people who risk their time, money, and other resources to start and manage a business
internal locus of control
a deep-seated sense that the individual is personally responsible for what happens in his or her life
external locus of control
a deep-seated sense that forces other than the individual are responsible for what happens in his or her life
small segment of a market with fewer competitors than the market as a whole. Quite attractive to small firms.
small business administration (SBA)
an agency of the federal government designed to maintain and strengthen the nation's economy by aiding, counseling, assisting and protecting the interests of small businesses
small business development centers (SBDCs)
local offices - affiliated with the Small Business Administration - that provide comprehensive management assistance to current and prospective small business owners
a formal document that describes a business concept, outlines core business objectives, and details strategies and timelines for achieving those objectives
individuals who invest in start-up companies with high growth potential in exchange for a share of ownership
venture capital firms
companies that invest in start-up businesses with high growth potential in exchange for a share of ownership
1) Greater financial success 2) Independence 3) Flexibility 4) Challenge 5) Survival
What are the key reasons that people launch small businesses?
1) Entrepreneurs aim to dominate their industry 2) Vision, Self-reliance, energy, Confidence, tolerance of uncertainty, Tolerance of failure
What is the entrepreneur mindset? What are the entrepreneurial characteristics?
1) Market niches, Personal customer service, Lower overhead costs, Technology
What are the opportunities that small businesses offer?
1) High risk of failure 2) Lack of knowledge and experience 3) Too little money 4) Bigger regulatory burden 5) Higher health insurance costs
What are some threats that small businesses face?
1) starting from scratch 2) buying an established business 3) Buying a franchise
What are some ways to become a new business owner?
1) Gain experience 2)Learn from others 3)Educate yourself 4)Access SBA resources 5)Develop a plan
What are some strategies for success when starting a new business?
1) The personal resources of the founder 2) bank loans, angel investors, venture capital firms
How are the vast majority of new firms funded? What are some other key funding sources?
1) generate more than half of the U.S. gross domestic product 2) Account for 60 to 80% of all new jobs over past decade 3) Small businesses contribute innovations at twice rate of big business 4) Offer opportunities in inner city economies 5) One out of ten start a business each year 6) Entrepreneurship ranges dramatically from country to country
Explain the size, scope, and economic contributions of small business.
1) Per Capita Income 2) Opportunity costs 3) Cultural/Political environment
What are the three key factors that determine the entrepreneurial rate in different countries?