What is Entrepreneurship?

Mark T. Schenkel, Ph.D.

Agenda
What is Entrepreneurship?
Historical development Definition Myths Process Career Paths

The Entrepreneurial Revolution

We are in the midst of a silent revolution a triumph of the creative and entrepreneurial spirit of humankind throughout the world. I believe its impact on the 21st century will equal or exceed that of the Industrial Revolution on the 19th and 20th. The death knell for brontosaurus capitalism of yesteryear.
-- Jeffry A. Timmons (The Entrepreneurial Mind, 1989)

Development of Entrepreneurship
Earliest Period- Marco Polo Middle Ages- Theater, Architectural Works 17th Century- Mississippi Company 18th Century- Edison & Whitney 19th & 20th Centuries
Organize/Operate Innovation

The Opportunity
Statistics
A random national sample (Gallup poll survey, 1994) of high school students reveals that 70% of these students say they want to own their own business some day (Timmons, 2004: 7) Annual Chronicle survey: 40% of incoming students have entrepreneurship as major goal for why they are going to college Fortune 500 employment decline: 1970 (20%) 1996 (8.5%) Small firms constitute more than 90 percent of the entire business population

Virtually of USAs economic growth is coming from entrepreneurial ventures of all sizes and types Not yet tainted by corporate way of life Good time to take risk!!!

Entrepreneurship
A process, not a type of person Creating and/or building something of value Identifying an opportunity Pulling together the needed resources to pursue the opportunity Developing and implementing a Business Plan Involves uncertainty and the acceptance of risk

The Nature of Entrepreneurial Risk

Failure Sinking the Boat Risk Opportunity Cost Missing the Boat Risk

Myths about Entrepreneurship

The Lone Cowboy Myth. The Experience Myth. The Im Only in it for the Money Myth. The Entrepreneurs are Gamblers Myth.

Myths about Entrepreneurship

The Entrepreneurs Dont Have to Worry about Numbers Myth.

The All You Need is Money Myth.

The Ive Got a Secret Myth. The IPO Myth.

Other Opportunities for Learning

Curb event center retail space Hatchery Practicing entrepreneurs activities Entrepreneurship club Internships Mentors Networking!!!

The Entrepreneurial Process

Working Definition of Entrepreneurship

Entrepreneurship is a way of thinking, reasoning and acting that is opportunity obsessed, holistic in approach [emphasis added], and leadership balanced (Timmons, 1999: 27).

The Entrepreneurial Process

(Timmons, 2000)

Communication Opportunity Business Plan Fits and Gaps Resources

Ambiguity
Creativity

Exogenous Forces
Team Leadership Capital Market Forces

Uncertainty

Founder

The Entrepreneurial Process

Eval., Review, & Feedback Analysis

Implementation

Strategy Formulation

The Entrepreneurial Process

Three Part Process

Planning
Strategy

Luck

Life Cycle of a Business Venture

Pre-Launch Process: Idea Generation

Understanding the Genesis of New Businesses in the Economy Sources of Ideas: Where to Look

The Entrepreneurial Process

Challenge Traditional Definitions of Value Entrepreneurship thrives on market inefficiencies Customers seek improvement in the following:
Speed Convenience Personalization Price

Pre-Launch Process: Evaluating Ideas Generation

Does the Idea = an Opportunity?
Market Margin Mission

The Right Team? The Necessary Resources?

The Start-up Process

Filling the Gaps The Business Plan
Executive Summary Market Analysis and Marketing Plan Operating Plan and Team Financial Plan

Growing the Business

CASH FLOW MANAGEMENT Building a Culture Marketing Staffing Building Management & Administrative Systems

Exit or Succession

Entrepreneurial Careers
Do it now! Not necessarily a one shot deal Sentry Position (in consulting firm or in industry) Family or existing Small Business Corporate Track

Key Takeaway Points . . .

No fully satisfactory definition of entrepreneurship has been developed to date (i.e., one that garners collective agreement among scholars & practitioners alike). Entrepreneurship reflects creative, innovative, and arbitrage oriented behaviors. Is a process; involves planning, strategizing, and a little bit of luck. Interconnectedness of resources and opportunities

Key Takeaway Points . . .

Entrepreneurship can occur and fail to occur

in firms that are old and new; small and large, fast and slow growing; in the private, not-for-profit, and public sectors; in all geographic points; and in all stages of a nations development.