Entrepreneurship

With Miss Ellen C. Soriano

Day one: December 7, 2019
[email protected]
Final submission project: come up business plan

What is USaid? (homework)

- The United States Agency for International Development is an independent agency of the
United States federal government that is primarily responsible for administering civilian
foreign aid and development assistance.

Entrepreneurship by Dr. Eduardo Morald Jr.

The Entrepreneur

Becoming an entrepreneurial leader: Seaside Organics

- Organic skincare
- Current President: Sara Norton (the entrepreneur)
- Different Inventor: Founded by Lara Green
o five years with the company before Sara came
o Lost passion due to stress and pressure to maintain the company’s growth
o Work-life balance
o Daily routine: she didn’t want to manage the company (management)
o Her passion was the product not the business
- Lisa Mackintosh (the manager)
o Hired for her steady, deliberate approach to company management and growth
- Daily management issues: it’s difficult more than the company the daily grind
o Operations: manufacturing
 lack of HR
 meeting deadlines
 distribution
 product development
o Marketing and Selling
 Important to reach the quota or reached target
o Financial
 Don’t sell then you won’t have enough fund to the operations and your
people

Sara Norton: Well-Bar (case methodology)

- An entrepreneur: started a business,
- A famous former soccer player
- Product gap:
o she started it because she couldn’t find that kind of product
 o she was looking for something organic
o she knew no one was selling it
o tasty and convenient
- What was the stimulus to invent? She identified her opportunities
o She couldn’t the product she was looking for in the market
o She worked for a marketing company
o For it to be successful product, she had to start it then and there
o She had good connections and networks and resources (could be anything, its
broad; her greatest resource)
o Bootstrap: start something with very little resource
o Your profession or background or passion can sometimes become a trigger or
bring you into its entrepreneurship
o You can also buy a company
- Similar to Lara Green
- She later sold the company and travelled afterwards
- Earning 16 million from the sale
- Reason for selling: due to Business enterprise
o Very high growth rate
o And then plateau of the sales

Sara Norton: Seaside Organics

- A serial entrepreneur: go from one business to another
- From her passion to becoming the voice of the industry
- She started as a venture capitalist
- The company needed money
o To sustain growth
o And maintain the other components of the company
- She couldn’t handle it alone so she hired Lisa Mackintosh

Traits or qualities to be an entrepreneur

- Started a business
- Creativity or innovative
- Passion
- Luck or timing or finding the opportunity (opportunity-seeker)
o She was there at the right time
- Willingness to sacrifice
o Connections with other companies
o Steady income
o Work-life balance
o Her other profession or passion
- Motivation
o Service
 answering a societal need
 noble intentions
 - Haphazard or messy
o Their minds and creativity jump from one idea to another
o They can’t handle the daily routine
o They need someone to compliment them, they need the steadiness
- Provide the vision
- Opportunity seeker
- The tragedy

Traits to be a manager
- Skills
o Communication
o Decision-making
o Problem-solving
- Discipline
- Realistic
- Strategic
- Leadership
- Implement the vision

Lisa Mackintosh
- A Professional Manager
o In hospitals, the heads were the doctors but were later headed by managers
o Manny Pangilinan
 The first one to head a hospital without the degree
- Starting a business is riskier than joining a profession
- She compliments Sara Norton but they did not always see eye to eye

Weekend Homework
- Read again the case

Quiz on Monday

Aimed Schedule: uses to cases throughout

- Monday: Operations and HR (8:15 am class and end at 3:45 pm)
- Tuesday: Marketing and selling
- Wednesday: Accounting and finance

Homework:
Rudimentary – undeveloped or basic form of something
Merit – be worthy of attention
Alienate – isolate or lose interest
Overestimate – to form overly high estimate
Stake – something gambled (maybe a sum of money) on the outcome of a risky venture
Bootstrap – start up with minimal financial resources
What is a business plan?
A written document describing the nature of the business, the sales and marketing strategy, and
the financial background, and containing a projected profit and loss statement

Sara Norton: Well-Bar

- Former soccer star
- In 1990, was 30 years old, working for a sports marketing company
- She launched a snack bar for athletes
-

Day two: December 9, 2019

- The characteristics of the entrepreneur and the manager are complimentary to each
other.
- Ideal that both the manager and the entrepreneur must have all these skills
- Entrepreneurs
o need communication skills
 Their vision has to be communicated to the managers, employees,
investors, customers.
 It is needed to get by in the business
- Manager
o needs to have creativity because at some point math cannot help solve problems,
especially when working with people.
o is also an opportunity-seeker, seeking for opportunities in the market
o has passion, motivation
o they are willing to sacrifice things, especially when making decisions

Seaside Organics
- success and failures go hand in hand
- entrepreneurial leadership is applicable to business large and small
- adaptability to each situation and phase (any point in time in the business)
- change is necessary for growth (do not be afraid of change because we live in a dynamic
world
o Forever 21 closed
 Managerial decisions
 Lack of innovation
 They failed to adapt to the online system
 Online shopping came about
 It’s hard to maintain a brick and mortar store
- learning is a MUST
o continue to learn

Entrepreneurial feelings
- no such thing as a “true entrepreneurial profile”
 - entrepreneurs come from a variety of (backgrounds):
o educational backgrounds
o family situations
o work experiences
 Henry Sy:
 Came from China
 His bad luck (Mercury Drugstore) turned into motivation
 Find opportunity in any situation in life
“make use of wherever you are in”

Locus of Control
- An attribute indicating the sense of control that a person has over life
- Question whether they will be able to sustain the drive and energy required not only to
overcome inertia in forming something new but also to manage the new enterprise
o That’s why Sara hired Lisa

Seaside Organics
- Organic skincare
o Much more expensive because of the special ingredients
o Just like the organic meat
 It’s hard to claim its organic
 Because the food they feed the animals have to be organic as well

- Entrepreneurs should start as an employee first to gain discipline

o They need to be like the manager first before becoming the boss
o You also learn what the managers feel: not only passion but also compassion

Yes, to organic cosmetics

- One at a time
- Upping price of existing to finance new
- Strengthen existing test market new
- Package together
- New team for cosmetics

No to organic cosmetics
- Focus on existing
- More research on the development of the new one
- Expand:
o Distribution
o International
o Existing products
- Avoid market confusion
- Recession or delay market
- Skincare > cosmetics
 - Lisa struggles with the
o Recession
o Distribution and focus on the skincare
o The want for the cosmetics
o Supermarkets
 don’t sell expensive cosmetics
 maintenance of the shell life of organic cosmetics
o they have not mastered the marketing of skincare

Feelings about
- need for independence
o being one’s own boss
 one of the strongest needs of an entrepreneur
- need for….

Risk taking
- whether financial, social, or psychological
o part of the entrepreneurial process
o financial: losing money
o social: missing out on social events, being shunned by their friends or being
embarrassed of them
o psychological: shame of failing
 entrepreneurs bringing something new are usually arrogant or proud
because the need it to rise and excel
- many studies show a general propensity for risk taking
o risk taking is indeed one aspect of being an entrepreneur
o they also take calculated risk

Background and characteristics

- childhood family environment
- education
- personal values
- age
o could be a second job to them
- work history
o just like Sara

Motivation
- what causes people to do something
o Independence
o Money
o Job satisfaction
o Achievement
o ….
Role Models and support systems
- Role model
o Individuals influencing an entrepreneur’s career choice and style
- Moral support network
o Individuals who give psychological support to an entrepreneur
- Professional support network
o Individuals who help the entrepreneur in business activities

Entrepreneurship
- The process of creating something new with value by devoting the necessary time and
effort, assuming the accompanying…

Basic Aspects
- Creation process
- Requires the devotion of the necessary time and effort
- Assuming necessary risks
- Rewards

Creation process
- Creation of something new of value
o For the entrepreneur
 Entrepreneurs frequently are not the actual inventor
o For the audience for which it was developed
 Move to a business concept that is market-centered and creates new
sources or forms of value
 Something to answer a certain need o whatever is lacking
Time and effort required
- Significant amount of time…

Risk

Rewards
- Independence
- …

Opportunity
- Entrepreneurship is opportunity-driven behavior
o Not resource-constrained behavior
- We are all surrounded by dozens of opportunities, we just do not see them or act on them
- The pursuit of opportunity makes one more “opportunity aware”
o A mistake can be an opportunity just like post it

Motivation for entrepreneurship

 - Passion
o Doing what you love
- Creativity
- Change
- Challenge
- Flexible, customer driven, responsive
- World class
o Global niche markets
- Fast paced product development
- Less hierarchical, employee participation

Impact
- Entrepreneurs are the innovators and risk-takers in business. They:
o Introduce new products
o Apply new and improved business methods
o Create value
- Entrepreneurs play a critical role in our economy and add immeasurably to our welfare.

Underlying dimension of entrep

- Innovativeness
o Develop novel, new products/services/processes
- Risk-taking
o Calculated
- Proactiveness
-
o Any venture
o Any organization
o Any person
o Any society
- …
- Entrepreneurship is all around you. You will:
o Start an entrepreneurial business
o Work for one
o Buy from one
o Outsource to one
o Invest in one

Entrepreneurial Process: John Q. Inventor and the Cardboard Snowplow

Group 4: Ruiz, Marabe, Sarmiento, Mata
Activity:
Will the plow be successful or not?
Yes. He did not pursue the launch of the business
Provide an initial critique of the idea.
- Make it cheaper, reevaluate the price
 - Make it water-proof
- Just add other boxes to make it bigger
Assess the feasibility of launching product.
What are the resources needed to sell and market commercially?
Where/ how will you get the resources to make the business successful?

John Q. Inventor:
- PhD in Physics
- Created in 1980s
- Secured a patent
- An aspiring entrepreneur
- Works in IBM (business) but a scientist
- Product: cardboard snowplow
o Waterproofing
o Different sizes
- What are the entrepreneurial ideas that came to inventing this product?
o Motivation: personal
 He hated shoveling
o Alternative products were expensive
 Shovel: 40 x 3 = $120 (breakable)
 Service: $150
 Snowblower: $250 (dangerous, still cold, breakable)
o Personal + alternative products = cardboard snowplow
- He setup an appointment with a buyer
o You have to prove that there is demand
- Selling proposition’
o Cheap
o Reliable with the modifications
- Resources needed
o #1: Operations
 Production
 Waterproofing
 Different sizes
 Packaging
 Suppliers of the materials
 Manpower (also personnel or personal)
 costs
o #2: Marketing (make sure to look at the end user)
 Advertisement
 Packaging
 Distribution
 Pricing
 Discounts
 o #3: Financial
 Investors
 Pricing/ discounts
 Costs

Nature and importance of entrepreneurs

- French = between-taker/go-between
- Individual who takes risks and starts something new
- Innovator = an individual developing something unique
- Behavior that includes
o Initiative taking
o The organizing and reorganizing of social and economic mechanisms to turn
resources and situations to practical account
o Acceptance of risk or failure…

Unique Package
- “Kaleidoscope thinking”
o We are all surrounded by the same things
o Entrepreneurs just put them together in a slightly different way
o The unique package should include:
 Product innovation
 New distribution approach
 Alternative service delivery method
 Different way of packaging

Impact of Entrepreneurship
- Entrepreneurs are the innovators and risk-takers in business. They:
o Introduce new products
o Apply new and improved business methods
o Create value
- Entrepreneurs play a critical role in our economy and add immeasurably to our welfare.
- Not confined to new start-up business
o Can be applied to anything
- A managerial focus that emphasizes the creation pf new business through:
o Innovative, opportunity-oriented management
- Can be applied to:
o Larger business: Intrapreneurship
o Not-for-Profits and Social Issues
 especially these because they don’t earn a lot but the social influence is
greater

Types of start-ups
- lifestyle firm
o small venture that supports owners and modest growth
 o caters to a certain style of living
o its not for the mass market
o answers a certain need in our lifestyle like
 the organics
 starbucks (they sell the experience)
 milktea (u can survive without it, it can comes and goes)
 salon
 spa
 belo
 gym
o its not for everyone
o modest growth
o (30-40 employees, $2M)
- foundation company
o from research and development that does not go public
o no commercial viability (cardboard)
o like
 the cardboard
 data analytics or research companies
o does not go public
o 40-400 employees
- high-potential venture
o high growth potential and gets great investor interest
o like
 malls
 real estate
 travel tours
 Instagram
- gazelles
o very high growth ventures
o these animals move swift but graceful, you don’t even notice the distance
o like
 gas
 technology-based items and services
 call centers

Entrepreneurial Vehicles
- Garage
o Steve jobs
o Bill Gates
- Start-up ventures (from nothing)
o Airbnb (Air bed n breakfast): rents houses
o Grab
 They don’t own the cars
  Make commission
 They don’t have a product
 They only have technology
- Acquisition of an existing business
o Like seaside organics
- Purchase franchise
- Joint venture or venture team in a large corporation, mergers and partnership
o When two businesses join together
o Like the acquisition of Coffee Bean by Jollibee
 Jollibee wants to be the number one branded restaurant in the world by
2025
- Non-profit organization
o Like concerts for non-profit organizations
- Family business
o Natural birthplace of future entrepreneurs
o Doctoral familia
- Process through which a new venture is created by an entrepreneur
- 4 distinct phases
o Identify and evaluate the opportunity
o Develop business plan
o Determine the resources required
o Manage the enterprise

Identify and evaluate the opportunity

- Opportunity assessment
o Can it be sold to the marketing?
- Creation and length of opportunity
- Risk and returns of opportunity
o Is it worth taking the risk?
- Opportunity versus personal skills and goals
o Question: what do I want to do with product?
- Competitive environment
o What are the competitions that could potentially kill my product?
o Look for facts that justify your product and the other competitive products

Opportunity and Assessment Plan

- Description of the product/service
- Assessment of the opportunity
- Assessment of the entrepreneur and the team
- Specifications of all the activities and resources needed to translate the opportunity into
a viable business venture
- Source of capital finance the initial venture and growth
o Show them when they can get their investment back
Develop a business plan
- Business plan: the description of the future direction of the business
- A good business plan is essential to developing the opportunity and determining the
resources required, obtaining those resources and successfully managing the resulting
venture
- What is the difference between a business plan and a feasibility study?
o Business plan only comes after doing the feasibility study
o Investors ask for the business plan

Resources Required
- Determine the resources needed
- Determine existing resources
- Identify resource gaps and available suppliers
- Develop access….

Types of skills required

- Technical
o Writing
o Oral communication
o Monitoring the environment
o Using technology
- Business management
o Planning
o Decision making
o Human relations
o Marketing (selling)
- Personal
o Inner control
 Discipline
 Have it tested and critiqued
o Risk taking
 Acceptance of the possibility to fail
o Innovative
 Especially when you don’t have enough finances
o Change-oriented visionary

Manage the Enterprise

- Develop the management style
- Understand the key variables to success
o Understand what it takes to be successful
- Identify problems and potential problems
- Implement control systems
o Know how much resources are the standard
o No consistency in the products
 o To keep an eye
- Develop growth strategy
o Like Sara Norton and Lisa Mackintosh

Assignment: Wednesday
- Identify
- Look for an article on an entrepreneur that you want to
write on, doesn’t have to be from an article
- Short
- One page
- Doesn’t have to be a famous or successful entrepreneur
- What made her a successful entrepreneur or fail in that
venture
- No font size 6
- SIZE 11, Times Roman
- No need for the article
- Just the name and venture
- Can be a business product or a business or the person?
What is entrepreneurial about this product, business or
person?
- Last paragraph: what you have learned from that product,
business or person? Basically, a personal reflection of it
Day three: December 10, 2019
Group 3: Marabe, Aguaviva, Casquejo, Ygnacio, Tan (Trading Industry)
Small business venture 2 groups per category
- Food
- Souvenir Items
- Entertainment

Business Plan Development Part 1

What a business plan WILL do

- Demonstrate your ability as an entrepreneur
 - Spotlight your entrepreneur style
- Feature your command of the industry
- Pique interest
- A business plan will set you well on your way to getting the funding that you are looking
for.

Level of Sophistication
- Depends on two things
o How much money do you need?
o How badly do you need it?

Snapshot of a Business Plan

- A compelling story board about your company that explains:
o Who you are
o Why you’re in business
o What you do
o How you do it
o Where you operate
o How you will generate profits
o Who your customers are
o Why your business is important

Setting the THEME

- Cover design is the very first impression that should be conveyed about the company
o Strength?
o Potential?
o Brand Name?
- A well-designed proposal will carry the feeling of the cover throughout the business plan
in terms of layout…

Business Plan
- Table of contents one page only

Summary Page
- Write in paragraph format
- Location of the company: Grade 12 classroom
- Present status of company

Amount of money Why needed How it will be repaid

Send by Friday through email

Marketing Plan
 - The introduction ppt will change after going through the marketing, financial, and
operations ppts.
- Market research is needed
- Know your market
- HOMEWORK: look into how much posters cost = Php 45
Market research
- Use the internet to research

Industry report
- Not needed tho
- From gov’t or other industries
- Beneficial info, useful to your company
Michael Porter’s Industry Analysis
- Probability of them eating into your business and reducing your sales
- Supplier
o They can start their own similar business
o Your production depends on them
- Potential Entrants
o Businesses easy to get into:
 Milk tea
 Loading
 Chicken Business
- Substitutes
o Similar products
o Coke and Pepsi (competitiveness)
 Substitute: juice, healthy drink, water
 Biggest competition is water
o Coffee Shops and Milk tea Shops (competitors)
- Buyers
o If you don’t give discount, they will go to another store

Product and Services

- Support services
o Having them return the product