Fundamentals for Becoming a Successful Entrepreneur: From Business Idea to Launch and Management, 1st edition

Introduction: Why This Book, What It Is All About, and Who We Are xi
The Why xi
The What xiii
The Who xvi
Chapter 1: What Is This Thing Called Entrepreneurship? 1
Introduction 1
The Entrepreneur 1
Entrepreneurial Dreams and Their Outcomes 2
There Is No One Narrative 4
Collective Dreams 6
Why Entrepreneurship Became Important 6
Challenging Assumptions—Entrepreneurship Is for All 7
Entrepreneurial Environments 9
National Innovation Systems for Entrepreneurs 10
Incubators and Accelerators 11
Entrepreneurs: Made or Born 12
Who Is an Entrepreneur? 12
The Entrepreneurial Personality 13
Entrepreneurial Mindset 14
Defining Entrepreneurship: It All Depends 16
Opportunity Recognition 17
Entrepreneurial Goals 19
Different Goals for Different Folks 20
Other Definitional Issues 20
The Self-Employed as Entrepreneurs 22
The Context for Self-Employed Entrepreneurs 22
A False Dichotomy 25
Do Goals Differentiate? 26
A Mini-Case Example 27
Opportunity and the Entrepreneur 28
Exercises 29
Advanced Exercises 30
References 31
Chapter 2: What Is Being Successful: Well It All Depends 33
Why Examine Success? 33
Case Example from Finland and Sweden 33
Defining Success 37
Defining Failure 37
Measurement Issues in Defining Success (and Failure) 39
Success in the Entrepreneurial Context 40
How Some Firm Founders See Success 41
How Entrepreneurship Researchers View Success 42
An Ancient Narrative on Obtaining Success 44
Success and Opportunity 44
Tying Success to Entrepreneurial Goals 45
Is Success Wealth? 46
The True Secret to Success: Networking 47
Rules for Networking 49
Finally, Success Is Having Fun 50
Case Example from Italy 51
Conclusion 54
Exercises 55
References 55
Chapter 3: Getting a Good Idea and Making It Work 57
Overview 57
The Idea 57
Idea Generation 58
Concept Benefits: Needs, Wants, and Fears 59
Examples of Needs, Wants, and Fears 61
Thinking out of the Box: Not Everything Needs a Hammer 62
The Role of Creativity 63
The Concept 65
The Conceptual Event 66
A Case Example of the Conceptual Event 67
The Entrepreneur as a Dreamer 68
Generating Ideas 70
Creating a Viable Business Concept and Business Model 71
Looking for Trends and Counter Trends as Concept Sources 72
Brainstorming: The Good and The Ugly 74
Timing: It Is Not First to Market 74
Designing a Concept for Profitability and Growth 75
Building a Viable Business Concept 76
More Thoughts on Concept Development 78
Some Commentary on Franchises 79
The Concept Feasibility Worksheet Exercise 80
Exercise: Can You Describe the Concept? 82
References 84
Chapter 4: The Basics About Marketing You Have to Know 85
An Overview 85
Why Know Your Market? 86
What Is Marketing? 87
Basic Marketing Terminology 87
Marketing Research: Doing the Work Upfront 91
Market Research: Start Personally 92
Examples of Walking Around Research 96
Developing Effective Marketing Strategies 97
Mobile Devices and Marketing 99
The Internet: The Best and Worst for a Venture 99
Using the Internet and Cell Phone Apps 101
Selling: The Challenge 102
Typical Problems in Selling Anything 102
Selling to the Internet Generation 104
Marketing in the Social Media Age 105
Advertising 106
Public Relations 107
Branding 108
Exercises 109
References 109
Chapter 5: It Is All About Building a Better Mousetrap: Product and Service Development 111
Overview 111
Product/Service Innovation 112
Entrepreneurs Versus Inventors 113
Stage-Gate Model of Product Development 114
Using Stage-Gate Model 116
Types of Innovation 120
Focus Innovation 121
Innovation Impact 123
To Innovate or Not: That Is the Big Question 123
Commercialization Is Key 125
Defining New: In the Eye of the Beholder 125
Building on the Past 127
Reinventing an Industry’s Products: Examples 127
E-Commerce: Using Innovation in Marketing and Distribution 128
Industry Change as Opportunity for Product/Development 130
Examples of Industrial Change Fostering New Models 130
Spotting New Trends for New Products/Services 132
Basic Conditions for Successful Products and Services 133
Case Study of New Product Development in a New Venture 134
Patents, Trade Secrets, and Copyrights 138
Exercise 138
References 139
Chapter 6: Finding Team Members and Building an Entrepreneurial Organization 141
Overview 141
Building the Venture One Person at a Time 142
The Entrepreneurial Team 142
Other Issues to Consider 144
Outsourcing 145
Finding New Employees 146
Big Hiring Errors 147
Characteristics of a Good Hire 148
A Mini-Case Example 150
Whom to Hire or Not, Whom to Fire or Not 151
Saying “No” to an Applicant 152
Firing an Employee 152
To Be a Family Firm or Not to Be 154
What Is Firm Owning Family? 154
Family Goals Impact Hiring 155
Long-Term Impact of Hiring Family Members 156
Compensation, Benefits, and Stock Options 156
Building an Entrepreneurial Team Structure 158
A Line Structure for Entrepreneurial Teams 159
Project Approach to an Entrepreneurial Team Structure 161
Informal Structure: Key to a Successful Entrepreneurial Team 161
New Firm Governance 162
Legal Structure Decisions 163
Final Thoughts on Entrepreneurial Management 165
Exercises 166
References 166
Chapter 7: Everything You Really Need to Know About Entrepreneurial Finance 169
Entrepreneurial Finance: An Introduction 169
Building an Entrepreneurial Financial Strategy 170
Entrepreneurial Finance: Not Just Venture Capital and IPO 171
Building a Sustainable Revenue Model 172
Cash Flow: A Numerical Scorecard 174
Determining Cash-Flow Needs 175
Timing and Cash Flow 177
Money Comes in Four Forms 179
Finding Money and Investors 182
More Money Sources 183
The Myth of Needing Deep Pockets 185
Understanding Investors and Bankability 186
Capital 189
Debt Financing 191
Banks 192
Venture Capital 192
Angel Investors 193
What Investors Look for in Any Venture 193
Bootstrap Financing 194
Advantages to Bootstrapping 195
Crowd Funding 196
Exercises 198
References 199
Chapter 8: How to Grow or Not to Grow Your Venture: That Is the Management Challenge 201
Growing Your Venture: An Introduction 201
What Is Business Growth? 201
Developing a Workable Growth Strategy 202
Growth and Success 203
Mini-Case on Growth by Replication 204
Describing Growth Versus Defining Growth 206
Some Descriptions and Issues 207
Growth and Competition 216
Growth as Metamorphosis 218
Conclusion 221
Exercise 221
References 222
Chapter 9: Planning: Should You, When Do You, and How Do You? 223
Overview of Plans and Planning 223
Why Plan? 225
Hooked on a Feeling 227
When Do You Plan? 228
How Long Will It Take? 229
For Whom Do You Plan? 230
What Goes into a Business Plan? 232
Detail Content of a Written Business Plan 232
Executive Summary Content 233
Marketing Plan Content 235
About Competition 237
Management and Organizational Plan 238
Financial Plan Content 240
General Comments Concerning Plans 242
Final Words on Planning and Success 242
Mini-Case on Chocolate Pralines 243
Index 247