Unit 1 Study Guide and Review: Elements of Entrepreneurship

The following study guide is meant to help you prepare for the final exam. This material is for your practice and review only. You will not be asked to turn in your responses to the questions and activities below. As you work through these study guides, take note of your confidence level with the material. Ask yourself if you feel comfortable with your grasp of these topics, and take the suggestions for resources to re-watch or re-read seriously before proceeding to the final exam.

1a: Analyze the entrepreneurial process through which business ideas are evaluated.

1a.1. Entrepreneurship plays a significant role in the US economy.

A. Briefly describe what it means to be an entrepreneur.

B. Identify and describe at least two ways that business ideas are formed.

Do you understand what it means to be an entrepreneur? Ask yourself if you are confident in your understanding of the ways business ideas are formulated?

As the final exam approaches, you may choose to review the essay US Department of State: Principles of Entrepreneurship: “What is Entrepreneurship?” and the video Kavita Ramdas’ “Definition of Entrepreneurship”. Additionally, you can review US Department of State: Principles of Entrepreneurship: “Chapter 3: Why Become an Entrepreneur?” for an overview of some of the benefits of entrepreneurship.

1a.2. The evolution of entrepreneurship in the United States came about as a result of many different factors, including the early belief in small business, the growth and expansion of railroads and other means of mass transportation, and legislation that was designed to protect business owners.

A. Describe how economics has helped shape the development of entrepreneurship in the United States.

B. Discuss legislative acts that have contributed to the modern business environment.

If you are unsure of how economics and the law have enabled entrepreneurship to evolve and expand, consider reviewing the reading Boundless: Management: “Chapter 1, Section 6: Introduction to Entrepreneurship”. Meanwhile Christopher Conte’s “Small Business in US History” focuses more on the history of entrepreneurial development.

1a.3. Entrepreneurs evaluate the potential for their ideas to become viable business opportunities by conducting research.

A. Identify the stages of the entrepreneurial process at which entrepreneurs conduct research.

B. Differentiate between incremental innovation and disruptive innovation.

These concepts can be found in Saylor Academy's “An Entrepreneurial Model,” as well as in Boundless: Management: “Chapter 1, Section 6: Introduction to Entrepreneurship”.

 

1b: Identify the characteristics of successful entrepreneurs.

1b.1. Entrepreneurs exhibit a variety of traits that enable them to address the unique set of experiences that come with business ownership.

A. Entrepreneurs can be defined as individuals who start a business from the ground up or individuals who become franchisees. Individuals may be serial entrepreneurs who continually reinvent themselves as business owners, or entrepreneurs can be part of the corporate environment.

B. Explain the difference between an entrepreneur and an intrapreneur.

C. Identify the characteristics that drive the entrepreneur.

Do you think you have the potential, skills, and personality to become a successful entrepreneur? If you are unsure of the nature of those characteristics, consider revisiting the Wikibooks resource, which describes the various kinds of entrepreneurs: Wikibooks: Getting Started as an Entrepreneur: “Entrepreneurship Is...”. Reviewing Wikidot: Andy Birol's “Entrepreneurs vs. Intrapreneurs” will ensure that you are clear on the definitions of these terms.

Finally, ask yourself if you have a firm grasp on the unique characteristics exhibited by those who choose to become business owners. Boundless: Management: “Chapter 16, Section 2: The Drive of an Entrepreneur” and US Department of State: Principles of Entrepreneurship: “Chapter 2: What Makes Someone an Entrepreneur?” will help you to identify those traits. These resources provide some additional perspective on how these characteristics translate to business growth and success.

1b.2. Explore your entrepreneurial potential.

A. Identify the viability of becoming an entrepreneur.

If you are still unsure about whether or not entrepreneurship is right for you, take another look at Saylor Academy's “An Entrepreneurial Model” as well as the “Assessment Survey” from the Global Text Project’ Business Fundamentals. Both of these resources will confirm, or not, whether you might consider pursuing an entrepreneurial venture.

Finally, the chapter reading on entrepreneurship in Chapter 11 of International Business, v.1.0, will provide a review of truths and myths about entrepreneurship. You can determine whether these factors to apply to you and whether your beliefs about entrepreneurship are accurate.

 

1c: Distinguish between business ideas and opportunities.

1c.1. Not all business ideas have the potential to become successful business ventures.

A. What is the primary difference between a business idea and a business opportunity?

B. In addition to a title page and a table of contents, a business plan will include sections on the market and competition, a marketing strategy, an operations plan, an identification of management, a financial plan, and supporting documents.

Ask yourself if you have a clear understanding of the differences between an idea and an opportunity. For a refresher, review the lecture, Stanford University: Chuck Eesley's “Nine Key Frameworks for Entrepreneurship”.

The business plan is a key factor in taking your concept to the next level: determining if a real business potential exists. A business plan can be a complex document, so a review of the contents of the business plan will be very valuable as you head into the final exam. The resource to explore is: US Department of State: Principles of Entrepreneurship: “Chapter 12: Creating a Business Plan”.

1c.2. Not all business plans present a viable business opportunity.

A. Explain why some businesses remain small, while others have the potential to become high-growth ventures.

B. Describe the steps in evaluating the business plan.

A review of the video, Stanford University: “Entrepreneurial Thought Leaders Seminar” offers a comprehensive overview of the entrepreneurial process and explores the small business and the high-growth enterprise.

If you become an investor in a new enterprise, you will need to know what to look for as you evaluate the viability of the product or service described in the business plan. The reading on due diligence (Developing New Products and Services, v.1.0) gives insight into this concept.

 

1d: Examine entrepreneurial potential.

1d.1. There are several ways to protect your business enterprise.

A. Describe each of the primary legal entities for a business enterprise: sole proprietorship, partnership, limited liability corporations, and corporations.

B. Define “intellectual property” and explain what that might mean to your business enterprise.

 Are you certain that you understand the pros and cons of each legal structure available to the business owner? The Small Business Blog: Jason Holden's “What Legal Entity is Right for Your Business?” clarifies these differences. For a refresher on the topic of intellectual property, review this insightful reading: Richard M. Stallman's “Did You Say ‘Intellectual Property?’ It's a Seductive Mirage”.

1d.2. Ethics plays a strong role in how business owners operate their company and, in turn, how the public views the company.

A. Define ethics and explain how a company is judged by the public based on the organization’s actions.

B. Companies adopt various strategies for ensuring that they are good corporate citizens, including by making donations of goods and services, either on a regular basis or through periodic contributions.

Do you need an update on what it means to be an ethical organization? Review The Global Text Project's Business Fundamentals: “Chapter 12: Business Ethics in a Nutshell”.

 

Unit 1 Vocabulary

This vocabulary list includes terms that might help you answer some of the review items above and some terms you should be familiar with to be successful in completing the final exam for the course.

  • Angel investor
  • Business plan
  • Clayton Antitrust Act
  • Copyright laws
  • Corporate culture
  • Corporate responsibility
  • Corporations
  • Drive
  • Due diligence
  • Entrepreneur
  • Entrepreneurship
  • Equity
  • Ethics
  • Idea
  • Innovation
  • Intellectual property
  • Interstate Commerce Act
  • Intrapreneur
  • Leadership
  • LLC
  • Market research
  • Motivation
  • Opportunity
  • Partnerships
  • Patent laws
  • Robinson Patman Act
  • Scalability
  • Sherman Antitrust Act
  • Sole Proprietors
  • Strategy
  • Trends
  • Venture capital
  • Vision
Last modified: Friday, March 29, 2019, 4:44 PM