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Starting Your Own IT Company. Jennifer Mertens Marianne Doyle Aaron Johnson Willie McGarry. Group 9:. Overview. What is an Entrepreneur? Statistics Entrepreneurial Characteristics Skills an Entrepreneur Should Possess Starting a Business Interviews David Garthe Harry Brumleve - PowerPoint PPT Presentation
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Starting Your Own IT Starting Your Own IT CompanyCompany
Group 9:
Jennifer Mertens Marianne DoyleAaron JohnsonWillie McGarry
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OverviewOverviewWhat is an Entrepreneur?StatisticsEntrepreneurial CharacteristicsSkills an Entrepreneur Should
PossessStarting a Business Interviews
– David Garthe– Harry Brumleve
Case Study– Red Hat
Comparison and Conclusion
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Questions?Questions? How many of you have
started your own business or currently own a business?
How many of you hope to start your own business someday in the future?
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What is an Entrepreneur?What is an Entrepreneur?
Coming from an entrepreneur himself, Bob Reiss says,
"Entrepreneurship is the recognition and pursuit of opportunity without regard to the resources you currently control, with confidence that you can succeed, with the flexibility to change course as necessary, and with the will to rebound from setbacks.“
http://www.thinkinglike.com/Essays/entrepreneur-definition.html
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What is an Entrepreneur?What is an Entrepreneur?
A person who organizes, operates, and assumes the risk for a business venture.
http://www.thefreedictionary.com/entrepreneur
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StatisticsStatistics
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How many businesses open and How many businesses open and close each year?close each year?
Starts and Closures of Employer Firms from 2000-2004.
Category 2000 2001 2002 2003 2004
New Firms 574,300 585,140 569,750 553,500e 580,900e
Firm Closures 542,831 553,291 586,890 572,300e 576,200e
Bankruptcies 35,472 40,099 38,540 35,037 34,317
http://www.sba.gov/advo/stats/sbfaq.pdf
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What is the survival rate for new What is the survival rate for new firms?firms?
“Two-thirds of new employer establishments survive at least 2 years, and 44% survive at least 4 years, according to a new study.”
“Major factors in a firm’s remaining open include an ample supply of capital, the fact that a firm is large enough to have employees, the owner’s education level, and the owner’s reason for starting the firm in the first place, such as freedom for family life or wanting to be one’s own boss.”
http://www.sba.gov/advo/stats/sbfaq.pdf
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What role do women and minority What role do women and minority entrepreneurs play?entrepreneurs play?
“66% of all home based businesses are owned by women.”
“Today, 4.7 million women are self-employed in the United States. This represents a 77% increase since 1983.”
http://www.sba.gov/advo/stats/sbfaq.pdf
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What role do women and minority What role do women and minority entrepreneurs play?entrepreneurs play?
“Of the 23 million firms in 2002, 6.9 percent were owned by Hispanic Americans, 5.2 percent by African Americans, 4.8 percent by Asian Americans, 0.9 percent by American Indians and Alaskan Natives, and 0.14 percent by Native Hawaiian and other Pacific Islanders.”
“In 2002, minorities owned 4.1 million firms that generated $694.1 billion in revenues and employed 4.8 million workers.”
http://www.sba.gov/advo/stats/sbfaq.pdf
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Top 10 Cities For EntrepreneursTop 10 Cities For Entrepreneurs
Minneapolis Norfolk/Virginia
Beach/Newport News Va.
Washington D.C. Atlanta Miami
Fort Lauderdale, Fla. Charlotte/Gastonia/
Rocky Hill, N.C. Salt Lake City West Palm Beach, Fla. Orlando Fla.
Journal of AccountancySource: Entrepreneur and D&B, 2003
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Entrepreneurial Entrepreneurial CharacteristicsCharacteristics
A Good Match
Outside the Norm
http://www.startupjournal.com "Are You Qualified To Be an Entrepreneur"
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Entrepreneurial CharacteristicsEntrepreneurial Characteristics
A Good Match Self confident Multi-skilled Innovative Results-Oriented Risk taker Committed
http://www.gdrc.org/icm/micro/define-micro.html
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Entrepreneurial CharacteristicsEntrepreneurial Characteristics
A Good Match Children or grandchildren of immigrants Relationship with key breadwinner in the family is
competitive Complete a college degree Get fired from several jobs; Dislike working for
others
http://www.startupjournal.com "Are You Qualified To Be an Entrepreneur"
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Entrepreneurial CharacteristicsEntrepreneurial Characteristics
Some of the most often found qualities in successful entrepreneurs are tenacity, leadership skills and the ability to adapt to unexpected developments.
Some argue that although personal traits are important, they do not necessarily determine why someone becomes an entrepreneur.
"Mastering the Entrepreneurial Life Cycle"
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Entrepreneurial CharacteristicsEntrepreneurial Characteristics
Outside the Norm Some people think in order to be entrepreneurial,
you have to start your own company; but this is not true.
Buy Companies Inherit Companies or take over for a founder. Work within large corporations, starting new
ventures that spin off.
http://www.startupjournal.com "Are You Qualified To Be an Entrepreneur"
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Skills an Entrepreneur Should Skills an Entrepreneur Should PossessPossess
FocusedHave a VisionAre LeadersPersistence and PassionateHave Technical Skills Flexible
http://ezinearticles.com/?Critical-Entrepreneurial-Skills&id=84877
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Skills an Entrepreneur Should Skills an Entrepreneur Should PossessPossess
OrganizedStrong Work EthicGood Decision making abilityTrustworthyDeterminedHealthy
http://www.geocities.com/mengle98/Ch1/page2.html
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Before You StartBefore You Start
How well do you qualify to be an entrepreneur?– http://www.liraz.com/webquiz.htm#q10
Go through a checklist similar to this one:– http://app1.sba.gov/survey/checklist/index.cgi
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Before you startBefore you start
You need a strategy Every business strategy needs to have the
following elements:1. Arenas: where will we be active?2. Vehicles: how will we get there?3. Differentiators: how will we win in the
marketplace? 4. Staging: what will be our speed and sequence of
moves? 5. Economic logic: how will we obtain our returns?
http://proquest.umi.com/pqdweb?did=105262864&Fmt=4&clientId=45249&RQT=309&VName=PQD
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Getting StartedGetting Started
31 Tips to face your fears and get started“Most startup articles focus on the
mechanics of launching a business. But the inner journey to starting a business is just as important as writing a business plan and getting financing.”– Suzanne Mulvehill
http://www.entrepreneur.com/article/0,4621,320394-1,00.html
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31 Tips31 Tips1. Say yes to your yearning.2. Start a journal.3. Write down your goals4. Visualize your success.5. Create and read affirmations6. Evaluate your beliefs7. Do what you love8. Do something different every day9. Act "as if.”10. Go out and scare yourself.11. Spend time in nature12. Accept all your feelings.13. Finish unfinished business.14. Get educated.15. Accept and believe compliments.16. Acknowledge your gifts.
http://www.entrepreneur.com/article/0,4621,320394-1,00.html
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31 Tips31 Tips17. Give up excuses18. Eliminate "I can'ts.”19. Accept confusion20. Know there is no "right" time21. Start small22. Say no when you mean no and yes when you mean yes.23. Resist self-judgment24. Stay out of overwhelm.25. Expect resistance.26. Answer your "what ifs.”27. Practice patience.28. Overcome the "not good enough" syndrome.29. Ask for help.30. Trust your instincts. 31. Treat yourself with tlc.
http://www.entrepreneur.com/article/0,4621,320394-1,00.html
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5 Mistakes Entrepreneurs 5 Mistakes Entrepreneurs MakeMake
“The best way to succeed is simply to avoid failure.”
To avoid making mistakes Entrepreneurs must:
1. Examine the 3 T’s– Time– Temperament– Talent
Five Mistakes Entrepreneurs Make Jim Stovall. ハ Accounting Technology: ハ CPA Wealth Provider: Best in Show ハBoston:Oct 2005. ハ p. ハ 18-19 ハ (2 ハ pp.)
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5 Mistakes Entrepreneurs 5 Mistakes Entrepreneurs MakeMake
2. Find his/her market niche “I never perfected an invention that I did not think
about in terms of the service it might give others… I find out what the world needs, then I proceed to invent.”-Thomas Edison
3. Have ample financing4. Be ready to do everything by themselves5. Understand the amount of time and
passion it takes to be successful
Five Mistakes Entrepreneurs Make Jim Stovall. ハ Accounting Technology: ハ CPA Wealth Provider: Best in Showハ Boston:Oct 2005. ハ p. ハ 18-19 ハ (2 ハ pp.)
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Getting StartedGetting Started
This website helps you get started:
– https://www.sos.mo.gov/
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InterviewsInterviews David GartheDavid Garthe
Harry Brumleve Harry Brumleve
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David GartheDavid Garthe
Age 33SingleFrom Ballwin, MissouriUniversity of Missouri-St. Louis
– B.A. in Finance– Minor in Partying
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David GartheDavid Garthe
Watlow Electric, Inc. – Started in Accounting, then IT
Net Assist Temporaries– Providing temporary Network Specialist
CareerConnection.com– Similar to Monster.com– Used by many Fortune 500 Companies
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Garthe CorporationGarthe Corporation
Garthe Corporation– Incorporated in 2000
Initial Business Plan– Create websites that provide advertising value
to casinos– Sell advertisement to Casinos– It was easy then (dot com boom)
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Garthe CorporationGarthe Corporation
Time Management– 15% Sales, 25% Admin, 60% Projects
Results of Initial Business Plan– Very Profitable until dot com bust– Clients changed after bust– Sold off sites to fantasy sports group.
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Garthe CorporationGarthe Corporation
Refined Business Plan– Create websites that provide subscription-based services– ConnectMe.com
Refined Time Management– 50% Marketing, 15% Admin, 35% Projects
Results– Closed site after legislative issue with State of Missouri– Next initiative already on the way
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Business ResourcesBusiness Resources
– CPAProtect yourself from IRSSave money in unexpected placesGuide through financial planning
– AttorneyAssist with incorporation
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David GartheDavid Garthe
8 Must-have Traits of an Entrepreneur Ability to work, work, work Ability to read people Ability to listen A good business plan Financial Stability Love and belief in offered product Never think you are smarter than customer Accountability
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Harry BrumleveHarry Brumleve
Age 32SingleFrom Ballwin, MissouriUniversity of Missouri-Columbia
– B.A. in German– B.S. in Computer Science
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Harry BrumleveHarry BrumleveGA Sullivan (Avanade)
Worked as “Jack-of-All-Trades” The perks were small
Tellabs Worked on telephone exchange system Worked here for the “big money”
Cambridge Business Partners (Novell) Worked on commerce logistics architecture 20% of all Logistics dollars spent
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Harry BrumleveHarry Brumleve
Started Jet Engine Consulting in 2003 Himself and a partner Formed once they had clients Did work for National Parks Dept.
Wanted to get into consulting Was tired of working for the big firm
Mergers No direction in accomplishing goals
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The Business PlanThe Business Plan
Two part Business plan:– Consulting: A partner and himself
Invest time and effort Produce superior customer service Solve people problems Help companies become more efficient Create a name through good PR
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The Business PlanThe Business Plan
– Product: Enterprise Service Bus“Incubation period” tied into consultingWork out the bugsDevelop a relationship through productConsume product and make moneyLet mature and take to market
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Harry BrumleveHarry Brumleve
What is an Entrepreneur?– Career must be Humanistic:
Help solve people problems– Had two mentors
One was in computer science– “No such thing as a one time deal”– Invest to provide better service– Not afraid to turn jobs down
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Harry BrumleveHarry BrumleveHow have things worked out:
Consulted for Accenture– Worked on eDemocracy software
Currently Consulting for Botanical Gardens– Writing classification software for Botanists
Consults 35-40 hours a week– Works on product 30 hours a week
Travels 4-5 times a year Owns his home Has money invested
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Red HatRed Hat
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The BeginningThe BeginningMarc Ewing
Carnegie Mellon University Started company after graduating
from college Couldn’t afford $10,000 Unix
workstation Decided to use Linux because it
was freeBob Young
University of Toronto Ran a distribution company for
Unix productswww.salon.com
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The BeginningThe Beginning
Marc Ewing created a Linux development business to accomplish a specific task
He decided there was more potential in developing Linux and dropped his project
Bob Young was enamored with the concepts of open source and free market
He saw the potential in Linux and begun distributing it through a catalog company
www.salon.com
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Coming TogetherComing Together
In 1994, Ewing released the first version of Red Hat Linux
Young bought 350 of the 500 copies Ewing had planned to print
Young decided he wanted to be more than a distributor and Ewing didn’t want to do “all of the business stuff”
www.redhat.com
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Coming TogetherComing Together
In 1995, Bob Young bought Ewing’s business, merges it with his company, and names the company Red Hat Software
Red Hat Linux 2.0 is released the same yearRed Hat is able to secure the number one
brand name in the business
www.salon.com
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Company ProfileCompany Profile
Their mission: “To be the defining technology company of the 21rst century”
980 employees Publicly Held Company as of 1999:
Eighth biggest first day gain in history
Headquarters: Raleigh, North Carolina
27 Worldwide offices
www.redhat.com
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Company ProfileCompany Profile
They surpassed Sun Microsystems in share price in 2002
In 2003, posted a profit for the first timeIt is announced that Red Hat ranks among
the top ten software companies in gaining share of IT dollars (2004)
www.redhat.com
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What They Have DoneWhat They Have Done
It is estimated that Red Hat holds 70% of the worldwide global Linux market share
Amazon.com is able to reduce technology costs by 25% by using Red Hat (from $71 million to $54 million)
Acquired AOL’s Netscape software for around $25 million
www.redhat.com
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What They Have DoneWhat They Have Done
Released Red Hat Desktop 3 which is their first dedicated desktop product.
Have entered into a partnership with IBM, Sony, and Novell to “take on Microsoft’s dominance of the market” (2005)
This partnership is buying up Linux patents to control cost and control market share
www.redhat.com
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How They Did ItHow They Did ItBob Young was never a “computer guy,”
but he was fascinated by open source and believes in a free market
He saw opportunity with Linux when others just laughed
Marc Ewing found something that worked better and focused on it
They both took chances
www.redhat.com
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OverviewOverviewWhat is an Entrepreneur?Entrepreneurial CharacteristicsStatisticsSkills an Entrepreneur Should
PossessStarting a Business Interviews
– David Garthe– Harry Brumleve
Case Study– Red Hat
Comparison and Conclusion
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OverviewOverview
Comparisons: •Clearly defined plan•Adapted to continuously changing environment•Vigorous implementation•Sound technical skills
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QuestionsQuestions