entrepreneuship

bankruptcy

a legal process for insolvent debtors who are unable to pay debts as they become due

lifestyle venture

a small venture in which the primary diving forces include independence, autonomy, and control

SWOT analysis

a strategic analysis that refers to Strenghts, Weaknesses, Opportunities, and Threats

small profitable venture

a venture in which the entrepreneur does not want venture sales to become so large that he or she relinquish equity or ownership position and this give up control over cash flows and profits, which it is hoped will be sustained

entreprenuerial leadership

an entrepreneurs ability to anticipate, envision, maintain flebility, and think strategically, and work to initiate changes that will create a viable future for the organization

Entrepreneurial Strategy Matrix Model

innovation: the creation of something new and different risk: the probability of major financial loss -a high-innovation/ low-risk venture is certainly preferable to a low-innovation/ high-risk one

feasibility criteria approach

involves the use of a criteria selection list from which entrepreneurs can gain insight into the viability of their venture

questions to ask within the feasibility criteria approach

is it proprietary? are the initial production costs realistic? are the initial marketing costs realistic? does the product have potential for veyr high margins? is the time required to get to market and to reach the break-even point realistic?

strategic planning

the formulation of long-range plans for the effective management of environmental opportunities and threats in light of a ventures strengths and weaknesses

strategic planning

the primary step in determining the future direction of a business influence by the abilities of the entrepreneur, the complexity of the venture, and the nature of the industry

strategic postitioning

the process of percieving new positions that attract customers from established positions or draw new customers into the market

high growth venture

when sales and profit growth are expected to be significant enough to attract venture capital money and funds raised through public or private placements

basic steps to strategic planning:

1. examine the internal and external environments of the venture (strengths, weaknesses, opportunities, and threats) 2. formulate the ventures long-range and short-range strategies 3. implement the strategic plan 4. evaluate the performance of the strategy 5. take follow-up action through continuous feedback

reasons for the lack of strategic planning

1. time scarcity 2. lack of knowledge 3. lack of expertise/ skills 4. lack of trust and openness 5. perception of high cost

know the five critical factors for new venture development that must be considered during the prestart-up and the start-up phases

1. uniqueness of venture 2. investment size 3. expected sales growth -lifestyle ventures -small profitable venture -high-growth venture 4. product availability 5. customer availability

know some of the reasons why new venture fail. what are the 3 major categories of causes for new venture failure?

-product/market problems -poor timing -product design problems -inappropriate distribution strategy -unclear business definition -overreliance on one customer -financial difficulties -initial undercapitalization -assuming debt too early -venture capital relationship problems -managerial problems -concept of a team approach -human resources problems

five unique managerial concerns of growing business

1. distinction of small size 2. continuous learning 3. community pressures 4. one-person-band syndrome 5. time management

strategic planning includes

-defining the ventures mission -specifying achievable objectives -developing strategies -setting policy guidelines

know some of the pitfalls for selecting new ventures:

-lack of objective evaluation -no real insight into the market -inadequate understanding of technical requirements -poor financial understanding -lack of venture uniqueness -ignorance of legal issues

Fatal mistakes:

#1. misunderstanding industry attractiveness #2. no real competitive advantage #3. pursuing an unattainable competition position #4. compromising strategy for growth #5. failure to explicitly communicate the ventures strategy to employees