Stages of Entrepreneurship

Dr. Milton SilverDr. Milton Silver

Outline

Critical Stages of EntrepreneurshipCritical Stages of Entrepreneurship Major Activities along the stagesMajor Activities along the stages Transition to next classTransition to next class

Basics: Five Best Ways to Get Rich InheritanceInheritance Marry richMarry rich Win a state lotteryWin a state lottery Be a show-biz celebrityBe a show-biz celebrity Start a companyStart a company

–From Stolze, From Stolze, Start upStart up

Major Stages of Entrepreneurship

Converging on the ideaConverging on the idea Business PlanBusiness Plan Business FormationBusiness Formation Growth/ exitGrowth/ exit Going publicGoing public

A Framework to Think About Ideas for Entrepreneurship

Existing Products

Modified Products

New Products

Existing Markets

Identifiable Markets

New Markets

Women’s Women’s ShampooShampoo

Alternative Alternative Greeting Greeting CardsCards

Solid state Solid state still camerastill camera

Clothes for Clothes for professional professional womenwomen

Overnight Overnight package package deliverydelivery

Specialty Specialty sports carsports car

Mobile pet Mobile pet grooming grooming devicedevice

Personal Personal ComputersComputers

Laser discsLaser discs

Existing Products

Modified Products New Products

Existing Markets

Identifiable Markets

New Markets

1. Converging on the idea

In many cases, the decision start a business In many cases, the decision start a business precedes the ideaprecedes the idea

Many ideas fall by the way side, since they are Many ideas fall by the way side, since they are either either technically not feasibletechnically not feasible or or financially not financially not viableviable or both or both

So you need to do enough ‘research’ to converge So you need to do enough ‘research’ to converge on the ideaon the idea DocumentaryDocumentary ExperienceExperience

Ideas: Intellectual Property The meaning of the termThe meaning of the term Four forms of legal defenseFour forms of legal defense

PatentPatent CopyrightCopyright TrademarkTrademark Trade SecretTrade Secret

Confidentiality AgreementsConfidentiality Agreements

In many cases, you will need legal help!

2.Business Plan Development

Four major elements:Four major elements: New product/ service developmentNew product/ service development Business ModelBusiness Model Financial ModelFinancial Model Operating planOperating plan

3.Business Formation

Type of company: legal form, registrationType of company: legal form, registration Financing new product development:Financing new product development:

Family and friendsFamily and friends SBIR grantsSBIR grants NCIA awards/ Ben Franklin grantsNCIA awards/ Ben Franklin grants AngelsAngels

Frugal: This is the time for extreme frugality

Example – BAIDA EntrepreneursTo be announced…To be announced…

IncubatorIncubator SBDCSBDC CollegesColleges

4.Growth/exit

Difference between life style and growth Difference between life style and growth companiescompanies

Growth will require Growth will require infusion of capital through internally generated infusion of capital through internally generated

fundsfunds Sometimes employment of venture capitalistsSometimes employment of venture capitalists Passive investorsPassive investors

Growth will also require organization, as taught in Growth will also require organization, as taught in business schools (Michael Dell story)business schools (Michael Dell story)

Exit

Various reasonsVarious reasons Story of Story of Land’s EndLand’s End

5. Going Public

Initial Public OfferingInitial Public Offering

Probably the point in time the entrepreneur extracts the value of his/her efforts

Major Stages of Entrepreneurship

Converging on the ideaConverging on the idea Business PlanBusiness Plan Business FormationBusiness Formation Growth/ exitGrowth/ exit Going publicGoing public