an entrepreneur possesses, but rather how many ________ the entrepreneur can harness.

Limits to Growth Concept

•Research studies based on inter-relationships among world population, industrial production, food production, resource consumption, and pollution reveal: •Continued growth in the global economy would lead to global population and economic collapse as a result of increased ecological damage and decreased resources •The demands of the human population could exceed the earth's carrying capacity •Resource scarcity can be effectively addressed by the economic laws of supply and demand •As a resource becomes scarce, the market will reduce its use by increasing its price •Increased demand for scarce resources can guide resource allocation to investment in resource-saving technology •Increased prices will also favor substitution (where another resource is used in place of the scarce resource)

New Venture Creation Process is affected by three major variables:

1.The individual entrepreneur and what he/she brings to the table. 2.The environment, which includes all external variables like industries, markets and resource availability. 3.The organization, which is all of the strategic aspects of a new venture, including resources gathered and strategic partnerships.

Developing a Business Concept

A business concept is a concise description of an opportunity. It is the plan or recipe for how the opportunity will create, deliver and capture value. It contains four essential elements: •The value proposition (what benefit are you selling?) best told through a compelling story •The definition of the customer (who are you selling to?) •A description of the product/service (What exactly is your product or service?) •The distribution channel (How will you get your product or service to your customer?)

Business Concept: The Value Proposition

A compelling story illustrates the benefit that the customer derives from the product or service •The benefit is often intangible, yet usually easily described with a story A compelling story answers the questions: •Why the interest? (A little drama is ok here!) •What problem does this product or service solve?

Radical Transparency

A high degree of transparency that unveils "the good, the bad, and the ugly" of a business •Is an emerging concept that complements sustainability •Relies heavily on open decision-making and unlimited disclosure of business activities and their consequences •Based on the concept that the truth is far easier to sustain than hidden information or a lie •Has been supported by the rise of social media and other forms of internet based communication

take a quick look and make a preliminary assessment.

Before undertaking the research associated with a thorough feasibility study, it makes sense to____

Opportunities associated with the Entrepreneurial Path

*Becoming independent *Flexibility in work schedule *Working in a business environment the entrepreneur creates *Doing something the entrepreneur is passionate about *Creating Wealth *Creating Jobs *Supporting the community *Potentially changing the world

Challenges associated with theEntrepreneurial Path

*Finding the right opportunity *Having no previous experience on which to rely *Needing to work for long hours without pay *Uncertainty as to when/whether the venture will succeed *Having to rely on other people for expertise and resources *Needing to make major decisions that affect other people's lives

Tragedy of the Commons

Describes a situation where individuals, acting in their own self-interest, overexploit a shared resource resulting in its depletion. (Examples: Polluting of the atmosphere and waterways; overharvesting of the fish stocks)

•Climate change •Pollution •Habitat destruction •Overexploitation Invasive species

Direct Threats to Ecosystems

•Public opinion •Economic conditions •Technological change •Interest groups (Lobbying) •Business associations

Factors that Influence Public Policy

Preparing to be an Entrepreneur

Find a mentor •Preferably someone leading the life you want to lead Build a network •Use LinkedIn to start building your business connections (How's your profile looking?) Learn about entrepreneurs •Read about them •Talk to them and ask questions - they like to talk Identify your reasons for wanting to own a business •"I can't find a job" is not a great reason! Analyze your personality and your business preferences •Do you like to work alone or need to be around people? •Are you willing and financially/physically able to work long hours for little or no pay? Improve or acquire critical skills •Ability to make frequent, timely decisions •Ability to weigh the options in complex situations •Ability to be detail-oriented Study an industry •...or, better yet, work in it for awhile! •Most people identify opportunity in the industry they know best.

•Businesses must collect information in an accurate and timely manner •Processes must be in place to compile and analyze collected sustainability data •The information collected and analyzed must be integrated into the management decision-making process •The information must also be used to inform the public and influence subsequent action outside of the company

For sustainability reporting to be effective:

Solving Problems/Finding Ideas

•See challenges in your daily lives (and the daily lives of others) as problems to solve Ex: What seems difficult for your aging grandparents? •Be observant of how solutions to other problems might translate into a solution for the problem you're trying to solve •Start with the familiar...Can you improve upon what already exists or find a new "use" for an existing product/service? Ex: Starbucks made coffee a designer beverage. •Take advantage of your personal network to help you refine your ideas •Return to your childhood. Forget adult concerns for awhile. Play. Relax enough to let ideas flow. •Think in opposites. View what everyone else sees as a problem as an opportunity. Ex: Recession is "bad" unless you figure out a way to harness all those newly unemployed folks in a way that creates wealth for you! •Challenge the status quo and recognize your habits Ex: Endlessly trying to put the garden hose back got tiring for someone so they invented a flexible, retractable hose

The Sustainability Perspective: A Systems Approach

In order to effectively create a sustainable business, a business' entire system of operations must be mapped, analyzed and understood.

great execution in a growing market

It's typically not a great idea, but _____, that makes a business a success.

What's more important than a business plan:

Testing the market for the feasibility of a business concept via a realistic assessment of potential product/service sales. •Many successful businesses have been started without a business plan.

PASSION

The Wildcard in Entrepreneurship is

A feasibility analysis is performed to answer the following four broad questions:

•Is there a market of sufficient size to make the concept viable? •Do the capital requirements to start this venture, based on estimates of sales and expenses, make sense? •Is this a good time to introduce the product or service to the market? •Can an appropriate start-up or founding team be assembled to effectively execute the concept?

U.S. Environmental Policies

•Modern U.S. environmental policy began in the late-1960's and early-1970's as a reaction to rising levels of air and water pollution •Creation of the EPA •The U.S. is the second largest emitter of greenhouse gas emissions in the world, surpassed only by China

•The Home-Based Entrepreneur •Over 50% of all U.S. businesses are home-based. •Sometimes this is required due to a lack of resources •Sometimes it's a lifestyle choice •Most often, entrepreneurs start businesses in their homes in order to reduce overhead and start-up risk. •The Internet Entrepreneur •Low cost because there is less/no physical facility •The Traditional Entrepreneur •Bricks and mortar (i.e., not solely on the internet) •The Serial Entrepreneur •Starts up businesses one at a time. An existing business is sold before a new one is started. •The Portfolio Entrepreneur •Starts up multiple businesses and keeps them. •The Non-profit Entrepreneur •Educational, religious or charitable goals. (It's okay to make a profit, but such profits cannot be distributed to the owners; profits must be churned back into the non-profit.) •The Corporate Venturer •In order to successfully compete for the best talent, large companies are finding it increasingly necessary to provide an opportunity for entrepreneurial activity within their organizations. •Special Corporate Autonomous Groups •Given a mandate to find and develop new products •Operate outside the traditional lines of authority of the company •Often have an unusually high level of access to the organization's resources •Known to be fast, flexible, and creative work environments •Examples: Google Lockheed's Stealth Fighter development group

Pathways to Entrepreneurship