Course Description
MBA Program
SB/ENTR6605.030A: ENTREPRENEURSHIP & NEW FIRM CREATION
Fall 2007
M 14:30 - 17:30
Room SSB N106
Catalogue # N07X01
Term: F2
Exam: A3
COURSE
DIRECTOR:
OFFICE:
OFFICE
TELEPHONE:
OFFICE
HOURS:
EMAIL:
Yuval Deutsch
SSB N305E
416-736-2100 x 77895
ADMINISTRATIVEClara Kan
ASSISTANT:
SSB N305A
OFFICE:
416-736-2100 x 77960
TELEPHONE:
EMAIL:
ckan@schulich.yorku.ca
ydeutsch@schulich.yorku.ca
ENTR 6605: Entrepreneurship and New Firm Creation
Course Syllabus
Fall 2007
Yuval Deutsch Secretary: Clara Kan
Office: N 305 E Room: N 305 A
Phone: (416) 736-2100 Ex. 77895 Phone: (416) 736-2100 Ex. 77960
E-mail: ydeutsch@schulich.yorku.ca e-mail: ckan@schulich.yorku.ca
I. Overview and Procedures
The purpose of this course is to explore various dimensions of
new venture creation. We will be concerned with content and
process questions as well as with formulation and implementation
issues that relate to conceptualizing, developing and managing
successful new ventures. Questions that will be addressed include:
1.
Who are entrepreneurs? What do they do?
1. Why do individuals choose to become entrepreneurs?
2. What is an opportunity?
3. How to effectively screen venture ideas?
4. How to prepare a cohesive, and effective Business Plan
(BP)
1. As an aid to deciding whether to go ahead
2. As a means for obtaining financing and other
critical resources
3. As a tool for monitoring and controlling the
growth of the venture
5. How to formulate the venture's business strategy?
6. How to assess the potential viability of a new venture?
7. How, when, how much, and what type of financing to
raise?
8. How to craft the deal with potential investors?
9. How can the value created be harvested?
10. How to manage the risk?
The emphasis in this intensively interactive integrative course is
on applying and synthesizing concepts and techniques from the
functional areas of accounting, finance, managerial economics,
marketing, operation management, and organizational behavior in
the context of new venture development.
You are asked to get out of the habit of being a receiver of
ideas, facts, concepts and techniques, and get into the habit
of generating ideas, identifying problems, analyzing and
evaluating alternatives, and formulating workable action
plans, thus putting knowledge into practice.
You will get this hands-on experience in the following ways:
11. Through the formation and ongoing work of a venture team
(see below) that will design a BP for a new venture.
12. Through our lectures and class discussions which are
designed to familiarize you with the many dimensions of
entrepreneurship. You are expected to come to class well
prepared to discuss the case studies and the readings that
will be assigned periodically.
13. Through class presentations, in which you will “sell”
yourself, your ideas, & your BP.
14. Through analyzing and constructively criticizing BPs of
other groups. In some class meetings, venture teams will
present a progress report to the class. Other groups will
then comment on the presentations, serving as a soundingboard of consultants or venture capitalists.
The contribution of this course to your management training (i.e.,
what you can expect to learn or how much you will learn)
depends, to a large extent, on the following:
15. The commitment of your team to the selected venture idea.
16. The level of effort you and other members of your team put
into turning the idea into a business.
17. The cohesiveness of your team (i.e., how well you work
together).
18. The overall businesslike atmosphere in the class.
II. Readings
Textbook:
M. J. Roberts, et al, New Business Ventures & the Entrepreneur,
Sixth Edition. McGraw- Hill Irwin, New York, NY, 2007.
III. Venture Teams
Course participants are asked to form 8 new venture teams of
students whose talents, skills and knowledge are complementary.
To be successful and productive (and to have fun), you should
carefully select your team members. The formation of teams will
take place during the second class. Each team will produce a
written BP as its major final product and will make presentations
of its progress. Specifics about these presentations are given
below. The teams will also work together on the cases and each
team will facilitate the discussion of one case. Please note that
extensive group work outside of class is an essential part of
this course.
IV. Presentations and Write Ups
A. Self Introduction (Individual presentation)
Due Date: First class
Description: A 45 second presentation in which students are given
an opportunity to introduce themselves and “sell” their
capabilities as potential team members.
B. Business Idea (Individual presentation)
Due Date: Second class
Description: A one-minute elevator pitch, in which students
introduce a business opportunity.
C. New Venture Concept
Due Date: Fourth class.
Description: Each venture team will develop a business concept.
Please note that when choosing a venture concept, you make an
irreversible decision for the term. You should therefore make sure
that all team members are deeply committed to exploring the
selected idea. During this class, each team will be asked to
present description of the chosen venture concept and why it
makes economic sense.
Length of Presentation: Each team should plan on up to a five
minute presentation and on a 10-15 minute follow-up
discussion period.
Submission Requirement: Each team should submit its Power
point slides BEFORE ITS PRESENTATION.
Participation: Each team member is expected to actively
participate in at least one of the team’s presentations. Also, all
team members are expected to participate in the preparation of
each presentation and be available to answer questions following
the presentation.
D. Business Plan (BP)
1. Due Date: 10th class Late submissions will NOT be
accepted.
2. Submission Requirements: Each team needs to submit the
following:
- Two hard copies of the BP (one for me and one for the team who
acts as your Reader), and a soft copy sent to me by e-mail. Please
add to the BP a cover letter that states who is you reader (e.g. VC
banker, potential partner etc.)
3. The BP should be double-spaced, (Font: Times Roman;
Size: 12), 1" margins.
4. While there are no minimum length requirements, the final
BP must not exceed 20 double spaced pages excluding
appendices.
E. Business Plan Presentation
5. Due Date: 12th class
6. Team will make a formal 10 minute presentation of the
final BP. The presentation will be followed by 5 minutes of
comments and questions from another team, which will act
as a reader to whom you have directed your BP.
7. Please give me a stapled hard copy of the presentation
slides.
Please note that the presenting teams are responsible for arranging
all AV equipment needed for their presentations and have to keep
a tight and disciplined schedule.
E. Case Analyses
Eight cases will be covered in the course. Each team will be
assigned to present one case and facilitate the discussion that
follows its presentation.
Each team is also required to submit 3 case analyses (two pages,
double-spaced, font: Times Roman, size: 12 and 1" margins).
Note that a team cannot submit the case it presents as one of the 3
write-ups.
V. Grading
The final grade will be determined as follows:
Individual grade + (Team grade x Peer review weight) = Final
grade
Individual grade includes:
Individual presentations:
Self introduction (first class) 2%
Elevator pitch (second class) 6%
Class participation 10%
Total 18%
Team grade includes:
New venture concept (presentation and written report) 10%
Written BP 25%
Final presentation BP 15%
Comments and questions of VC team (presentation and write up)
10%
Written case reports (3 x4%) 12%
Case presentation 10%
Total 82%
100%
Peer review weight:
Individual grades on team assignments are determined through a
peer review of your team members. Each member will assign a
weight that represents the contribution of each team member to
the team such that the average weight assigned to team members
is exactly 50. See an illustration below.
Note that you are not allowed to give to any group member
less than 40/50
Percent given
to A
by A
NA
by B
58
by C
44
Average
51
Peer review weight = 51 / 50
Average/ 50:
To
B
60
NA
56
58
58 /
50
to C Average
40
42
NA
41
41 /
50
50
50
50
50
Week 1: INTRODUCTION
1. Introduction to the course
2. Students “sell” themselves as potential group members in a
45 second presentation.
Readings:
Chapter 1: A Perspective on Entrepreneurship
Bhide, 1996. The question every entrepreneur must answer.
Harvard Business Review.
Week 2: OPPORTUNITY RECOGNITION
1. Students “sell” their venturing ideas – a one - minute
elevator pitch.
2. Creativity and the business idea
3. Where should we search for ideas?
4. When is an idea an opportunity?
Readings:
Kim & Mauborgne, 1999. Creating new market space. Harvard
Business Review.
Baron, Robert A. 2006. Opportunity Recognition as Pattern
Recognition: How Entrepreneurs "Connect the Dots" to Identify
New Business Opportunities. Academy of Management
Perspectives.
Kimberly D Elsbach. 2003 How to pitch a brilliant idea Harvard
Business Review
Week 3: THE ENTREPRENEUR & THE ENTREPRENEURIAL TEAM
1.
2.
3.
4.
5.
Personal networks of entrepreneurs
The entrepreneurial mindset
The importance of a team
Forming and building teams
Rewards and incentives
Case: R&R.
Study Questions:
What factors created an opportunity for Bob Reiss?
What risks and obstacles had to be overcome in order to
pursue the opportunity?
Would this approach have worked for Parker Bros., or
Milton Bradley?
What should Reiss do next?
Readings:
Reich, Robert B. 1987 Entrepreneurship reconsidered: the team as
a hero. Harvard Business Review.
Pino G Audia, Christopher I Rider. 2005. A Garage and an Idea:
What More Does an Entrepreneur Need? California Management
Review.
Dan Bricklin. Harvard Business Review 2001 Natural-born
entrepreneur. Harvard Business Review.
Week 4: NEW VENTURE CONCEPTS
1. Team presentations of new venture concepts - a five minute
presentation.
2. Following each presentation, each team will receive
feedback from peers meant to improve and fine tune the
new ventures concepts.
Readings:
Chapter 9: Managing Risk and Reward In The Entrepreneurial
Venture
Cahpter 10: The Legal Forms of Organizations
Week 5: THE BUSINESS GAME
1. Strategy for New Ventures
1. Examining market characteristics and
environmental analysis
2. First Mover Advantage
3. Building Strategic Assets
4. In Search of Competitive Advantage
Case: Zipcar
Study Questions:
Evaluate the potential venture and cahse’s progress.
What is the business model? What does the
September data on actual operation tell you how the
business model evolves in practice?
What should Chase do re the September data?
What should be Cahse’s selling point to potential
investors?
Readings:
Chapter 3: Note On Business Model Analysis for the Entrepreneur
Cahpter 6: The Legal Protection Of Intellectual Property
Bhide 1994. How Entrepreneurs Craft Strategies That Work.
Harvard Business Review,
Eisenhardt & Sull 2001. Strategy as simple rules Harvard
Business Review
Week 6: THE BUSINESS PLAN
1. The need for a BP—turning creative ideas into viable
businesses
2. The BP—structure and content
Case: Heather Evans
Study Questions:
Evaluate the opportunity for Heather Evans.
Evaluate the business plan.
Evaluate each of her financing alternatives.
Who should she approach and on what terms?
Readings:
Chapter 2: Some Thoughts on Business Plans
Sahlman. 1997. How to write a great Business plan. Harvard
Business Review.
Week 7: EVALUATION OF A BUSINESS OPPORTUNITY
1. Qualitative assessment
2. Quantitative assessment
3. Collecting data
Case: Mac Development
Readings:
Chapter 4: Valuations, Financing and Capitalization Tables in The
New Venture Context
Chapter 5: How Venture Capitalists Evaluate Potential Venture
Opportunities
Roberts & Stevenson. 1984. Valuation techniques Harvard
Business School
Week 8: ENTRANCE STRATEGIES November 7
1. Buying a business
2. Franchising
Case: Jim Sharp.
Readings:
Bhidé, Amar. 2000. David and Goliath, Reconsidered. Harvard
Business Review.
Light, David 1997. Franchising. Harvard Business Review.
Week 9: OBTAINING THE NEEDED RESOURCES November 14
1. Resource requirements
1. Bootstrapping strategies
2. Obtaining outside resources
2. Financing the new venture
1. Determining capital requirements
2. Angels and VCs
Case: ONSET Ventures
Readings:
Chapter 7: New Venture Financing
Champion, David 2000 A Stealthier Way to Raise Money.
Harvard Business Review.
Bhide, Amar 1992. Bootstrap Finance: The Art of Start-ups.
Harvard Business Review.
Week 10: SELLING YOUR BUSINESS PLAN TO INVESTORS November 21
Business Plans are DUE
1. Financing the new venture (cont.)
2. Deal structure
3. How to give a winning presentation
Case: Valhalla
Readings:
Chapter 8: Deal Structure and Deal Terms
Zider. 1998. How venture capital works? Harvard Business
School
Kawasaki, Guy 2001. The Top Ten Lies of Entrepreneurs.
Harvard Business Review.
Week 11: ENDING THE VENTURE
1. Harvesting Strategies
1. Going public
2. Selling
2. Failure
1. Bankruptcy
2. Liquidation
Case: RightNow Technologies Readings:
Readings:
Champion, David 2001.Too Soon to IPO? Harvard Business
Review, 79(2):35-46, 9p
Veit, Ken The Reluctant Entrepreneur. Harvard Business Review,
Nov/Dec92, Vol. 70 Issue 6, p40, 8p
Week 12: BUSINESS PLANS FORMAL PRESENTATIONS
BP Presentations & Comments
Last revised: 08/28/2007