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AFM 132 > Unit 6: Entrepreneurship > Flashcards

Unit 6: Entrepreneurship Flashcards

- Value an entrepreneurial mindset and traits of an entrepreneur - Differentiate between entrepreneurship and intrapreneurship - Describe the challenges of launching a new idea and ways to start a business - Give examples of resources to start a business, including incubators, industry and government supports, and financial resources - Describe some tools that can help you plan a business, including the Value Proposition, Business Model Canvas, and business plans

1
Q

what does it mean to be an entrepreneur

A
  • Being entrepreneurial means managing uncertainty, taking risks, being creative, and problem solve
  • Harnessing an entrepreneurial mindset can set you up for success regardless of your future career
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2
Q

what are some experiences you can gain from part-time, summer, or co-op jobs

A
  • Finding your passion
  • Building technical abilities
  • Expanding skills
  • Gain exposure to different organizational cultures
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3
Q

what are the traits of successful entrepreneurs

A
  • passion & motivation
  • tolerant of uncertainty
  • learning & growth mindset
  • confidence
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4
Q

what does it mean for entrepreneurs to have passion & motivation

A
  • When making money is not the main motivator
  • Believes in the purpose of their ideas and pursue them
  • Passion helps plan and execute their ideas into a business
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5
Q

what does it mean for entrepreneurs to have tolerant of uncertainty

A
  • Comfortable navigating what you don’t know
  • Not being afraid of failing
  • Comfortable taking risks
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6
Q

what does it mean for entrepreneurs to have learning & growth mindset

A
  • Having a growth mindset to learn
  • Learning from past failures and mistakes and being able to adapt
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7
Q

what does it mean for entrepreneurs to have confidence

A
  • Understanding personal abilities, strengths, and weaknesses
  • Actively look for opportunities to improve their skills
  • Knowing when to seek help from others
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8
Q

what are some motivators for people to pursue an idea of their own or within a business

A
  • Meet an unmet need (Make life easier)
  • Evolve a process (be more efficient or cost-effective)
  • Improve an existing product/service
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9
Q

what are some reasons someone would become an entrepreneur

A
  • can be their own boss
  • flexibility
  • define their own success
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10
Q

why is “being their own boss” a reason why someone would become an entrepreneur

A
  • Making their own ideas come to life
  • Making all of the decisions for the business
  • Don’t need to work for someone else’s vision
  • Do things your way
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11
Q

why is “flexibility” a reason why someone would become an entrepreneur

A

-Finding work-life balance
- Setting own timelines to manage and grow the business

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12
Q

why is the ability to “define their own success” a reason why someone would become an entrepreneur

A
  • Satisfaction and pride that comes with running your own business
  • Defining your own earnings potential overtime through decisions you made
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13
Q

what are the factors that made entrepreneurship more mainstream (more common & supported)

A
  • education
  • technology
  • social acceptance
  • support systems
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14
Q

how does technology make entrepreneurship more mainstream

A
  • Costs of technology has reduced overtime
  • Changes the way companies operate
  • Ex. use of social media
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15
Q

how does education make entrepreneurship more mainstream

A

More courses, workshops, etc. on entrepreneurship

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16
Q

how does social acceptance make entrepreneurship more mainstream

A
  • More awareness and interest in non-traditional career paths
  • More respect for those taking risks and becoming entrepreneurs
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17
Q

how does support systems make entrepreneurship more mainstream

A

With social acceptance, there are more support systems that help entrepreneurs succeed

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18
Q

what is intrapreneurship

A

Being entrepreneurial within a corporate setting; therefore can only exercise creativity to launch new products/services or evolve processes using the existing resources and reputation of a company

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19
Q

how does companies encourage intrapreneurship

A
  • Promoted through competitions to encourage employees to create new features or products in short time frames
  • Providing time and resources to employees to think outside traditional ways of doing business
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20
Q

what is the purpose of intrapreneurship

A
  • constantly challenge the status quo and don’t get comfortable relying on current successes
  • Constantly find ways to satisfy the changing needs of customers
  • Increases competition in the market
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21
Q

what are the stages of entrepreneurial venture

A
  1. birth/introduction
  2. breakthrough/growth
  3. maturity/exit
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22
Q

what happens in the birth/introduction stage of an entrepreneurial venture

A
  • Can the company define its business model to exist and make money?
  • Gets the initial customers in this stage
  • Focus is survival
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23
Q

what happens in the breakthrough/growth stage of an entrepreneurial venture

A
  • Business model is proved to work well
  • Focus is managing growth
  • Can the business effectively manage customer relationships or obtain financing to continue its growth?
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23
Q

what happens in the maturity/exit stage of an entrepreneurial venture

A
  • How to keep the business relevant
  • How can the company stay competitive in a constantly changing environment?
  • Focus is maintaining and growing market share, and maintaining continued financial stability
  • Or an exit strategy; like selling the business
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24
Q

what is the purpose of the entrepreneurial venture stages

A
  • These stages show the importance of honing an entrepreneurial mindset
  • Helps entrepreneurs and their businesses stay flexible, focused, and to persevere
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25
Q

what are the different types of strategic leadership an organization is looking for at each of the business stages

A
  1. birth/introduction - “risk taker”
  2. breakthrough/growth - “caretaker”
  3. maturity/exit - “surgeon”
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26
Q

what are the advice from an entrepreneur

A
  • develop a growth strategy
  • map out growth plan
  • invest for growth
  • increase productivity
  • become a better leader
  • get advice/guidance
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27
Q

what are some common challenges in launching an idea during the birth/introduction phase

A
  • getting customers
  • managing time
  • abiding by local rules
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28
Q

how is getting customers a common challenge when launching an idea during the birth/introduction phase

A
  • Is there a storefront or established web presence?
  • Attract customers through social media, advertising, or word of mouth
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29
Q

how is managing time a common challenge when launching an idea during the birth/introduction phase

A

Do you have self-discipline & time management skills to remain engaged and productive?

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30
Q

how is abiding by local rules a common challenge when launching an idea during the birth/introduction phase

A
  • Are there restrictions to where the business can be set up?
  • Are there rules/regulations in how to operate?
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31
Q

what are some other ways to get into business (besides starting from scratch)

A
  • buy an existing business
  • franchising
32
Q

why would someone buy an existing business

A
  • Starting your own business requires a lot of planning and money
  • Buying an existing business increases the chances of success
  • Already have an existing customer base, supplier relationships, and existing reputation
  • Sometimes the employee of the business is the one that takes over
33
Q

what are some considerations buyers should have when buying an existing business

A
  • why is it up for sale?
  • due diligence
  • what price to pay
34
Q

what are buyers considering when they are asking why a business is up for sale

A

What are the opportunities or challenges that are associated with the business?

35
Q

what do buyers need to consider due diligence

A
  • Verifying the information of the business
  • Letter of intent between the seller and potential buyer
  • Addresses any privacy/confidentiality concerns during the discussions
  • Buyer can assess financial records and agreements
  • Getting advice from accountants and lawyers
  • Assessing any potential issues which could cause future problems
36
Q

how do buyers consider what price to pay for a business

A

The value of a company is based on:
- What the business owns (assets)
- What it currently earns & future profit potential
- What makes it unique (ex. Reputation, quality of employees)

37
Q

what are the benefits of buying & operating a franchise

A
  • franchisor’s experience & reputation
  • proven product or service (already introduced to the market)
  • lower failure rates compared to starting from scratch
38
Q

how is the franchisor’s experience and reputation a benefit of a franchise

A

Franchisor can provide ongoing management support, assistance in setting up a location, training, marketing, and managing the supply chain to get the best prices

39
Q

what else should be considered about a franchise

A
  • Consider relationship between franchisor and sign a franchising agreement
  • Displays day-to-day responsibilities, standards to follow, and royalty/fee payments
40
Q

what are some downsides to franchising

A
  • Franchising also has a potential lack of control
  • Franchisor may dictate the look or have final say in products/services and operational decisions
41
Q

what are incubators

A
  • Supportive environments that not only provide working space but also support to grow ideas and manage a business
  • Can include coaching, management and operations assistance, networking opportunities, and access to financing
42
Q

what are the advantages of incubators

A
  • One of the biggest advantages is the community and structure provided
  • It is a support system for creative minds and a structured environment that is crucial for the early stages of a business
  • Universities, colleges, and government-industry partnerships are investing more into incubators
43
Q

how do incubators benefit communities

A
  • by creating jobs, stimulating local industry, and allowing Canada to compete in the global marketplace
  • Current rise in social entrepreneurship, there are also incubators dedicated to social impact
44
Q

How does Business Develop Bank of Canada (BDC) support innovation and small businesses

A
  • helps small and medium-sized companies launch and grow
  • They provide financing and advisory services to help make businesses successful
45
Q

why do various levels of the Canadian government support innovation and small business creation

A
  • Entrepreneurial activities drive the economy
  • Creates jobs and increase productivity
  • Most small businesses in Canada are Canadian-owned and managed
  • Larger businesses have foreign ownership
  • 98% of employer businesses are small businesses
  • 70% of the workforce works for small businesses
46
Q

what are all the difference sources/types of funding

A
  • personal savings
  • bank loans
  • borrowing from friends/family
  • accessing government grants
  • angel investors
  • venture capitalists
  • crowdfunding
47
Q

what is the largest source of funding for small businesses and how much is it (%)

A

personal savings - 84%

48
Q

what is the second largest source of funding for small businesses and how much is it (%)

A

bank loans - 37%

49
Q

what are angel investors

A
  • Wealthy individuals that invest in early-stage businesses
  • Want some control in how the business is run in addition to their return on investment
  • Can also act as mentors
50
Q

what are venture capitalists

A
  • Individuals or companies that invest in businesses that are established
  • Expecting a return on investment
  • Venture capital usually provides millions of dollars
  • These funds are used to significantly expand and grow the business
51
Q

what is crowdfunding

A
  • Raising capital from people online
  • Use of platforms where companies can set a financial goal, pitch their idea
  • They hope to catch the attention of people known as “backers” to support their business
  • Backers contribute small amounts and get something in return like early access, reduced prices, or additional perks
  • Crowdfunding can gauge customer interest into an idea before investing much in it
52
Q

what is a value proposition

A
  • Describes the benefits customers can expect from using the products and services of a company
  • What the company offers to the customers and what they will value
53
Q

what should be done before creating a value proposition

A

develop a profile on customers (market research)

54
Q

what market research should be conducted on the customers

A
  • jobs
  • pains
  • gains
55
Q

what are “jobs” when conducting market research on customers

A
  • Tasks customers want to accomplish
  • Can be professional or personal
    Ex. grocery shopping
56
Q

what are “pains” when conducting market research on customers

A
  • Are what annoy or are obstacles to your customers in getting the job done
    Ex. long line-ups or not having payment methods available when grocery shopping
57
Q

what are “gains” when conducting market research on customers

A
  • Are what customers want
  • Outcomes/benefits that they expect, require, or desire when getting a job done
    Ex. finding deals or earning benefits like store loyalty points when grocery shopping
58
Q

why is it important to determine the jobs, pains, & gains of customers

A
  • Understanding these can help you prioritize what is most important to the customer and focus the value proposition on that
  • Can understand how a company’s product/services delivers value to a customer
59
Q

How can businesses find the jobs, pains, and gains of customers

A

through surveys
Ex. highlighting benefits if a customer fills out a survey at the bottom of a receipt from a grocery store

60
Q

what is a business model

A

Captures how you create and deliver value to customers (value proposition) through your products/services and also capture value as a company (earning money through revenue streams)

61
Q

what is the business model canvas (BMC)

A
  • a tool that helps businesses design and map out their business models
  • shows businesses how they can create, deliver, and capture value
62
Q

what are the 9 sections of a business model canvas

A
  • customer segments
  • value propositions
  • channels
  • customer relationships
  • revenue streams
  • key resources
  • key activities
  • key partnerships
  • cost structure
63
Q

which sections of the business model canvas create value

A
  • customer segments
  • value propositions
  • channels
  • customer relationships
64
Q

which sections of the business model canvas deliver value

A
  • value propositions
  • key resources
  • key activities
  • key partnerships
65
Q

which sections of the business model canvas capture value

A
  • revenue streams
  • cost structure
66
Q

what are business plans

A
  • can summarize and idea and how the business will operate
  • Can be shared with banks and investors to request funding
  • Helps ensure you understand your customers, manage resources well, and deliver value to customers
67
Q

what details do business plans aim to capture

A
  • nature of the business
  • target market
  • understanding the competition and industry
  • qualifications of people involved
68
Q

what does business plans capture about the nature of the business

A

What is the vision and mission of the business?

69
Q

what does business plans capture about the target market

A
  • Who are you reaching?
  • What are their wants/needs, background, decision-making process?
70
Q

what does business plans capture about the understanding the competition and industry

A
  • How does the business fit in the external environment
  • Assessing competition, opportunities, and challenges
  • Knowing what makes the business unique
71
Q

what does business plans capture about the qualifications of people involved

A
  • What is the education and experiences of those involved in the business?
  • What resources do they bring
72
Q

what are common mistakes in writing a business plan

A
  • ignoring the competition
  • relying on a few customers
  • procrastinating
  • being too optimistic
73
Q

how is ignoring the competition a mistake when writing a business plan

A
  • Existing competitors can change their strategies
  • New competitors can enter the market
  • How to keep a competitive edge as this happens
74
Q

how is relying on a few customers a mistake when writing a business plan

A
  • Don’t just focus on maintaining relationships with existing customers
  • Branch out to capture more market share
75
Q

how is procrastinating a mistake when writing a business plan

A
  • Creating a business plan is providing a direction for the business
  • Help create strategies and act quickly in a competitive and changing business environment
  • Can help maintain or find new competitive advantages
76
Q

how is being too optimistic a mistake when writing a business plan

A
  • Should be realistic with projections
  • Consider all possible scenarios and plan courses of action for each
77
Q

why is record keeping very important

A
  • Can help you understand where the business is headed and help make informed decisions
  • Without proper record keeping practices, there is a higher risk of failure
78
Q

what are examples of areas that record keeping should take place

A
  • accounting systems; captures financial transactions, how much money you have, spent, borrowed, need
  • inventory; what you have/don’t have/used
  • customer records; maintain long-term relationships
  • employee records; maintaining their information

AFM 132 (12 decks)

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