ENTREPRENEUR

LESSON 1: CONCEPT OF ENTREPRENEURSHIP

ENTRPRENEURSHIP
 It was derived from the French verb entreprendre, which means “to undertake.” This is
pinpointing to those who “undertake” the risk of enterprise.
 The enterprise is created by an entrepreneur and the process is called “Entrepreneurship.”
 Entrepreneurs are innovators. They are willing to take the risks and generate unique ideas
that can provide profitable solutions to the needs of the market and the society.

RELEVANCE OF THE ENTREPRENEURSHIP

1. Development of Managerial Capabilities
- this means that one of the benefits an entrepreneur gets is to develop his managerial
skills.
2. Creation of Organizations
- which means that because of entrepreneurship many organizations will exist.
3. Improving Standard of Living
- this means that entrepreneurship can lift up the economic status of an individual.
4. Means of Economic Development
- this means that entrepreneurship can lift up the economic status of an individual.

PERSONAL FACTORS AFFECTING ENTREPRENEURSHIP

1) Initiative
2) Proactive
3) Problem Solver
4) Perseverance
5) Persuasion
6) Planner
7) Risk Taker

ENVIRONMENTAL FACTORS AFFECTING ENTREPRENEURSHIP

1) Political
2) Climate
3) Legal System
4) Economic System
5) Market Situations
6) Social Conditions

COMMON COMPETENCIES IN ENTREPRENEURSHIP

1) Decisive
 - an entrepreneur must be firm in making decisions.
2) Communicator
- an entrepreneur must have a convincing power.
3) Leader
- an entrepreneur must have the charisma to be obeyed by his employees.
4) Opportunity Seeker
- an entrepreneur must have the ability to be the first to see business chances.
5) Proactive
- an entrepreneur can control a situation by making things happen or by preparing for
possible future problems.
6) Risk Taker
- an entrepreneur has the courage to pursue business ideas.
7) Innovative
- the entrepreneur has big business ideas and he does not stop improving and thinking
of new worthwhile ideas for his business.

CORE COMPETENCIES IN ENTREPRENEURSHIP

1. Economic and Dynamic Activity
- Entrepreneurship is an economic activity because it involves the creation and
operation of an enterprise with a view to creating value or wealth by ensuring
optimum utilization of limited resources.
2. Innovative
- The entrepreneur constantly looks for new ideas, thus he needs to be creative.
3. Profit Potential
- The entrepreneur can be compensated by his profit coming from the operation.
4. Risk bearing
- The entrepreneur needs to gamble but wise enough to offset the risk.

TYPES OF ENTREPRENEURSHIP
1. Innovative Entrepreneurs
- They are those who always make new things by thinking of new ideas. They have the
ability to think newer, better and more economical ideas.
2. Imitating Entrepreneurs
- They are those who don’t create new things but only follow the ideas of other
entrepreneurs.
3. Fabian Entrepreneurs
- They are skeptical about changes to be made in the organization. They don’t initiate
but follow only after they are satisfied.
4. Drone Entrepreneurs
- They are those who live on the labor of others. They are die-hard conservatives even
ready to suffer the loss of business.
 5. Social Entrepreneurs
- They are those who initiate changes and drive social innovation and transformation in
the various fields such as education, health, human rights, environment and enterprise
development.

CAREER OPPORTUNITIES OF ENTREPRENEURSHIP

 Business Consultant
 Researcher
 Sales
 Teacher
 Business Reporter

LESSON 2: THE ENTREPRENEURIAL MINDSET

Some people make a big deal out of the fact that there are many successful business founded by
entrepreneurs who do not have college degree. Often cited are
 Apple founder Steve Jobs
 Microsoft founder Bill Gates
 Facebook co-founder Mark Zuckerberg
 Uber co-founder Travis Kalanick.
In the Philippines,
 Philippine Airlines and Asia Brewery owner Lucio Tan
 National Bookstore owner Socorro Ramos
 Zest-O Corporation President Alfredo Yao
 Mang Inasal Founder Edgar Sia II.
Some of these individuals went to college, but decided to drop out after spotting a business
opportunity.
However, we must not lose sight of the fact that other equally successful businesses were
founded by individuals who earned their college degrees.
 Jollibee founder Tony Tan Caktiong
 Lamoiyan Corporation founder Cecilio Pedro
 ECHOstore co-founder Pacita Juan
Clearly educational background, while important, is not the defining element for entrepreneurial
success.
ENTREPRENEURIAL PROCESS
 refers to the formulation of strategy which includes an articulation of a plan and how this
is going to be implemented.
The steps include the following:
Discovery
Development of Concept
Organizing resources
Implementation
Reaping the returns
Characteristics of an Entrepreneur:
 Level of Education
 Wealth
 Employment Status
Characteristics of an Entrepreneur:
 Opportunity seeker
 More females are engaged in the early stage entrepreneurial activities
 They attract more young individuals
 Fearful of business failure
Entrepreneurial Decision-Making:
 Critical thinking – systematic and rational
 Creative thinking – discovery of new ideas
 The Blue Ocean Strategy – differentiating
 Strategic thinking – assessing
Risk in the Entrepreneurial Process:
 Risks can be described as uncertain situations and developments that can
increase the probability of loss or business failure.
a) Internal risks
b) External risks

LESSON 3: RECOGNIZE A POTENTIAL MARKET

ENTREPRENEURIAL IDEAS
 The creation of an entrepreneurial idea leads to the identification of entrepreneurial
opportunities, which in turn results in the opening of an entrepreneurial venture.
ESSENTIALS IN ENTREPRENEUR’S OPPORTUNITY – SEEKING
1. Entrepreneurial Mind Frame
- This allows the entrepreneur to see things in a very positive and optimistic way in the
midst of difficult situation. Being a risk - taker, an entrepreneur can find solutions
when problems arise.
2. Entrepreneurial Heart Flame
- Entrepreneurs are driven by passion; they are attracted to discover satisfaction in the
act and process of discovery. Passion is the great desire of an entrepreneur to achieve
his/her goals.
3. Entrepreneurial Gut Game
- This refers to the ability of the entrepreneur of being intuitive. This also known as
intuition. The gut game also means confidence in one’s self and the firm belief that
everything you aspire can be reached.

SOURCES OF OPPORTUNITIES
1. Changes in the Environment
- Entrepreneurial ideas arise when changes happen in the external environment. A
person with an entrepreneurial drive views these changes positively. External
environment refers to the physical environment, societal environment, and industry
environment where the business operates.
1.1 Physical Environment
 Climate – the weather conditions.
 Natural resources – such as minerals, forests, water, and fertile land that
occur in nature and can be used for economic gain.
 Wildlife – includes all mammals, birds, reptiles, fish, etc., that live in the
wild.
1.2 Societal Environment
 Political forces – includes all the laws, rules, and regulations that govern
business practices as well as the permits, approvals, and licenses necessary
to operate the business.
 Economic forces – such as income level and employment rate.
 Sociocultural forces – customs, lifestyles and values that characterize a
society.
  Technological environment – new inventions and technology
innovations.
1.3 Industry Environment
 Competitors
 Customers
 Creditors
 Employees
 Government
 Suppliers
2. Technological Discovery and Advancement
- A person with entrepreneurial interest sees possibility of business opportunities in any
new discovery or because of the use of latest technology.
3. Government’s Thrust, Programs, and Policies
- The priorities, projects, programs, and policies of the government are also good
sources of ideas.

4. People’s interest
- The interest, hobbies, and preferences of people are rich sources of entrepreneurial
ideas, like the increasing number of Internet Cafés at present could lead to the strong
attachment of young people to computers.
5. Past Experiences
- The expertise and skills developed by a person who has worked in a particular field
may lead to the opening of a related business enterprise

FORCES OF COMPETITION MODEL

Competition – it is the act or process of trying to get or win something.
1) Buyers
- The buyers are the ones that pay cash in exchange for your goods and services. One
example is the influence of the price or in the bargaining strategy. The buyer has a
strong and magnified bargaining power.
2) Potential New Entrants
- A new entrant is defined as companies or businesses that have the ability to penetrate
or enter into a particular industry. For example, in the level of capital requirements, if
the business requires huge capital, new entrants should decline to join the business.
This gives a threat to the business.
3) Rivalry Among Existing Firms
- Rivalry is a state or situation wherein business organizations are competing with each
other in a particular market. For example, it depends on the marketing strategy of
your competitor, like giving freebies and special offers.
4) Substitute Products
 - Substitute is one that serves the same purpose as another product in the market. For
example, the consumers decide to use margarine as a substitute for butter. In case the
price of butter increases, preferably the consumer will gradually switch to margarine.

5) Supplier
- The Suppliers are the one that provide something that is needed in business
operations such as office supplies and equipment. In an example where supplies and
services being offered is unstable the intensity of the threat is strong in this kind of
the competitive force in the industry.

LESSON 4 & 5: RECOGNIZE AND UNDERSTAND THE MARKET

VALUE PROPOSITION (VP)
 is a business or marketing statement that summarizes why a consumer should buy a
company's product or use its service. This statement is often used to convince a customer
to purchase a particular product or service to add a form of value to their lives.
IN CREATING VALUE PROPOSITION, ENTREPRENEURS WILL CONSIDER
THE BASIC ELEMENTS
Target Customer
Needs/opportunity
Name of the product
Name of the enterprise/company

UNIQUE SELLING PROPOSITION (USP)

 refers to how you sell your product or services to your customer. You will address the
wants and desires of your customers.
AS AN ENTREPRENEUR, YOU SHOULD THINK OF MARKETING CONCEPTS
THAT PERSUADE YOUR TARGET CUSTOMERS.
 What do the customers want?
 What brand does well?
 What does your competitor sell well?

VALUE PROPOSITION (VP) UNIQUE SELLING PROPOSITION

(USP)
 A VP is a statement that summarizes  A USP is a specific benefit that
the benefits that a customer will differentiates a product or service
receive from a product or service. It is from its competitors. It is what
essentially a promise to the customer makes the product or service unique
 that the product or service will meet and valuable.
their needs.  A USP is a specific benefit that makes
 A value proposition is more general the product or service stand out from
than a USP. It is a statement of the the competition.
overall benefits that a product or  A USP is what makes you different
service offers
 A VP is what you offer
EXAMPLES:
NIKE
VALUE PROPOSITION (VP) UNIQUE SELLING PROPOSITION
(USP)
 Nike is a leading manufacturer of  Nike's unique selling proposition is its
athletic shoes, apparel, and "Just Do It" slogan. This slogan
equipment. The company's products encourages people to overcome
are designed to help athletes perform challenges and achieve their goals. It
at their best. Nike's value proposition is a simple but powerful message that
is based on the belief that "if you have has resonated with people all over the
a body, you are an athlete." world.

TESLA
VALUE PROPOSITION (VP) UNIQUE SELLING PROPOSITION
(USP)
 Tesla is a leading manufacturer of  Tesla's unique selling proposition is
electric vehicles that are designed to its focus on innovation. "The world's
be high-performance, luxurious, and most advanced electric car."
environmentally friendly. Tesla's cars
are also known for their advanced
technology, such as their self-driving
features.

APPLE
VALUE PROPOSITION (VP) UNIQUE SELLING PROPOSITION
(USP)
 Apple is a technology company that  “Think Different" is a call to action
designs, develops, and sells consumer for people to think outside the box and
electronics, computer software, and to challenge the status quo. It is a
online services. The company's message that resonates with many
products are known for their sleek people, and it has helped to make
design, user-friendly interface, and Apple a symbol of innovation and
innovative features. creativity.

NETFLIX
VALUE PROPOSITION (VP) UNIQUE SELLING PROPOSITION
 (USP)
 Netflix: "Unlimited streaming of TV  "Watch TV shows and movies
shows and movies." whenever you want, anywhere."

SPOTIFY
VALUE PROPOSITION (VP) UNIQUE SELLING PROPOSITION
(USP)
 Spotify is a music streaming service  Spotify: "Listen to any song,
that allows users to listen to millions anywhere."Ad-free listening. Premium
of songs on demand. The service is ad- subscribers can listen to Spotify
supported or subscription-based, and it without ads. Spotify allows users to
offers a variety of features, such as share their music with friends and
playlists, recommendations, and social family.
sharing.

THREE FACTORS THAT WILL DETERMINE YOUR CUSTOMERS

1. Target Market
- Market Targeting is a sage in market identification process that aims to determine the
buyers with common needs and characteristics. Prospect customers are a market
segment that an entrepreneurial venture intends to serve
a) Geographical Segmentation - the total market is divided according to
geographical location.
 Climate
 Dominant ethnic group
 Culture
 Density (either rural or urban)
b) Demographic Segmentation - divided based on consumers
 Gender
 Age
 Income
 Occupation
 Education
 Religion
 Ethnic group
 Family size
c) Psychological Segmentation - divided in terms of how customers think and
believe
 Needs and wants
 Attitudes
 Social class
 Personality traits
 Knowledge and awareness
  Brand concept
 Lifestyle
d) Behavioral Segmentation - divided according to customers’ behavior pattern
as they interact with a company.
 Perceptions
 Knowledge
 Reaction
 Benefits
 Loyalty
 Responses
2. Customer Requirements
- Customer requirements are the specific characteristics that the customers need from a
product or a service. There can be two types of customer requirements:
a) Service Requirement
- An intangible thing or product that cannot be touched but the customer can
feel the fulfillment. There are elements in service requirement like on-time
delivery, service with a smile, easy-payment etc.
b) Output Requiremnt
- A Tangible thing or things that can be seen. Characteristic specifications that
a consumer expects to be fulfilled in the product. Example: customer buys
gadgets (phones speaker) the specification like the loudness and clarity are
the output requirements.
3. Market Size
- Market size is like a size of the arena where the entrepreneurs will play their business.
It is the approximate number of sellers and buyers in a particular market.

MARKET RESEARCH
SURVEY
 are the most common way to gather primary research with the use of questionnaires or
interview schedule. These can be done via direct mail, over the phone, internet (e.g.
Google) or email, face-to-face or on the Web (e.g. Skype or Viber).
INTERVIEW
  is one of the most reliable and credible ways of getting relevant information from
target customers. It is typically done in person between the researcher/entrepreneur and a
respondent where the researcher asks pertinent questions
 Interviews normally last from 15 to 40 minutes, but they can last longer, depending on
the participants’ interest in the topic.
o Personal interviews are the traditional method of conducting an interview. It
allows the researcher to establish relationship with potential participants and
therefore gain their cooperation.
o Telephone interviews are less expensive and less time-consuming, but the
disadvantages are that the response rate is not as high as the face-to-face
interview, but considerably higher than the mailed questionnaire.
FOCUS GROUP DISCUSSION
 is an excellent method for generating and screening ideas and concepts. It can be
moderated group interviews and brainstorming sessions that provide information on
user’s needs and behaviors.
 The following are considerations in the use of focus group discussions in market
research:
o The length of the session is between 90 and 120 minutes.
o Conduct focus groups discussion with 8 to 10 participants per group.
o Assign an expert moderator / facilitator who can manage group dynamics.
o Use a semi-structured or open-format discussion
o Strive for consistency in the group’s composition