ENTREPRENEURIAL FINANCE
Leach & Melicher
INTRODUCTION AND OVERVIEW
Chapter 1
© 2012 South-Western Cengage Learning
1
Chapter 1: Learning
Objectives
Characterize the
entrepreneurial process
Describe entrepreneurship
and some characteristics
of entrepreneurs
Indicate three megatrends
providing waves of
entrepreneurial
opportunities
List and describe the
seven principles of
entrepreneurial finance
Discuss entrepreneurial
finance and the role of the
financial manager
Describe the various
stages of a successful
venture’s life cycle
Identify, by life cycle, the
relevant types of financing
and investors
Understand the life cycle
approach used in the
textbook
2
The Entrepreneurial
Process
Process:
Developing opportunities
Gathering resources
Managing and building operations
Goal:
Creating value
3
Entrepreneurship
Fundamentals
Entrepreneurship:
process of changing ideas into commercial opportunities
and creating value
Entrepreneur:
individual who thinks, reasons, and acts to convert ideas
into commercial opportunities and to create value
4
Entrepreneurial Traits or
Characteristics
A successful entrepreneur
Sees and seizes a commercial
opportunity
Tends to be doggedly optimistic
(perhaps even to a fault)
Plans to obtain the physical,
financial, and human resources
needed for the venture to succeed
5
Non-Entrepreneurial Traits or
Characteristics
Success is unlikely if you
“are seldom able to see an
opportunity, until it ceases to be
one” (Mark Twain)
“view the glass as being half empty
instead of half-full” (unknown)
are paralyzed by a fear of failure
6
Opportunities Exist but Not
Without Risks
Opportunities:
New U.S. business formations in
the millions annually
Firms with less than 500
employees
represent over 99 percent of all employers
account for about one-half of the annual...