Starting Your Own Business

Become an Entrepreneur
 Course Objective
• To learn how to identify, organize and build a new
enterprise.
• Always remember, We don’t just study entrepreneurs,
we become entrepreneurs.
Thinking about Starting a
Business
Where do you
start?
With an Idea!!

How your Idea

Should be?
 Short Case Study
• You are an MBA with 2 years of Industry experience
• You just thought of starting your own venture
• Now Build a Business Plan
• How Would you do this??
• Discuss among a group of 5 each
• Each group should come up with an idea and the other groups will
ask questions and list advantages and disadvantages of the same
• Activity time: 20 min
 Think about Why do You Want to
Enter Into a Particular Business
• Check for Feasibly of that Business
• Estimate the Market Size (Total Addressable Market)
• Establish a Target Market (Based on demographics, geographical location,
taste and Preferences of Customers)
• Conduct a Competition Analysis
• Develop a Unique Selling Proposition
• Look for Human Resources and Establish a Sales Strategy/Model
• Calculate the Investment and Return on Investment
• Establish Sources of Finance ( How much capital and from where?)
Establishing a Business Plan
• Executive Summary of Your Business
This is an overview of your business and your plans. It comes first in
your plan and is ideally only one to two pages
• Opportunity
This section answers these questions: What are you actually selling and
how are you solving a problem (or “need”) for your market? Who is your
target market and competition? 
• Execution
This section will cover your marketing and sales plan, operations,
Advertising & Promoting your business and how you’re going to
measure success. 
Establishing a Business Plan
• Human Resources
Investors look for great teams in addition to great ideas. Use this
chapter to describe your current team and who you need to hire.
• Location
Location of you Business also plays a vital role in investor funding
• Financial plan
Your business plan isn’t complete without a financial forecast. Do
conduct a financial analysis before pitching in for Funds
• Appendix
 Identify why this is an
Exceptional Opportunity
• There are many opportunities within the idea; job is to pick one & focus
- explain why & establish a growth strategy.
• Should you go into Frozen Food Packaging & Export?? Open up a
Restaurant?? Open a Delivery/Takeaway outlet?? or Enter into
Catering??
• Must concentrate to increase chances of success with limited resources
• Its time for Numbers/Calculations (Which is a more feasible plan,
Calculate)
• Reject one and Accept other or Reject All
 Identify the Drivers and
Inhibitors
• You would deal with a list of problems that you would have to
address. How serious is each problem? Identify and be ready with
the solutions beforehand
• Identify the key factors that is driving the market and look how to
grab an opportunity from those
• You would detail what are the risks in your plan – Financial,
Market, Technological etc. - and how you would reduce risks.
• How do you know as quickly as possible if this is a good business?
 Analyse the Demand
• What is the sale of Frozen Food in India? How good
is Gurgaon to open up a Fine-Dine Restaurant?
• What are the Problems if I just open a QSR?
• Where do customers actually go for Food ?
• What are the advantages of each of the above
business models?
 Summarize the Market
• Population of Gurgaon = 20 lac
• No of House Holds (assuming 4 people in one house)
= 5 Lac
• Calculate TAM on the basis of demographics, Income
Group and other related factors
• Market Penetration (%)
• Build model by making a few Assumptions
 FINANCING
Equity Debt Financing
Financing (Borrowing Funds from
(Sharing Owner Creditors)
• Banks & Other
• ship
Home) Equity Commercial
Loan Lenders
• Friends & • Friends &
Relatives Relatives
• Venture Capital • Bonds
• Angel Investors • Government
• Government Programmes
Grants • Leasing
• IPO • NBFC’s
• Equity
Offerings
 Venture Capital
• Financing that comes from companies or individuals in the
business.
• They provide capital to young businesses in exchange for an
ownership share of the business.
• They prefer to invest in companies that have received
significant equity investments from the founders and are
already profitable.
• They also prefer businesses that have a competitive advantage
or a strong value proposition in the form of a patent, a proven
demand for the product, or a very special (and protectable)
idea.
• They intervene in the management and also provide valuable
 Venture Capital

• Focus on creating an investment portfolio of

businesses with high growth potential resulting in
high rates of returns
• They may look for annual returns of 25 to 30 percent
on their overall investment portfolio.
 First Requirement...

Ability to believe in (and get others

excited about) something that does not
yet exist.

Your starting point may be an Idea, a

Technology, a Team, or a Market..
The House is Open for Your Questions