ENTREPRENEURSHIP &
INNOVATION MANAGEMENT
244
NOTES & SUMMARIES
TEXTBOOK CHAPTERS & ADDITIONAL
MATERIAL
AUTUMN NEETHLING 2021
, CHAPTER 1
SMALL BUSINESS: ITS OPPORTUNITY & REWARDS
Small business
Involves 1–50 people and has its owner managing the business on a day-to-day basis.
Self-efficacy
A person’s belief in his or her ability to achieve a goal.
Entrepreneur
A person who owns or starts an organization, such as a business.
Starting an Entrepreneurial Small Business: Four Key Ideas (p. 39)
(LO 1: Understand the scope of small business in the United States)
1. Believe that you can do this
2. Planning + Action = Success
3. Help helps – learn from other entrepreneurs.
4. Do well, do good – doing good to others helps your business & the entrepreneur feel
good.
The Entrepreneurial Process (p. 40)
(Firms most likely to be successful follow a four-step process)
1. Feel - entrepreneur has a feeling—about maybe starting a business or maybe creating a
particular product or service
2. Check – check likelihood for success via a feasibility analysis
3. Plan - small-scale, part-time start-ups, lean business practices approaches, pilot testing,
business modelling or doing a business plan.
4. Do – Implement your approach & refine it until your firm is successful.
Entrepreneurs are Everywhere (p. 41) - (Definitions to learn)
▪ Occupation: The type of activity a person does regularly for pay.
▪ Goods or services: The tangible things (goods) or intangible commodities (services)
created for sale.
▪ Firm: An organization that sells to or trades with others.
▪ Novelty: Characterized by being different or new.
▪ Imitative: Characterized by being like or copying something that already exists.
▪ Self-employed: Working for yourself.
▪ Founders: People who create or start new businesses.
▪ Franchise: A pre-packaged business bought, rented, or leased from a company called
a franchisor.
▪ Buyers: People who purchase an existing business.
▪ Heir: A person who becomes an owner through inheriting or being given a stake in a
family business.
▪ Innovativeness: Refers to how important a role new ideas, products, services,
processes, or markets play in an organization.
,The Many Types of Entrepreneurial Small Businesses (p. 43)
(LO. 2: Differentiate between small businesses and high-growth ventures)
Small and medium The international term for small businesses.
Enterprise (SME)
Independent small A business owned by an individual or small
Business group.
Owner-managed firm A business run by the individual
who owns it.
Serial entrepreneur A person who opens multiple businesses
throughout his or her career
Differences between Small Businesses and High-Growth Ventures (p. 44)
Small Business High Growth Ventures
Preferred funding source Owner’s own money Other people’s money
When the firm’s in trouble Cut costs Sell more
What’s more important Sales Marketing
Personal control preference Retain autonomy Involve key others
Focus Efficiency Effectiveness
Meta-strategy Imitation Novelty
External control preference Control firm Control market
Grow When necessary When possible
Human resources Personalize Professionalize
Acceptance Personal validation External legitimacy
What limits growth Loss of control Market response
Delegation orientation Delegation is difficult Delegation is essential
Types of Firms (p. 45)
Overall growth strategy
▪ One of four general ways to position a business based on the rate & level of growth
entrepreneurs anticipate for their firm.
Lifestyle or part-time firm
▪ A small business primarily intended to provide partial or subsistence financial support
for the existing lifestyle of the owner, most often through operations that fit the owner’s
schedule and way of working.
Traditional small business
▪ A firm intended to provide a living income to the owner and operating in a manner and
on a schedule consistent with other firms in the industry and market.
High-performing small business
▪ A firm intended to provide the owner with a high income through sales or profits
superior to those of the traditional small business.
, High-growth venture
▪ A firm started with the intent of eventually going public, following the pattern of growth
and operations of a big business.
Unicorn
▪ The most successful high-growth ventures, those with a valuation of $1 billion or more.
Main street businesses
▪ A popular term for small businesses reflecting the idea that these are the kinds of firms
you would expect to find on the main street of a typical American city, and are the
opposite of big business or “Wall Street” businesses
Rewards for Starting a Small Business (p. 45)
(L.O.3: Discover the rewards entrepreneurs can achieve through their businesses)
▪ Growth rewards: What people get from facing and beating challenges.
▪ Income rewards: The money made by owning one’s own business.
▪ Flexibility rewards: The ability of business owners to structure life in the way that suits
their needs best.
Myths about Small Businesses (p. 47)
(LO 4: Dispel key myths about small businesses).
▪ There’s not enough financing.
▪ You can’t start businesses during a recession.
▪ To make profits, you need to make something.
▪ If you fail, you can never try again.
▪ Students don’t have the skills to start a business.
▪ Ninety percent of all new businesses fail within two years
INNOVATION MANAGEMENT
244
NOTES & SUMMARIES
TEXTBOOK CHAPTERS & ADDITIONAL
MATERIAL
AUTUMN NEETHLING 2021
, CHAPTER 1
SMALL BUSINESS: ITS OPPORTUNITY & REWARDS
Small business
Involves 1–50 people and has its owner managing the business on a day-to-day basis.
Self-efficacy
A person’s belief in his or her ability to achieve a goal.
Entrepreneur
A person who owns or starts an organization, such as a business.
Starting an Entrepreneurial Small Business: Four Key Ideas (p. 39)
(LO 1: Understand the scope of small business in the United States)
1. Believe that you can do this
2. Planning + Action = Success
3. Help helps – learn from other entrepreneurs.
4. Do well, do good – doing good to others helps your business & the entrepreneur feel
good.
The Entrepreneurial Process (p. 40)
(Firms most likely to be successful follow a four-step process)
1. Feel - entrepreneur has a feeling—about maybe starting a business or maybe creating a
particular product or service
2. Check – check likelihood for success via a feasibility analysis
3. Plan - small-scale, part-time start-ups, lean business practices approaches, pilot testing,
business modelling or doing a business plan.
4. Do – Implement your approach & refine it until your firm is successful.
Entrepreneurs are Everywhere (p. 41) - (Definitions to learn)
▪ Occupation: The type of activity a person does regularly for pay.
▪ Goods or services: The tangible things (goods) or intangible commodities (services)
created for sale.
▪ Firm: An organization that sells to or trades with others.
▪ Novelty: Characterized by being different or new.
▪ Imitative: Characterized by being like or copying something that already exists.
▪ Self-employed: Working for yourself.
▪ Founders: People who create or start new businesses.
▪ Franchise: A pre-packaged business bought, rented, or leased from a company called
a franchisor.
▪ Buyers: People who purchase an existing business.
▪ Heir: A person who becomes an owner through inheriting or being given a stake in a
family business.
▪ Innovativeness: Refers to how important a role new ideas, products, services,
processes, or markets play in an organization.
,The Many Types of Entrepreneurial Small Businesses (p. 43)
(LO. 2: Differentiate between small businesses and high-growth ventures)
Small and medium The international term for small businesses.
Enterprise (SME)
Independent small A business owned by an individual or small
Business group.
Owner-managed firm A business run by the individual
who owns it.
Serial entrepreneur A person who opens multiple businesses
throughout his or her career
Differences between Small Businesses and High-Growth Ventures (p. 44)
Small Business High Growth Ventures
Preferred funding source Owner’s own money Other people’s money
When the firm’s in trouble Cut costs Sell more
What’s more important Sales Marketing
Personal control preference Retain autonomy Involve key others
Focus Efficiency Effectiveness
Meta-strategy Imitation Novelty
External control preference Control firm Control market
Grow When necessary When possible
Human resources Personalize Professionalize
Acceptance Personal validation External legitimacy
What limits growth Loss of control Market response
Delegation orientation Delegation is difficult Delegation is essential
Types of Firms (p. 45)
Overall growth strategy
▪ One of four general ways to position a business based on the rate & level of growth
entrepreneurs anticipate for their firm.
Lifestyle or part-time firm
▪ A small business primarily intended to provide partial or subsistence financial support
for the existing lifestyle of the owner, most often through operations that fit the owner’s
schedule and way of working.
Traditional small business
▪ A firm intended to provide a living income to the owner and operating in a manner and
on a schedule consistent with other firms in the industry and market.
High-performing small business
▪ A firm intended to provide the owner with a high income through sales or profits
superior to those of the traditional small business.
, High-growth venture
▪ A firm started with the intent of eventually going public, following the pattern of growth
and operations of a big business.
Unicorn
▪ The most successful high-growth ventures, those with a valuation of $1 billion or more.
Main street businesses
▪ A popular term for small businesses reflecting the idea that these are the kinds of firms
you would expect to find on the main street of a typical American city, and are the
opposite of big business or “Wall Street” businesses
Rewards for Starting a Small Business (p. 45)
(L.O.3: Discover the rewards entrepreneurs can achieve through their businesses)
▪ Growth rewards: What people get from facing and beating challenges.
▪ Income rewards: The money made by owning one’s own business.
▪ Flexibility rewards: The ability of business owners to structure life in the way that suits
their needs best.
Myths about Small Businesses (p. 47)
(LO 4: Dispel key myths about small businesses).
▪ There’s not enough financing.
▪ You can’t start businesses during a recession.
▪ To make profits, you need to make something.
▪ If you fail, you can never try again.
▪ Students don’t have the skills to start a business.
▪ Ninety percent of all new businesses fail within two years
