Entrepreneurship Roleplay Flashcards
Describe the nature of entrepreneurship.
Creativity and Innovation: Entrepreneurship is driven by creativity and innovation, involving the ability to identify new ideas, opportunities, or solutions to unmet needs or challenges.
Risk-Taking and Uncertainty: Entrepreneurship inherently involves risk-taking and navigating uncertainty. Entrepreneurs are willing to take calculated risks, make decisions in ambiguous or unpredictable environments, and embrace failure as a learning opportunity.
Vision and Opportunity Recognition: Entrepreneurs possess a vision for the future and the ability to identify opportunities that others may overlook.
Passion and Commitment: Entrepreneurship is fueled by passion and commitment to one’s vision, mission, or purpose.
Networking and Collaboration: Entrepreneurship involves building networks, forging strategic partnerships, and collaborating with others to leverage expertise, resources, and opportunities.
Explain the role requirements of entrepreneurs and owners.
The role requirements of entrepreneurs and owners vary depending on the stage of the business, its size, industry, and specific circumstances. However, there are several key roles and responsibilities commonly associated with entrepreneurs and owners:
Visionary Leadership: Entrepreneurs and owners are responsible for providing visionary leadership by setting a clear vision, mission, and strategic direction for the business.
Business Strategy and Planning: Entrepreneurs and owners develop business strategies and plans to achieve the company’s objectives and drive growth.
Decision-Making and Problem-Solving: Entrepreneurs and owners make critical decisions and solve complex problems to steer the business toward success.
Describe entrepreneurial planning considerations.
Entrepreneurial planning involves a systematic process of setting goals, identifying opportunities, assessing risks, and developing strategies to guide the launch and growth of a new venture.
Market Analysis: Conduct thorough market research to understand industry trends, customer needs, competitive dynamics, and market opportunities. Identify target market segments, assess demand for products or services, and evaluate potential competitors to inform business strategies.
Value Proposition: Define a clear value proposition that communicates the unique benefits and value that the business offers to customers.
Business Model: Develop a viable business model that outlines how the venture will generate revenue, deliver value to customers, and achieve profitability.
Financial Planning: Create a comprehensive financial plan that forecasts revenue, expenses, and cash flow projections for the business.
Marketing and Sales Strategy: Develop a marketing and sales strategy to promote the business, attract customers, and drive revenue growth.
Operational Plan: Outline the operational processes, systems, and resources required to deliver products or services efficiently and effectively.
Exit Strategy: Consider the long-term goals and potential exit strategies for the business, such as acquisition, merger, initial public offering (IPO), or succession planning. (contingency planning)
Assess start-up requirements.
Financial Resources: Determine the financial resources needed to start and operate the business, including startup costs, working capital, and ongoing expenses. Assess funding options such as personal savings, loans, grants, investments, or crowdfunding to secure the necessary capital.
Market Research: Conduct market research to understand customer needs, market demand, competitive landscape, and industry trends.
Product or Service Development: Develop the product or service offering based on customer insights, market feedback, and competitive analysis.
Business Infrastructure: Establish the necessary infrastructure and resources to support business operations, including physical facilities, equipment, technology systems, and supply chain management. Consider factors such as scalability, efficiency, and flexibility when designing the business infrastructure.
Assess the cost/benefits associated with resources.
Assessing the cost and benefits associated with resources is essential for optimizing resource allocation, maximizing value creation, and achieving business objectives.
Cost Analysis: Evaluate the direct and indirect costs associated with acquiring and utilizing resources, including financial costs, time, effort, and opportunity costs.
Benefits Assessment: Identify and quantify the benefits and value generated by the resources in terms of revenue generation, cost savings, productivity improvements, competitive advantage, customer satisfaction, and overall business performance.
Return on Investment (ROI): Calculate the ROI of resources by comparing the expected benefits or returns generated by the resources to the costs incurred to acquire and utilize them.
Cost-Benefit Analysis (CBA): Conduct a comprehensive cost-benefit analysis to weigh the costs against the benefits of resources and determine their overall value proposition.
Describe processes used to acquire adequate financial resources for venture creation/start-up.
Bootstrapping: Bootstrapping involves self-funding the business using personal savings, credit cards, or income from other sources. Entrepreneurs may leverage their own resources to cover start-up costs, minimize debt, and retain full control over the business without external investors.
Friends and Family Funding: Entrepreneurs may seek funding from friends, family members, or acquaintances who are willing to invest in the venture.
Angel Investors: Angel investors are high-net-worth individuals or affluent professionals who provide capital to early-stage startups in exchange for equity ownership or convertible debt.
Venture Capital (VC): Venture capital firms invest in high-growth startups with significant growth potential in exchange for equity stakes.
Crowdfunding: Crowdfunding platforms allow entrepreneurs to raise capital from a large number of individuals or investors through online campaigns.
Bank Loans and Lines of Credit: Entrepreneurs may apply for bank loans or lines of credit to finance start-up costs, working capital, or expansion initiatives.
Small businesses grants and competitions
Select sources to finance venture creation/start-up.
Assess Financial Needs: Determine the amount of capital required to fund the venture’s start-up costs, operational expenses, and initial growth phases.
Identify funding options with their advantages and disadvantages
Self-funding/Bootstrapping
Pros: Full control over the business; No dilution of ownership; Flexible terms; No interest or repayment obligations.
Cons: Limited capital available; Personal financial risk; Potential strain on personal finances; Limited access to external expertise or networks.
Friends and Family
Pros: Access to quick capital; Flexible terms; Potential for low or no interest; Trust and support from close contacts.
Cons: Strained personal relationships if business fails; Potential loss of personal assets; Limited expertise or networks beyond personal circle.
Angel Investors
Pros: Early-stage funding; Access to expertise, mentorship, and networks; Potential for strategic partnerships; Faster decision-making process.
Cons: Ownership dilution; High equity stake demands; Limited investment amounts; Potential loss of control and autonomy.
Venture Capital
Pros: Large funding amounts available; Access to expertise, networks, and resources; Potential for rapid growth and scalability.
Cons: High ownership dilution; Strict investment criteria and terms; Loss of control; Pressure for fast growth and exits.
Crowdfunding
Pros: Access to capital from a wide pool of investors; No dilution of ownership; Marketing and validation of product or idea.
Cons: Time-consuming campaign setup and management; Platform fees and expenses; Regulatory compliance requirements; Limited funding amounts.
Bank Loans
Pros: Relatively low interest rates; Structured repayment terms; No dilution of ownership; Established banking relationships.
Cons: Collateral requirements; **Strict eligibility criteria; Long approval process; **Personal liability; Limited availability for start-ups.
Diversify Funding Sources: Consider diversifying sources of financing to mitigate risk and enhance financial stability. Combine different funding options, such as equity, debt, grants, and bootstrapping, to create a balanced capital structure that meets the venture’s needs and objectives.
Describe considerations in selecting capital resources
Financial Needs: Evaluate the amount of capital required to fund the business’s start-up costs, operational expenses, and growth initiatives. Consider short-term and long-term financial needs to ensure adequate funding for different stages of the business lifecycle.
Risk Tolerance: Assess the business’s risk profile and the entrepreneur’s risk tolerance. Determine the level of risk associated with each funding option
Cost of Capital: Compare the costs associated with different sources of funding, including interest rates, fees, equity dilution, and repayment terms.
Ownership and Control: Evaluate the impact of each funding option on ownership and control of the business.
Access to Expertise and Networks: Assess the value-added benefits beyond capital that each funding source provides, such as access to expertise, mentorship, industry networks, strategic partnerships, and business development opportunities.
