Скачать презентацию January 2005 Why Entrepreneurship Douglas Abrams 6 Скачать презентацию January 2005 Why Entrepreneurship Douglas Abrams 6

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January 2005 Why Entrepreneurship? Douglas Abrams January 2005 Why Entrepreneurship? Douglas Abrams

6 XXXX Why entrepreneurship? Ÿ Why entrepreneurship? Ÿ Let’s fail! Ÿ So how? Douglas 6 XXXX Why entrepreneurship? Ÿ Why entrepreneurship? Ÿ Let’s fail! Ÿ So how? Douglas Abrams 2

6 XXXX What is an entrepreneur? Ÿ A person who organizes, operates, and assumes 6 XXXX What is an entrepreneur? Ÿ A person who organizes, operates, and assumes the risk for a business venture. Ÿ From Old French, from entreprendre, to undertake. Ÿ Enterprise: An undertaking, especially one of some scope, complication, and risk. Ÿ Enterprising: Willingness to undertake new ventures; initiative: "Through want of enterprise and faith men are where they are, buying and selling, and spending their lives like serfs" (Henry David Thoreau). Douglas Abrams 3

6 XXXX What are the qualities that make a successful entrepreneur? Ÿ Intelligent Ÿ 6 XXXX What are the qualities that make a successful entrepreneur? Ÿ Intelligent Ÿ Creative problem-solving skills Ÿ Self-starting Ÿ Committed Ÿ Motivated Ÿ Risk taking Douglas Abrams 4

6 XXXX What about luck? Ÿ Luck by definition is random Ÿ In the 6 XXXX What about luck? Ÿ Luck by definition is random Ÿ In the long run, luck evens out for everyone Ÿ Luck plays some role in success but much less than you imagine Ÿ Don’t wait to get lucky; make your own luck Ÿ Chance favors the prepared mind Douglas Abrams 5

6 XXXX Why is entrepreneurship important to Singapore? Ÿ The development of a thriving 6 XXXX Why is entrepreneurship important to Singapore? Ÿ The development of a thriving entrepreneurial sector in Singapore is not just an economic "nice-to-have. " Ÿ In the knowledge- and innovation-driven globalized economy of the 21 st century it is a competitive necessity. Ÿ In 2000, venture backed companies generated $736 billion in revenues and have created 4. 3 million new jobs, so the small number of venture backed companies account for 3. 3% of total jobs in the US and 7. 4% of GDP. Ÿ Singapore itself is the product of entrepreneurship Douglas Abrams 6

6 XXXX Why is entrepreneurship important to you? Ÿ What type of life do 6 XXXX Why is entrepreneurship important to you? Ÿ What type of life do you want to have? – An average life or an extraordinary life? Ÿ What do you want to do with your life? – Create something of value from nothing or just make money? Ÿ Do you want to: – Make a difference? – Change the world in some way? – Leave something of value after you are gone? Douglas Abrams 7

6 XXXX As an entrepreneur, you can: Ÿ Have an extraordinary life Ÿ Create 6 XXXX As an entrepreneur, you can: Ÿ Have an extraordinary life Ÿ Create something of value from nothing Ÿ Become rich Ÿ Make a difference Ÿ Change the world in a positive way Ÿ Leave something of value behind after you are gone Douglas Abrams 8

6 XXXX Obstacles to entrepreneurship in Singapore Ÿ Lack of entrepreneurial skills Ÿ Attitudes 6 XXXX Obstacles to entrepreneurship in Singapore Ÿ Lack of entrepreneurial skills Ÿ Attitudes toward risk Ÿ Cultural attitudes toward failure Ÿ Entrepreneurial success is difficult Douglas Abrams 9

6 XXXX Entrepreneurship can be taught Ÿ Skills and talent are distinct Ÿ Talent 6 XXXX Entrepreneurship can be taught Ÿ Skills and talent are distinct Ÿ Talent is innate; everyone can improve their skills Ÿ Skills can be developed and improved through learning, training and practice Ÿ No matter what your innate level of talent, you can improve your performance by enhancing your skills Douglas Abrams 10

6 XXXX How can entrepreneurship be taught? Ÿ Simulation - learning through doing Ÿ 6 XXXX How can entrepreneurship be taught? Ÿ Simulation - learning through doing Ÿ Like learning to play a musical instrument Ÿ How would you like to learn to swim by reading up on swimming theory and then being thrown in the pool? Douglas Abrams 11

6 XXXX TR teams swept 2004 business plan competitions Douglas Abrams 12 6 XXXX TR teams swept 2004 business plan competitions Douglas Abrams 12

6 XXXX Winning teams came from all courses Douglas Abrams 13 6 XXXX Winning teams came from all courses Douglas Abrams 13

6 XXXX TR teams received more than S$200, 000 in 2004 Team Amount Help-to-Screen 6 XXXX TR teams received more than S$200, 000 in 2004 Team Amount Help-to-Screen Frensville/Mobile. Tow n $ 40, 300 Derma. Tech $ 36, 986 World Indigo $ 30, 000 TMD $ 25, 704 Liaser Douglas Abrams $ 63, 568 $ 12, 000 Xten. SAN Total prize money and seed funding of S$215, 357 $ 5, 000 14

6 XXXX This could be you - Derma. Tech Ÿ First Prize Winner – 6 XXXX This could be you - Derma. Tech Ÿ First Prize Winner – Lee Kuan Yew Global Business Plan Competition 2004 Ÿ Semi-Finalist – Wharton Business Plan Competition 2004 Ÿ Semi-Finalist and Youth Category Merit Award - [email protected] 2004 – Total funding S$37, 000 Ÿ Featured on CNA and in Straits Times Derma. Tech - TBV 3102 Douglas Abrams 15

6 XXXX This could be you – World Indigo Ÿ First Prize Winner – 6 XXXX This could be you – World Indigo Ÿ First Prize Winner – [email protected] Business Plan Competition 2004 – S$30, 000 Ÿ Representing NUS in the 2 nd Global [email protected] Business Plan Competition in October 2004 World Indigo - TBV 3102 Douglas Abrams 16

6 XXXX This could be you – TMD and Help-to-Screen Ÿ TMD- 2 nd 6 XXXX This could be you – TMD and Help-to-Screen Ÿ TMD- 2 nd Prize in Lee Kuan Yew Global Business Plan Competition 2004 – US$15, 000 Ÿ Help-to-Screen – Finalist in LKY 2004, 2 nd Runner Up and winner of 1 st Youth Category Prize in [email protected] 2004, Semi -Finalist Wharton BPC – S$23, 000 TMD - TBV 3102 Ÿ Help-to-Screen has received a term sheet for up to S$40, 000 in seed funding Help-to-Screen - TBV 3102 Douglas Abrams 17

6 XXXX This could be you: Fresnville, Liaser, Xten. San Frensville – TR 3002 6 XXXX This could be you: Fresnville, Liaser, Xten. San Frensville – TR 3002 Ÿ Frensville – Semi-Finalist, NUSMotorola BPC, seed funding of S$40, 000 Liaser – TR 5105 Ÿ Liaser – 1 st Place Winner, NUSMotorola BPC, Finalist, [email protected] – S$12, 000 Ÿ Xten. San – 2 nd Place Winner, NUS Motorola BPC, Semifinalist, [email protected], 2 nd Place Winner – IIT Megabucks BPC – S$6, 000 Douglas Abrams Xten. San – TR 5105 18

6 XXXX This could be you – Geo-X and Apex Solutions Ÿ Both TR 6 XXXX This could be you – Geo-X and Apex Solutions Ÿ Both TR 3002 teams – advanced to the final round in Start. [email protected] Competition 2002/3 Ÿ Only eight out of 230 entrants went so far Geo-X – TR 3002 Ÿ Apex won a total of $2500 in prizes in the competition Ÿ Geo-X won $10, 000 runner-up prize; also a finalist in the Mega. Bucks business plan competition held in India Apex Solutions – TR 3002 Douglas Abrams 19

6 XXXX This could be you - Quanta. Gen Ÿ Won top prize of 6 XXXX This could be you - Quanta. Gen Ÿ Won top prize of $30, 000 in Start [email protected] Competition 2002/3 Ÿ Runner-up in the first Global [email protected] Business Plan Competition, beating out competitors from the top business schools in the world, including Harvard, Wharton and Stanford Ÿ Team members include Heng Eu Jin an NUS Overseas College student in Silicon Valley Quanta. Gen – TR 3103 Douglas Abrams 20

6 XXXX This could be you: Google Ÿ 1995: Sergey Brin and Larry Page, 6 XXXX This could be you: Google Ÿ 1995: Sergey Brin and Larry Page, two Stanford University graduate students develop the technology that will become the Google search engine. Ÿ 1998: Sergey and Larry raise $1 million in funding from family, friends, and angel investors to start Google in a friend's Menlo Park, Calif. garage with four employees. Ÿ 1999: Google raises $25 MM from VCs and angel investors Ÿ 2004: Google planning IPO at valuation of US$15 -25 billion. Will sell 10 -15% to public for $2 billion Douglas Abrams 21

6 XXXX Founded by undergrads: Dell and Microsoft Ÿ Michael Dell, who founded Dell 6 XXXX Founded by undergrads: Dell and Microsoft Ÿ Michael Dell, who founded Dell in 1984 with $1, 000 when he was 19 years old. The company now employs approximately 41, 800 people worldwide and reported revenues of $38. 2 billion for the past four quarters. Ÿ Bill Gates, who founded Microsoft in 1975 while still an undergraduate at Harvard. Microsoft had revenues of US$32. 19 billion for the fiscal year ending June 2003, and employs more than 54, 000 people in 85 countries and regions. Douglas Abrams 22

6 XXXX Why entrepreneurship? Ÿ Why entrepreneurship? Ÿ Let’s fail! Ÿ So how? Douglas 6 XXXX Why entrepreneurship? Ÿ Why entrepreneurship? Ÿ Let’s fail! Ÿ So how? Douglas Abrams 23

6 XXXX Let’s fail: the importance of failure for innovation Douglas Abrams 24 6 XXXX Let’s fail: the importance of failure for innovation Douglas Abrams 24

6 XXXX What is the relationship between risk and return? Ÿ Risk and return 6 XXXX What is the relationship between risk and return? Ÿ Risk and return are highly correlated Ÿ You cannot increase return without taking more risk Ÿ How much risk do you want to take? Ÿ What type of life do you want to have? Ÿ How much return do you require? Douglas Abrams 25

6 XXXX Evolving cultural attitudes toward failure Traditional Failure is bad; avoid at all 6 XXXX Evolving cultural attitudes toward failure Traditional Failure is bad; avoid at all costs Douglas Abrams 26

6 XXXX Evolving cultural attitudes toward failure Traditional Failure is bad; avoid at all 6 XXXX Evolving cultural attitudes toward failure Traditional Failure is bad; avoid at all costs Current Failure is acceptable; leads to learning Douglas Abrams 27

6 XXXX Evolving cultural attitudes toward failure Traditional Failure is bad; avoid at all 6 XXXX Evolving cultural attitudes toward failure Traditional Failure is bad; avoid at all costs Current Failure is acceptable; leads to learning Future Failure is desirable; necessary for innovation Douglas Abrams 28

6 XXXX The rate of technological change is increasing exponentially Douglas Abrams 29 6 XXXX The rate of technological change is increasing exponentially Douglas Abrams 29

6 XXXX The rate of innovation is increasing Douglas Abrams 30 6 XXXX The rate of innovation is increasing Douglas Abrams 30

6 XXXX Ever-shortening product cycles require more innovation Ÿ Phonograph - invented in 1877 6 XXXX Ever-shortening product cycles require more innovation Ÿ Phonograph - invented in 1877 by Thomas Edison Ÿ 33 rpm/45 rpm discs - 1948 (75 years) Ÿ Cassette tapes - 1970 s (25 years) Ÿ Compact disc - 1990 s (20 years) Ÿ MP 3 files - 2000 (10 years) Douglas Abrams 31

6 XXXX Innovation requires failure Ÿ “Failing is one of the greatest arts in 6 XXXX Innovation requires failure Ÿ “Failing is one of the greatest arts in the world. One fails toward success” - Charles Kettering - founder of Delco and inventor with 200 patents Ÿ “An inventor fails 999 times, and if he succeeds once, he’s in. He treats his failures simply as practice shots. ” - Charles Kettering Ÿ Failure is “the opportunity to begin again, more intelligently” - Henry Ford, who started Ford Motors after failing at 2 previous ventures Ÿ “The fastest way to succeed is to double your failure rate” - Thomas Watson, founder of IBM Ÿ “Success is a lousy teacher. It seduces smart people into thinking they can’t lose. ” - Bill Gates, founder of Microsoft. Douglas Abrams 32

6 XXXX Sometimes failure itself is innovation Ÿ Post-It notes - failed glue Ÿ 6 XXXX Sometimes failure itself is innovation Ÿ Post-It notes - failed glue Ÿ Scotchgard - spilled on shoes Ÿ Combat - failed additive for cattle feed Douglas Abrams 33

6 XXXX The essence of risk is failure Douglas Abrams 34 6 XXXX The essence of risk is failure Douglas Abrams 34

6 XXXX Failure is necessary to achieve success Douglas Abrams 35 6 XXXX Failure is necessary to achieve success Douglas Abrams 35

6 XXXX Why are people afraid to risk failure? Ÿ Fear of the unknown 6 XXXX Why are people afraid to risk failure? Ÿ Fear of the unknown - “Why take a chance? ” Ÿ Fear of looking stupid - “What will they think? ” Ÿ Judging too quickly - “That will never work” Ÿ Attachment to the old - “We have always done it this way” Ÿ Attachment to past successes - “This approach got us here” Douglas Abrams 36

6 XXXX Do not let fear stop you Ÿ Why are you afraid to 6 XXXX Do not let fear stop you Ÿ Why are you afraid to try? Ÿ The outcome must be important to you; otherwise no fear Ÿ This makes you afraid to fail Ÿ If you do not try, then you have already failed Ÿ “You miss 100% of the shots you do not take” - Wayne Gretzky Ÿ Fear causes you to fail at the things that are most important to you Douglas Abrams 37

6 XXXX Conquering your fear Ÿ Everyone is afraid Ÿ It is OK to 6 XXXX Conquering your fear Ÿ Everyone is afraid Ÿ It is OK to be afraid Ÿ Don’t try to eliminate your fear Ÿ Work through your fear Douglas Abrams 38

6 XXXX If you don’t fail, you are not trying hard enough Ÿ Most 6 XXXX If you don’t fail, you are not trying hard enough Ÿ Most learning and progress are achieved through failure Ÿ The top scientists in the world fail more than average scientists Ÿ Everyone who is now highly successful took significant risk to get there Ÿ We don't regret the things that we do and fail at; we regret the things that we fail to do. Ÿ A life lived in fear is a life half lived Douglas Abrams 39

6 XXXX Success from failure: Albert Einstein Failure Success Ÿ 1895: Fails entrance Ÿ 6 XXXX Success from failure: Albert Einstein Failure Success Ÿ 1895: Fails entrance Ÿ 1905: Submits paper exam to the Swiss Polytechnic, a top technical university Ÿ 1902: Unable to find work at a university, takes a job as a clerk at the Swiss Patent Office on Special Theory of Relativity to a leading German physics journal. At age 26, formulates the equation e=mc 2. Ÿ Now recognized as one of the leading thinkers of the 20 th Century Douglas Abrams 40

6 XXXX What makes Silicon Valley different? Ÿ A different attitude toward failure Ÿ 6 XXXX What makes Silicon Valley different? Ÿ A different attitude toward failure Ÿ Many Silicon Valley VCs will only invest in entrepreneurs who have already failed Ÿ “I got my education on the mean streets of Silicon Valley, where I got to see how huge mistakes are made. Knowing what doesn’t work is perhaps more valuable than knowing what should work. Failure is just tuition. If you are in a failing start-up, take notes. ” successful start-up founder Douglas Abrams 41

6 XXXX Only do things that are difficult to do Ÿ Everything that is 6 XXXX Only do things that are difficult to do Ÿ Everything that is worth doing is difficult Ÿ If it is easy, it is probably not worth doing Ÿ You should never hesitate to do something difficult Douglas Abrams 42

6 XXXX Why entrepreneurship? Ÿ Why entrepreneurship? Ÿ Let’s fail! Ÿ So how? Douglas 6 XXXX Why entrepreneurship? Ÿ Why entrepreneurship? Ÿ Let’s fail! Ÿ So how? Douglas Abrams 43

6 XXXX From idea to business model Ÿ How do we create value? Ÿ 6 XXXX From idea to business model Ÿ How do we create value? Ÿ Who do we create value for? Ÿ What is our source of competence/advantage? Ÿ How do we differentiate ourselves? Ÿ How do we make money? Ÿ What are our time, scope and size ambitions? Douglas Abrams Business model developed by Michael H. Morris, Ph. D 44

6 XXXX Key steps to success Ÿ Develop an innovative product - Innovation Ÿ 6 XXXX Key steps to success Ÿ Develop an innovative product - Innovation Ÿ Choose the right market - Customers Ÿ Create sustainable competitive advantage - Competitors Douglas Abrams 45

6 XXXX Product or service? Ÿ Odds of starting a company that made the 6 XXXX Product or service? Ÿ Odds of starting a company that made the Inc 500 list of fastest growing young private companies from 1982 to 2000 Ÿ Biotech – 265 times higher than restaurant Ÿ Software – 823 times higher than hotel Ÿ Choosing the right opportunity is the most important determinant of success Douglas Abrams 46

6 XXXX High risk, low return? Ÿ Product-based start-ups – High risk of failure 6 XXXX High risk, low return? Ÿ Product-based start-ups – High risk of failure – High return if successful Ÿ Service-based start-ups – Higher risk of failure – Lower return if successful Ÿ Choose an industry favorable to start-ups Douglas Abrams 47

6 XXXX Evaluating new ideas Ÿ Original? Ÿ Feasible? Ÿ Marketable? Ÿ Profitable? Douglas 6 XXXX Evaluating new ideas Ÿ Original? Ÿ Feasible? Ÿ Marketable? Ÿ Profitable? Douglas Abrams 48

6 XXXX What problem are you solving for customers? Ÿ You need to have 6 XXXX What problem are you solving for customers? Ÿ You need to have a value proposition for customers Ÿ Start a business with a product that meet a real customer need Ÿ Develop a solution to the customers’ problem Ÿ Meet customer needs better than competitors Ÿ Evaluate customer preferences – traditional market research ineffective – listen to customers Douglas Abrams 49

6 XXXX Identify, analyze and strategize your market Ÿ Identify market opportunity Ÿ The 6 XXXX Identify, analyze and strategize your market Ÿ Identify market opportunity Ÿ The niche that will make you rich Ÿ Assess and analyze market – Competitors - don’t say you don’t have any – Customers Ÿ Develop marketing strategy – Differentiation that offers superior customer value – Cost leadership Douglas Abrams 50

6 XXXX Create sustainable competitive advantage Ÿ Competing with established companies Ÿ Protect your 6 XXXX Create sustainable competitive advantage Ÿ Competing with established companies Ÿ Protect your intellectual property Ÿ Create barriers to entry Douglas Abrams 51

6 XXXX Writing a model business plan Ÿ Concept Ÿ Market opportunity & strategy 6 XXXX Writing a model business plan Ÿ Concept Ÿ Market opportunity & strategy Ÿ Value proposition and sustainable competitive advantage Ÿ Products and services Ÿ Team Ÿ Financials, including pro-forma projections and valuation, total funding, funding required, equity offered and exit strategy Douglas Abrams 52

6 XXXX Begin with an executive summary Ÿ The executive summary contains the key 6 XXXX Begin with an executive summary Ÿ The executive summary contains the key points of your business plan Ÿ This is all that most investors will read Ÿ Approximately 2 -5 pages long Ÿ Define your business Ÿ Why and how it is going to be a success Douglas Abrams 53

6 XXXX A value proposition Ÿ For (target customers) Ÿ Who are dissatisfied with 6 XXXX A value proposition Ÿ For (target customers) Ÿ Who are dissatisfied with (the current market alternative) Ÿ Our product is a (new product category) Ÿ That provides (key problem-solving capability) Ÿ Unlike (the product alternative) Douglas Abrams 54

6 XXXX Amazon. com’s value proposition (circa 1995) Ÿ For people who buy books 6 XXXX Amazon. com’s value proposition (circa 1995) Ÿ For people who buy books Ÿ Who are dissatisfied with shopping in bookstores Ÿ Our product is an on-line bookstore with millions of titles Ÿ That uses the Internet to transform book buying into the fastest, easiest, and most enjoyable shopping experience possible. Ÿ Unlike Barnes & Noble, Waldenbooks and other brick-and-mortar bookstores Douglas Abrams 55

6 XXXX Product, team and financials Ÿ Describe the products and services in only 6 XXXX Product, team and financials Ÿ Describe the products and services in only enough detail for investors to understand why they should be interested Ÿ The team is the most important thing Ÿ Go beyond the management team Ÿ Financials – Business model – Projections and valuation – Funding required and equity offered – Exit Strategy and ROI Douglas Abrams 56

6 XXXX Contact us Ÿ Douglas Abrams Ÿ dka@parallaxcapital. com Ÿ necadk@nus. edu. sg 6 XXXX Contact us Ÿ Douglas Abrams Ÿ [email protected] com Ÿ [email protected] edu. sg Ÿ 65 -9780 -5381 (hp) Douglas Abrams 57