entrepreneur in the classroom module 3: turning an idea into a business
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Entrepreneur in the Classroom Module 3: Turning an Idea into a Business. Module 3 Objectives. Learn the Basics of Business Planning Understand F unding Landscape and Options Map out Government Agencies and their Relationship with Business Owners. Module 3 Objectives. - PowerPoint PPT PresentationTRANSCRIPT
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Entrepreneur in the ClassroomModule 3: Turning an Idea into a Business
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Module 3 Objectives
• Learn the Basics of Business Planning• Understand Funding Landscape and Options• Map out Government Agencies and their
Relationship with Business Owners
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AN INVESTMENT IN AMERICA’S FUTURE. AN INVESTMENT IN AMERICA’S FUTURE.© Copyright Katherine Korman Frey
www.KathyKormanFrey.com
Module 3 Objectives
• Learn the Basics of Business Planning• Understand Funding Landscape and Options• Map out Government Agencies and their
Relationship with Business Owners
![Page 4: Entrepreneur in the Classroom Module 3: Turning an Idea into a Business](https://reader036.vdocuments.site/reader036/viewer/2022062422/56812fa9550346895d952a63/html5/thumbnails/4.jpg)
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“Begin with the End in Mind.”
Stephen Covey, author of The 7 Habits of Highly Effective People
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AN INVESTMENT IN AMERICA’S FUTURE. AN INVESTMENT IN AMERICA’S FUTURE.© Copyright Katherine Korman Frey
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Matching Creativity with a PlanExercise 3-1
Rosabeth Moss Kanter, Professor, Harvard Business School speaks to Big Think
http://bit.ly/GEkaI3
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Matching Creativity with a PlanExercise 3-1
• What does Kanter’s Law “Everything looks like a failure in the middle” mean?
• Can you provide an example of Kanter’s Law in your own life?
• Is it easy to turn your own creative idea into something meaningful and powerful? Why or why not? What is required?
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The Business Plan
• Entrepreneurs who finish a business plan are twice as likely to:o Grow their businesso Obtain an investment or a loan
Source: Survey of nearly 3000 entrepreneurs by Palo Alto Software
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Purpose of a Business Plan
• A Business Plan has three Primary Purposes:o Charts the course for a business ownero Provides an introduction document for fundraisingo Drives action for team
Source: DECA exercise by George T. Solomon, The George Washington University’s Center for Entrepreneurial Excellence
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Thinking about “How”Exercise 3-2
• Write down your business ideao How would I describe it in one sentence?o How would I market it to my customers?o How could I have an advantage over competitors?
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Business Plan Basics
• Typical Sections of a Typical Business Plan:o Executive Summaryo Product or Service Description oMarket Landscapeo Operational Plano Sales and Marketing Plano Financial Plano Appendices
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Business Plan Basics: Case StudyExercise 3-3
Watch film with sections from previous slide in mind
http://bit.ly/GE8ZN9
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Business Plan Basics: Case StudyExercise 3-3
• Fill in notes on the strategies mentioned by the Didgiridoo Dojo team in each of the areas below that you can.
• Where you do not understand an area, notate that. By the end of this section, you’ll understand all aspects of a business plan. – Executive Summary– Product or Service Description– Market Landscape– Operational Plan– Sales and Marketing Plan– Financial Plan– Appendices
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Business Plan Basics
• Executive Summary o One page highlight of each plan section
• Product or Service Descriptiono Detail about your products and services
• Market Landscapeo Demonstrates knowledge of your market &
customers
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Market Landscape: Tip SheetPrimary and Secondary Data
• The Industry: Size, Growth, Consumer Behavior, etc.• Target Markets: People, Place, Preferences, Competition
http://bit.ly/GBAFpF
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Sites for EntrepreneursExercise 3-4
• Entrepreneurs all have their favorite sites. Watch this video, then develop a list of your own favorite entrepreneur sites. Be prepared to share your top 3 favorites with the class.
http://bit.ly/GDXyqE
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Business Plan Basics
• Operational PlanoManagement team, form of incorporation, major
milestones (timeline)• Sales & Marketing Strategy
o Plan for reaching customers, driving sales• Financial plan
o Financial statements, projections, funding sources
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Operational Plan: Tip Sheet
• Team and Structureo Team bios, Staff needs in Future, Definition of all roles
• Business Locationo List advantages or rationale
• Form of Ownershipo Sole Proprietorshipo Limited Liability Companyo Partnership (General, Limited)o Corporation (C Corp, S Corp)
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Operational Plan: Tip Sheet
• Product and Service Plano Description of product or Serviceo Supplier/Manufacturing/Inventory Details
• Major First Year Tasks and Future Goalso Year One Tasks with Dates and Status
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Sales and Marketing: Tip Sheet• Rule of Thumb: Product, Place, Price, Promotion• Promotion = Advertising, Publicity, Personal Selling
http://bit.ly/GEacDU
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Financials: Tip Sheet
Revenue-Expenses
Net Income
Revenue:• How many did you sell?
• This should be examined monthly, quarterly, & yearly
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AN INVESTMENT IN AMERICA’S FUTURE. AN INVESTMENT IN AMERICA’S FUTURE.© Copyright Katherine Korman Frey
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Financials: Tip SheetCase Study
http://bit.ly/GBnReK
Discuss the innovative way of managing expenses. What impact did this have on how much money the
company made?
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Financials: Tip SheetRevenue
-ExpensesNet Income
Expenses:
• Salaries• Rent• Utilities
• Rent • Car• Insurance
• Machinery• Equipment• Office
• Inventory• Marketing• Dues
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Financials: Tip SheetRevenue
-ExpensesNet Income
Net Income:• After Taxes
• Profit Remains
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Projecting ProfitExercise 3-5
Example1. $100
2. -$75
3. $25
4. $25 / $100 =
25%
1. Estimate one unit of your revenue(one product or one service).
2. Estimate the expense of this unit (the cost to manufacture, supplies, time, etc.).
3. Subtract #2 from #1 (Example: 100 – 75 = 25).
4. Divide your answer by #1 (Example: 25/100 = 25).
Your Profit
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What Entrepreneurs do with ProfitExercise 3-6
• Reinvest back in the Business• Pay back Investors• Keep it for Themselves/Family• Dedicate to Something Charitable• A Combination of the Above
What would you do with the profits from your business? Make a pie chart with specific segments.
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Appendices: Tip Sheet
• Detailed Spreadsheets• Market Research• Other Items that do not fit directly in the
specific sections of a business plan
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Optional Advanced Exercise
• Your Business PlanoStudents will complete their own business
plan by following a step by step exercise and a downloadable template.
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YOUR Business PlanExercise 3-6a
• Part I: Fill out business plan outline as provided, using YOUR business idea.
• Part II: For Financial section, use financial worksheet provided.
• Getting started: – Your Passion/Area of Interest
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YOUR Business PlanExercise 3-6a
• Executive Summaryo One Page Description of the Business
• Product or Service Description• Market Landscapes
o Industry and Characteristicso Target Marketso Competition
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YOUR Business PlanExercise 3-6a
• Operational Plano Team Roles and Organizational Structureo Form of Ownership (Sole Proprietorship, etc.)o Business LocationoMaterial Sources for Products/ServicesoMajor Year One Tasks and Future Goals
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YOUR Business PlanExercise 3-6a
• Sales and Marketing Strategyo Producto Placeo Priceo Promotion
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YOUR Business PlanExercise 3-6a
• Financial Plan (refer to template)o Projected Income:
oRevenue - Expenses = Income o Starting yearo Year Oneo Year Two
o Proposed Plan to meet Capital (monetary) needs
Source: 3-4 PDF PART II derived from DECA curriculum by Dr. Susan G. Duffy
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YOUR Business PlanExercise 3-6a
• Appendiceso Detailed Financialso Extended Market Research Chartso Detailed Operational Chartso Other Misc. and Necessary Documents
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YOUR Business PlanExercise 3-6a: Wrap Up Video
http://bit.ly/GBjqiU
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Module 3 Objectives
• Learn the Basics of Business Planning• Understand Funding Landscape and Options• Map out Government Agencies and their
Relationship with Business Owners
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Funding Landscape
Call it funding, financing, raising capital, or borrowing… Here’s why you need it:
• Pay Start Up Costs• Fund Growth• Short Term Cyclical Needs
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Funding options
What Funding Options do you have?• Profit—generated through your business• Debt– borrow money• Equity—give up percentage of company in
exchange for money• Special – Unique grants to for-profits. Examples
include Small Business Innovation Research (SBIR) Grants and Crowd Funders like Kickstarter.
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Funding Debate ClubExercise 3-7
Verbally duke it out with you classmates. Which form of funding is best? Will yours win?
• Divide into teams and receive your funding assignment.• Research your Funding Type.• Each team makes a mini-presentation about their form of
funding to the class, persuading your peers that your form of funding is best.
• Class votes on the favorite form of funding (not allowed to vote for own group).
Forms of Funding Description on next slide.
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Funding Debate ClubExercise 3-7
Sources of Funding (Four Primary Sources in Bold)
• Financial Institutions• FFF: Founder, Family, Friends• Angel Investors• Private Equity (Includes Venture Capital)• Initial Public Offerings (IPOs)• New Breeds (CrowdFunding/Special Grants)Source: Dr. Susan G. Duffy Advanced Follow-Up Exercise: 3-7a: Your Funding Options
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Funding Wrap UpEducation about finance affects home too: 86% per cent
of teens care about managing their money.
Carrie Schwab-Pomerantz, President, Charles Schwab Foundation, talks with Big Think
http://bit.ly/GBjtLx
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Module 3 Objectives
• Learn the Basics of Business Planning• Understand Funding Landscape and Options• Map out Government Agencies and their
Relationship with Business Owners
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Agency Relationships
• Establishing a Business the Right Way• Different Rules for Different Business Sizes
– Smart entrepreneurs: Seek Mentors & Experts
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Agency Relationships
First Stops when Starting a Business• A permit or license• State corporation commission• Zoning office• The SBA, resources, ongoing help• The IRS concerning your tax status
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Agency Relationships
• Business license: Do I need one?o Learning more: Search “business license” + your
town• State Corporation Commission
o How to incorporateo Learning more: Search www.nolo.com
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Agency Relationships
• Zoning Office—Information to think about:o Increased vehicular traffico Number of employeeso Use of a homeo Selling retail goodso Storageo Learning more: Search “zoning office” + your town
Source: Start Your Own Business: The Only Start-Up Book You'll Ever Need (Entrepreneur Press) & www.Entrepreneur.com
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Agency Relationships
• Small Business Administrationo Loanso Certificationso Learning more: www.SBA.gov
with young
Optional follow up: See this @NFIBYEF blog post to stimulate additional discussion on federal programs
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Agency Relationships
• Internal Revenue Serviceo Do I need to file taxes?o Federal ID numbero Payment of employeeso Learning more: See video on next slide
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Agency Relationships
http://anse.rs/GBBLBE
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Agency Relationships
• As your Business Grows: Department of LaboroWageso Health Insuranceo BenefitsoWork Environmento Hiring and Firingo Learn More: www.DOL.gov and www.NFIB.org
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Associations and Membership Organizations for ESTABLISHED Entrepreneurs
• National Federation of Independent Businesseswww.nfib.org • Entrepreneur’s Organizationwww.EONetwork.org • Young President’s Organizationwww.YPO.org • Vistagewww.Vistage.com • Maverick1000www.maverick1000.com• Women Presidents Organizationwww.WomensPresidentOrg.com
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Associations and Membership Organizations for EMERGING Entrepreneurs
• The Young Entrepreneur Foundationwww.nfib.com/yef • Distributive Education Clubs of Americawww.DECA.org • Network for Teaching Entrepreneurshipwww.nfte.com • Junior Achievementwww.ja.org
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Associations and Membership Organizations for EMERGING Entrepreneurs
• Future Business Leaders of Americawww.fbla.org • Students in Free Enterprisewww.sife.org • Hugh O’Brien Youth Foundationwww.HOBY.org • Start Up America Partnershipwww.startupamericapartnership.org • The Founder Institutewww.fi.co
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Module 3 Objectives
• Learn the Basics of Business Planning• Understand Funding Landscape and Options• Map out Government Agencies and their
Relationship with Business Owners
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Curriculum developed by:• Katherine Korman Frey, Entrepreneur in Residence & Adjunct Professor of Management at
The George Washington University School of Business, Center for Entrepreneurial Excellence• Contributing content provided by: Dr. George Solomon, Dr. Susan Duffy, Dr. Ayman Tarabishy
and Professor Janet Nixdorff.