Stamford University, Bangladesh

MGMT- 466 : Entrepreneurship Development

Session 2 : Part of Chapter 1 & Chapter 2

We Left off in last class

Three Categories of start-up firms

1. Lifestyle firms –Privately held, small-scale, modest growth,
with an avg. employees of 30-40, having an annual revenue of
around $2 million

2. Foundation Company – Created from R&D, lays the

foundation for a new business, can grow in 5-10 years from 40-
400 employees, having 10-20 million in revenues

3. High-potential venture – Receives big public investment,

rapid growth, huge staff with around $20-30 million in revenues
Role of Entrepreneurship in
Economic Development
 Entrepreneurship and Economic development
are intertwined!
 Schumpeter says ‘entrepreneurial process is a
major factor in economic development and
the entrepreneur is the key to economic
growth’
 So, entrepreneurship is indispensable
for economic development (Bayineni, 2005)
Role of Entrepreneurship in
Economic Development
 SMEs have a high potential in the economic
growth in countries like Bangladesh. (Read the
article by Venesaar & Loomets, 2006)
 Driving force of decentralization, economic
restructuring and movement in the direction
of market economy
 More businesses means more employments
 New products and services to the society
Intrapreneurship Vs. Entrepreneurship
 have vast similarities and differences
Intrapreneurship is the process by which large
organizations seek to utilize, maintain or retain the
edge in innovation and profit-making by asking
employees to spawn businesses within the business.
VS
someone who brings resources, such as land, labor,
materials, and combine them to enhance their value
through various transformation method while they
also bring about change, engender innovation and
introduce new ideas and orders…
Intrapreneurship Vs. Entrepreneurship
 Intrapreneurs are employees, who are
supposedly given free rein to run a particular
aspect of the company, perhaps a new
product line or subsidiary.
Vs.
Entrepreneurs are self-employed people
running their own company
Intrapreneurship Vs. Entrepreneurship
 Entrepreneurs don’t necessarily need formal
education ––
They don’t need university degrees, but they need
high degree of business acumen and intelligence
Vs.
 Intrapreneurs are, however, usually selected by a
corporate hierarchy (Marketing, sales R&D etc)

Entrepreneurs builds something from the ground up,

Intrapreneurs build something new within an
establishment
The Entrepreneurial Process
 An entrepreneur must find, evaluate, and develop
an opportunity by overcoming the forces that resist
the creation of something new………

Four distinct phases

1. Identify and evaluate opportunity – the key and
the most difficult!! You don’t find it in a museum!
Constantly look for it. Think of a problem.. Can you
offer a product or service to solve it…. Put yourself in
the shoes!

Trades Journals, Magazines, Internet, consumers,

friends may be potential sources of information!
The Entrepreneurial Process
2. Develop a sound business plan
 It’s time consuming!
 Everybody doesn’t really do this!!
 But it is actually essential and helpful!
 We will DO a business plan, maybe an
assignment!!!
The Entrepreneurial Process
3. Determine the resources required
 Appraise your own situation
 See what else you need
 It’s often the strenuous task…money
doesn’t grow on trees!!!
 Make sure you have it, or arrange all the
required financial, physical and human
recourses..
 Be the boss…Keep the major share, at least
initially!!!
The Entrepreneurial Process
4. Manage your enterprise
 Implement your business plan

 Effectively and efficiently

 What management style would you follow?

Autocratic? Participative?
 Initiate a control system…MONITOR the

progress!
 Make corrective actions, wherever necessary!
Managerial Vs. Entrepreneurial
decision making
 Different in five key business dimensions

1. Strategic Orientation
2. Commitment to Opportunity
3. Commitment of Resources
4. Control of Resources
5. Management Structure
Corporate Vs. Intrapreneurial
culture….
 The era of the entrepreneurs
e.g. Fokruddin Byrani and Microsoft…..
 Corporate culture is conservative, rational
mainly based on facts and data, subject to
approval by a legion of bosses!!!!
 This is an inhibiting culture!!!!
 Intrapreneurial culture promotes innovations,
risk-taking, and new product development.
 It’s an encouraging culture!
Thank you very much
and
Have a nice day!