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samenvatting Entrepreneurship in HMS
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Entrepreneurship in HMS
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General answer Q1, Q2 en Q10Question 1: The Life Cycle of the Firm
The essence of the life cycle of the firm is that firms that are in different stages during the life
cycle of the firm show different characteristics, or that one firm shows different
characteristics in different stages during the life cycle of its existence: it is not predictive/
normative.
Stages of The Life Cycle of the Firm: combinations of intervals of time & and firm size.
1. The start-up stage:
The start-up stage reflects the initial steps of the firm right after its founding; in this stage,
the firm represents a combination of small size and young age.
Characteristics:
Sales: the firm only has a limited set of activities, and thus the sales can be seen as (more or
less) a mono-culture.
Diversification in employment: only the entrepreneur (or sometimes a few entrepreneurs
who started the firm together) and at best some support staff or active family members to
help
Financing: business finance will mainly come from the entrepreneur himself and maybe from
certain relatives, friends, and acquaintances. Commercial banks will not be very much
interested in the firm in this stage of its development, because not much collateral is
available, and most likely the entrepreneur does not have a long track record of previous
successful experiences. In other words, the start-up stage is in general too risky for
commercial banks
2. The growth stage:
In the second stage, the growth stage (nowadays also called the scale-up stage), the firm
takes off after its initial steps; in this stage, the firm employs more people than in the initial
stage, after a number of years of its existence, so further in time as well.
Characteristics:
Sales: the diversification of sales will increase, compared to the start-up stage, as a result of
increasing the number of activities.
Diversification in employment: increase, because the firm has to hire new personnel and has
to apply task division among its employees
Financing: formal financers may come in, like commercial banks and perhaps venture
capitalists: apparently they are willing to do so because the entrepreneur and the firm have
proven themselves and because the risk decreases for the financers
3. The maturity stage:
In the maturity stage, the firm finds itself after a number of years in a more or less stable
situation in terms of the number of employed people.
Characteristics:
See stage 2.
4. The decline stage:
,Finally, in the decline stage, or in the last years of its existence, the firm has grown older and
cuts back in terms of employed people and prepares for the end in its existence.
Sales: the diversification of sales will decrease, as compared to the maturity stage, because
the number of activities that is carried out by the firm is reduced.
Diversification in employment: decrease, because the number of activities that is carried out
by the firm is reduced.
Financing: investors will withdraw from the scene, because not much future is left, in which
of the loaned money will be paid back. The relationship between the life cycle of the firm, on
the one hand, and the assumed level of investment risk by investors: The further the firm gets
in its life cycle, the lower will be the assumed level of investment risk by investors. This
assumption makes sense, because the firm has proven its rationale of existence in the course
of time. The authors also suggested a connected decreasing level of informality with the
investors of the firm, during the life cycle of the firm: personal finance, family and friends,
bootstrapping, internal funding, seed capital, public/grant funding, business angels, formal
venture capitalists, non-financial corporations, commercial banks, and finally initial public
offering (IPO).
Question 2: The entrepreneurial dilemma
Definition Page 5
A situation in which an entrepreneur or multiple entrepreneurs has/have to choose between
two or more future courses of action concerning his/their firm(s), without sufficient
information to make that choice or not being able to prioritize the gathered information for
making that choice.
There is no progress with the firm without any crisis with the firm, according to Greiner
(1972). His model: firm size and complexity of the operations increase from small to large
(vertical axes) against time/ development firm. There 5 stages (p.44) with typical problems
during shifting (p. 45)
Question 10: Recommendation
The advice should include:
1. a clear recommendation what to do
2. a clear explanation of this recommendation
3. a brief overview of the pros and cons of this recommendation.
,Case 1: To Protect or Not to Protect (That Is
the Question)
Set: University sector: human movement sciences
Question 1:
The start-up stage reflects the initial steps of the firm right after its founding; in this stage,
the firm represents a combination of small size and young age.
Characteristics:
Sales: the firm only has a limited set of activities, and thus the sales can be seen as (more or
less) a mono-culture.
Diversification in employment: only the entrepreneur (or sometimes a few entrepreneurs
who started the firm together) and at best some support staff or active family members to
help
Financing: business finance will mainly come from the entrepreneur himself and maybe from
certain relatives, friends, and acquaintances. Commercial banks will not be very much
interested in the firm in this stage of its development, because not much collateral is
available, and most likely the entrepreneur does not have a long track record of previous
successful experiences. In other words, the start-up stage is in general too risky for
commercial banks
Question 2
Dr. Steps is in a situation in which an he has to choose between continuing with operating
his firm like he is doing right now and has been doing for the duration of his PhD or make the
choice to invest to protect his self-developed interactive walkway with his improvements
ideas, because if he doesn’t others might use his ideas without consequences. Right now he
doesn't have sufficient (financial) information to make the choice to take action into
protecting his firm or not and/ if in what way.
Question 3 – innovation
(1) new products and services see page 21
Question 4 – protection see page 47
The investments that the entrepreneur makes for his start-up and for his innovation may
take four different forms of value: money, time, reputation, and goodwill.
, 4 forms of protection of the start-up firm:
- registered formal protection (e.g. patents, registered designs, trademarks, copyrights)
- non-registered formal protection (e.g. confidentiality clauses in contracts, licensing)
- informal protection. Page 49 (6 forms)
- no protection
The investments that the entrepreneur makes for his start-up and for his innovation may
take four different forms of value: money, time, reputation, and goodwill.
Question 5
Financial costs: how much does it cost to realize this form of protection in terms of for
instance application and procedure costs, does he need to hire and pay experts and is it a
time, thus money, consuming path?
With how well I mean mainly two things: how well does this form protect against the
(changing) properties and developments of this product/ could it be specified enough and
against who could it be protected: “the whole market” or professionals who use/ bought the
product and for whom it is relatively easy to discover the developments in great detail.
Question 4 - 9
Your specific forms Your Patent for the Confidentiality building in
specific criteria unique way of clauses in technological
working of this contracts protections to
interactive walkway prevent others from
(.e.g. algorithm, copying the
light patterns) innovation
Financial costs of Worst option for Dr Best option for Medium option for
protecting ++ Steps Dr Steps Dr Steps
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