ADVANCED

ENTREPRENEURSHIP
Unit – I: Fundamentals of Entrepreneurship & Refining Business
Model and Product:

Fundamentals and key concepts of entrepreneurship, refining the

business model, products and services, pivoting, types of business
models, business model evolution, generating new business models,
analyzing the business model, adding new customer segment, product
manager, significance and role of product manager.
Definition of Entrepreneurship

Entrepreneurship is defined as the professional application of

knowledge, skills and competencies of generating a new business
idea, by an individual or a set of people by launching an enterprise or
business organization to pursue growth while generating wealth,
employment and social good
Peter Drucker defined Entrepreneurship as ‘a systematic
innovation, which consists in the purposeful and organized search
for changes, and it is the systematic analysis of the opportunities
such changes might offer for economic and social innovation.
Entrepreneur is a person who starts an enterprise. The process of
creation is called entrepreneurship.
The entrepreneur is the actor and entrepreneurship is the act. The
outcome of the actor and the act is called the enterprise.
An enterprise is the business organization that is formed and
which provides goods and services, creates jobs, contributes to
national income, exports and over all economic development.
 Functions of Entrepreneurs
The main functions of entrepreneurs are
1.Planning:
Planning starts from New product development, procuring resources and to convert ideas
into product/service, finding channel of distribution, right customer segment and
commercialization.
2.Risk and Uncertainty bearing:
In today’s market dynamics modification in the existing products/services is must to retain
customers and build, develop the business.
3.Organization building
Entrepreneurs has to assign the roles and responsibilities to the people to see that business goal
is attained.
4.Managing
Entrepreneurs need to manage, collaborate, coordinate with all the entities for successful
venture.
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5. .Decision making
They need to decide whether to go for a new market or new product or both
(Diversification).
6.Innovation
Always innovation is a continuous activity should be encouraged to remain
competitive in the market place.
7.Leading:
Entrepreneur should lead the whole team starting from the idea generation till the final
sales or delivery of innovative service to the end customers
8.Managing growth
They need to see that market share improves over a period of time and the innovative
product is really creating a differential advantage in the market place.
 Qualities and Skills of
Entrepreneurship
Qualities of Entrepreneurship
i.Ability to Innovate
ii.Business oriented tendency
iii.Organizing function
iv.Managerial and leadership function
v.Knowledge based function
vi.Based on principles, not on intuition essential in every activity.

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 Skills of Entrepreneurship
Communication skills (possessing the ability to read, write and speaking in an
understandable, accurate and professional manner)
Human relations skills (the ability to build and maintain positive relationships, working well
with others)
Math skills (knowledge of basic arithmetic and business math skills such as calculating profit)
Problem-solving and Decision-making skills (the ability to assess situation and make good
decisions)
Technical skills (knowledge of computers and how to use them productively)
Business skills (knowledge and understanding of the economy and business functions such as
marketing and management)

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 Things to be done by Entrepreneur
1. Build a Business model
Building the right Business model is the key to success
of start-ups. For every customer segment there should
be one business model.
2. Build a sustainable Venture: The same business model
should be carried in the future with slight modifications
or minute changes in Lean canvas template
3.Build a Right Pitch: Identifying the right problem is the
key to success of any business.
 Various Steps involved are
1.REVISIT:
We need revisit our idea in the present scenario before converting our idea to products/services.
2. VALIDATE
We need to validate our goal with sustainable business venture.
3.REFINE
Refine the product with modifications or going for a new product/service
4.PIVOT
Appropriate Market for present product/services.
5. PLAN
Plan suitably for HR,Hiring,funding and technology.
6. INCREASE REVENUE
Increase revenues for product we are offering and get necessary funding
7.PITCH
Create and present the Business pitch. Also mange legal compliances and Regisdtrations.
 do?
1. Identifying right Opportunities
Problem identification and assessing the right opportunity is the first step of
successful venture.
2. Finding out the Problems/Products
Innovating product and services which finds the solution to the existing problems.
3. Recognizing Customer segment
Finding out the early adopters and targeting the right customer segment is the third
step.
4.Anticipate future problems.
The product or service should able to solve or flexible enough to undergo modifications
in solving future problems.
Business model
TYPES OF BUSINESS MODEL
 Meaning of business model
A business model is an outline of how a company plans to make money with its product and
customer base in a specific market.
Business Model is a Lean canvas , entrepreneur-focused and designed for emerging
businesses: it takes only minutes to create, focus on building your business faster, by capturing
the idea, collecting feedback, and iterating on it dynamically.

At its core, a business model explains four things:

What product or service a company will sell
How it intends to market that product or service
What kind of expenses it will face
How it expects to turn a profit
A Business Model is dot connecting between value of products and
services that is delivered to the customers.
It emphasizes on
1.Price of the product
2.Revenues
3.Cost of Production
4.Investment in Sales, Marketing and Product Development
5.Profit and Cash flow
 Components of Business model
Value proposition: A feature that makes your product attractive to your customers.
Target market: A specific group of consumers who would be interested in your product.
Competitive advantage: A unique feature of your product or service that can’t easily be copied by competitors.
Cost structure: A list of the fixed and variable expenses your business requires to function, and how they affect
pricing.
Key metrics: The ways your company measures success.
Resources: The physical, financial, and intellectual assets of your company.
Problem and solution: Your target customers’ pain points, and how your company intends to meet them.
Revenue model: A framework that identifies viable income sources to pursue.
Revenue streams: The multiple ways your company can generate income.
Profit margin: The amount your revenue exceeds your business costs.
Business model
HOW TO APPROACH LEAN CANVAS?
First identify the problem or opportunity identification ,then define the customer segment which will help in
identifying the new/innovative product or service.
This innovative Product result in offering right solution for targeted customer segment.

Customer
Problem
Segment

Solution
LEAN CANVAS TEMPLATE:
1.Brainstorm on the target customers' problem and list down each
problem
We have to put our self in customers' shoes and capture their 3 key
frustrations that we intend to serve.

Find out the existing alternatives to our offering (per each problem ) that
customers may utilize to meet their needs.
2.Analyze Target customer segments.
The customers are not necessarily the users of product (e.g. users of dog
food are dogs, however, these are dog owners who buy stuff for the pets).
We need to find the potential early adopters of the product.
3.Formulate your unique value proposition.
UVP is precise statement that reflects the promise of value of product delivers. It
explains how it solves your customer's problems (relevancy), outlines specific
benefits (quantified value), and tells what makes your product better than the
competitors' one (unique differentiation).
Get inspired by UVP's of admired brands and come up with a unique UVP that
helps you differentiate meaningfully, targeting your early adopters, and keeping
their key problem in mind.
Example: YouTube — "Flickr for video", Aliens (movie) — "Jaws in space".
4.Unfair advantage
An unfair advantage is something that cannot easily be copied or bought by the
competition and is compelling enough - for target customers to choose the product
over the existing alternatives.
It can come from a number of sources, be it in-depth knowledge of a specific
domain (e.g. multiyear expertise in a given industry), intense focus on one domain
(e.g. Google's focus on search engine), the community behind brand (think of
Facebook or Apple ecosystem users), etc.
5. Envision your Solution
Shift to the Solution section reflecting your product vision, its possible
details and features.
Ideally, do this in a team workshop, be open-minded and collect various
ideas with some figures/evidence.
Smallest solution we build so that customers is ready to pay for it.
6. Think of promotion channels
All the possible channels we can utilize to promote offering: free ones (like social
media, SEO, blogging, etc.) and the paid ones (Facebook ads, Google ads, LinkedIn
ads, directories listings, trade fairs, etc).
How do you want to reach your customers?
Automate activities, where possible and efficient. Also, think of retention first, rather than
of referral. Its crucial to have a product worth spreading first, and then attempt to go
viral.
7. Revenue streams and cost structure
We have to note down intended revenue streams.To make things simple, start with a single
and simple pricing plan first. It can be tested and got back to at later stages.

8.Write down your key metrics

Set up the clear metrics that can be easily measured regularly, in order to tell you how the
business is doing.
Metrics reflecting new users acquisition (e.g. No of app downloads, or user registrations), users
engagement (No of interactions with your brand in SM - likes/reposts, followers base growth,
referrals), user retention figures (e.g. No of active product/service users monthly), your
expenses (e.g. funds spent on travel, or ads costs), etc.
The Rapid shifts in the Business Model is what
differentiates Start-ups from Established
Company
-STEVE BLANKS
 Types of business model
Manufacturing model
Distributor Model
E-tailer/Online Model
Aggregator Model
Franchise model
Bricks and clicks Model
Subscription model
Freemium model
SAAS Model
Market Place
 1.MANUFACTURING MODEL
It sells a finished product to Distributors and then to the final
customers.

Ex: Samsung, Philips, Cross, Rotimatic.

2.DISTRIBUTORS MODEL
It buys finished products from manufactures and sells to the
retailer who sells directly to the customer.
Ex: Car Dealership
3.E-tailer/Online Model:
It sells the products online without Brick and Mortar store.
Ex: Flipkart,Amazon,LINIO

4.Aggregators:
Brings multiple service providers under one brand and offers
them to the customers. They earn money through
commissioning.
Ex: OYO Rooms,UBER
5.Franchise:
They can be distributor or retailer. They uses the product or Business model of
partnerships.It has to pay Royalty fees for Parent company of using the Brand.
Ex: The Bodyshop ,Mc Donald.
6.Bricks and Clicks:
Offline as well as Online shopping opportunities for customers
Ex: Clothing Business
7.Subscription:
Customers pay fixed amount as subscription fees at regular intervals. Business charge a
subscription fee (monthly, annually, etc.) for customers to access a service. This type of
business model can be adjusted and customized for each individual business.
Ex: Netflix,The Gift Box
There are some digital products used for photos, Software and
Videos.
FREEMIUM: Most common Business model found on internet.
Freemium, is "free" and "premium", is a pricing strategy by
which a basic product or service is provided free of charge, but
money (a premium) is charged for additional features, services,
or virtual (online) or physical (offline) goods that expand the
functionality of the free version of the software.
Ex: Zendesk,Trello
.
SAAS(Software as a service):It is a software licensing and delivery model in
which software is licensed on a subscription basis and is centrally hosted. It is
sometimes referred to as "on-demand software", and was formerly referred to
as "software plus services" by Microsoft. SaaS applications are also known as
on-demand software and Web-based/Web-hosted software.
SaaS is considered to be part of cloud computing.
Ex: Zendesk, Trello
MARKET PLACE:
It is a platform where vendors and customers buy and sell products.
Vendors no need to pay money for marketing and customers pay the
money for the trusted platform.
A pure ecommerce marketplace follows a zero inventory
model. eBay, Naaptol, and Shop cluesare examples of e-commerce
players that follow the marketplace model. The company acts as a
meeting ground for buyers and sellers without storing goods. But they
do offer shipping and payment assistance by tying up with selected
logistics players and financial partners.

Ex:e-bay, Shutter stock

Pivoting and
Refinement of business
model
1.A pivot means fundamentally changing the direction of a business when
you realize the current products or services aren't meeting the needs of
the market. The main goal of a pivot is to help a company improve
revenue or survive in the market, but the way you pivot your business can
make all the difference.

2.Pivots are the essence of Entrepreneurs and Key to start up success. If

you can’t pivot chances are quickly we will fail.
3.Create a new product or service or modify the existing one.
4.Pivoting answers the questions like Does the customer need the
product and is the customer right segment
Ex: REDBUS is Bus book software for Bus operators to Online ticketing
platform for customers.
Need for Pivoting
Don’t Builds a product that nobody wants Ex: Google glass
Was the solution is indeed solving the customer problem
Is it Problem-Solution fit and Product-Market fit.
Hitting the plateau with respect to the growth
Fall in number of returning customers
Changing needs of the Market.
Ex: Minglebox unable to compete with Giant Leader Face book so
introduces Online Education portal.
A pivot is not a magic pill that can solve all your business woes. Companies
should only consider pivoting when absolutely necessary. It should be the
last resort when all other options have been exhausted.
It may be the right time to pivot your business if:
• You can't see much progress even after putting in a tremendous amount
of money and resources.
• There is just too much competition.
• The company's progress has plateaued.
• Only one of your company’s features or services gets traction.
• Customers aren't responding to your products like you thought they
would.
• Your perspective about the industry has changed
 NPS (Net Promotion Score)
NPS is to test find your market –product fit.
How likely we recommend company X to a friend or Colleague.
These inputs are converted into Quantifiable score
If NPS>=0,GOOD
NPS<=0,NEGATIVE ,Need to be pivoted .
Pivoting is a strategy to help to show the right direction and achieve new
heights.
 Business Plan Business Model

1.It is a road map of how you develop a 1.It answers the question like how we can
product or service deliver value added products/services and
2.Formal plan of reaching or achieving the monetize its value.
Business goals. 2. It clearly lays out the problem and find
3.It helps to develop a product/service the solution.
3.How the business generates revenues and
profits.

Based on Business Model we can create

Business plan.
 Business Refinement
On How to Fine Tune The Business Model to Increase Revenue:
In order to think about how you can make your business model more innovative from
an income generation perspective, consider these questions:
1. Are there people or businesses that could use my goods or services but don’t
currently have access to them? Would it be beneficial for me to reach out to such
a group?
Example: One of the major business model innovations in the South African cell phone
industry was “pay-as-you-go”. By changing the nature of the offering, South African cell
phone companies were able to tap into much larger markets. MTN and Vodacom were
global pioneers in the pay-as-you-go cell phone business model and it is one of the
reasons that both companies have been so successful.
2. Are there people who are not buying what I offer because of the price point? If
I shifted the price point up or down and adjusted my offering could I tap into a
whole new market?
Example: Kulula.com radically expanded the market for airline travel in South
Africa by dropping the price point for domestic airline tickets. Virgin Active
innovatively expanded their offering by creating classic clubs with a premium
offering and a higher price point to establish exclusivity for those willing to pay
for it.
3. Is everything you are doing for customers providing them with value? Could
you simplify or lessen your offering without impacting your customers’
perception of value?
Example: Outsurance discovered that not everyone valued the services of a
broker when buying insurance. People were willing to do the work of a broker
themselves if they were given the right information. Outsurance created the
highly successful direct model for selling insurance.
4. Are there additional untapped revenue streams that you could exploit?
Example: Vida e Caffe don’t only sell great coffee, they also sell advertising
space, creating lucrative additional revenue streams. They produce and
sell advertising space in a quarterly magazine called Obrigado that is
available in their stores. They also sell advertising space on their take
away cup holders and little tags attached to their in-store mugs.
5. Are there ways that you could alter the timing of revenue collection to
benefit the business? Most smaller businesses benefit by getting cash in
earlier to speed
up cash flow.
 REFINEMENT OF BUSINESS MODEL:
Refining Business Model means solving same problem in differently.
We refine the Business Model because of the following reasons
1.To grow your revenues
2.To come up with fresh ideas and to stay in the competition
3.To become more profitable
4. To address changing g tastes of customers
5.To bring in new technologies and trends
6.To comply to changes in taxes and custom duty
7.To address the large customer database.
By refining Business model we should see that cost structure
decreases ,revenue stream increases and new distribution channels
gets added.
Ex: Clothing companies like fabIndia,Mark Spencer has refined their
business model b y adding new distribution channel online sales.Cost
increased in terms of generating new website,payment gateways
and advertising in digital marketing. Revenues are increased due to
additional distribution channel.
It is important to note that refining Business model means Pivoting
Create a new product or services model means Pivoting.
Pivoting helps in getting customers and generating revenues.
Pivoting is essential when entrepreneur experiment fails.
Ex: 1.SLACK ,online game in 2008 was failed initially and it refined its
Business model to a Professional Chat services.
2.LEGO, a toy manufacturing company refined its Business model from toy
manufacturers, building block toy to a new Business model where in
customer select various toy pieces from 1000 different blocks and
assemble to form a new Building or facility then send the orders for his
assembled structure.
Manufacturing Business Model Refinement BM E tailer, Online
Booking
Because of this refinement ,Cost structure and revenue stream
changes.
3.LENSKART: They have reinvented their Business model from E
tailer , Online shopping to Brick –mortar Eye store because
customers felt that for eye glasses they need to personally select the
lenses,eye glasses ,computerized eye power checking and if
necessary opthamaologist advise and suggestion.
They have added a new distribution channel of going through off line
from online the cost has increased but revenues also increased
because they catered to customer needs and opened branches at all
important locations of the different cities.
 ANALYZING THE BUSINESS MODEL OF THE COMPETITORS

Entrepreneurs have constantly study the environment in which they operate.

Understand Competitors Business Model thoroughly
For Example: For prescription eye glasses and lens go out look for Brick and Mortar stores Business
model, Onsite optometrists, types of customer segment they cater to,Are the prices too high or low,
estimate costs ,hiring is expensive, setting up and investment costs are high, how they advertise, What
are their marketing opportunities , Distribution channels, How many branches online Optician store
have?.....
Sketch the Lean Canvas template of the Competitor based on the strengths like availability of Optometrist
all the day, Fast turnaround time of making prescription Online glasses etc,
Work out on weaknesses like High Price, High Investment cost
Learn from the strengths and Benefit from weaknesses i.e Identify the strengths an weakenesses
Check out for Online e tailer for prescription eye glasses
Checkout any manufacturer has their own retail outlets

Research Competitor Business

Model

Fill all the 9 blocks of Lean

canvas template

Build Your Own B.M

Analyze the strenths and Weknesses
of Competitor BM
By analyzing the competitor Business Model ,Borrow all the
strengths from the competitor model, overcome the weakness of
competitor model then frame Lean canvas template of our Business
model with above modifications
Thus new model has reduced the set up cost ,lowered the price but
implemented fast turnaround of time of competitor proves to be
Best Business model.
ADDING NEW CUSTOMER SEGMENT
We add new customer segment to
1.To increase revenues and expand business
For Adding new customer segment mwe need identify
Who are my existing customers
 Can I add some more customer segments
Am I selling for B2B or B2C
Can I add more segment in B2B or B2C or both
For Example:1. OLA an online on demand Car services provide car
services to both B2C and B2B
In 2010 OLA was catering to only B2C booked cabs via app.
In 2016 OLA started corporate services B2B where employees avail
cabs through prepaid account avoiding unneccary reimbursement.
OLA Started CORPORATE, LUX, SHARE type of Care services.
OLA Corporate for Corporate em[ployees,OLA LUX for customer
availing Luxurious car of Audi,Benz etc, OLA share where customers
share drive with other passengers at economical price.
2.Youtube in 2017 started You tube kids that cater only to kids
segment with parents control of what they have to do with various
features present in it.
3.If Mens shaving accessories Manufacturing company
wants to cater to the Women They have to create a
separate Business model as below. First the Solution, the
product should have different blades, nice handle etc.
New distribution channel ,it may focus on beauty stores and
E-commerce and Relook at the cost structure.
Product Management bridges the gap between Business and the Customer.
What is effective Product Management
 Prersenting changing needs and ttrends of the customer
Bridging gap between Product design and Cuastomer usage
Collaborating Engineers,Designers and the Customers
Helping the customers come up with Blockbuster products
Product management was very effective in OLA
1.OLA Cab aggregator
2.OLA Share
3.OLA Auto
OLA Ouytstation
OLA Prime,OLA Prime Plan,OLA Credit
Product Manager
What is a Product Manager?
The Product Manager is responsible for delivering a differentiated
product to market that addresses a market need and represents a
viable business opportunity. A key component of the Product
Manager role is ensuring that the product supports the company’s
overall strategy and goals.
Product manager scope of his Job
In most cases, the description of Product Manager covers an incredibly wide range of skills.
However, most Product Manager roles have several key components:
Domain expertise: Very often, your knowledge of your market and product area is why
your company hired you. The fact that you know the customers and the business is the
main reason you’re now a Product Manager.
Business expertise: People say that the Product Manager is the CEO of the product. Though
that is not typically 100% true, making sure the company is generating a profit is usually
involved. You need to have a suite of business skills to keep your product profitable.
Leadership skills: Many people within your company are looking to you for guidance. If you
don’t have leadership skills under your belt, you need to develop them quickly.
Operational ability: Product Managers need to dive deep into the many nitty-gritty details
needed to manage a product: for example, creating part numbers or updating a
spreadsheet. Sometimes you can get someone else to do these tasks, but many times you
are responsible for them.
What Does a Product Manager Do?
The Product Manager:
Defines the product vision, strategy, and roadmap.
Gathers, manages, and prioritizes market/customer requirements.
Acts as the customer advocate articulating the user’s and/or buyer’s
needs.
Works closely with engineering, sales, marketing, and support to
ensure business case and customer satisfaction goals are met.
Product Manger
Designs,Create,Market,sell and improve the existing product.He /She who involved in idea generation,design
the product , manufacturing and testing.

Interior Team PRODUCT MANAGER User Interface

1.Engineering 1.User Experience

2.Design 2.Data Analysis
3. Packaging 3. Customer Behaviour
4.Track Customer
Feedback
What happened if Product Manager
fails to foresee
Undoubtedly face the losses and lost customer trust and loyalty.The following are
the examples
1.P&G product Gillette Vector Razor product was outcome of spent 3000 hrs and MIT
graduates hard work of getting clogged after single use and declogged under running
water. This product meant for Indian mens. But Indian men use cup of water instead
of running water for cleaning their razors ,so the product was very big failure.
2.Snapchat a multi media Messaging App used by yopunng people around the world
was quite good till Nov,2017.
When it wanted to achieve the goal of simple personalized user experience for
navigation for new users, 1.2 million users signed up petition of roll back of UI
changes and there was sharp decline in stock prices.
So Product Manger play an important role
1.Not only coming up with products of customer wants but
also what delights them
2.Constantly they need to Observation( what customer does
with the product),Empathy and working on the Customer
feedback.
3.Make the Product more aligned to the Customer
Thank You