QUESTIONS:

1.Mention at least three well-known Ethiopian entrepreneurs who have exhibited

entrepreneurial characteristics (Qualities) and briefly discuss.

Well-known Ethiopian entrepreneurs who have exhibited entrepreneurial characteristics

include:

• Bethlehem Xilahun Alemu

Bethlehem Tilahun Alemu: She is the founder of soleRebels, a footwear company known for its
eco-friendly and sustainable practices. Bethlehem has shown qualities such as creativity,
resilience, and a strong commitment to social and environmental responsibility.
• Addis Alemayehou: He is the founder of 251 Communications, a leading marketing and
advertising agency in Ethiopia. Alemayehou has demonstrated qualities such as innovation,
strategic thinking, and the ability to identify and capitalize on market opportunities.

• Eleni Gabre-Madhin

Economist and entrepreneur, founder of the Ethiopia Commodity Exchange.

Industry: Commodity Exchange

Innovation: Introduced modern trading systems to Ethiopian agriculture

- Eleni Gabre-Madhin: She is the founder and former CEO of the Ethiopia Commodity Exchange
(ECX). Eleni exhibited entrepreneurial qualities such as vision,

leadership, and the ability to create and implement a transformative business model in the
agricultural sector.
• Sara Menker

Founder and CEO of Gro Intelligence, a company that provides agricultural data analysis.

Industry: Agriculture Technology

Achievement: Creating a platform for global agricultural data and analysis

• Samuel Tafesse

Founder of Sunshine Construction, a leading construction company in Ethiopia.

Industry: Construction

Notable Project: Sheraton Addis Hotel

• Noah Samara

Founder of Yazmi, a company that offers satellite-based learning solutions.

Industry: Education Technology

Innovation: First to offer satellite-based education in Africa

• Bruktawit Tigabu

Co-founder and CEO of Whiz Kids Workshop, an educational media company.

Industry: Education

Award: Next Generation Prize from the Prince Claus Fund

• Kassy Kebede

Founder of Panton Capital Group and investor in various sectors in Ethiopia.

Industry: Finance

Investment Focus: Banking, agriculture, and real estate

2.Discuss and distinguish how creativity, invention and innovation are linked to
entrepreneurship?

Creativity involves generating new ideas or concepts, invention is the process of creating a new
product or process, and innovation is the implementation of a new idea or invention to create
value. Entrepreneurship involves all three. Entrepreneurs use creativity to come up with new
business ideas, then invent products or processes to realize those ideas, and finally innovate by
bringing these ideas to the market in a way that adds value.

An idea is simply a creative thought or a concept, whereas Opportunity is a chance to bring

that idea to life and make it a reality.

Creativity, Invention and Innovation

Concept Description
Creativity ability to develop something original, particularly an idea or a representation of an
idea, with an element of aesthetic flair

Invention truly novel product, service, or process that, though based on ideas and products

Innovation change that adds value to an existing product or service

Table 2.1

3.Explain the difference between an idea and an entrepreneurial opportunity. Why is it

important to recognize if your idea is truly an entrepreneurial opportunity or only an idea?

An idea is a thought or suggestion about a possible course of action, while an entrepreneurial

opportunity is a favorable set of circumstances that creates a need for a new product, service,
or business. It's important to recognize if your idea is truly an entrepreneurial opportunity
because not all ideas have the potential to create a viable business.

It's important to recognize if your idea is truly an entrepreneurial opportunity or only an idea
because:

Viability Assessment: Distinguishing between an idea and an opportunity helps you assess the
commercial potential of your concept. An entrepreneurial opportunity has the potential to be
transformed into a successful business venture, while a mere idea may lack the necessary
market demand or feasibility.

Resource Allocation: Recognizing an entrepreneurial opportunity allows you to allocate your

time, effort, and resources towards developing a concept that has a higher likelihood of
success. Focusing on viable opportunities increases your chances of building a sustainable
business.

Market Relevance: An entrepreneurial opportunity is aligned with market needs, trends, and
customer preferences. By understanding if your idea fits into an existing market gap or
addresses unmet needs, you can tailor your approach to meet those demands effectively.
Investor Appeal: Investors and stakeholders are more likely to support ventures that are built
around genuine entrepreneurial opportunities rather than vague ideas. Demonstrating a clear
understanding of the market opportunity and the potential for business success can attract
investment and support.

4.How would you work around having limited access to capital in starting your own business?
What difficulties can you see in trying to do so? What possible options will you use to realize
your idea?

Working around limited access to capital when starting a business can be challenging, but there
are several strategies that can help overcome this obstacle:

Bootstrapping: This involves using personal savings, credit cards, or loans from friends and
family to fund the initial stages of the business. It requires careful budgeting and a willingness
to take on personal financial risk.

Crowdfunding: Platforms like Kickstarter and Indiegogo allow entrepreneurs to raise funds from
a large number of people who believe in their idea. This can be a good option for businesses
with a compelling story or unique product.

Angel investors: These are individuals who provide capital in exchange for ownership equity or
convertible debt. Finding the right angel investor can be challenging, but they can provide
valuable mentorship and connections in addition to funding.

Small business loans: Many banks and credit unions offer loans specifically designed for small
businesses. These loans typically require a strong business plan and collateral, but they can
provide the necessary capital to get a business off the ground.

Strategic partnerships: Collaborating with other businesses or organizations can provide access
to resources and funding that may not be available on your own.

Difficulties in starting a business with limited capital include:

- Limited resources for marketing, product development, and hiring

 - Difficulty attracting top talent without competitive salaries or benefits

- Greater financial risk for the entrepreneur

- Limited ability to weather unexpected expenses or economic downturns

5.Assume you come up with an idea for a new electronic product you think your target
customers would really like. How would you go through the product development process?
How would you accomplish each step within that process?

To follow each step of product development process through valuable way.

First step,New Idea Generation:- The new product development process starts with search for
ideas about this new electronic product.
• Some sources of ideas for include consumers, existing
products & services, & research and development which was conducted on this product.
Second,Idea Screening:- In the 2nd step the purpose is to spot out the valuable ideas( good
idea) and ignore poor idea which are generated at first step by all source idea generation.
Third ,Concept Development and Testing:- In this step,Idea is converted into concept, because
idea is not purchased rather concept.

Any spotted idea can be turned into several product concepts like : Who will use the product?
What benefits should the product provide? When will people consume the produced?
• The concepts can be in word or Mella Tutorials picture description.

Fourth ,Marketing Strategy Development:-The marketing strategy plan consists of three parts:
Market size, structure, behavior; Planned price, distribution strategy and Long run sales and
profit goals.

marketing strategies develop include how the price of new electronic product is
determined,distributed and bring long run sales and profit goals as it achieve the organization
goal.
Fifth ,Business Analysis:-Management needs to prepare sales, cost and profit projections to
determine whether they satisfy the company's objective or not.
In this business analysis, determines the new electronic product it's sales,cost and profit earned
whether achieve or not organization goal.

Sixth,Product Development:- In this step the spotted idea about new electronic product which
was converted to product concept again converted into actual new electronic product.

Its goal is to find a prototype that the consumers see embodying the key attribute described in
the product concept statement.

• Functional tests like Durability, Speed,Cost, etc. and Psychological aspects like Colors, Sizes,
Weight & Other Physical Cues are conducted.

Seventh,Market Testing:- The goals are to test the new electronic product is more authentic
customer settings and to learn how large the market is.

In this step,some of new electronic product provided into the market to see and identify
customer want ,compare with product of competitors and determines whether this product is
sold by mass or not.
Eight,Commercialization

• When (Timing): - In commercializing, market entry timing is critical. Whether it is First Entry.
"first mover advantage” or Late Entry Strategy or Parallel Entry.
• Where (Geographical Strategy): - We need to decide whether to launch the new electronic
product in a local area, a region,national and international market.
• To Whom (Target-Market-Prospect): - Within the rollout markets, the company must target
its distribution and promotion to the best prospect group.
• How (Introductory Markets Strategy): - a new electronic product may/can use network-
planning techniques such as Critical Path Scheduling (CPS).

6.Discuss ways in which intellectual property, such as patents,trademarks and copyrights can
add value to an entrepreneurial venture. How would it protect entrepreneurial ventures from
unnecessary imitations?
Intellectual property, such as patents, trademarks, and copyrights, can add significant value to
an entrepreneurial venture in various ways:

Protection of Innovation: Patents protect new inventions or processes developed by the

entrepreneur, giving them exclusive rights to use and commercialize the innovation for a
certain period of time. This protection can help prevent competitors from copying or replicating
the invention, giving the entrepreneur a competitive advantage in the market.

Brand Recognition: Trademarks help protect the unique identity and branding of the
entrepreneurial venture, such as logos, slogans, and brand names. Building a strong brand
through trademark protection can enhance the venture's reputation and customer loyalty,
leading to increased sales and market share.

Monetization Opportunities: Intellectual property assets can be monetized through licensing

agreements, partnerships, or outright sales. By licensing their patents, trademarks, or
copyrights to other companies, entrepreneurs can generate additional revenue streams and
expand their market reach without having to invest in additional resources.

Attracting Investors and Partners: Having strong intellectual property protection can make an
entrepreneurial venture more attractive to investors and potential partners. Investors are more
likely to invest in a venture that has valuable intellectual property assets, as they provide a level
of security and potential for future growth.

Legal Recourse: Intellectual property protection provides legal recourse against competitors or
third parties who may try to imitate or infringe on the entrepreneur's innovations or branding.
With patents, trademarks, and copyrights in place, entrepreneurs can take legal action against
infringer and protect their rights in court.

7.Explain the use of franchise as an option for new venture expansion strategy for an
entrepreneur & discuss its relative advantages & disadvantages both to the franchisor &
franchisee..

Relative advantages and disadvantages of both franchisor and franchisee

Advantages for the Franchisor:

Rapid Expansion: Franchising allows the original business to grow quickly without the need for
significant capital investment, as franchisees provide the necessary funds for opening new
locations.

Brand Exposure: Franchising can lead to increased brand visibility and market penetration, as
franchisees operate under the original brand name, potentially reaching new geographic areas
and customer segments.

Revenue Generation: Franchisor benefit from initial franchise fees, ongoing royalties, and
other revenue streams without directly managing the day-to-day operations of each location.

Risk Mitigation: Franchising shifts some operational and financial risks to the franchisees,
reducing the burden on the franchisor.

Disadvantages for the Franchisor:

Control Challenges: Franchising involves relinquishing a degree of control over individual

business operations, which can lead to inconsistencies in customer experience and brand
representation.

Legal and Regulatory Compliance: Franchisor must navigate complex legal and regulatory
requirements related to franchising, including disclosure documents, contracts, and compliance
with franchise laws.

Brand Reputation Risks: The actions of individual franchisees can impact the overall brand
reputation, and franchisor may face challenges in maintaining consistent quality standards
across all locations.

Advantages for the Franchisee:

Established Brand and Support: Franchisees benefit from operating under a recognized brand
with established operational systems, marketing support, and training provided by the
franchisor.
Reduced Business Risk: Franchisees can leverage the success of an existing business model,
reducing the risk associated with starting a new venture from scratch.

Access to Resources: Franchisees may have access to bulk purchasing discounts, centralized
marketing efforts, and ongoing support from the franchisor and other franchisees.

Disadvantages for the Franchisee:

Initial Investment and Fees: Franchisees are typically required to pay substantial initial fees,
ongoing royalties, and contribute to marketing funds, which can impact their profitability.

Limited Autonomy: Franchisees must adhere to the operational guidelines set by the
franchisor, limiting their ability to make independent business decisions.

Dependence on Franchisor: The success of the franchisee's business is tied to the overall
performance and decisions of the franchisor, including changes in branding, policies, or
support.

8.List the users of a business plan and associate them with the functions (components of a
business plan) which they consider to be their primary focus. Example: Investors are more
interested with financial plan section of a business plan for different reasons.

Users of a business plan include

_investors (financial plan)

_ potential partners (management team and operations)

_employees (human resources plan)

_suppliers (production plan)

_customers (marketing plan) and

_ government agencies (legal and regulatory information).

9.Why do you think that creativity and innovation has been weak in Ethiopia? Give your own
opinion.

Some cause of the weakness in creativity and innovation in Ethiopia could be attributed to
factors such as:

Limited Access to Education and Resources: Historically, Ethiopia has faced challenges in
providing quality education and access to resources, which are essential for nurturing creativity
and innovation. Limited investment in research and development also hinders the emergence
of new ideas and inventions.

Cultural and Social Norms: Cultural norms and societal expectations may discourage risk-taking
and experimentation, which are essential components of creativity and innovation. Fear of
failure or non-conformity can stifle entrepreneurial spirit and innovative thinking.

Political and Economic Instability: Political instability and economic challenges in Ethiopia may
create an environment of uncertainty and hinder long-term planning and investment in
innovative ventures. Lack of stability can deter entrepreneurs from taking risks and pursuing
creative ideas.

Limited Infrastructure and Support Systems: Inadequate infrastructure, such as access to

reliable electricity, Internet connectivity, and transportation, can impede the development and
implementation of innovative solutions. Additionally, a lack of supportive ecosystems, such as
incubators, accelerators, and funding opportunities, can hinder the growth of creative ventures.

Intellectual Property Protection: Weak enforcement of intellectual property rights in Ethiopia

may discourage entrepreneurs from investing in research and development, as they may not
have adequate protection for their innovations. This can lead to a reluctance to share new ideas
or inventions due to fear of imitation.

Lack of Collaboration and Networking: Limited opportunities for collaboration, networking,

and knowledge-sharing among entrepreneurs, researchers, and industry professionals can
hinder the cross-pollination of ideas and the development of innovative solutions. Building a
culture of collaboration is essential for fostering creativity and innovation.

Mindset Shift Needed: Encouraging a mindset shift towards embracing creativity, risk-taking,
and experimentation is crucial for promoting innovation in Ethiopia. Cultivating an environment
that values and rewards creativity can inspire individuals to think outside the box and pursue
innovative solutions to societal challenges.

10.What are the advantages of establishing a firm as a team (Partnership, Joint Venture
corporation, cooperative) than as an individual (Sole proprietorship)?

• Establishing a firm as a team (partnership, joint venture corporation, cooperative) has

advantages over sole proprietorship including:

Shared Responsibility: In a team-based firm, the workload and decision-making responsibilities

are distributed among the partners or members, reducing the burden on any single individual.

Diverse Skill Sets: Each team member brings their unique skills, expertise, and perspectives to
the table, allowing for a broader range of capabilities within the firm.

Risk Sharing: By forming a team, the risks associated with running a business are shared among
the partners or members, reducing the individual financial liability and providing a safety net.

Increased Capital: Team-based firms often have access to more capital as multiple partners can
contribute funds, increasing the financial resources available for business operations,
expansion, and investment.

Enhanced Networking: A team-based firm can leverage the networks and connections of each
partner or member, opening doors to new opportunities, clients, suppliers, and partnerships.

Complementary Resources: Partnerships and joint ventures allow for the pooling of resources,
such as equipment, facilities, technology, and intellectual property, which can lead to cost
savings and improved efficiency.
Shared Decision Making: In a team-based firm, decisions are made collectively, drawing on the
expertise and perspectives of multiple individuals. This can lead to more informed and well-
rounded decision-making.

Continuity and Succession Planning: Team-based firms often have better continuity and
succession planning, as the departure or retirement of one partner does not necessarily lead to
the dissolution of the entire business.

Shared Workload and Flexibility: Partnerships and joint ventures allow for the distribution of
workload, enabling team members to share responsibilities and potentially achieve a better
work-life balance.