chapter 6

________________________ is a new financing method that uses the internet to solicit small sums of money from groups and individuals.

venture capitalists

Companies that want to enhance intrapreneurship should:

quickly move proposals for new ventures through the approval process at the firm

________________________ is the initial funding needed to launch a new venture.

seed capital

A person who starts one business, runs it, and then starts another in succession is known as a ________________________.

serial entrepeneur

________________________ is a person who recognizes societal problems and uses business principles to develop innovative solutions.

social entrepreneur

true or false A business plan should identify the financial state of the industry and market conditions

true

true or false A good idea for a business should aim to satisfy an unmet need in the marketplace.

true

true or false A successful entrepreneur always follows his or her business plan.

true

true or false An increasing number of small businesses are started by professionals and managers who separated from large corporations when those firms downsized.

true

true or false Being your own boss is a primary lure of entrepreneurship.

true

true or false Buying a franchise is a less risky way to begin a business than starting a new firm.

true

true or false Classic entrepreneurs identify business opportunities and allocate available resources to tap those markets.

true

true or false Crowd funding is a financing method that has been around for centuries.

true

true or false Entrepreneurs are wealth creators.

true

true or false Entrepreneurs often believe that their greatest success lies in working for themselves.

true

true or false Entrepreneurs often believe that they control their own destinies and refrain from blaming others for their hardships.

true

true or false Franchisors run the risk of losing absolute control over every aspect of their business.

true

true or false In the beginning of their new career, entrepreneurs often find themselves working longer and harder than ever before.

true

true or false Large firms can encourage intrapreneurship by using dedicated programs such as skunkworks

true

true or false Managers are employees who direct the efforts of others to achieve an organization's goals.

true

true or false Many entrepreneurs start a business because they have created something new and want to make it a market success themselves.

true

true or false McDonalds and Baskin-Robbins are examples of franchises that have expanded overseas.

true

true or false Most entrepreneurs successfully transform their original business ideas into the next big thing.

true

true or false Most new ventures are formed to solve problems that people have experienced at work or in their personal lives.

true

true or false The major responsibility of an entrepreneur is to use the resources of their organizations in order to accomplish their goals.

true

It is suggested that entrepreneurs are a "different breed." Which of the following is a characteristic of an entrepreneur?

a tendency to avoid risks

Wealthy individuals who invest directly in a new venture in exchange for an equity stake are called ________________________.

angel investors

Small start-up ventures can benefit from a ________________________, which can be sponsored by a community agencies and provide low-cost shared business facilities and resources.

business incubator

The first step of any entrepreneurial endeavor is creating the ________________________, which outlines a company's objectives, methods, and standards.

business plan

The most common type of entrepreneur, one who identifies a business opportunity and allocates available resources to tap that market, is known as a(n) ________________________.

classic entrepeneur

________________________are business firms or groups of individuals who invest in new and growing firms.

crowd funding

Financing from borrowed funds that entrepreneurs must repay is known as ________________________.

debt finanching

When entrepreneurs borrow money to finance a business venture, they are using:

debt finanching

Sources of equity financing for new ventures include:

Family and friends venture capital firms Business partners Private investors

When trying to find an idea for a new business, it is may be wise to:

List your interests, abilities,values, and goals Consider the job experience you've already had think about how to solve problems people have experienced at work or in their personal lives Look for ways to improve on existing goods and services

Popular methods for entering new ventures include:

Starting a business form scratch, based on an original idea Buying an existing business that has potential rejuvenated Buying a franchise

Aspiring entrepreneurs can find information by:

Subscribing to magazines and reading books Using the internet Contacting trade associations for the industry in which they have interest

People who seek profitable opportunities, and who take the necessary risks to set up and operate a business, are known as ________________________.

entrepeneur

Funds invested in new ventures in exchange for part ownership constitute ________________________.

equity finanching

true or false A franchisor is the individual or business firm purchasing a franchise.

false

true or false A serial entrepreneur recognizes a societal problem and uses business principles to develop innovative solutions.

false

true or false An entrepreneur is an employee of a large organization.

false

true or false Defining your vision is all you need to become a successful entrepreneur.

false

true or false Entrepreneurial firms find they really can't compete effectively in an economy based on knowledge and information technology.

false

true or false Entrepreneurs tend to avoid using social media as a marketing tool.

false

true or false Franchised businesses account for 9 million jobs in the U.S. workforce.

false

true or false Merely owning a business makes you an entrepreneur.

false

true or false Once financing has been secured for a new business venture, the entrepreneur should then create a business plan.

false

true or false Once franchisees buy a franchise, they have complete freedom over how the company runs.

false

true or false Once you have a great idea for a new product, it is generally unnecessary to determine if there is a need or desire for that product in the marketplace.

false

true or false Once your new business is off the ground, you can expect to work fewer hours than you would at a regular job.

false

true or false Small business owners often have the goal of expansion and growth.

false

true or false The U.S. Small Business Administration encourages entrepreneurs to use credit cards for their business startup funds.

false

true or false The main aim of a social entrepreneur is to start a business with the hope of maximizing profit.

false

true or false The most successful entrepreneurs operate in industries that aren't experiencing much change.

false

true or false The third step in starting a new business is to create a business plan.

false

true or false Working for large corporations generally provides more job security than becoming an entrepreneur

false

An individual or businesses that purchases a franchise is called a ________________________.

franchisee

________________________ is the contractual business arrangement between a manufacturer and a dealer.

franchising

The ________________________ is the firm who allows a franchisee to sell its products.

franchisor

Someone who uses entrepreneurial talent while working for large firm is called a(n):

intrapreneur

Established firms implement programs such as skunkworks to support what type of business people?

intrapreneurs

________________________ is the process of promoting innovation within an existing organization's structure.

intrapreneurship