genn001 spring 2013 session #7 entreprenuership
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Entrepreneurs: The Driving Force Behind Small Business
1-1
Lecture: 7
The World of the EntrepreneurIn the U.S., entrepreneurs start more than
6 million businesses a year!Global Entrepreneurship Monitor (GEM)
Approximately 8% of the U.S. population is actively involved in entrepreneurial activity
Nearly 11% of people in 49 GEM countries studied are involved in starting a new business
What is an Entrepreneur? One who creates a new business in the face of risk and uncertainty for the purpose of achieving profit and growth by identifying opportunities and assembling the necessary resources to capitalize on them
What is an Entrepreneur?An entrepreneur is someone who is willing to work 16 hours a day to keep from working 8 hours a day for someone else!
Characteristics of EntrepreneursSurvey: 61% of adults in the U.S. would
like to start their own business Willingness to take initiativePreference for moderate riskConfidence in their ability to succeedSelf-reliancePerseverance1
Desire for immediate feedback
1Perseverance is commitment, hard work, patience, endurance
High level of energyCompetitivenessFuture orientation
Serial entrepreneursSkilled at organizingValue achievement over money
Characteristics of Entrepreneurs
EntrepreneurshipOne characteristic of entrepreneurs stands
out:Diversity!
Anyone – regardless of age, race, gender, color, national origin, or any other characteristic – can become an entrepreneur (although not everyone should)
How to Spot Entrepreneurial OpportunitiesCreativity vs. Innovation
Creativity – the ability to develop new ideas and to discover new ways of looking at problems and opportunities
Innovation – the ability to apply creative solutions to problems and opportunities to enhance or to enrich people’s lives
Monitor trends and exploit them early on
Take a different approach to an existing
market
Put a new twist on an old idea
How to Spot Entrepreneurial Opportunities
Look for creative ways to use existing
resources
Realize that others have the same problem
that you do
Notice what is missing
How to Spot Entrepreneurial Opportunities
Benefits of Small Business Ownership
The opportunity to:Control your own destinyMake a differenceReach your full potentialReap impressive profitsContribute to society and to be
recognized for your effortsDo what you enjoy and to have fun at it
Drawbacks of Small Business Ownership
Uncertainty of incomeRisk of losing your entire investmentLong hours and hard work
1 to 39 hours10%
40 to 49 hours29%
50 to 59 hours22%
60 to 69 hours19%
More than 70 hours20%
Small Business Owners' Work WeekNumber of Hours Worked per Week
Average workweek = 54 hours
Uncertainty of incomeRisk of losing your entire investmentLong hours and hard work Lower quality of life until the
business gets established
Drawbacks of Small Business Ownership
Uncertainty of incomeRisk of losing your entire investmentLong hours and hard workLower quality of life until the business gets
established
High levels of stress Complete responsibility Discouragement
Drawbacks of Small Business Ownership
The Cultural Diversity of Entrepreneurship
Young entrepreneurs
Entrepreneurial Activity by Age Group
The Cultural Diversity of Entrepreneurship
Young entrepreneurs
Women entrepreneurs
Entrepreneurial Activity by Gender
The Cultural Diversity of Entrepreneurship
Young entrepreneursWomen entrepreneurs
Minority-owned enterprises
Minority Business Ownership in the United States
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The Cultural Diversity of Entrepreneurship
Young entrepreneursWomen entrepreneurs
Minority-owned enterprises Immigrant entrepreneurs Part-time entrepreneurs
Small Business by Industry
Small Businesses...Employ 50.2% of the nation’s private
sector workforcePay 45% of total private payrollCreate more jobs than big
businessesSBA estimates they create 79% of all net
new jobs in the U.S.
Are leaders in offering training and advancement opportunities to workersProvide 67% of workers with their first
jobs Account for 47% of business salesKey role in innovation:
Produce 13 times more patents per employees than large companies
Small Businesses...
Putting Failure into PerspectiveAbout 54% of new companies fail within 4
years Entrepreneurs are not affected by the
prospect of failureFailure – a natural part of the creative
process Successful entrepreneurs learn to fail intelligently
Avoiding the Pitfalls of Small Business Failure
Know your business in depth
Prepare a business plan
Manage financial resources
Understand financial statements
Learn to manage people
effectively
Set your business apart from the
competition
Maintain a positive attitude
Avoiding the Pitfalls of Small Business Failure