Chapter 1: Entreprenurship1 Copyright 1999 Prentice Hall Publishing Company Entrepreneurs: The Driving Force Behind Small Businesses

Chapter 1: Entreprenurship2 Copyright 1999 Prentice Hall Publishing Company The Age of the Entrepreneur l More than 35 million U.S. households - 37% of the U.S. total - “have an intimate involvement in a new or small business.” l Survey of college seniors: 49% of men and 31% of womensaid they were interested in pursuing entrepreneurship after graduation.

Chapter 1: Entreprenurship4 Copyright 1999 Prentice Hall Publishing Company What Is an Entrepreneur? A person who creates a new business in the face of risk and uncertainty for the purpose of achieving profit and growth by identifying opportunities and assembling the necessary resources to capitalize on those opportunities.

Chapter 1: Entreprenurship5 Copyright 1999 Prentice Hall Publishing Company Characteristics of Entrepreneurs l Desire for responsibility. l Preference for moderate risk. l Confidence in their ability to succeed. l Desire for immediate feedback. l High level of energy. l Future orientation. l Skilled in organization. l Value achievement over money.

Chapter 1: Entreprenurship6 Copyright 1999 Prentice Hall Publishing Company Benefits of Small Business Ownership l The opportunity to gain control over your own destiny. l The opportunity to make a difference. l The opportunity to reach your full potential. l The opportunity to reap unlimited profits. l The opportunity to contribute to society and to be recognized for your efforts. l The opportunity to do what you enjoy.

Chapter 1: Entreprenurship7 Copyright 1999 Prentice Hall Publishing Company Drawbacks of Small Business Ownership l Uncertainty of income l Risk of losing your entire invested capital

Chapter 1: Entreprenurship8 Copyright 1999 Prentice Hall Publishing Company Drawbacks of Small Business Ownership l Uncertainty of income l Risk of losing your entire invested capital l Long hours and hard work

Chapter 1: Entreprenurship10 Copyright 1999 Prentice Hall Publishing Company Drawbacks of Small Business Ownership l Lower quality of life until the business gets established l Uncertainty of income l Risk of losing your entire invested capital l Long hours and hard work

Chapter 1: Entreprenurship11 Copyright 1999 Prentice Hall Publishing Company

Chapter 1: Entreprenurship12 Copyright 1999 Prentice Hall Publishing Company Drawbacks of Small Business Ownership l High levels of stress l Complete responsibility l Uncertainty of income l Risk of losing your entire invested capital l Long hours and hard work l Lower quality of life until the business gets established

Chapter 1: Entreprenurship13 Copyright 1999 Prentice Hall Publishing Company Feeding the Entrepreneurial Fire l Entrepreneurs as heroes. l Entrepreneurial education. l Economic and demographic factors. l Shift to a service economy. l Technological advancements. l Independent lifestyles. l The World Wide Web.

Chapter 1: Entreprenurship15 Copyright 1999 Prentice Hall Publishing Company Feeding the Entrepreneurial Fire l Entrepreneurs as heroes. l Entrepreneurial education. l Economic and demographic factors. l Shift to a service economy. l Technological advancements. l Independent lifestyles. l The World Wide Web. l International opportunities.

Chapter 1: Entreprenurship16 Copyright 1999 Prentice Hall Publishing Company

Chapter 1: Entreprenurship17 Copyright 1999 Prentice Hall Publishing Company Trends in Entrepreneurship l Women

Chapter 1: Entreprenurship19 Copyright 1999 Prentice Hall Publishing Company l Minority enterprises l Immigrant entrepreneurs l Part-time entrepreneurs l Home-based businesses l Women Trends in Entrepreneurship

Chapter 1: Entreprenurship20 Copyright 1999 Prentice Hall Publishing Company

Chapter 1: Entreprenurship21 Copyright 1999 Prentice Hall Publishing Company Trends in Entrepreneurship l Family businesses l Copreneurs l Corporate castoffs l Corporate dropouts l Women l Minority enterprises l Immigrant entrepreneurs l Part-time entrepreneurs l Home-based businesses

Chapter 1: Entreprenurship23 Copyright 1999 Prentice Hall Publishing Company Entrepreneurial Profiles l Women. l Minorities. l Immigrants. l Part-time entrepreneurs. l Home-based entrepreneurs. l Family business owners. l Copreneurs. l Corporate castoffs. l Corporate dropouts.

Chapter 1: Entreprenurship24 Copyright 1999 Prentice Hall Publishing Company Small Businesses... l make up 98.5% of all the businesses in the U.S. l employ 53% of the nation's private sector workforce. l create more jobs than big businesses. l lead the way in training workers for jobs. l produce 50% of the nation's GDP. l account for 47% of business sales. l create 4X more innovations per R & D dollar spent than medium-sized firms and 24X as many as large companies.

Chapter 1: Entreprenurship26 Copyright 1999 Prentice Hall Publishing Company The Small Business Failure Record l 24% of new businesses fail after two years. l 51% fail within four years. l 63% fail within six years.

Chapter 1: Entreprenurship27 Copyright 1999 Prentice Hall Publishing Company Putting Failure Into Perspective l Failure is a natural part of the creative process. l Failures are simply stepping stones along the path to success. l The “secret” to success is the ability to fail intelligently, learning why you failed so that you can avoid making the same mistake again.

Chapter 1: Entreprenurship28 Copyright 1999 Prentice Hall Publishing Company Avoiding the Pitfalls of Small Business Failure l Know your business in depth. l Prepare a business plan. l Manage financial resources. l Understand financial statements. l Learn to manage people effectively. l Set your business apart from the competition. l Keep in tune with yourself.