FALL 2008
BMG 214: ENTREPRENEURS HIP; NEW VENTURE CREATION
STEVE KARPENKO
EXT. 2544; E-MAIL: skarpenk@ubishops.ca
OFFICE HOURS: WEDNESDAY, 1:00—4:00 PM, AND BY APPOINTMENT
COURSE OBJECTIVES:
Entrepreneurs create value in every field of human endeavour by applying what they know
and learn to meet economic, social or cultural needs. You will examine the behavior and values of
persons who successfully demonstrate entrepreneurial capacity and initiative, in order to assess
your own entrepreneurial potential and better understand how to use entrepreneurial principles to
realize your dreams...our focus will be new venture creation.
TEACHING METHODOLOGY:
"I hear and I forget; I see
and I remember; I do and I
understand."
CASE STUDY is ideally suited to the study of entrepreneurship. Your superior texts deal more than
adequately with theoretical issues and you will be expected to refer to them for whatever
theoretical help you may require to better understand the issues dealt with by the cases. That is to
say, we will devote very little class time to lectures devoted to theory. Our route to understanding
will be via case analysis and discussion, augmented by what you choose to take from
recommended readings. You will:
• identify critical factors driving new venture success
• observe how successful entrepreneurs and investors differentiate profitable and
durable ideas from merely good ones
• identify the financial and non-financial resources available to new ventures
• apply a spreadsheet to develop and analyze financial projections for start up ventures
• learn to recognize and assess risk, and identify strategies which can improve
risk/reward odds of new ventures
• assess business valuation practices and approaches
• apply entrepreneurial principles to the purchase of a business and a franchise
•
develop an understanding of strategic planning processes
YOUR PRIMARY TASKS
YOUR KEY TASK THIS SEMESTER WILL BE TO CONSTRUCT A BUSINESS PLAN.
AN EFFECTIVE PLAN is more than a document. It is:
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a working description of a closely imagined future,
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a schedule of the resources and actions required to get you there and
a purpose built tool designed to help participants make a desired future
happen.
All of your work this term is designed to help you create such a document. In particular,
you will:
1
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generate ideas for potentially self sustaining initiatives that respond to identified needs
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distinguish between merely good ideas and genuine opportunities
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recruit/join, a team—teams of 3 very strongly encouraged—
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assess opportunities in order to identify those with higher potential
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determine whether a high potential opportunity is, in fact, achievable and, if
achievable, can be sustained
identify market, regulatory and competitive information you will need to succeed
Identify your customers; talk to one
locate information you will need to attract and reach customers
identify resources required to capitalize on the opportunity you have selected, and
develop strategies to obtain them
identify the help, expertise, advice you need to complement your skills
•
create a strategy to enter a market
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create a strategy to locate the financial resources you will need
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identify potential risks and develop strategies to manage them
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present your idea
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RELATED TERM ASSIGNMENTS
You will be exposed to the entrepreneurial experience: too much to do, too little time, too few
resources, ambiguity and the certainty that your actions will have observable- but not necessarily
predictable— consequences.
EXAMS
CASES:
THERE WILL BE NO TERM OR FINAL EXAMS
YOU WILL BE REQUIRED TO:
• read and analyze each case,
•
read theoretical material relating to case issues
•
respond to questions concerning cases by e-mail prior to class and
•
take part in class discussion.
participation is essential—and will account for 50 % of your total grade.
if you do not attend, you cannot participate
if you are not prepared to discuss the cases, your participation will be
valueless, and your attendance pointless
BUSINESS SIMULATION:
Participation is compulsory and requires one full day, 8:30 am—4:00 pm. a fee of $40 will be
charged, if the fee presents financial hardship, I will accommodate your request for a reduction if
your schedule prohibits your participation, please arrange to take the course at another time.
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BUSINESS PLANNING ASSIGNMENTS
Planning is a creative, multi task, multi phased life skill and process.
The construction and presentation of your plan will comprise the remainder of your
assignments, including:
Resume
Submit a resume noting your strengths and weaknesses. Outline
experience and interests which might help you add value to an
entrepreneurial team. Identify strengths, skills, experience which will
complement your own describe your personal objectives in taking this
course.
Draft Ideas
You will be asked to discuss your ideas in class. Please note: proposals for
a restaurant, single store retail outlet, or a personal services or a
consulting firm will not be accepted
Teams
Teams must be for formed and potential projects identified by the
conclusion of week three. Teams must present their ideas to me 1st
tutorial week.
Tutorials
During tutorial weeks your reports will require you to complete planning/
evaluating/research activities
Quick Screen
Prepare and submit quick screen analysis
Market/
Industry
Research
Obtain market and customer data of specific reference to your plan
Ratios
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Identify and locate key ratios
Legal Issues
Identify and resolve potential corporate structural, regulatory, legal, and
intellectual property issues
VOSG
Apply the "venture opportunity screening guide" tool to assess the potential
of the opportunity
Manage/ Organize
The Project
Allocate/schedule tasks and responsibilities. Assign a value to team
member's contribution
Presentations
Each tea m will prepare a 15 minute presentation. A bound copy of your
plan will be required
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GRADING: Each term several students will ask me to explain why they received a lower
grade than another member of their team. The answer lies in the way in which grades are
calculated:
50% on class/course participation, 50% on the Plan, as follows
50% for PARTICIPATION, of which
Attendance = 50%
Case prep submitted by e-mail prior to class = 50%
Contribution in class = adjustment of up to + or - 10%
50% for PLAN of which
Resume; Ideas; Quick Screen; VOSG analysis; Tutorial preparation = 30 %
Presentation = 30%: of which
Overall presentation yields 40%
Your presentation yields 60%
Bound presentation of Plan= 40%
Adjustments: Peer evaluation = potential adjustment of + or - 10 %
Class investments = adjustment of + or - 5%
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BMG214: NEW VENTURE CREATION
FALL 2008
SEPTEMBER
Business planning tasks in September: Self assessment;
generate ideas; identify opportunities; recruit/join a team; Apply
Quick Screen to select superior opportunity; Identify your
resource, information and people needs. What information do
you need; where will you find it? Take a look, below, at what you
will need to present in your first Tutorial session. TIME IS NOT
YOUR FRIEND
3
W
Intro: Syllabus, expectations, assignments, deadlines.
Hand out: Fall Schedule & Syllabus
Hand out: Starting over, and over, and over
Hand out: Memorandum of Understanding
Hand out: R & R Case
Homework: Self assessment – www.bdc.ca Æ Tools menu
8
M
Lecture: Entrepreneurship defined. The context: change
equals opportunity.
Hand out: Idea Generation Guide
Hand-out: Timmons Model
10
W
1 st Case: R & R: Entrepreneurship further defined. The
Timmons Model. What does ''without regard for resources you
currently control.'' mean?
Hand out: R&R Exercise
Hand out: Profit and Loss
Hand out: Break Even Analysis
15
M
Discussion: Idea Generation exercise: Risk and risk
management:
Exercise: Creative Squares
Handout: Quick Screen
Hand out: Roxanne Quimby Case
Hand out: When Does ldea= Opportunity?
Opportunity Spawners & driversSea Changes
Three Technology Laws
New Rules for the New Economy
17
W
2" d Case: Roxanne Quimby; Who can be an entrepreneur?
Where do little ideas come from?
Sign up for 1st Tutorial
1
Hand-out: Team Presentations Form
22/24 M,W
1 st TUTORIAL: Teams formed; Discuss Ideas / Opportunities.
Discuss Quick Screen results. Be prepared to describe your
opportunity; identify your customers—and the benefits they will
receive. Can you name some competitors? What info do you
lack? Where will you find it? What expertise do you lack? Who
could provide it?
What actions must you take, what tasks complete to prepare
for the 2nd Tutorial? Who will undertake this work? Who will
ensure that work is done—on time? According to what
schedule...deadlines? If you are unable to identify a suitable
opportunity, or recruit or join a team, perhaps this is not the
time to take this course.
Handout: Business plan model; One size doesn’t fit all!!
Hand out: Failing to plan equals planning to fail
29
M
3 rd Case: Outdoor Scene; Use Quick Screen to evaluate the
opportunity.
Timmons Model cont'd —The Team & Getting the Resources.
Why plan? Plan What?
Hand out: Out-Door Scene Cash Flow and Industry
Analysis
OCTOBER
Business planning tasks in October: What business are
you in? Use Venture Opportunity Screening Guide to
analyze your opportunity and determine what remains to
be done to launch your venture. What products/services
will you provide? To whom? How will they benefit?
Describe your industry; total market, growth factors,
change factors; keyplayers & competitors. Identify
distribution channels- how is the pie divided; begin to get
a handle on prices, find key ratios. Identify your
information requirements: what do I need to know; how will
I find this information; who can help me succeed. Will you
need partners? Who might they be? What needs to be done
to prepare for the third tutorial session? Who will do it?
When? TIME IS NOT YOUR FRIEND.
1
W
1 st “Live Case" An entrepreneur will tell his story; be prepared
to ask questions.
1
6
M
Discussion: Outdoor Scene: be prepared to discuss your
industry analysis, cash flow and break even analysis
8
W
4 th Case: Gary and George Muller; Use Quick Screen to
assess opportunities presented in this case. Identify
categories- of data included in the industry analyses
undertaken by the Mullers. What sources of this data exist?
15
W
5 th Case: PC Build: What adds up to a winning
Business Plan?
Sign up for 2nd Tutorial
Handout: Fact Sheet for Students
20
M
2 nd "Live Case" An entrepreneur will tell his story.
22
W
In class activity: Ethics
Handout: In class ethics assignment
27/29 M,W
2 nd Tutorial: Present detailed information concerning your
industry, the market for your product or service. How big is
your market? What is your niche? What are the other elements
of the value chain in your industry? What % of this market are
you after? Note information sources you have accessed.
Detail your opportunity. What information do you need, now?
How do you propose to obtain it?
Submit a Work Plan noting each member's specific
responsibilities; provide a work schedule. Prepare a Gantt
chart describing the tasks you must complete to launch.
Google "Gantt Chart" Select free software to prepare what you
need. Try Smart Draw.
29
W
Lecture/discussion: Finding the resources. Enterprise
valuation.
Where's the money? How much will I need? What for? When
will I need it? For how long? Where will I find it?
Hand out: Valuation
Handout: Where's the Money?
Handout: Note on Venture Capital
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NOVEMBER
Business Planning tasks in November: Prepare for 3rd
tutorial: Continue to refer to the Venture Screening Guide.
Have you spoken to a customer yet? Who are they? How
many are there? Where are they? How will you reach them?
What benefits wilt you provide? How will you sell? What do
you need to accomplish to launch this venture? What has
to go right? How can you make that happen? What has
changed since you started this process? Redo your Gantt
Chart to reflect new information.
3
M
6 th Case: Heather Evans. Where's the money? Entrepreneurs
create value; how do we measure/assess value?
Hand out: Team and Resources: A new look at
Timmons Model
5
W
3 rd “Live Case" An entrepreneur will tell his story.
Handout: The Deal
Saturday 8th
or Sunday 9th
The SIMULATION: The process and challenges of launching a
new venture in a competitive market. Participation is
compulsory and requires a full day, from 8:30 AM —4:00 PM
on either Saturday or Sunday. If you are unable to participate,
on either of these days, please arrange to take the course
another term.
A fee of $40.00 will be charged. If this represents financial
hardship, speak to me and I will make suitable arrangements.
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7 th Case Michael Healey: The Deal
M
10/12 M,W
3 rd Tutorial: Be prepared to discuss your market in detail.
What have you learned from your customers? Describe your
customers. How many are there? Where are they? How will
you reach them? What benefits will you provide? How will you
sell?
What do you need to accomplish to launch this venture?
What has to go right? How can you make that happen?
What additional information do you need?
Redo your Gantt Chart to reflect new information and to take
you forward to a specific launch date. Remember: you're
playing this game for real!!
Describe responsibilities for each team member and list their
outstanding tasks to prepare presentation and bound copy of
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final plan.
12
W
8 th Case: Ice Delights; Franchising
17
M
9 th Case: Marcia Radosevich A: Launching a technical product
19
W
Lecture discussion: Rules, rules., rules: Setting up in
business; Legal issues and regulations. Boards of Advisors or
Directors.
Handout: Forms of Business Organization
Handout: Registration in Quebec
Handout: Promoting Entrepreneurship in Canada
November 24,
25,26
PRESENTATIONS: Monday, Tuesday & Wednesday
4:30—8:00 PM. Attendance is compulsory.
December 12 th BOUND BUSINESS PLAN SUBMITTED
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