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Nature of Opportunity
MBAX 6100MBAX 6100
Entrepreneurship & Entrepreneurship &
Small Business ManagementSmall Business Management
MBAX 6100MBAX 6100
Entrepreneurship & Entrepreneurship &
Small Business ManagementSmall Business Management
Frank MoyesFrank MoyesLeeds College of Business Leeds College of Business University of ColoradoUniversity of ColoradoBoulder, ColoradoBoulder, Colorado
Nature of Opportunity
Today’s AgendaToday’s Agenda
Tech Transfer conceptsTech Transfer concepts InterviewInterview Opportunity RecognitionOpportunity Recognition Feasibility PlanFeasibility Plan Status of Entrepreneurship Interview Status of Entrepreneurship Interview
Nature of Opportunity
Next Week’s ScheduleNext Week’s Schedule
Corporate EntrepreneurshipCorporate Entrepreneurship Read Read
Building Breakthrough BusinessesBuilding Breakthrough Businesses Understanding ObstaclesUnderstanding Obstacles M-3 Is This a Good Market?M-3 Is This a Good Market?
Nature of Opportunity
When Is an Idea an Opportunity?When Is an Idea an Opportunity?
AttractiveAttractive DurableDurable TimelyTimely Adds valueAdds value
Open windowOpen window Entry is feasibleEntry is feasible Management teamManagement team Competitive advantageCompetitive advantage Economics Economics
RewardingRewarding ForgivingForgiving GrowthGrowth
Timmons, New Venture Creation
Nature of Opportunity
Good OpportunityGood Opportunity
Market is strong & accessibleMarket is strong & accessible Compelling needCompelling need Sustainable competitive advantageSustainable competitive advantage Unique/differentUnique/different High marginsHigh margins ManagementManagement
Nature of Opportunity
Market Demand Is StrongMarket Demand Is Strong
Favorable trendsFavorable trends Growing market Growing market Size is big enough to be Size is big enough to be
worth the effortworth the effort Market share attainableMarket share attainable Favorable window of Favorable window of
opportunityopportunity
Venture CapitalVenture Capital 30%+ per year30%+ per year $100 million to $1 billion $100 million to $1 billion
potentialpotential Minimum 20%Minimum 20%
Nature of Opportunity
Market Is AccessibleMarket Is Accessible
Market StructureMarket Structure FragmentedFragmented No dominant playerNo dominant player SOT’s (slow, old or traditional)SOT’s (slow, old or traditional)
Response of competitors to new entrants is indifferentResponse of competitors to new entrants is indifferent No proprietary barriers to entryNo proprietary barriers to entry Access to channels is possibleAccess to channels is possible Forgiving of mistakesForgiving of mistakes
Nature of Opportunity
Compelling NeedCompelling Need
Solves a problemSolves a problem Unfulfilled nicheUnfulfilled niche Dissatisfaction with current products/servicesDissatisfaction with current products/services Poor quality or servicePoor quality or service NeedsNeeds
Physical Physical PhysiologicalPhysiological EmotionalEmotional SocialSocial FinancialFinancial IntellectualIntellectual
Nature of Opportunity
Competitive AdvantageCompetitive Advantage
Understand the marketUnderstand the market Understand the competitionUnderstand the competition SustainableSustainable
InnovationInnovation DifferentiationDifferentiation Resources & capabilitiesResources & capabilities
Really understand the market & competitionReally understand the market & competition
Nature of Opportunity
Unique/DifferentUnique/Different
You must differentiate your business – it’s already being You must differentiate your business – it’s already being done by someonedone by someone
More than unique product/service designMore than unique product/service design Marketing – positioningMarketing – positioning Operations – process or value chainOperations – process or value chain Channels – create a new channelChannels – create a new channel
BenefitsBenefits
Nature of Opportunity
High MarginsHigh Margins
Mind-set of high & low margin thinkingMind-set of high & low margin thinking Advantages of high gross profit marginsAdvantages of high gross profit margins
FundingFunding Cash flowCash flow Development & marketingDevelopment & marketing
Can solve the screw-up problemCan solve the screw-up problem
Nature of Opportunity
ManagementManagement
Meets your personal interests & objectivesMeets your personal interests & objectives Takes advantage of your experienceTakes advantage of your experience Would your potential customers buy from you?Would your potential customers buy from you? You can put a management team togetherYou can put a management team together You are passionate and commitYou are passionate and commit
Nature of Opportunity
CommitmentCommitment““Until one is committed, there is hesitancy, the chance to draw Until one is committed, there is hesitancy, the chance to draw back, always ineffectiveness. Concerning all acts of initiative and back, always ineffectiveness. Concerning all acts of initiative and creation there is one elementary truth, the ignorance of which creation there is one elementary truth, the ignorance of which kills countless ideas and splendid plans:kills countless ideas and splendid plans:
That the moment one definitely commits oneself, Providence That the moment one definitely commits oneself, Providence moves too. All sorts of things occur to help one that would never moves too. All sorts of things occur to help one that would never other wise have occurred. A whole stream of events issue from other wise have occurred. A whole stream of events issue from the decision, raising in one’s favor all manner of unforeseen the decision, raising in one’s favor all manner of unforeseen incidents and meetings and material assistance, which no man incidents and meetings and material assistance, which no man could have dreamed would have come his way. Whatever you could have dreamed would have come his way. Whatever you can do or dream you can, begin it. Boldness has genius, power can do or dream you can, begin it. Boldness has genius, power and magic in it.”and magic in it.”
Goethe’s Faust.Goethe’s Faust.
Nature of Opportunity
Good OpportunityGood Opportunity
Market is strong & accessibleMarket is strong & accessible Compelling needCompelling need Sustainable competitive advantageSustainable competitive advantage Unique/DifferentUnique/Different High marginsHigh margins ManagementManagement
Nature of Opportunity
New Ventures Are Opportunity DrivenNew Ventures Are Opportunity Driven
Not technology drivenNot technology driven Not product drivenNot product driven Not solution drivenNot solution driven Not asset drivenNot asset driven Not resource drivenNot resource driven
Nature of Opportunity
Ideas Are OverratedIdeas Are Overrated
Build a better mouse trapBuild a better mouse trap Most ideas already thought of Most ideas already thought of Process of refinement is essentialProcess of refinement is essential
“He who builds a better mousetrap these days runs into material shortages, patent-infringement suits, work stoppages, collusive bidding, discount discrimination--and taxes.” H.E. Martz
Nature of Opportunity
When Opportunity DrivenWhen Opportunity Driven
Uncertainty is good!Uncertainty is good! Lack of information is good!Lack of information is good! Being small & flexible can be good!Being small & flexible can be good!
Nature of Opportunity
Feasibility PlanFeasibility Plan
ObjectivesObjectives Assessment FrameworkAssessment Framework AssignmentAssignment
Nature of Opportunity
Objectives of a Feasibility PlanObjectives of a Feasibility Plan
Will anyone buy it?Will anyone buy it? Can you make money?Can you make money?
Is this a good opportunity?Is this a good opportunity?
Nature of Opportunity
Assessment FrameworkAssessment Framework
Part I Market AnalysisPart I Market Analysis Part II Industry AnalysisPart II Industry Analysis Part III Venture AnalysisPart III Venture Analysis
Nature of Opportunity
ApproachApproach
Start with broad perspectiveStart with broad perspective Talk to wide variety of peopleTalk to wide variety of people Qualitative customer surveyQualitative customer survey Secondary research of industry and competitionSecondary research of industry and competition
Nature of Opportunity
AssignmentAssignment
Answer questions in Feasibility Plan FrameworkAnswer questions in Feasibility Plan Framework Conduct interviews with business people (5 per person)Conduct interviews with business people (5 per person)
Prepare Call ReportsPrepare Call Reports Conduct customer survey (5 per person)Conduct customer survey (5 per person)
Prepare answers to surveysPrepare answers to surveys DeliverableDeliverable
Parts I & II due week 10Parts I & II due week 10 Parts I, II & III due week 14Parts I, II & III due week 14
Parts I & II revised based on feedback and further researchParts I & II revised based on feedback and further research DECK formatDECK format