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The Entrepreneurial Lifecycle
Presented By: Kavit Doshi (Roll No- 113)
Flow of presentationEntrepreneurial Life CycleEntrepreneurial S-curve
Risk ModelFit Model
Conclusion
Life-cycle stagesWhat is born today, Must die tomorrowThe ‘IDEA’GrowthShakeoutMaturity
Incubation
IdeaBusiness plan/ startup
Pilot/Prototype
Founders fund
Venture capitalists & corporate investors
Time
Revenue
Banks/financial institutions
IPO/ acquisitions
Growth
Shakeout
Maturity
Market development/ roll-out
Entrepreneurial Lifecycle Chart
The ‘IDEA’ (Stage 1)Not everyone with an idea starts his/her
businessIntentMotivationMindset
Mull over the idea INCUBATION CENTRE (e.g. Hi-Tech
Products)to:Designing and Prototyping the productTest marketingDeveloping customer & supplier base
Not all need INCUBATION MODEL
1st milestone (for Technology Based Products):Development of the PrototypeTested with few ‘alpha’ customers
2nd milestone:Launching in a limited wayNext tranche of funding usually needed here
Incubation
IdeaBusiness plan/ startup
Pilot/Prototype
Founders fund
Venture capitalists & corporate investors
Time
Revenue
Banks/financial institutions
IPO/ acquisitions
Growth
Shakeout
Maturity
Market development/ roll-out
Entrepreneurial Lifecycle Chart
Growth (Stage 2)Entrepreneur goes for expansion through:
Capturing Market ShareDifferentiatingExpanding channelsTraining and Expanding the core teamAcquiring resources
Entrepreneur Focuses on:Developing Operational SystemsAchieving Sales growthIncreasing market Share
VCs bring in important Value Additions
Incubation
IdeaBusiness plan/ startup
Pilot/Prototype
Founders fund
Venture capitalists & corporate investors
Time
Revenue
Banks/financial institutions
IPO/ acquisitions
Growth
Shakeout
Maturity
Market development/ roll-out
Entrepreneurial Lifecycle Chart
Shakeout (Stage 3)Period of Continuous GrowthCompany is now big enough to be ‘noticed’Entrepreneur goes for:
Rapid growth and professionalizationAttempts for Market Leader PositionBroadens product/service lines & geographical
coverageTo carry on Continuous Growth:
New Venture Strategies Continuous Innovations
In a position to approach the Banks for Debt Funding
Incubation
IdeaBusiness plan/ startup
Pilot/Prototype
Founders fund
Venture capitalists & corporate investors
Time
Revenue
Banks/financial institutions
IPO/ acquisitions
Growth
Shakeout
Maturity
Market development/ roll-out
Entrepreneurial Lifecycle Chart
Maturity (Stage 4)Entrepreneur’s Alternatives regarding future
Evolve the companyPartial/Full management buy-outs
Founder’s Vision and ObjectivesMay Cash-out to start another business
It is a Journey that is Important
It is a journey of Self-actualization and realizing one’s full Potential
The truly successful are those few who are Contended and Disciplined
The Entrepreneurial S-Curve:
A Conceptual Model for Entrepreneurial Life Cycle
Submitted to the:International Council for
Small Business and Entrepreneurship 2005
Annual ConferenceJune 15-18, 2005
IntroductionA single, holistic model to help entrepreneurs
conceptualize the entire entrepreneurial processThe concept of the entrepreneurial S-curve is
intended to help entrepreneurs predict, formulate, and execute strategies over time, taking into account changes in context.
It includesRisk ModelFit Models
Finally, we correlate the entrepreneurial S-curve, entrepreneurial risks, and the fit models together, and suggest a future research agenda and three propositions.
The Risk ModelThe conceptualized entrepreneurial S-curve with
three stages in the entrepreneurial process as well as possible and relevant risks along each stage
3 stages:StartupHigh GrowthSustainability (global enterprises)
Entrepreneurial Risk All of the risks may occur at all three stages. This
paper attempts to focus on those risks that are most prominent at specific stages of the three-stage entrepreneurial process.
Six Risks1. Developmental Risk2. Manufacturing Risk3. Marketing risk4. Management Risk5. Growth Risk6. Public Financing risk
Time
Performance
(1) Developmental Risk
(2) Manufact- uring Risk
(3) Marketing Risk
(4) Management Risk
(5) Growth Risk
(6) Public Financing Risk
Entrepreneurial Fit ModelsMay be helpful for entrepreneurs to manage
stage-related risksElements in the Four Fit model
Start-up StageHi-growth StageSustainability StageGlobal Enterprise
Each stage in the entrepreneurial process involves three correlating and critical elements that must fit together to achieve success at that stage.
Fit model: Start-up StageEntrepreneur
Venture Context
Fit model: Hi-growth StageTools
ManagerTask
Fit model: Sustainability StageProduct
FinanceMarket
Fit model: Global EnterpriseEntrepreneur
Venture Context
S-curve, Risk and Fit Model correlation The Fit Models and entrepreneurial risks formulates a cycle along the
entrepreneurial process. As the two approaches join, elements within the Start-up Fit Model relate
to the early stages of an entrepreneur’s journey. Once the initial investment and the payback period has been achieved, a
firm may begin to experience rapid growth and expansion. Using the tools provided by the Hi-growth Fit Model, managers can
ensure that the organization has the potential to continue to develop into a larger business venture.
Businesses at some point usually enter into a period of stagnation (commonly following a period of rapid growth). During this phase, managers of a firm may profit from an understanding of the sustainability phase and its elements of product, market, and finance to keep its operations viable.
This conceptual framework may allow entrepreneurs, corporate leaders, and venture capitalists to better understand their own businesses and forecast potential risks and opportunities, thereby formulating plans to avoid obstacles, seize opportunities, and achieve new Heights.
“If I am in control, I’m probably moving too slow!”
- Mario Andretti
Thank You
