562 takehome exam - 1. There are three types of start-up...

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1. There are three types of start-up firms: salary-substitute firms, lifestyle firms, and entrepreneurial firms. Salary-substitute firms are small firms that yield a level of income for their owner or owners that is similar to what they would earn when working for an employer. Accounting firms, dry cleaners, restaurants, retail stores are examples of salary-substitute firms. Lifestyle firms provide their owner or owners the opportunity to pursue a particular lifestyle and earn a living while doing so. Lifestyle firms include golf pros, tour guides. These firms are nor innovative, nor do they grow quickly. Commonly, lifestyle companies promote a particular sport, hobby and may employ only the owner and just a handful of people. Entrepreneurial firms bring new products and services to the market. The essence of entrepreneurship is creating value and then disseminating that value to the customers. Microsoft, Apple and Amazon are successful entrepreneurial firms. 2. Relationships with people are called “ties.” Strong-tie relationships are characterized by frequent interaction and ties between coworkers, friends, and spouse. Weak-tie relationships are cauterized by infrequent interaction and ties between casual acquaintances. It is more likely that an entrepreneur will get business idea through a weak-tie relationship because strong-tie relationships, which typically from like-minded individuals, tend to reinforce insights and ideas the individuals already have. Weak-tie relationship which form between casual acquaintances, are not as apt to be between like-minded individuals, so one person may say something to another that comes up a completely new idea. 3. First, a common way to generate new business ideas is through brainstorming. Brainstorming is simply the process of generating several ideas about a specific topic. In a formal brainstorming session, the leader of the group asks the participants to share their ideas. One person shares
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562 takehome exam - 1. There are three types of start-up...

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