Entrepreneurship and New Ventures

Credits: 3 Professor: Dr. M.K. Nandakumar

Contact No. 0495-2809256 Email: nandakumarmk@iimk.ac.in

This course introduces students to the key facets of Entrepreneurship. It helps students to
understand the entrepreneurial process and exposes them to the challenges, problems, and issues
faced by entrepreneurs who start new ventures. This course will be beneficial to those who are
interested in either launching their business venture or working for a small business. It provides
detailed guidelines for successfully launching and growing an entrepreneurial venture. This course
makes use of some interesting case studies that help the students to gain a good understanding of
the entrepreneurial process. The students in this course will work in teams and will develop
business ideas that will be developed based on the feedback received from the classroom. By the
end of the course, the teams need to develop comprehensive business plans based on these business
ideas. One of the key highlights of this course is a live consulting project. A start-up firm will be
assigned to each team, and the team will address a specific issue/challenge faced by the start-up
firm during this consulting project. After completing the consulting project, each team will submit
a report providing recommendations for addressing the issues/challenges faced by the start-up.
Another key highlight of this course is a web-based simulation in which each team will run a
company and compete against other teams. The simulation provides an opportunity for the students
to make key decisions in a safe environment, and this experience helps boost their confidence
while performing important tasks during the entrepreneurial process. After completing this course,
the participants will develop the following skills/capabilities:
 Ability to identify business opportunities and assess their feasibility;

 Ability to prepare a business plan;

 Awareness about other relevant issues in entrepreneurship like various sources of funding,
intellectual property, choosing a form of ownership, marketing, finance, and operations;

 A good understanding of social entrepreneurship;

 An understanding about issues related to buying an existing business and valuation; and

 An understanding of the key issues and challenges faced by start-up firms; and

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  Greater confidence while performing various tasks during the entrepreneurial process.

All the students in the class will be divided into groups for carrying out the following activities:
(i) Case discussion, (ii) Business Plan Project, (iii) Consulting Project, and (iii) Simulation.

Active participation of students during the classes is essential for assimilating various concepts
discussed in this course. Students are encouraged to share their views about various issues in the
entrepreneurial process in the class so that it becomes an active learning process. Those who have
experience in setting up businesses are encouraged to share their experiences with the rest of the
class.

Details of the Sessions

Session
Topic Case
No.

Introduction to the Entrepreneurship and

New Ventures course Hebon: Transforming Indian
1 and 2 Jackfruit from Weed to Wonder
An Overview of Entrepreneurship
Food (W19027)
Entrepreneurial Opportunity Recognition

Feasibility Analysis The Pre-Venture Feasibility

3 and 4 Analysis: The Andrea Kaneb Case
Activity
(NA0445)
Conscious Capitalism Simulation

Feasibility Analysis (contd)

Balanced Snacking (BAB242 /
5 and 6
Activity September 2016)
Conscious Capitalism Simulation

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 Feasibility Analysis (contd) By-the-Sea Biscuit Company: A
7 and 8 Decision in New Venture Analysis
Business Idea Elevator Pitch (NA0361)

Business Model Configuration

9 and
AngelList (9-814-036)
10 Creating a Business Plan

Business Idea Elevator Pitch (contd)

11 and Business Model Configuration (contd) Tenalpina Tools: The Entrepreneur’s

12 Dilemma (BAB276 / May 2015)
Consulting Project Status Update

Obtaining Funding
13 and OutReach Networks: First Venture
Franchising
14 Round (UV6569)
Consulting Project Status Update (contd)

Obtaining Funding (contd)

15 and
PunchTab, Inc (9-812-033)
16 Conscious Capitalism Simulation

Buying an existing business and valuation

17 and BelleFleur: Buying an Existing
Building a New Venture Team
18 Business or Starting Fresh (W18098)
Conscious Capitalism Simulation

Social Entrepreneurship
21 and Sanergy:Tackling Sanitation in
Choosing a form of Ownership
22 Kenyan Slum (B5871)
Business Plan Presentations

Buyout as an Exit Strategy

23 and KickShot: GOOOOOOOOOAL!
24 Intellectual Property and Legal Issues (NA0516)

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 Business Plan Presentations

25 and
26 Consulting Project Presentations

Consulting Project Presentations

27 and
28 Conscious Capitalism Simulation

29 and
Conscious Capitalism Simulation
30

Assessment Criteria

1. Class Participation: 10%

2. Business Plan Project: 20%
3. Consulting Project: 20%
4. Simulation Report: 20%
5. Examination: 30%

Class Participation

Questions based on the case studies provided have been uploaded to the Moodle site. Each group
needs to prepare the answers for those questions, and one member from each group should upload
the answers through the link provided in the Moodle site. They need to upload the answers before
the date and time specified by the professor. All the students should actively participate in the case
discussions. The professor might also ask some students/groups to present certain answers.
Participation in the case discussions is an important criterion for awarding marks for class
participation.

In addition to participation in case discussions, students are also expected to participate and
contribute to simulation, business plan pitches and consulting project presentations.

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Business Plan Project

Each group needs to identify a business idea and do an elevator pitch in sessions 7/8 and 9/10,
which should not exceed three minutes. Each pitch will be followed by a discussion in the class.
Based on the feedback received from the class during these presentations, the teams should modify
the business idea further. The teams should develop this idea into a full-fledged business plan by
the end of the course. Each team should do a business plan pitch in sessions 21/22 and 23/24,
which should not exceed more than three minutes. Each pitch will be followed by a discussion in
the class. Since time allowed for the pitch is only three minutes, the teams need to summarize their
business plans and present only the key highlights of the plan. The final business plan should be
prepared based on the specifications discussed in the class, and it should not exceed 35 pages. It
should be original work, and you have to do proper referencing. Harvard (author-date) style of
referencing should be done throughout the report. If you are not sure about this referencing, you
should be able to obtain plenty of materials from the internet, which explains how to use Harvard
style of referencing. A few documents explaining Harvard System of Referencing have been
uploaded to the Moodle platform. Plagiarism checks will be done for each report by the professor
using anti-plagiarism software, and the marks of those who submit plagiarized reports will be
reduced significantly. The deadline for submitting the project reports will be announced in the
class. One member of each team should upload a copy of the report through the link provided in
the Moodle site. There will be a penalty for submissions made after the deadline. 10% of the total
marks awarded for the assignment will be deducted for each day after the specified deadline.
Submissions made three days after the deadline will not be marked.
The following structure adapted from Scarborough & Cornwall (2015) and Kuratko, (2017) can
be used as a reference while preparing the business plan. You can customize this structure based
on the context of your business idea.
I. Executive Summary ( not to exceed one page)
A. Company name address and phone number
B. Name(s), addresses and phone number(s) of all key people
C. Brief description of the business, its products and services, the customer problems
they solve, and the company’s competitive advantage
D. A brief overview of the market for your products and services
E. A brief overview of the strategies that will make your company successful
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 F. Brief description of the managerial and technical experience of key people
G. A brief statement of the financial request and how the money will be used
H. Charts or tables showing highlights of financial forecasts

II. Vision and Mission Statement

A. Entrepreneur’s vision for the company
B. “What business are we in?”
C. Values and principles on which the business stands
D. What makes the business unique? What is the source of its competitive
advantage?

III. Company History ( for existing businesses only)

A. Company founding
B. Financial and operational highlights
C. Significant achievements

IV. Company Products and Services

A. Description
1. Product or service features
2. Customer benefits
3. Warranties and guarantees
4. Unique Selling Proposition (USP)

B. Patent or trademark protection

C. Description of the production process (if applicable)
1. Raw materials
2. Costs
3. Key suppliers
4. Lead times

D. Future product or service offerings

V. Industry Profile and Overview

A. Industry analysis
1. Industry background and overview
2. Significant trends
3. Growth rate
4. Barriers to entry and exit
5. Key success factors in the industry
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 B. Outlook for the future
C. Stage of growth (start-up, growth, maturity)

VI. Competitor Analysis

A. Existing competitors
1. Who are they? Create a competitive profile matrix
2. Strengths
3. Weaknesses

B. Potential competitors : Companies that might enter the market

1. Who are they?
2. Impact on your business if they enter
3.
VII. Business Strategy
A. Desired image and position in market
B. Company goals and objectives
1. Operational
2. Financial
3. Other
C. SWOT analysis
1. Strengths
2. Weaknesses
3. Opportunities
4. Threats

D. Competitive strategy
1. Cost leadership
2. Differentiation
3. Focus
VIII. Marketing Strategy

A. Target market
1. Problem to be solved or benefit to be offered
2. Demographic profile
3. Other significant customer characteristics

B. Customers’ motivation to buy

C. Market size and trend
1. How large is the market?
2. Is it growing or shrinking? How fast?
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 D. Personal selling efforts
1. Sales force size, recruitment and training
2. Sales force compensation
3. Number of calls per sale
4. Amount of average sale
E. Advertising and promotion
1. Media used – reader, viewer, listener profiles
2. Media costs
3. Frequency of usage
4. Plans for generating publicity

F. Pricing
1. Cost structure
a) Fixed
b) Variable
2. Desired image in market
3. Comparison against competitors’ prices
4. Discounts
5. Gross profit margin

G. Distribution strategy (if applicable)

1. Channel of distribution used
2. Sales techniques and incentives for intermediaries

H. Test market results

1. Surveys
2. Customer feedback on prototypes
3. Focus groups

IX. Location and Layout

A. Location
1. Demographic analysis of location versus target customer profile
2. Traffic count
3. Lease/rental rates
4. Labour needs and supply
5. Wage rates

B. Layout
1. Size requirements
2. Compliance with disability rules
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 3. Ergonomic issues
4. Layout plan(suitable for an appendix)

X. Description of management team

A. Key managers and employees
1. Their backgrounds
2. Experience, skills and know-how they bring to the company
B. Resumes of key managers and employees (suitable for an appendix)
C. Future additions to management team
D. Board of Directors or advisers

XI. Plan of Operation

A. Form of ownership chosen and reasoning
B. Company structure(organisation chart)
C. Decision-making authority
D. Compensation and benefits packages
E. Staffing plans

XII. Financial forecasts (suitable for an appendix)

A. Key assumptions
B. Financial statements (year 1 by month, years 2 and 3 by quarter)
1. Income statement
2. Balance sheet
3. Cash flow statement
C. Break-even analysis
D. Ratio analysis with comparison to industry standards (most applicable to existing
businesses)
XIII. Loan or investment proposal
A. Amount requested
B. Purpose and uses of funds
C. Repayment or “cash out” schedule (exit strategy)

XIV. Critical Risks

A. Potential problems
B. Obstacles and risks
C. Alternative courses of action

XV. Harvest Strategy It stands for Initial Public Offering but it should be well understood.

A. Liquidity event (IPO or sale)

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 B. Continuity of business strategy
C. Identify successor

XVI. Milestone Schedule

A. Timing and objectives

B. Deadlines and milestones
C. Relationship of events

XVII. Appendices (supporting documentation, including market research, financial

statements, organization charts, resumes, and other items)

The business plans will be marked using the following criteria:

a. Quality of the research and analysis carried out
b. Effectiveness of the product/service to be launched either to solve problems faced by
customers or to fulfill specific needs
c. Effectiveness of the business plan to attract funding
d. The overall quality of the business plan

Consulting Project

Each student group will work with a start-up firm and will act as consultants who strive to address
certain issues/problems faced by the firm. Each student group will be provided the details of the
start-up firms assigned to it. Each group will make a presentation in the class during sessions 25/26
and 27/28, explaining the details of the project they have completed. The time allowed for each
presentation will be five minutes. Since the time allowed for each presentation is only five minutes,
the teams need to summarize and present only the key highlights of the consulting project. Each
presentation will be followed by a discussion. Subsequently, each group needs to produce a report
containing the details of the consulting project. Broadly the structure of this report is provided
below.
 Introduction
 The Issue/Problem facing the Start-up firm
 The strategy adopted by the team to address this Issue/Problem
 The methodology followed by the team
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  Findings from the project
 Recommendations provided to the Start-up firm
The deadline for submitting the report will be announced in the class. One member of each team
should upload a copy of the report through the link provided in the Moodle site. There will be a
penalty for submissions made after the deadline. 10% of the total marks awarded for the
assignment will be deducted for each day after the specified deadline. Reports submitted three
days after the specified deadline will not be marked. The length of the report should be around
2500 – 3000 words.

The marks for the consulting project report will be awarded based on the following criteria:
 Effectiveness in addressing the Issue/Problem faced by the start-up firm
 Effectiveness in the strategy and methodology adopted to address the Issue/Problem
 Quality of the recommendations provided
 Effectiveness in functioning as a team
 The overall quality of the report submitted

Simulation

Conscious Capitalism Simulation will be used for this course. A brief overview of this simulation
is provided below:
You are about to start a new company that will be entering a new segment of the bicycle industry.
Your company will license the technology to build carbon fiber bikes using 3D printing and a new
economical form of carbon fiber. With this new technology, it will be possible to make bicycle
parts anywhere in the world with carbon fiber, a material that is stronger, lighter, and now less
expensive than the light metals. You should lead your executive team to develop this market
opportunity.
You can learn more about this simulation by logging in to the simulation site. Each group will be
provided with a license key to join the simulation. There will be two industries in the simulation,
and each industry will have five teams. All the teams in an industry will compete against each
other in each period. Each team will make decisions relating to various activities of the business
in each period. After each period, all the teams will get an opportunity to know their competitive
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position. All the teams are expected to participate in the simulation. At the end of the simulation,
one team will be declared as the overall winner based on their performance in each industry. After
the simulation gets over, every group is expected to submit a reflective report. This report should
explain their learning experiences, the strategies they have used and the challenges they have faced
while playing the simulation. The suggested structure of the report is as follows:
 Introduction
 Strategies used while competing with other teams
 Key learnings from the simulation
 An understanding of the entrepreneurial process
 The ability to make key entrepreneurial decisions
 Achieve entrepreneurial growth
 How will I do it differently next time?
 Do you think that you should have followed a different strategic approach during
this simulation?
 Do you think that you should have made some different decisions during the
simulation?
 Was your preparation before the simulation enough?
The length of the report should be about 2000 – 2500 words.
Marks for the simulation report will be awarded based on the following criteria:
a. The extent of learning by participating in the simulation
b. Quality of reflection
c. Structure of the report and overall writing style
The deadline for submitting the project reports will be announced in the class. One member of
each team should upload a copy of the report through the link provided in the Moodle site. There
will be a penalty for submissions made after the deadline. 10% of the total marks awarded for the
assignment will be deducted for each day after the specified deadline. Submissions made three
days after the specified deadline will not be marked.

Examination

The examination will be based on a case study. The case will be made available to the students a
few days before the examination to enable them to prepare for the examination. The question paper
will contain questions based on the case provided. The students should not bring a copy of this
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case to the examination hall. A fresh copy of the case will be provided to the students along with
the question paper. Further details regarding the examination will be provided to the students later
on.

Suggested Reading:

Several readings based on the topics discussed in the course are available in the Moodle site. Also,
the students are encouraged to read the following books and journal articles.

Books

Barringer, B.R. and Ireland, R.D. (2019) Entrepreneurship – Successfully Launching New
Ventures, 6th Edition, New Jersey: Prentice Hall

Hisrich, R.D., Manimala, M.J., Peters, M.P. and Shepherd, D.A. (2014) Entrepreneurship 9th
Edition, New Delhi: McGraw-Hill

Katz, J. and Green, R. (2017) Entrepreneurial Small Business, 5th Edition, McGraw-Hill

Kuratko, D.F. (2017) Entrepreneurship – Theory, Process, Practice 10th Edition, Boston: Cengage
Learning

Scarborough, N.M. and Cornwall, J.R. (2015) Entrepreneurship and Effective Small Business
Management 11th Edition, New Jersey: Pearson Education

Spinelli, Jr., S and Adams, R. (2016) New Venture Creation – Entrepreneurship for the 21st
Century, 10th Edition, New York: McGraw-Hill/Irwin

Read, S., Sarasvathy, S., Dew, N., Wiltbank, R. and Ohlsson, A. (2016) Effectual
Entrepreneurship, 2nd Edition, New York: Routledge

Journal Articles

Students are encouraged to read articles relating to the topics discussed in this course, published
in leading journals like Journal of Business Venturing, Entrepreneurship Theory, and Practice,
Strategic Management Journal, Academy of Management Journal, Academy of Management
Review, Strategic Entrepreneurship Journal, Journal of Small Business Management, Long Range
Planning, etc. All these leading journals can be accessed through the electronic resources provided
by IIMK.
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