ENTRP 340 FINAL

lean canvas

An adapted version of the BMC that was created to better address the needs of startup entrepreneurs.

linkages

Connections to people or groups regardless of their position in an organization, society, or other community.

bottom-up analysis

Estimating potential sales using calculations in order to arrive at a total sales figure.

grit

The quality that enables people to work hard and sustain interest in their long-term goals

pivot

a change in business direction

incubator

an organization that helps early-stage entrepreneurs to refine an idea while also providing access to a whole network of other startups, mentors, and other valuable resources

effectuate pathway

is more about creating opportunities rather than simply uncovering them.

supply

sellers who compete for customers in the marketplace

improvisation

the art of spontaneously creating something without preparation

effectuation

the idea that the future is unpredictable yet controllable

TAM (total available market)

the total market demand for a product or service

desirability

who will want to use or buy the product or service

button to nowhere

- Used to test if your customers will click on a new feature on your website before building it - Great way of measuring user interest

limited liability company (LLC)

A business structure that combines the pass-through taxation of a partnership or sole proprietorship with the limited liability of a corporation.

investor model

A crowdfunding model that gives backers an equity stake in the business in return for their funding.

reward-based crowdfunding

A crowdfunding model that involves rewarding backers for supporting a project.

income statement (or profit and loss statement)

A financial report that shows revenue, expenses, and profit for a period of time, typically a month, quarter, or year.

design thinking

A human-centered approach to innovation that brings together what people need with what is technologically feasible and economically viable.

brand strategy

A long-term plan to develop a successful brand; it involves how you plan to communicate your brand messages to your target customers.

segmented market

A market divided into groups according to customers' different needs and problems.

market sizing

A method of estimating the number of potential customers and possible revenue or profitability of a product or service.

exploratory experimentation

A method whereby market tests are conducted to get early feedback and acquire important learning and information

sweat equity

A non-monetary investment that increases the value or ownership interest created by the investment of hard work for no compensation.

Business model canvas (BMC)

A one-page plan that divides the business model into nine components in order to provide a more thorough overview.

competition-led pricing

A pricing strategy that matches prices to other businesses selling the same or very similar products and services.

royalties

A share of the income of a business paid by a franchisee to the franchisor.

convertible debt

A short-term loan that can be turned into equity when future financing is issued

early-stage financing

A stage of financing which involves larger funds provided for companies that have a team in place and a product or service tested or piloted, but has little or no revenue

not-for-profit

A tax status granted to companies performing functions deemed by Congress to be socially desirable that exempts them from income tax and, in some cases, allows them to receive tax deductible donations

angel investor

A type of investor who uses his or her own money to provide funds to young startup private businesses run by entrepreneurs who are neither friends nor family

cost-led pricing

A type of pricing strategy that involves calculating all the costs involved in manufacturing or delivering the product or service, plus all other expenses, and adding an expected profit or margin by predicting your sales volume to get the approximate price.

points-of-difference

A type of value proposition that focuses on the product or service relative to the competition and how the offering is different from others on the market.

MVP (minimum viable product)

A version of a new product that allows a team to collect the maximum amount of validated learning about customers with the least effort.

customer journey map

A visual representation that captures customer experience across multiple touchpoints.

need-finding interview

An interview conducted to better understand the problems or needs of people or validate what you think a need or problem may be.

feedback interview

An interview conducted to get feedback on an existing product or service.

loss leader

An item priced at or below cost in attempt to attract more customers

trademark

Any word, name, symbol, or device used in business to identify and promote a product

utility and usage revenue model

Charging customers fees on the basis of how often goods or services are used

bonds

Connections with people who are just like us, such as family, friends, and others who have a similar cultural background or ethnicity

operating expenses

Costs involved in operating a business, such as rent, utilities, and salaries.

top-down analysis

Determining the total market using demographic data and then estimating your share of the market.

data revenue model

Generating revenue by selling high-quality, exclusive, valuable information to other parties.

multiparty business

Giving one party product or service free, but charging the other party (or parties).

product application

Goods or services created to meet a demand, thereby providing a solution to a customer problem.

definitive stakeholders

Has power, legitimacy and urgency and management should give priority to this stakeholders claim. Likely to be a dominant stakeholder moving to a definitive category.

bridges

Links that go further than simply sharing a sense of identity; for example, making connections with classmates or colleagues who may have different backgrounds, cultures, or other characteristics.

multisided markets

Markets with two or more customer segments that are mutually independent of each other.

freemium revenue model

Mixing free (mainly web-based) basic services with premium or upgraded services.

true fans

People who will buy anything you produce; they will wait in line for your products, drive for hours to attend one of your events, and preorder your next product without even knowing what it looks like.

value pricing

Pricing strategy that involved pricing your product based on how it benefits the customer

buyer personas

Profiles or representations of ideal customers based on information and market research.

paper testing

Simple way to outline the vision and to spot any mistakes

market opportunity

The degree of customer or market demand for a specific product application.

prior knowledge

The information gained from a combination of life and work experience.

evidence-based entrepreneurship

The practice of hypothesizing, testing, and validating to create a business model.

self-selected stakeholders

These are the people who "self-select" into an entrepreneur's network in order to connect them with resources such as subject-matter expertise, funding, advice, introductions to others, new perspectives, feedback on concepts, mentors, and so on, in an effort to steer the venture in the right direction.

benefit corporation (B-Corp)

This is a form of organization certified by the nonprofit B Lab that ensures that strict standards of social and environmental performance, accountability, and transparency are met.

general partnership

Two or more people who have made a decision to comanage and share in the profits and losses of a business

inattention

When an entrepreneur becomes sidetracked from the core business.

sole proprietorship

a business owned by one person who has not formed a separate entity to run it

family enterprise

a business that is owned and managed by multiple family members, typically for more than one generation

founders' agreement

a clear agreement between founders on a number of key issues that their business might face

venture philanthropy funding

a combination of financial assistance such as grants with a high level of engagement by the funder

initial public offering (IPO)

a company's first opportunity to sell stocks on the stock market to be purchased by members of the general public

S corporation

a corporation whose stockholders elect special treatment for income tax purposes

patronage model

a crowdfunding model in which financial support given by backers without any expectation of a direct return for their donations

social consequence entrepreneurship

a for-profit venture whose primary market impact is social

equity crowdfunding

a form of crowdfunding that gives investors the opportunity to become shareholders in a company

skimming

a form of high pricing method, generally used for new products or service that face very little, or even no competition

copyright

a form of protection provided to the creators of original works in the areas of literature, music, drama, choreography, art, motion pictures, sound recordings, and architecture

enterprising nonprofits

a form of social entrepreneurship where both the venture mission and the market impact are for social purposes

marketing mix

a framework that helps define the brand and differentiate it from the competition - product, price, place, promotion - sometimes adding people, packaging, and positioning

patent

a grant of property rights on inventions through the U.S. government

founding team

a group of people with complementary skills and a shared sense of commitment coming together in founding an enterprise to build and grow the company.

revenue model

a key component of the business model and identifies how the company will earn income and make profits

needs

a lack of something desirable, useful, or required that are uncovered through the design thinking process.

mass market

a large group of customers with very similar needs and problems

guerrilla marketing

a low-budget strategy that focuses on personally interacting with a target group by promoting products and services through surprise or other unconventional means.

marketing

a method of putting the right product in the right place at the right price at the right time

groupthink

a phenomenon in which people share too similar a mindset, which inhibits their ability to spot gaps or errors.

market

a place where people can sell goods and services (the supply) to people who wish to buy those goods and services (the demand)

introductory offer

a pricing method to encourage people to try a new product by offering it for free or at a heavily discounted price

target-return pricing

a pricing method whereby the price is based on the amount of investment you have put into your business

cognitive comprehensiveness

a process in which team members examine critical issues with a wide lens and formulate strategies by considering diverse approaches, decision criteria, and courses of action.

implementation

a process involving the testing of assumptions of new ideas to continuously shape them into viable opportunities

corporate entrepreneurship (intrapreneurship)

a process of creating new products, ventures, processes, or renewal within large corporations

self-leadership

a process whereby people can influence and control their own behavior, actions, and thinking to achieve the self-direction and self-motivation necessary to build their entrepreneurial business ventures.

due diligence

a rigorous process carried out to evaluate an investment opportunity prior to a deal being finalized.

C corporation

a separate legal entity created by the state government and owned by an unlimited number of shareholders

entrepreneurial marketing

a set of processes adopted by entrepreneurs based on new and unconventional marketing practices to gain traction and attention in competitive markets

niche market

a small market segment comprising customers with specific needs and requirements

pilot experiment

a small-scale study conducted to assess the feasibility of a product or service

habit

a sometimes unconscious pattern of behavior that is carried out often and regularly.

seed-stage financing

a stage of financing in which small or modest amounts of capital are provided to entrepreneurs to prove a concept

startup financing

a stage of financing in which the money is provided to entrepreneurs to enable them to implement the idea by funding product research and development

unicorn

a tech startup company that has received a $1 billion valuation, as determined by private or public investment

startup

a temporary organization in search of a scalable business model.

experiment

a test designed to help you learn and answer questions related to the feasibility and viability of your venture

Franchise

a type of license purchased by an individual (franchisee) from an existing business (franchisor) that allows the franchisee to trade under the name of that business.

customer-led pricing

a type of pricing strategy when you ask customers how much they are willing to pay, and then offer it at that price

bundled pricing

a type of pricing strategy whereby companies package a set of goods or services together and then sell them for a lower price than if they were to be sold separately

venture capitalist (VC)

a type of professional investor who generally invests in early-stage and emerging companies because of perceived long-term growth potential

franchising revenue model

a type of revenue model whereby franchises are sold by an existing business to allow another party to trade under the name of that business

resonating-focus (product-market fit)

a type of value proposition that describes why people will really like your product and focuses on the customers and what they really need and value

all-benefits

a type of value proposition that involves identifying and promoting all the benefits of a product or service to target customers, with little regard to the competition or any real insight into what the customer really wants or needs

licensing revenue model

a way of earning revenue by giving permission to other parties to use protected intellectual property (patents, copyrights, trademarks) in exchange for fees

opportunity

a way of generating value through unique, novel, or desirable products, services, and even processes that have not been previously exploited in a particular context.

Entrepreneurship

a way of thinking, acting, and being that combines the ability to find or create new opportunities with the courage to act on them.

lending model

aa crowdfunding model in which funds are offered as loans with the expectation that the money will be repaid

divergent thinking

allows us to expand our view of the world to generate as many ideas as possible without being trapped by traditional problem-solving methods or predetermined constraints.

convergent thinking

allows us to narrow down the number of ideas generated through divergent thinking in an effort to identify which ones have the most potential.

AEIOU framework

an acronym for activities, environments, interactions, objects, and users. This is a framework commonly used to categorize observations during fieldwork to help you make sense of what you are seeing.

hypothesis

an assumption that is tested through research and experimentation

prototype

an early and often crude version of a product

passion

an intense positive emotion, which is usually related to entrepreneurs who are engaged in meaningful ventures, or tasks and activities, and which has the effect of motivating and stimulating entrepreneurs to overcome obstacles and remain focused on their goals.

insight

an interpretation of an observation or a sudden realization that provides us with a new understanding of a human behavior or attitude that results in some sort of action

accelerator

an organization that provides tailored support for existing startups that have already built a successful product or service (usually through an incubator) by helping to develop, scale, and grow their business.

a hybrid model of social entrepreneurship

an organization with a purpose that equally emphasizes both economic and social goals

trade secret

any confidential information that provides companies with a competitive edge and is not publicly known or accessible, such as formulas, patterns, customer lists, compilations, programs, devices, methods, techniques, or processes.

find pathway

assumes that opportunities exist independent of entrepreneurs and are waiting to be found

improvement

bettering existing products. low novelty high value

debt financing

borrowing money to start a business that is expected to be paid back with interest at a designated point in the future

social purpose ventures

businesses created by social entrepreneurs to resolve a social problem and make a profit

deliberate practice

carrying out carefully focused efforts to improve current performance

subscription revenue model

charging customers to gain continuous access to a product or service

wizard of oz

customers think they are interfacing with the real product, but it is actually you behind the scenes manually providing the service.

financial viability

defines the revenue and cost structures a business needs to meet its operating expenses and financial obligations

Corporate Social Responsibility (CSR)

describes the efforts taken by corporations to address the company's effects on environmental and social well-being in order to promote positive change

business model

describes the rationale of how an organization creates, delivers, and captures value

customer value proposition (CVP)

describes why a customer should buy and use your product or service

professional angels

doctors, lawyers, dentists, accountants, consultants, and the like, who use their savings and income to invest in entrepreneurial ventures

storyboard

easy form of prototyping that provides a high-level view of thoughts and ideas arranged in sequence in the form of drawings, sketches, or illustrations

development strategies

employed to enhance and modify existing ideas in order to create better alternatives and new possibilities

Entrepreneurs inside

employees who think and act entrepreneurially within different types of organizations

deviance

entrepreneur defies legal and ethical boundaries, leading to mismanagement of the venture

micromanagement angels

entrepreneurs who have achieved success through their own companies and want to be involved in the ventures they invest in

entrepreneruial angels

entrepreneurs who have already successfully started and operated their own businesses, which they may or may not still be running

interview

fast and inexpensive way to get insights into your idea from your target customers before you begin the experiment.

intelligent failures

good failures that provide valuable new knowledge that can help a startup overcome hurdles and roadblocks

dominant stakeholders

have both power and legitimacy, which gives them strong influence in your organization

heterogeneous teams

have members with diverse personal characteristics

homogenous teams

have members with similar personal characteristics

discretionary stakeholders

have no power to influence and no urgent claims, but they have legitimacy

dangerous stakeholders

have power and urgency but no legitimacy

dependent stakeholders

have urgent claims and legitimacy, but lack power

demanding stakeholders

have urgent claims, but lack legitimacy and organizational power

behavior-focused strategies

help increase self-awareness to manage behaviors, particularly when dealing with necessary but unpleasant tasks

invention

high in novelty, but if an invention does not reach the market or appeal to consumers, then it will be rendered useless

viability

how sustainable the idea is in the long term

revenue

income gained from sales of goods or services

enthusiast angels

independently wealthy retired or semiretired entrepreneurs or executives who often invest their personal capital in startups as a hobby

new business owners

individuals who are former nascent entrepreneurs and have been actively involved in a business for over three months but less than three and a half years

necessity-based entrepreneurs

individuals who are pushed into starting a business because of circumstance such as redundancy, threat of job loss, and unemployment

corporate angels

individuals who are usually former business executives, often from big multinationals, looking to use their savings or current income to invest

potential entrepreneurs

individuals who believe they have the capacity and know-how to start a business without being burdened by the fear of failure

nascent entrepreneurs

individuals who have set up a business they will own or co-own that is less than three months old and has not yet generated wages or salaries for the owners

opportunity-based entrepreneurs

individuals who make a decision to start their own businesses based on their ability to create or exploit an opportunity, and whose main driver for getting involved in the venture is being independent or increasing their income, rather than merely maintaining their income

intellectual property (IP)

intangible personal property created by human intelligence, such as ideas, inventions, slogans, logos, and processes

psychological pricing

intended to encourage customers to buy based on their belief that the product or service is cheaper than it really is

accredited investors

investors who earn an annual income of more than $200,000 or have a net worth of more than $1 million

relationship-seeking strategies

involve consciously making links between concepts or ideas that are not normally associated with each other

imagination-based strategies

involve suspending disbelief and dropping constraints in order to create unrealistic states, or fantasies

analytical strategies

involve taking time to think carefully about a problem by breaking it up into parts, or looking at it in a more general way, to generate ideas about how certain products or services can be improved or made more innovative.

search strategies

involve using a stimulus to retrieve memories in order to make links or connections based on personal experience that are relevant to the current problem

ideation

involves generating and developing new ideas to address needs (or latent needs), based on observations made during the inspiration process.

crowdsourcing

involves using the Internet to attract, aggregate, and manage ostensibly inexpensive or even free labor from enthusiastic customers and like-minded people.

wicked problems

large, complex social problems where there is no clear solution; where there is limited, confusing, or contradictory information available; and where a whole range of people with conflicting values engage in debate.

irrelevent

low on both novelty and usefulness

constructive thought patterns

models to help us to form positive and productive ways of thinking that can benefit our performance

latent needs

needs we have but don't know we have

diversified market

offers a variety of services to serve two or more customer segments with different needs and problems, which bear no relationship to each other

design pathway

one of the most complex, yet it can be the most value-creating approach

metacognition

our ability to understand and be aware of how we think and the processes we use to think

social capital

our personal social networks populated with people who willingly cooperate, exchange information, and build trusting relationships with each other

impression management

paying conscious attention to the way people perceive you and taking steps to be perceived in the way you want others to see you

growth mindset

people believe that their abilities can be developed through dedication, effort, and hard work.

fixed mindset

people perceive their talents and abilities as set traits. They believe that brains and talent alone are enough for success, and they go through life with the goal of looking smart all the time

brokers

people who organize transactions between buyers and sellers

customers

people who populate the segments of a market served by the offering

serial entrepreneurs (habitual entrepreneurs)

people who start several businesses, either simultaneously or consecutively

direct cross-subsidies

pricing a product or service above its market value to pay for the loss of giving away a product or service for free or below its market value

self-goal setting

process of setting individual goals for ourselves

self-punishment (self-correcting feedback)

process that allows us to examine our mistakes before making a conscious effort not to repeat them

innovation

product/service is novel, useful, and valuable

professional revenue model

professional services on a time and materials contract

demand

prospective customers' desire for the goods and services available

real reason to believe

provides evidence to the customer that you will do as you promise

self-observation

raises our awareness of how, when, and why we behave the way we do in certain circumstances

interpersonal strategies

require group interaction; ideas are generated as a group and the group builds on each other's ideas

dormant stakeholders

sleepers- they hold power but do not tend to use that power unless they are given a reason to do so

consumer

someone who actually uses the product or service

customer

someone who pays for goods or services

advertising

spreading the word about your business using brochures or social media directed to your relevant target market and assessing the level of response.

habit-breaking strategies

techniques that help to break our minds out of mental fixedness in order to bring about creative insights

preselling

testing technique that involves booking orders for your product before it has been developed

alertness

the ability to identify opportunities in their environment

entrepreneurial mindset

the ability to quickly sense opportunities, take action, and get organized under uncertain conditions

observation

the action of closely monitoring the behavior and activities of users/potential customers in their own environment for greater empathic understanding

advertising revenue model

the amount of revenue gained through advertising products and services

unit sales revenue model

the amount of revenue generated by the number of items (units) sold by a company

entrepreneurial self-efficacy (ESE)

the belief entrepreneurs have in their ability to begin new ventures.

creativity

the capacity to produce new ideas, insights, inventions, products, or artistic objects that are considered to be unique, useful, and of value to others

vesting

the concept of imposing equity forfeitures on cofounders over a certain period of time on a piecemeal basis should they not stay with the company

Concierge

the customer interfaces with the product but the "technology" is going on behind the scenes

fair pricing

the degree to which both businesses and customers believe that the pricing is reasonable

intermediation revenue model

the different methods by which third parties such as brokers (or "middlemen") can generate money

cost of goods sold (COGS)

the direct cost of purchasing a product

lack of ability

the entrepreneur is overextended and lacks the skillset to get the job done

inspiration

the first phase of design thinking, when you develop the design challenge and acquire a deeper understanding of users

uncertainty

the lack of clarity about future events that can cause entrepreneurs to take unreasonable actions

overt benefit

the one big benefit for your customer

stakeholders

the people or groups affected by or involved with the achievements of the social enterprise's objectives

established business owners

the people who have been active in business for more than 3.5 years

Total Entrepreneurial Activity (TEA)

the percentage of the population of each country between the ages of 18 and 64, who are either a nascent entrepreneur or owner-manager of a new business

SOM (share of market)

the portion of SAM that your company is realistically likely to reach

bootstrapping

the process of building or starting a business with no outside investment, funding, or support

branding

the process of creating a name, term, design, symbol, or any other feature that identifies a product or service and differentiates it from others.

pattern recognition

the process of identifying links or connections between apparently unrelated things or events

self-cueing

the process of prompting that acts as a reminder of desired goals, and keeps your attention on what you are trying to achieve

crowdfunding

the process of raising cash for a new venture from a large audience (the "crowd"), typically through the internet

social entrepreneurship

the process of sourcing innovative solutions to social and environmental problems.

infrastructure

the resources (people, technology, products, suppliers, partners, facilities) that an entrepreneur must have in order to deliver the CVP.

earned-income activities

the sale of products or services that are used as a source of revenue generation

equity financing

the sale of shares of stock in exchange for cash

SAM (serviceable available market)

the section of the TAM that your product or service intends to target

dramatic difference

the uniqueness of your product or service in relation to other available options

landing page

the web page that a person reaches when clicking on a search engine listing or ad

process inadequacy

the wrong (or lack of) processes set up in the organization causing communication breakdown

natural reward strategies

types of compensation designed to make aspects of a task or activity more enjoyable by building in certain features, or by reshaping perceptions to focus on the most positive aspects of the task and the value it holds

search pathway

used when entrepreneurs are not quite sure what type of venture they want to start, so they engage in an active search to discover new opportunities

task completion

watching someone using your product to understand what works and what doesn't

self-reward

ways in which we compensate ourselves when we achieve our goals

feasibility

what can possibly be achieved in the near future

offering

what you are offering to a particular customer segment, the value generated for those customers, and how you will reach and communicate with them

nondisclosure agreement (NDA)

which is a legal contract that outlines confidential information shared by two or more parties