7.3 Bird in Hand

UVA-ENT-0090 THE BIRD-IN-HAND PRINCIPLE: WHO I AM, WHAT I KNOW, AND WHOM I KNOW Not all ideas are great opportunities—take, for example, New Coke or te !ord Edsel" #e t some one t ougt enoug of t ese to a$tual l% in &e st in t em and pr odu$e t em" Unders tanda'l %, mos t no&i $e ent rep reneur s, espe$i all % to se wo a&e good (o' mar ket prospe$ts, tend to worr% a lot a'out finding te )rigt* opportunit%" Idea versus Opportunt!: Assessn" #eas$%t! and &a%ue Tere are se&eral frameworks in text'ooks, trade 'ooks, (ournal arti$les, periodi$als, and on +e' sites tat $laim to predi$t te feasi'ilit% and &alue of new &enture ideas" #"ure ' depi$ts a simple and useful summar% of four ke% $on$epts at te eart of man% of tese frameworks " .s it doa'le / te $ni$a l feas i'ili t%1 market feasi' ilit %2 3" .s it wort doing / finan$ial feasi 'il it% 2 4" Can I do it/ +o else do . need/ 5rgani6ational feasi'ilit%2 7" 8o . want to do it/ +% do . want to do it/ oti&ational and exit feasi'ilit%2 .f answers to all four are positi&e, te entrepreneur $an $onfidentl% pro$eed" Te first two elements a&e to do wit external fa$tors su$ as te te$nolog% of te time and te market en&ironment for te 'usiness idea" Te last two are internal, depending on te personal $ir$umstan$es and moti&ations of te entrepreneur making te de$ision" :elow is a list of ;uestions witin ea$ of te four ;uadrants of #"ure '" Among te te$ni;ues re$ommended for answering tese ;uestions are market resear$ 'ased on sur&e%s, fo$us groups, inter&iews and demand fore$asting, and so fort1 risk e&aluation and risk redu$tion strategies1 and finan$ial pro formas wit sensiti&it% anal% ses and te like" Ti s te$ ni$ al not e was pre par ed '% <aras 8" <ar as& at% , ass o$i ate pro fessor of 'usiness admini str ation" Cop%rigt 300= '% te Uni&ersit% of Virginia 8arden <$ool !oundation, Carlottes&ille, VA" All rigts reser&ed" To order copies, send an e-mail to sales>dardenpu'lising"$om" No part of this publi cation may be reproduc ed, stored in a retrieval system, used in a spreadsheet, or transmitted in any form or by any means—electr onic, mechanical, photocopying, recording, or otherwise—without the permission of the Darden School Foundation

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7.3 Bird in Hand