AEM 120 Textbook Outline

AEM 120 Textbook Outline - Chapter 1 Basics Entrepreneur...

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Chapter 1: Basics Entrepreneur – the field of business that seeks to understand how opportunities to create something new arise and are discovered or created by specific individuals, who then use various means to exploit or develop them, thus producing a wide range of effects; components: o Something new is created (service/product) o Discovered by somebody o Specific individual pursues o Exploit or develop idea o Has effect on public Intrapreneurship – when people create something new INSIDE of an existing company instead of through a new venture ENTREPRENEURSHIP PROCESS o Recognition of opportunity Opportunity is recognized Results from economic, technological, governmental, and social changes Economic change – interest rate change Technological – broadband becomes faster Governmental – environmental protection policy Social – nature of people to buy online Have potential for economic value o Assembling Resources Basic information (about markets, competitors, environmental and legal issues) Human resources (partners, initial employees) Financial resources (angels, VCs, 3Fs) BUSINESS PLAN!!! o Launching the New Venture Choosing new legal form of venture (sole proprietorship, partner, LLC, corporation, etc) Developing the new product or service (prototype, beta testing, etc) Establish roles of top management o Building Success and Managing Growth Getting additional funding (2 nd , 3 rd rounds of funding from VCs) Most stressful Most businesses fail Develop strategies to encourage and manage growth Struggle to attract, motivate, and retain high-quality workers Build effective relationships among founders hardest part, high stress, volatility, building management trust, socially competent o Harvesting rewards
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Cashing out IPO ESOP (to employees) Family succession Acquisition Profits Individual-level variables o Skills o Motives o Characteristics of entrepreneurs Group-level variables o Ideas o Input from others o Effectiveness in interactions with venture capitalists o Customers o Potential employees Social level o Government policy, economic conditions, technology Who is on the cutting edge, creating new ideas? o Incubators and science parks o Universities o Technology transfer offices o Entrepreneurial cognition Entrepreneurial Sources of Knowledge o Three means of acquiring knowledge Observation Reflection Experimentation o Opportunity recognition Doing well with patterns Systematic observation ** Perceiving connections between various events and trends ** Broad experiences help recognize this Do well when given training in recognizing patterns Chapter 2: Opportunities and How They Arise 2 main sources for new opportunities o Info people have that helps them recognize it o Changes in the external world that generate opportunities Technological Change o
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