Module III: Growth and Development of Entrepreneurial Ventures

• Identifying ‘paying customer’.

• Developing market understanding- Narrowing focus-end user profiling.
• Ideal persona-market segmentation, market sizing- marketing plan, pricing- strategy Rigor of
another kind.
• Cliff-vesting schedule.
• Relative importance of operational involvement, Idea/Patent, driving force and capital
infusion. Go live, what proof of concept is needed- Minimum viable product – Name of
product/service. Website, visiting card, office space. Valuation and harvesting.
• Valuation methods. Term sheet Strategic sale. Negotiations – Management succession.

Dr. Shaifali Garg

Associate Professor
Amity University Madhya Pradesh
 Module III

Growth and Development of Entrepreneurial Ventures

 Introduction :
• The process of improving
entrepreneurial skills and knowledge
among individuals with the help of
providing well-organized training and
developing supporting institutions is
called entrepreneurial growth or
development.
 Entrepreneurial Ventures
• An entrepreneurial venture is when an
organization pursues opportunities and
new practices in order to have growth
and profitability as its main goals.
• Examples : Business life coach (BADA
BUSINESS ) , Vlogging or Blogging,
Graphic designer, Copywriting and editing
services etc .
 Identifying ‘paying customer ‘
• Profile on this perfect customer.
• Which consist : Write down everything
about them like: age, where they work,
what is their social standing, their cultural
interests.
• After that : 1.Know your product, services .
• 2.Determine your Goals.
• 3.Analyze past interactions.
• 4. Build a customer profile .
Developing Market Understanding
• Expanding the potential market through
new users .
• New geographic segments,
• New demographic segments,
• New institutional segments ,
• New psychographic segments.
 Market Development
• Market development is a strategic step
taken by a company to develop the
existing market rather than looking for
a new market.

• The company looks for new buyers to

pitch the product to a different segment of
consumers in an effort to increase sales.
Narrowing focus –end user profiling :

• Case study : Johnson and Johnson baby

product .
• End user profiling involves gaining an
understanding and building a profile of the
final users of the system in terms of age,
gender, socio economic background,
(dis)abilities, knowledge, skill set,
frequency, interest and any other relevant
information.
Ideal persona – Market
Segmentation .
• Customer segments as high-level
categorical classifications of groups of
people
• While personas illuminate specific
details that speak to a type of person -
their experiences, goals, or
motivations. Examples : Olay total
effects , Titan Raga watches .
Ideal persona and Market Segment

• Segments help to forecast market interest for

a product or service,
• While personas help to understand the
emotional and behavioral triggers behind
individual customers within that market.
• Child going to a new school for the first time wants others to
think that he is popular, cool, and unafraid. He dresses in
fashionable clothing, and he walks in with confidence and
says hello to everyone. He is presenting a brave persona of a
likable and popular kid.
 Market sizing
• Market sizing is defined as estimating the
number of buyers of a particular product, or
users of a service.
• Like : relative newness of mobile money,
sizing the potential market is a necessary and
valuable exercise for a MFSP(Micro finance
skills project ) in the early stages of new
product development.
 Market size
• Made up of the total number of
potential buyers of a product or service
within a given market, and the total
revenue that these sales may generate.
• Entrepreneurs and organizations can use
market sizing to estimate how much profit
they could potentially earn from a new
business, product or service. This helps
decision-makers to decide whether they
should invest in it.
 Marketing Plan
• A marketing plan is a strategic roadmap that
businesses use to organize, execute, and track
their marketing strategy over a given time
period.
• Marketing plans can include separate
marketing strategies for the various marketing
teams across the company, but all of them
work toward the same business goals.
 Types of Marketing Plan
• Quarterly or Annual Marketing Plans
• Paid Marketing Plan: native advertising or
paid social media promotions.
• Social Media Marketing Plan: This plan could
highlight the channels, tactics, and campaigns.
• Content Marketing Plan: This plan the
strategies in which you'll use content to
promote your business or product.
 Pricing strategy Rigor
• Rigor means is to know about the
bringing discipline, rules, thoroughness,
consistencies and framework to
processes and operations.
• For example now a days : Ending a price with
an odd number to make a customer feel like
they're spending much less (Rs.99 instead of
Rs.100). This is often known as charm pricing.
Business can use a variety of Pricing
 Introduction
• Pricing strategies determine the
price companies set for their products.
• The price can be set to maximize
profitability for each unit sold or from the
market overall.
• Cost plus pricing .
• High low pricing .
• Limit pricing .
• Pay what to want .
• Premium pricing .
• Price leadership .
• Performance –bases pricing .
• Psychological pricing .
• Loss leader (losing market )
 24.05.22 Cliff-Vesting Schedule
• Cliff vesting is more commonly used by
startups because it enables them to evaluate
employees before committing a full range of
benefits to them.
• Vesting of employee benefits over a short
period of time .
• Reward employees for the years worked at a
business and for helping the firm reach its
financial goals .
Operational Involvement
• Operational Role means engaging in any business
activity as a full-time
employee of a
company that involves the direct
management, supervision or performance of the
ongoing development, production, marketing, sales or
service of and for technologies, products or services.
• Work of managing the inner working of your business so
it runs as efficiently as possible .
 Minimum Viable Product
• A product that has just enough features to satisfy early
customers and fulfill at least one of their identified needs.
(Qty, quality, Free gift, color of product, identification and
resemblance , favorite celebrity endorsement, past experience
of some family member )
• Go live, what proof of concept is needed.
• MVP is a development technique in which a new product is
introduced in the market with basic features, but
enough to get the attention of the
consumers. The final product is released in the market
only after getting sufficient feedback from the product's initial
users. LIKE : NESCAFE.
 Planning Your Minimum Viable
Product
• Identify and Understand The Business Needs.
a) Determine the long-term goal of the
product and write it down. b) Answer the
question “Why are we doing this project?” ...
• Find The Opportunities. a) Map out the user
journey(s) Identify the users (actors) ...
• Decide What Features To Build.
• Name of product/service. Website, visiting
card, office space.
• (The main purpose of an office environment is to support its occupants in
performing their jobs. Work spaces in an office are typically used for conventional

.)
office activities such as reading, writing and computer work
 Valuation and harvesting.
• Harvesting (or exiting) is the method owners and
investors use to get out of a business and, ideally,
reap the value of their investment in the firm. Many
entrepreneurs successfully grow their businesses but fail
to develop effective harvest plans.(Club Mahindra : free
trip with clients, Lions club memberships)
• Valuation is the analytical process of determining the current
(or projected) worth of an asset or a company. An analyst
placing a value on a company looks at the business's
management, the composition of its capital structure, the
prospect of future earnings, and the market value of its
assets, among other metrics.
 Valuation methods :
• The Two Main Categories of Valuation
Methods

• Absolute valuation models attempt to find the intrinsic or

"true" value of an investment based only on fundamentals.
Looking at fundamentals simply means you would only focus
on such things as dividends, cash flow, and the growth rate for
a single company, and not worry about any other companies.
• Relative valuation models, in contrast,
operate by comparing the company in
question to other similar companies. These
methods involve calculating multiples
and ratios, such as the price-to-earnings
multiple, and comparing them to the
multiples of similar companies.
Term sheet
Term sheet
 Negotiations – Management succession.

• Good negotiations contribute significantly to business success, as

they: help you build better relationships. deliver lasting, quality
solutions—rather than poor short-term solutions that do not satisfy
the needs of either party. help you avoid future problems and
conflicts.

• Negotiation holds the key to getting ahead in the workplace,

resolving conflicts, and creating value in contracts. When
disputes arise in business and personal relationships, it's easy to
avoid conflict in an effort to save the relationship.
 Management succession Planning
• Process of preparing an organization for a
transition in leadership.
• Succession planning is helpful when a
management change occurs due to
unforeseen circumstances, such as the sudden
death of a corporation's chief executive officer
(CEO).
• It provides a way to identify key roles, people with the right skills and positions
that may need filling in a short space of time. It also provides a way to cut the
costs of recruitment, enabling organizations to manage recruitment in-house.
 Role of Succession Management
• In the long term, succession planning
strengthens the overall capability of the
organization by: Identifying critical
positions and highlighting potential
vacancies; Selecting key competencies
and skills necessary for business
continuity; Focusing development of
individuals to meet future business
needs.
• Management succession
planning focuses vertically on the
organization chart. The goal is to prepare
people for higher-level responsibility.
There are many ways to act on technical
succession planning, but they require
going beyond the familiar methods of
management succession planning.
Plan