Kristen Farberman

Michelle Hoffmann

Jeff Laughlin

Xin Liu

April 29, 2004

Presentation Outline

Traits of a typical entrepreneur How to start a business The business plan Case studies

Grant Willer, Note Knowledge, LLC

Richard Laughlin, Midwest Testing, Inc.

Charles Wang, Computer Associates, Inc. Reasons for failure Conclusion

Definition

An entrepreneur is described as one who organizes, manages, and assumes the risks of a business or enterprise

Miriam Webster Online, www.m-w.com, March 17, 2004

Characteristics of Successful Business Owners

Vision Need for achievement Desire to work for self Willingness to listen Opportunistic Creativity and innovativeness Awareness of risk

Johnson, David & Ma, Rosa Suet Fan, “A Method for Selecting and Training Entrants on New Business Start-up Programmers”, International Small Business Journal; Apr-Jun 1995; 13, 3; pg. 80~84

Benefits to Owning a Business

Self-management Financial independence Creative freedom Full use of personal skills and

knowledgeGreater opportunities

“Start up Basics.” www.sbaonline.sba.gov, March 17, 2004 <http://www.sbaonline.sba.gov/starting_business/startup/basics.html>

Determine an Entrepreneurial Passion

What do I like to do with my time?What technical skills do I possess?What do others say are my strengths?Could this endeavor become a profitable

business?

"Are You Ready?." www.sbaonline.sba.gov, March 17, 2004 http://www.sbaonline.sba.gov/starting_business/startup/areyouready.html

What services or products will be sold?

Is the idea practical?

Who are the competitors?

What are the competitive advantages?

Can better quality service be provided?

Can a demand be created?

Identify a Business Niche

“Start up Basics.” www.sbaonline.sba.gov, March 17, 2004 <http://www.sbaonline.sba.gov/starting_business/startup/basics.html>

The Business Plan

Defines the business Identifies goals Includes a current and projected balance

sheet, income statement, and cash flow analysis

Allows all stakeholders to better understand the company

Identifies the potential customers for the product of service

"Busines Plan Basics.” www.sbaonline.sba.gov, March 17, 2004 http://www.sbaonline.sba.gov/starting_business/planning/basic.html

The Business Plan Establishes marketing strategies to reach

customers Projects all necessary financial needs Displays technical competency and business

efficiency

"Busines Plan Basics.” www.sbaonline.sba.gov, March17, 2004 http://www.sbaonline.sba.gov/starting_business/planning/basic.html

Hire a management team Follow a budget to control costs Determine accounting procedures Build key relationships

Next Steps

Pentilla, Chris. “Souped Up.” www.entrepreneur.com, October 2002.  March 16, 2004 <http://www.entrpreneur.com/article/0,4621,303085-1,00.html>

The Ultimate Goal

Locate customers Satisfy customers Retain customers

Grant Willer

President of Note Knowledge, LLC

Personal Interview with Grant Willer, President of Note Knowledge, LLC, Feb. 28, 2004

Background

Born in 1980 in Saint LouisOldest of four boysGraduated from UMSL in 2003

with degrees in marketing and management

Family history of entrepreneurship

Personality Traits

Creative

Inventive

Constructive

Rational

Outgoing

Friendly

Down-to-earth

Assertive

Motivations for Starting a Company

EscapeFreedomThe challengeSuccessDesire to lead

Note Knowledge Objectives

Website will initially target beginnersThe business purpose is to teach guitar playing at a lower cost by means of the internetThe short term goal is to have the website active within two months

Current Development of Note Knowledge

Wrote a business planUsed strategic management principlesSurveyed potential customersSpoke with an accountantMet with a lawyerTalked with a web designerCreate lessonsBegin advertising

Major Challenges

Designing the service to create maximum value for customers

Encouraging efficient learning through an entertaining website

Developing the step-by-step detailed lessons

Words of Wisdom

“Don’t be discouraged. Write a solid business plan and seek advice from those who have been through the process.” “We planned for over a month before we even incorporated.” “Planning is key.”

- Grant Willer

Comparison to Successful Entrepreneurs

Vision Strong & Intense

Need for Achievement Essential

Desire to work for self Great Aspiration

Willingness to listen Listening gives an opening to greater ideas

Opportunistic Pioneer for new methods

Creativity & Innovativeness

Always flourishing

Awareness of Risk Planning is key

Midwest Testing, Inc.

Personal Interview with Richard Laughlin, President of MTI, Feb. 25, 2004

Company History

Founded in 1985 by Richard LaughlinFinanced with $30k loan from a friendStarted with 3 employees, currently 40 total personnelA highly mobile construction firm based in the St. Louis metro area

Richard Laughlin’s Bio

Born March 27, 1953Older of two boysGraduated UMR Civil Engineering in 1975 with Masters in GeotechnicalBrief experiences as an employee

Childhood Experiences

Always took charge and thrived as a leaderLearned business principles for independence (Ex. pulling weeds)Constantly brainstorming different ways to earn money

Entrepreneurial History

Mowing lawnsHouse painting Laughlin BrothersBroetke-Laughlin partnershipMidwest Testing, Inc

Major Challenges

Learning to be a businessmanFinding work during difficult times such as a recessionMaking the tough decisions, especially in regards to costs

His Vision

“ Our clients talk. We listen. We deliver creative solutions. Let Midwest Testing apply innovation and technology to make a positive impression on the construction industry.”

- Richard Laughlin

"Midwest Testing." www.mwtesting.com  23 Mar. 2004

Closing Thoughts

Customers, customers, customersSimplify how to run a businessHonesty, hard work, persistence, and the desire to listenFind and maintain long term relationshipsHire great people and make them part of the team

Comparison to Successful Entrepreneurs

Vision Customer focus

Need for Achievement High

Desire to work for self Strong desire

Willingness to listen Moderate

Opportunistic Very

Creativity & Innovativeness

Always

Awareness of Risk Conservative

Charles B. Wang

Chairman of the Board at Computer Associates International, Inc. (CA) from April 1980 to November 2002

CEO of the company from 1976 to July 2000.

Co-founded the company with three associates in 1976

Inglesby, Tom. “An Interview with Charles Wang”, MSI; Jul 1991; 9, 7; pg. 28~34

Player Behind the Scene

“In 1999, CA sold $5.6 billion worth of software, trailing only Microsoft Corp. and IBM, but did not take in a dollar from the consumer market. CA makes a vast array of programs for managing large, diverse computer systems. ‘We are all the plumbing behind the scenes, as opposed to all the pretty faucets,’ says Wang”

Anthony Bianco, Steve Hamm, Manjeet Kripalani, Software's Tough Guy:Charles Wang muscled his way to the top. Now he wants respect, Business Week, New York: March, 6, 2000, Iss. 3671;  pg. 132

Company Profile CA delivers software and services that enable

organizations to manage their IT environments.

“About CA”, Computer Associates. 15 Apr. 2004. <http://www.ca.com/about/timeline.htm>

Investor RelationsRevenue: Over 3 billion in fiscal year 2003Number of employees: ~ 16000Stock symbol and price: NYSE: CA

“MSN Money”, MSN, 20 Apr. 2004, <http://moneycentral.msn.com/scripts/webquote.dll?ipage=qd&Symbol=CA>

Merger ManiaFive Largest Deals in the History of Software Industry

by 2000

Acquired Company Price (in billions)

Year

Sterling Software, Inc $4.0 2000

Platinum Technology International, Inc

$3.5 1999

Legent Corp $1.8 1995

Cheyenne Software, Inc $1.2 1996

Uccel Corp $0.8 1987

Anthony Bianco, Steve Hamm, Manjeet Kripalani, Software's Tough Guy:Charles Wang muscled his way to the top. Now he wants respect, Business Week, New York: March, 6, 2000, Iss. 3671;  pg. 132

Charles B. Wang

“We may be reluctant to commit to something, but when we commit to it, its our word on the line”

“So I told my mother, I thought that I was going to be a programmer. She said, ‘What’s that?’ I said, ‘I don’t know, Mom, but boy, they need them”

Nahm, H.Y., GoldSea Asian American, 1991. 12 Mar. 2004, <http://goldsea.com/Money/Wangcharles/wangcharles.html>

Biography

Born in Shanghai, China in August 1944The second of three sonsGrandfather was a landowner involved in business and politicsFather studied law at Harvard. He served for a time as a justice of the Shanghai Supreme CourtMoved to the United States with his family in 1952 Raised in Queens Village, New YorkAttended Brooklyn Technical High School

Nahm, H.Y., GoldSea Asian American, 1991. 12 Mar. 2004, <http://goldsea.com/Money/Wangcharles/wangcharles.html>

Biography

Earned B.S. in Mathematics from Queens CollegeBecame a programmer trainee at the Electronics Research Laboratory of Columbia University in 1967Joined the software division of Standard Data Corporation in 1971Spun off SDC in 1976, founded CA, CEOBecame the Chairman of the Board in 1980Retired in 2002

Nahm, H.Y., GoldSea Asian American, 1991. 12 Mar. 2004, <http://goldsea.com/Money/Wangcharles/wangcharles.html>

Personality

Sense of adventureIntegrity of man’s wordIndependentPractical approach to lifeFearlessConfidentHard-workingMake work fun

Starting CA

Conceived the idea for the businessSpun off SDCSold the first product CA-SORTUtilized product-for-equity swap strategy Initial public offering on December 10, 1981First acquisition: Capex Corp.

Anthony Bianco, Steve Hamm, Manjeet Kripalani, Software's Tough Guy:Charles Wang muscled his way to the top. Now he wants respect, Business Week, New York: March, 6, 2000, Iss. 3671;  pg. 132

Major Challenges

Giving up a quality job to start a companyPreparing the payroll initiallyEstablishing market driven ideasSurviving a fast-changing technological industryMaintaining cultural stability during acquisitions Understanding the marketObtaining sufficient resources

Comparison to Successful Entrepreneurs

Vision Customer focus

Need for Achievement Essential

Desire to work for self Strong

Willingness to listen Moderate

Opportunistic Very

Creativity & Innovativeness

Always

Awareness of Risk Very

10 Common Mistakes

Miscalculating potential market share, market size, timing, and ease of entry

Underestimating financial requirements and timing

Hiring too many people and spending too much money on offices and other facilities

Lacking a contingency plan for unexpected shortfalls in the expectations

Henricks, Mark. “What not to do.” Entrepreneur Magazine, February 2004

10 Common Mistakes

Making cost projections that are too low Lacking simplicity in your vision Lacking a long-term plan and business

purpose Hiring for convenience rather than skill Neglecting to manage the entire company

as a whole Lacking an exit strategy

Henricks, Mark. “What not to do.” Entrepreneur Magazine, February 2004

Comparison of Three Entrepreneurs

Grant Willer Richard Laughlin Charles Wang

Vision Strong & Intense Customer focus Strong & Clear

Need for achievement Essential High Essential

Desire to work for self

Great Aspiration Strong desire Strong

Willingness to listen Listening gives an opening to greater ideas

Moderate Moderate

Opportunistic Pioneer for new methods

Very High

Creative & Innovative Always flourishing Always Always

Risk taker Planning is key Conservative High

Questions?