1_9.ppt Entreprenuers: the Driving Force

Entrepreneurs Infromation

1. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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Entrepreneurs: The
Driving Force Behind
Small Business

2. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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The World of the
Entrepreneur
In 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

3. Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall Chapter 1 Entrepreneurs 1-3

4. Chapter 1 Entrepreneurs
Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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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

5. 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!
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6. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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Characteristics of
Entrepreneurs
Survey: 61% of adults in the U.S. would
like to start their own business
Willingness to take initiative
Preference for moderaterisk
Confidence in their ability to succeed
Self-reliance
Perseverance
Desire for immediate feedback

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High level of energy
Competitiveness
Future orientation
Serial entrepreneurs
Skilled at organizing
Value achievement over money
Characteristics of
Entrepreneurs

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Entrepreneurship
One 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)

9. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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How to Spot Entrepreneurial
Opportunities
Creativity 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
creativesolutions to problems and
opportunities to enhance or to
enrich people’s lives

10. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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How to Spot Entrepreneurial
Opportunities
Monitor trends and exploit them early on
Sonic Mule
Take a different approach to an existing
market
Poo Poo Paper Company
Put a new twist on an old idea
Green Grass at Last

11. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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How to Spot Entrepreneurial
Opportunities
Look for creative ways to use existing
resources
Greenfields Coal
Realize that others have the same problem
that you do
SkirtSports
Notice what is missing
Dogs on Wheels

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Benefits of Small Business
Ownership
The opportunity to:
Control your own destiny
Make a difference
Social entrepreneurs
Reach your full potential
Reap impressive profits
Contribute to society and to be recognized
for your efforts
Do what you enjoy and to have fun at it

13. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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Drawbacks of Small
Business Ownership
Uncertainty of income
Risk of losing your entire investment
Long hours and hard work

14. Source: MasterCard Global Small Business Survey, 2007. Small Business Owners' Work Week
Number of Hours Worked per Week
1 to 39 hours
10%
40 to 49 hours
29%
50 to 59 hours
22%
60 to 69 hours
19%
More than 70 hours
20%
Average workweek = 54 hours
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15. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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Drawbacks of Small
Business Ownership
Uncertainty of income
Risk of losing your entire investment
Long hours and hard work
Lower quality of life until the business
gets established

16. Source: National Federation of Independent Businesses and Wells Fargo Bank, 2002. 9 . 8 %
3 3 . 5 %
3 1. 1%
17 . 8 %
6 . 1%
1. 7 %
0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
Under 25 25-34 35-44 45-54 55-64 65+
Age
Owner Age at Business Formation
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17. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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Drawbacks of Small
Business Ownership
Uncertainty of income
Risk of losing your entire investment
Long hours and hard work
Lower quality of life until the business gets
established
High levels of stress
Complete responsibility
Discouragement

18. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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Feeding the
Entrepreneurial Fire
Entrepreneurs as heroes
Entrepreneurial education
Demographic and economic factors
Shift to a service economy
Technological advancements
Outsourcing
Independent lifestyles
E-Commerce and the World Wide
Web
International opportunities

19. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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The Cultural Diversity
of Entrepreneurship
Young entrepreneurs
Women entrepreneurs
Minority-owned enterprises

20. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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The Cultural Diversity
of Entrepreneurship
Young entrepreneurs
Women entrepreneurs
Minority-owned enterprises
Immigrant entrepreneurs
Part-time entrepreneurs

21. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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Avoiding the Pitfalls of
Small Business Failure
Know your business in depth
Prepare a business plan
Manage financial resources
Understand financial
statements

22. Chapter 1 Entrepreneurs Copyright ©2012 Pearson Education, Inc. publishing as Prentice Hall
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Avoiding the Pitfalls of
Small Business Failure
Learn to manage people
effectively
Set your business apart from
the competition
Maintain a positive attitude