Entrepreneurship

late career entrepreneurs

(also known as second career entrepreneurs) People who begin their businesses after having re- tired or resigned from work in cor- porations at age 50 or later

In order to start a business, you need four elements to come together

- Boundary, resources, intention, and exchange - BRIE model

Today's 5 most typical types of entrepreneurial personalities

- Small Business Owner - Idea Person - Contemporary Classic Entrepreneur - Managerial Entrepreneur - Salesperson Entrepreneur

1/3 of the retirees who return to work decide to become self-employed, but face 3 challenges

- adjusting to the entrepreneurial life - reestablishing self-confidence - keeping personal finances out of the business

The four forms of PICS differ in which aspect of entrepreneurship they focus

- creation - customer focus - efficiency - innovation

Five types of entrepreneurs face special challenges:

- family business owners - team entrepreneurs - women entrepreneurs - minority entrepreneurs - second career entrepreneurs

two challenges typical to family businesses

- role conflict - succession

% of all businesses owned by woman, and by women and men equally

63 Around 30 percent of all businesses are majority owned by women, with another 18 percent equally owned by women and men

standard business practice

A business action that has been widely adopted within an industry or occupation

family business

A firm in which one family owns a majority stake and is involved in the daily management of the business.

innovation-driven economy

A nation there the major forces for jobs, revenues, and taxes come from high-value added production based on new ideas and technolo- gies and from professional ser- vices based on higher education.

efficiency-driven economy

A nation where industrialization is becoming the major force pro- viding jobs, revenues, and taxes, and where minimizing costs while maximizing productivity (i.e. efficiency) is a major goal.

factor-driven economy

A nation where the major forces for jobs, revenues, and taxes come from farming or extractive indus- tries like forestry, mining, or oil production.

virtual instant global entrepreneurship (VIGE)

A process that uses the Internet to quickly create businesses with a worldwide reach.

expert business professionalization

A situation that occurs when all the major functions of a firm are con- ducted according to the standard business practices of its industry.

specialized business professionalization

A situation that occurs when busi- nesses have founders or owners who are passionate about one or two of the key business functions, such as sales, operations, account- ing, finance, or human resources.

minimalized business professionalization

A situation that occurs when the entrepreneur does nearly every- thing in the simplest way possible.

both women and minorities still face the challenge of access

Access refers to the simplest form of discrimination—often women- or minority-owned firms are simply excluded from the opportunities offered to firms owned by white males

key business functions

Activities common to all businesses such as sales, operations (also called production), accounting, finance, and human resources

industry-specific knowledge

Activities, knowledge, and skills specific to businesses in a par- ticular industry

PICS Model of Entrepreneurship

An acronym for the four forms of entrepreneurship— P ublic, I ndependent, C orporate, and S ocial.

certification

An examination based acknowl- edgement that the firm is owned and operated as specified

Boundry (BRIE model)

Creating a place for your business—in location and in people's minds

competencies

Forms of business-related expertise.

set-asides

Government contracting funds which are earmarked for particular kinds of firms, such as small busi- nesses, minority-owned firms, women-owned firms, and the like

Small Business Owner

Hard worker Loner Socially isolated Average learner Average income seeker Risk averse

Original Classic Entrepreneur

Hard worker Loner Socially isolated Fast learner Wealth seeker Risk taker

Idea Person

Hard worker Loner (but could team up) Socially isolated Fast learner Fame seeker Risk taker

Contemporary Classic Entrepreneur

Hard worker Self-sufficient Socially connected Fast learner Wealth seeker Risk manager

Managerial Entrepreneur

Hard worker Team player Socially connected Fast learner Wealth seeker Risk averse

Salesperson Entrepreneur

Hard worker Team player Socially connected Fast learner (socially) Average learner (technologically) Acceptance seeker Risk averse

Exchange (BRIE model)

Moving resources/products/ services in exchange for money

determination competencies

Skills identified with the energy and focus needed to bring a busi- ness into existence.

opportunity competencies

Skills necessary to identify and exploit elements of the busi- ness environment that can lead to a profitable and sustainable business.

resource competencies

The ability or skill of the entrepre- neur at finding expendable compo- nents necessary to the operation of the business such as time, in- formation, location, financing, raw materials, and expertise

mindshare

The degree of attention your tar- get market pays to your idea or organization.

Intention (BRIE model)

The desire to start a business

innovation (the 4 focuses)

The entrepreneurial focus which looks at a new thing or a new way of doing things.

creation (the 4 focuses)

The entrepreneurial focus which looks at the making of new entities.

customer-focus (the 4 focuses)

The entrepreneurial focus which refers to being in tune with one's market.

efficiency (the 4 focuses)

The entrepreneurial focus which refers to doing the most work with the fewest resources.

professionalization

The extent to which a firm meets or exceeds the standard business practices for its industry.

social entrepreneurship (PICS)

The form of entrepreneurship involving the creation of self- sustaining charitable and civic organizations, or for-profit orga- nizations which invest significant profits in charitable activities. - Cr, CF, E

corporate entrepreneurship (PICS)

The form of entrepreneurship which takes place in existing busi- nesses around new products, ser- vices, or markets. - CF, I

independent entrepreneurship (PICS)

The form of entrepreneurship in which a person or group own their own for-profit business. - Cr, CF, E, I

public entrepreneurship (PICS)

The form of entrepreneurship that involves revitalizing government agencies. - CF, E

ecommerce

The general term for conducting business on the Internet.

focuses of entrepreneurship

The key directions the organiza- tion intends to pursue.

role conflict

The kind of problem that arises when people have multiple re- sponsibilities, such as parent and boss, and the different responsi- bilities make different demands on them.

Resources (BRIE model)

The money, product, knowledge, etc., that make up the business

succession

The process of intergenerational transfer of a business.

occupational structure

The sequence or organization of jobs and careers in the economy - meaning if you want to go into dentistry, plumbing, farming, you are choosing to go into small business because the occupation is structured that way

creative destruction

The way that newly created goods, services, or firms can hurt existing goods, services, or firms

Spiral, or helical, entrepreneurs

alternate periods of growth and stability which are deter- mined by personal or family needs. They are driven by a need to balance family and business, being successful at each. A typical spiral strategy is to slow down when children are young and push for growth when the children are older

Occasional entrepreneurs

are people who generally have another job that is their primary one. They are often fascinated by entrepreneurship and pursue it periodically. They are the classic part-time entrepreneurs, who might work on a seasonal basis

Growth entrepreneurs

lifetime owners. Their goal is major success, and if they top out with one business, they'll start another growth-oriented company, often before they exit from the first one

Number of Owners Involved in Start-Ups from the Panel Study of Entrepreneurial Dynamics

one member - 48% two members - 38% three members - 7% four members - 4% five+ members - 3%

Habitual entrepreneurs

owners for a lifetime, sometimes in one business, sometimes across several firms (which usually get closed down, not sold). The owner's career goal is personal satisfaction first, income second.

Harvest entrepreneurs

owners with an exit plan. Their goal is to work first in order to play later. may start several companies, but they build one company at a time, harvest it, enjoy the proceeds, and then start another