Introduction to Entrepreneurship and TechnologyBased Ventures

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Introduction to Entrepreneurship
andTechnology-Based Ventures
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The empires of the future are the empires of the
mind. Winston Churchill
Summary
What enables global capitalism? The entrepreneur
provides the creative force in order for
capitalism (free enterprise) to work.
Entrepreneurs strive to make a difference in our
world and contribute to its betterment. They are
also motivated by achievement, independence, and
the accumulation of wealth.
Technology Ventures From Idea to Opportunity
Chapter 1 Summary
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An entrepreneur is a person who undertakes the
creation of an enterprise or business that has
the chance of profit (or success).
Technology Ventures From Idea to Opportunity
Chapter 1 concept
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For an entrepreneur, a challenge is a call to
respond to a difficult task and the commitment to
undertake the required enterprise.
What are the key elements to overcoming a
challenge?

• The Elements of Overcoming a Challenge
• Able to deal with a series of tough issues
• Ability to create solutions and work to perfect
  them
• Can handle many tasks simultaneously
• Resiliency in the face of set-backs
• Willingness to work hard and not expect easy
  solutions
• Possess well-developed problem solving skills
• Able to learn and acquire the necessary skills
  for the tasks at hand

Technology Ventures From Idea to Opportunity
Chapter 1 Table 1.2
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An opportunity is a favorable juncture of
circumstances with a good chance for success or
progress. It is the job of the entrepreneur to
locate new ideas and to put them into action.
Thus, entrepreneurship may be described as the
identification and exploitation of previously
unexploited opportunities.
Technology Ventures From Idea to Opportunity
Chapter 1 concept
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An Attractive Opportunity
Finding the Right Opportunity

• Timely
• Solvable
• Important
• Profitable
• Favorable Context

TheSweetSpot

• Like to do the tasks
• Like the challenge
• Committed to do what is necessary

• Skilled at the neededtasks

Interests, Passions, Commitment
Capabilities Skills
Technology Ventures From Idea to Opportunity
Chapter 1 Figure 1.1 - Finding the Right
Opportunity
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Entrepreneurial Capital EC Ecomp x Ecomm ?
Ecomp Entrepreneurial competence is the ability
to 1) to recognize and envision taking
advantage of opportunity and 2) to access
and manage the necessary resources to
actually take advantage of the opportunity ?
Ecomm Entrepreneurial commitment is a
dedication of the time and energy necessary to
bring the enterprise to initiation and fruition.
Technology Ventures From Idea to Opportunity
Chapter 1 Entrepreneurial Capital
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Economic Value Opportunity x Entrepreneurial
Capital After T years the market value is MV
M x C x EV M x C x Ecomp x
Ecomm where M management efficiency and
effectiveness C context
Technology Ventures From Idea to Opportunity
Chapter 1 Economic Value
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The intellectual capital of an organization is
the talents of its people, the efficacy of its
management systems, the effectiveness of its
customer and supplier relations, and the
technological knowledge employed and shared among
its people and processes.
Technology Ventures From Idea to Opportunity
Chapter 1 concept
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Economy
Natural Capital
Beneficial Outputs
Financial Capital
Undesired Waste Outputs
Intellectual Capital
Technology Ventures From Idea to Opportunity
Chapter 1 Figure 1.2 A Model of the Economy
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The Firm
Outputs
Inputs
Raw Materials
Components Modules
Products Services
Financial Capital
Physical Assets
Technologies
Technology Ventures From Idea to Opportunity
Chapter 1 Figure 1.3 Transforming available
inputs into desired outputs
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A firms theory of its business is how it
understands its total activities, resources and
relationships.
Technology Ventures From Idea to Opportunity
Chapter 1 Figure 1.5
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What is Dynamic Capitalism?
Dynamic Capitalism is the process of wealth
creation characterized by the dynamics of new,
creative firms forming and growing and old, large
firms declining and failing.
What is Creative Destruction?
Creative Destruction is the entrepreneurial
activity of destroying old models and creating
new models of doing business.
Technology Ventures From Idea to Opportunity
Chapter 1 concept
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Principle 1The entrepreneur develops an
enterprise with the purpose of creating wealth
and prosperity for all participants investors,
customers, suppliers, employees, and themselves
using a combination of intellectual and
entrepreneurial capital.
What other purposes can there be? If not focused
on wealth, are they really entrepreneurial?
Technology Ventures From Idea to Opportunity
Chapter 1 Principle 1
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In the field of observation, chance only favors
minds which are prepared. Louis Pasteur
Summary
How can an entrepreneur identify and select a
valuable opportunity?
The choice of an opportunity and the decision to
act is a critical juncture in the life of an
entrepreneur. With the decision to act, the
entrepreneur prepares a business summary for the
venture that is used to test the new venture with
potential investors, employees, and customers.
Technology Ventures From Idea to Opportunity
Chapter 2 Summary
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Six steps to Acting as an entrepreneur
If you are uncomfortable Youll just have to
fake-it till you make it !
Technology Ventures From Idea to Opportunity
Chapter 2 Figure 2.1
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Types of Opportunity Opportunity Pull the
size of the opportunity attracts opportunity
seekers to attempting to exploit it. Example A
drug to mitigate the effect of Alzheimers
disease.
Technology Ventures From Idea to Opportunity
Chapter 2 concept
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Types of Opportunity Capability Push a new
technology or capability causes a search for new
applications. Example Digital Television
Technology Ventures From Idea to Opportunity
Chapter 2 concept
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Nine Categories of Opportunity 1. Increasing
the value of a product or a service 2. New
applications of existing means or
technologies 3. Creating mass markets 4.
Customization for individuals 5. Increasing
reach 6. Managing the supply chain 7.
Convergence of change 8. Process innovation 9.
Increasing the scale of the firm
Technology Ventures From Idea to Opportunity
Chapter 2 Table 2.1
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The Attractiveness of an Opportunity EA
Where Y income I independence W
work effect R risk
What did this mean to you when you read it?
Technology Ventures From Idea to Opportunity
Chapter 2 concept
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Evaluating an Opportunity Sources of
Discontinuities I. Society Aging
Society Lifelong Education Food and
Population Regulation II. Technology Innovation
Disruptive Technologies New Knowledge III.
Markets Deregulation Supply Chain disruption
Technology Ventures From Idea to Opportunity
Chapter 2 Table 2.2
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Characteristics of Entrepreneurial Teams
Positive attitudes towards independence,
achievement, and innovation Acceptance of risk
and demanding work effort Capabilities
matching the needs of the venture Willing to
make the commitment required Passionate about
the opportunity
Characteristics of the Context Timeliness
Favorable industry conditions Future conditions
appear favorable
100
50
100
50
100
50
0
Characteristics of the
Opportunity Novelty of the product
Potential for sustainable long-term success
Potential for good return on investment
Potential for a growing market Good
risk-versus-reward balance Customers are known
and responsive
50
Resources Capable of securing access to the
human, financial, and physical resources required
by the opportunity
100
Technology Ventures From Idea to Opportunity
Chapter 2 Figure 2.4 Evaluating An Opportunity
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• The Elements of a Business Concept Summary
• Explain the problem or need and identify the
  customer.
• Explain the proposed solution and the uniqueness
  of the solution.
• Tell why the customer will pay for the solution.

Technology Ventures From Idea to Opportunity
Chapter 2 Table 2.14
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The Elements of the Business Story Background De
scribe the current situation, the characters, and
the problem. Challenge Describe the challenges
and conflicts that impede a coherent plan to
solve the problem. Resolution Portray a solution
to the challenges and the problem and how the
venture will succeed by resolving the problem.
Technology Ventures From Idea to Opportunity
Chapter 2 Table 2.15
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• The Elements of an Executive Summary
• Business Concept The problem and the solution
• Market, Customer, and Industry
• Marketing and Sales Strategy
• Organization and Key Leaders
• Financial Plan Four years of summary results
• Financing and Key Allies Required

Technology Ventures From Idea to Opportunity
Chapter 2 Table 2.17
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Principle 2 The capable entrepreneur knows how
to identify, select, describe, and communicate an
opportunity that has good potential to become a
successful venture.
Technology Ventures From Idea to Opportunity
Chapter 2 Principle 2
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Success in any enterprise requires the right
product, methods, and workers, and each must
complement the others. Joseph Burger
How do successful entrepreneurs create a
compelling business design for their new ventures?
To design a new business, the entrepreneur must
cogently and clearly describe the customers and
their needs and how the new venture will satisfy
those needs. The entrepreneur must be able to
explain the VALUE to the customer (not the
company)!
Technology Ventures From Idea to Opportunity
Chapter 3 Summary
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Example of a vision for an innovative firm We
strive to preserve and improve life through the
innovation of biomedical devices while
supporting, training, and inspiring our employees
so that individual ability and creativity is
released and rewarded. Our goal is to be a
leader in the industry by 2006 and be widely
known throughout the world.
Technology Ventures From Idea to Opportunity
Chapter 3 Table 3.1
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Elements of a vision Clarity Easily
understood, focused. Consistency Holds constant
over a time period, but adjustable as
conditions warrant Uniqueness Special to this
organization Purposeful Provides reason for
being
Technology Ventures From Idea to Opportunity
Chapter 3 Table 3.1
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A mission statement is a description of the
course of action to implement the vision.
Possible Elements of a mission statement
Core Values Customers and/or Stakeholders
Products
Competitive Advantage Values Provided to
Customer Markets or Industry
Checkout the dilbert mission statement generator
online
Technology Ventures From Idea to Opportunity
Chapter 3 Table 3.3 Elements of a Mission
Statement
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The Value Proposition defines the company to the
customer.
What types of value can can company offer?
Technology Ventures From Idea to Opportunity
Chapter 3 Concept
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The Value Proposition defines the company to the
customer.
Five values offered to a customer 1. Product
Performance, quality, features, brand,
selection, search, easy to use, safe 2. Price
Fair, visible, consistent, and reasonable 3.
Access Convenient, location, nearby, at-hand,
easy to find, in a reasonable time 4. Service
Ordering, delivery, return, check-out 5.
Experience Emotional, respect, ambiance, fun,
intimacy, relationships, community
Technology Ventures From Idea to Opportunity
Chapter 3 Table 3.6
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Example of a value proposition Intel offers
product as their primary value and service as
their secondary value.
The Unique Selling Proposition is a short version
of firms value proposition. Can you suggest some
from the book?
Example Intel has a USP The best
product with great service.
Technology Ventures From Idea to Opportunity
Chapter 3 concept
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Elements of A Business Model
Technology Ventures From Idea to Opportunity
Chapter 3 Table 3.8
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Dell Computer Business Model
Customer Selection High Relevance Four
Segments Corporate, Government, Education,
Consumer. Value Proposition Unique
Benefits A customized computer at a good price
with great service readily accessible via phone
or the Internet. Differentiation and control
Sustainable competitive advantage Customized
products via a direct sales channel on the phone
or Internet with strong service and customer
relationships. Scope of Product and
Activities Desktop, laptop, and
servers. Strong supply chain management. Organi
zational Design Divisional organization for
each customer segment. Value Capture for
Profit Opportunities for cross-sell and up-sell.
Avoid price as the key value and focus on
service and accessibility. Value for Talent
Learn, Grow, Prosper Training, Learning, and
Career Opportunities.
Technology Ventures From Idea to Opportunity
Chapter 3 Table 3.9
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Identify and State the Firms Core
Competencies Example The core competency of
Google is the design and operation of an internet
search engine.
Technology Ventures From Idea to Opportunity
Chapter 3
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Competitive Advantage The competitive advantage
of a firm is its distinctive factors that give it
a superior or favorable position in relation to
its competitors. A sustainable competitive
advantage is a competitive advantage that can be
maintained over a period of time hopefully,
measured in years.
Technology Ventures From Idea to Opportunity
Chapter 3 concept
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The market value of a firm is MV CA x
D CA competitive advantage D duration
Technology Ventures From Idea to Opportunity
Chapter 3 Market Value
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Sources of Competitive Advantage Source Exampl
e Efficiency - Low Costs Alcoa Product
Innovation Intel Quality - Reliability Mercede
s Customer Responsiveness Dell Manufacturing
Innovation Toyota
Technology Ventures From Idea to Opportunity
Chapter 3 Table 3.11
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Principle 3 The vision, mission, and value
proposition, and business model embodied within
the business design firm and powered by a
sustainable competitive advantage can lead to
compelling results.
Technology Ventures From Idea to Opportunity
Chapter 3 Principle 3
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VENTURE CHALLENGE 1) Create a brief vision
statement for your venture. 2) State the value
proposition for the venture. 3) Create a draft
business model for the venture using the elements
of Table 3.8. 4) What are your ventures core
competencies and competitive advantage?
Technology Ventures From Idea to Opportunity
Chapter 3 Venture Challenge
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DVD Videos Dont Write a Mission Statement,
Write a Mantra Guy Kawasaki (Garage Technology
Ventures) Innovate in Technology and Business
The Founding of Google Larry Page (Google)
Technology Ventures From Idea to Opportunity
Chapter 3 DVD Videos