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Chapter 4 (Intro): Busines (The Entrepreneurial Process (Identifying…
Chapter 4 (Intro): Busines
Definition
Small business: independently owned + x dominate market
New Venture
Entrepreneurship: identify opportunities + assess needed resources
Entrepreneur
Intrapreneur: create something new within existing
The Role
Small businesses
98.2% of all
Private sector: organizations and companies owned by the government
New venture
Vast majority of new products and services
The Entrepreneurial Process
Identifying opportunities
Developing the opportunity
Compete directly with existing but add a twist
Totally new product
Franchise
Screening
Value for the customers
Provide a competitive advantage that can be sustained
Marketable and financially viable
Low exit costs
Idea generating
Accessing resources
Financial resources
Equity financing
Private funding
Love money: investments from friends, families,...
Private investors
Venture capitalists: come from professionally managed pool of investor money (venture capital)
Debt financing
Financial institution: personal loans
Suppliers
Other resources
Business Development Bank of Canada
Incubators: facilities support businesses during early growth
The Internet: available sources online
Building the right team
Size and scope required
Personal competencies
Assessing the fit between elements in the entrepreneurial process
The entrepreneur-opportunity fit
The opportunity-resources fit
The entrepreneur-resources fit
Start-up and beyond
Starting up a small business
Buying an existing business
Taking over a family business
Buying a franchise
Success and failure in small business
Reasons for success
Hard work, drive and dedication
Market demand for the product or service
Managerial competence
Luck
Reason for failure
Managerial incompetence or inexperience
Neglect
Weak control system
Insufficient capital
Form of Business Ownership
The sole proprietorship
The partnership
The corporation
The co-operative: organized, owned, and democratically controlled by the people who use its products and services,and whose earnings are distributed on the basis of use of the co-operative rather than level investment