(See related pages)
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| Acquisition | Purchasing all or part of a company. |
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| Acquisition financing | Financing to buy or own another company. |
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| Administrative domain | The ways managers make decisions. |
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| Aftermarket support | Actions of underwriters to help support the price of stock following the public offering. |
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| Assessment of a new entry's attractiveness | Determining whether the entrepreneur believes she or he can make the proposed new entry work. |
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| Assessment of risk | Identifies potential hazards and alternative strategies to meet business plan goals and objectives. |
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| Asset base for loans | Tangible collateral valued at more than the amount of money borrowed. |
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| Assets | Represents items that are owned or available to be used in the venture operations. |
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| Attribute listing | Developing a new idea by looking at the positives and negatives. |
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| Backward integration | A step back (up) in the value-added chain toward the raw materials. |
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| Balance of payments | The trade status between countries. |
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| Bargaining zone | The range of outcomes between the entrepreneur's reservation price and the reservation price of the other party. |
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| Barter | A method of payment using nonmoney items. |
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| Big-dream approach | Developing a new idea by thinking about constraints. |
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| Blue-sky laws | Laws of each state regulating public sale of stock. |
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| Book value | The indicated worth of the assets of a company. |
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| Brainstorming | A group method for obtaining new ideas and solutions. |
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| Breakeven | Volume of sales where the venture neither makes a profit nor incurs a loss. |
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| Breakthrough innovations | New products with some technological change. |
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| Brokers | People who sell companies. |
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| Business angels | A name for individuals in the informal risk-capital market. |
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| Business ethics | The study of behavior and morals in a business situation. |
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| Business plan | 1. The description of the future direction of the business. 2. Written document describing all relevant internal and external elements and strategies for starting a new venture. |
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| C Corporation | Most common form of corporation, regulated by statute and treated as a separate legal entity for liability and tax purposes. |
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| Chapter 7 bankruptcy | Requires the venture to liquidate, either voluntarily or involuntarily. |
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| Chapter 11 bankruptcy | Provides the opportunity to reorganize and make the venture more solvent. |
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| Chapter 13 bankruptcy | Voluntarily allows individuals with regular income the opportunity to make extended payments over time. |
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| Checklist method | Developing a new idea through a list of related issues. |
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| Collective notebook method | Developing a new idea by group members regularly recording ideas. |
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| Comment letter | A letter from the SEC to a company indicating the corrections that need to be made in the submitted prospectus. |
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| Concept stage | Second stage in product development process. |
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| Contract | A legally binding agreement between two parties. |
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| Conventional bank loan | Standard way banks lend money to companies. |
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| Copyright | Right given to prevent others from printing, copying, or publishing any original works of authorship. |
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| Corporate culture | The environment of a particular organization. |
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| Creative problem solving | A method for obtaining new ideas focusing on the parameters. |
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| Customers' switching costs | The costs that must be borne by customers if they are to stop purchasing form the current supplier and begin purchasing from another. |
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| Deal structure | The form of the transaction when money is obtained by a company. |
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| Debt financing | Obtaining borrowed funds for the company. |
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| Demand uncertainty | Considerable difficulty in accurately estimating the potential size of the market, how fast it will grow, and the key dimensions along which it will grow. |
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| Departure points | The activities occurring when the venture is started. |
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| Description of the venture | Provides complete overview of product(s), services, and operations of new venture. |
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| Desirability of new venture formation | Aspects of a situation that make it desirable to start a new company. |
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| Development financing | Financing to rapidly expand the business. |
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| Direct exporting | Selling goods to another country by taking care of the transaction. |
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| Disclosure document | Statement to the U.S. Patent and Trademark Office by inventor disclosing intent to patent idea. |
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| Distribution task | Negotiating how the benefits of the relationship will be allocated between the parties. |
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| Diversification strategy | A strategy to grow by selling a new product to a new market. |
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| Diversified activity merger | Combination of at least two totally unrelated firms. |
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| Due diligence | The process of deal evaluation. |
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| Early-stage financing | One of the first financings obtained by a company. |
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| Earnings approach | Determining the worth of a company by looking at its present and future earnings. |
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| Emerging industries | Industries that have been newly formed and are growing. |
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| Employee stock option plans (ESOP) | A two- to three-year plan to sell the business to employees. |
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| Entrepreneur | Individual who takes risks and starts something new. |
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| Entrepreneur as an innovator | An individual developing something unique. |
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| Entrepreneurial decision process | Deciding to become an entrepreneur by leaving present activity. |
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| Entrepreneurial domain | The ways entrepreneurs make decisions. |
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| Entrepreneurial process | The process through which a new venture is created by an entrepreneur. |
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| Entrepreneurial resource | An important entrepreneurial resource is the ability to obtain, and then recombine, resources into a bundle that is valuable, rare, and inimitable. |
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| Entrepreneurial strategy | The set of decisions, actions, and reactions that first generate, and then exploit over time, a new entry. |
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| Entrepreneurship | Process of creating something new and assuming the risks and rewards. |
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| Environmental analysis | Assessment of external uncontrollable variables that may impact the business plan. |
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| Equity financing | Obtaining funds for the company in exchange for ownership. |
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| Equity participation | Taking an ownership position. |
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| Equity pool | Money raised by venture capitalists to invest. |
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| Error of commission | Negative outcome from acting. |
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| Error of omission | Negative outcome from not acting. |
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| Exporting | Selling goods made in one country to another country. |
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| Factor approach | Using the major aspects of a company to determine its worth. |
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| FIFO | Inventory costing method whereby first items into inventory are first items out. |
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| Financial plan | Projections of key financial data that determine economic feasibility and necessary financial investment commitment. |
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| Financial ratios | Control mechanisms to test financial strength of new venture. |
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| Focus groups | Groups of individuals providing information in a structured format. |
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| Forced relationships | Developing a new idea by looking at product combinations. |
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| Form S-1 | Form for registration for most initial public offerings of stock. |
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| Forward integration | A step forward (down) on the value-added chain toward the customers. |
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| Foundation company | A type of company formed from research and development that usually does not go public. |
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| Free association | Developing a new idea through a chain of word associations. |
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| Full and fair disclosure | The nature of all material submitted to the SEC for approval. |
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| Gazelles | Very high growth ventures. |
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| General partner | The overall coordinating party in a partnership agreement. |
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| General valuation approaches | Methods for determining the worth of a company. |
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| Going public | Selling some part of the company by registering with the SEC. |
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| Gordon method | Method for developing new ideas when the individuals are unaware of the problem. |
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| Government as an innovator | A government active in commercializing technology. |
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| Harvesting | Selling the business outright to either an employee or an outsider. |
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| High-potential venture | A venture that has high growth potential and therefore receives great investor interest. |
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| Horizontal integration | Occurs at the same level of the value-added chain but simply involves a different, but complementary, value-added chain. |
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| Horizontal merger | Combination of at least two firms doing similar businesses at the same market level. |
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| Idea stage | First stage in product development process. |
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| Imitation strategies | Copying the practices of other firms. |
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| Indirect exporting | Selling goods to another country through a person in the entrepreneur's home country. |
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| Industry analysis | Reviews industry trends and competitive strategies. |
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| Informal risk-capital market | Area of risk-capital markets consisting mainly of individuals. |
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| Initial public offering (IPO) | The first public registration and sale of a company's stock. |
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| Integration task | Exploring possible mutual benefits from the relationship so that the "size of the pie" can be increased. |
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| Intellectual property | Any patents, trademarks, copyrights, or trade secrets held by the entrepreneur. |
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| International entrepreneurship | An entrepreneur doing business across his or her national boundary. |
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| Intrapreneurial culture | The environment of an entrepreneurial-oriented organization. |
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| Intrapreneurship | Entrepreneurship within an existing organization. |
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| Inventor | An individual who creates something new. |
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| Involuntary bankruptcy | Petition of bankruptcy filed by creditors without consent of entrepreneur. |
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| Iterative synthesis | The intersection of knowledge and social need that starts the product development process. |
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| Joint venture | Two or more companies forming a new company. |
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| Key success factors | The requirements that any firm must meet in order to successfully compete in a particular industry. |
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| Lead time | The grace period in which the first mover operates in the industry under conditions of limited competition. |
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| Leveraged buyout (LBO) | Purchasing an existing venture by any employee group. |
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| Liabilities | Represents money that is owed to creditors. |
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| Liabilities of newness | Negative implications arising from an organization's newness. |
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| Licensing | 1. Allowing someone else to use something of the company's. 2. Contractual agreement giving rights to others to use intellectual property in return for a royalty or fee. |
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| Lifestyle firm | A small venture that supports the owners and usually does not grow. |
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| LIFO | Inventory costing method whereby last items into inventory are first items out. |
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| Limited partner | A party in a partnership agreement that usually supplies money and has a few responsibilities. |
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| Liquidation covenant | The right of an investor to sell the interest in the company. |
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| Liquidation value | Worth of a company if everything was sold today. |
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| Locus of control | An attribute indicating the sense of control that a person has over life. |
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| Majority interest | Having more than 50 percent ownership position. |
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| Management contract | A method for doing a specific international task. |
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| Managing underwriter | Lead financial firm in selling stock to the public. |
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| Market development strategy | Strategy to grow by selling the firm's existing products to new groups of customers. |
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| Market extension merger | Combination of at least two firms with similar products in different geographic markets. |
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| Market knowledge | possession of information, technology, know-how, and skills that provide insight into a market and its customers. |
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| Marketing goals and objectives | Statements level of performance desired by new venture. |
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| Marketing mix | Combination of product, price, promotion, and distribution and other marketing activities needed to meet marketing objectives. |
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| Marketing plan | 1. Describes market conditions and strategy related to how products and services will be distributed, priced, and promoted. 2. Written statement objectives, strategies, and activities to be followed in business plan. |
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| Marketing segmentation | Process of dividing a market into definable and measurable groups for purposes of targeting marketing strategy. |
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| Marketing strategy and action plan | Specific activities outlined to meet the venture's business plan goals and objectives. |
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| Marketing system | Interacting internal and external factors that affect venture's ability to provide goods and services to meet customer needs. |
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| "Me-too" strategy | Copying products that already exist and attempting to build an advantage through minor variations. |
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| Merger | Joining two or more companies. |
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| Minority interest | Having less than 50 percent ownership position. |
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| Moral-support network | Individuals who give psychological support to an entrepreneur. |
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| Motivations | What causes people to do something. |
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| Need for independence | Being one's own boss - one of the strongest needs of an entrepreneur. |
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| Need for achievement | An individual's need to be recognized. |
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| New entry | Offering a new product to an established or new market, an established product to a new market, or creating a new organization. |
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| Nonequity arrangements | Doing international business through an arrangement that does not involve any investment. |
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| Ordinary innovations | New products with little technological change. |
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| Organizational plan | Describes form of ownership and lines of authority and responsibility of members of new venture. |
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| Opportunity identification | The process by which an entrepreneur comes up with the opportunity for a new venture. |
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| Opportunity parameters | Barriers to new product creation and development. |
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| Owner equity | Represents the amount owners have invested and/or retained from the venture operations. |
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| Parameter analysis | Developing a new idea by focusing on parameter identification and creative synthesis. |
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| Participative style of management | The manager involves others in the decision making process. |
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| Partnership | Two or more individuals having unlimited liability who have pooled resources to own a business. |
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| Patent | Grants holder protection from others making, using, or selling similar idea. |
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| Penetration strategy | A strategy to grow by encouraging existing customers to buy more of the firm's current products. |
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| Possibility of new venture formation | Factors making it possible to create a new venture. |
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| Preliminary screening | Initial evaluation of a deal. |
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| Prepackaged bankruptcy | Provides opportunity to settle debts prior to bankruptcy court legal proceedings. |
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| Present value of future cash flow | Valuing a company based on its future sales and profits. |
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| Pricing amendment | Additional information on price and distribution submitted to the SEC to develop the final prospectus. |
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| Principle of analysis | Understanding how time is currently being allocated, and where it is being inefficiently invested. |
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| Principle of desire | A recognition of the need to change personal attitudes and habits regarding the allocation of time. |
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| Principle of effectiveness | A focus on the most important issues. |
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| Principle of prioritized planning | Categorization of tasks by their degree of importance and then the allocation of time to tasks based on this categorization. |
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| Principle of reanalysis | Periodic review of one's time management process. |
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| Principle of teamwork | Acknowledgement that only a small amount of time is actually under one's control and is taken up by others. |
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| Private offering | A formalized method for obtaining funds from private investors. |
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| Private venture-capital firms | A type of venture-capital firm having general and limited partners. |
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| Pro forma balance sheet | Summarizes the projected assets, liabilities, and net worth of the new venture. |
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| Pro forma cash flow | Projected cash available calculated from projected cash accumulation minus projected cash disbursements. |
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| Pro forma income | Projected net profit calculated from projected revenues minus projected costs and expenses. |
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| Pro forma sources and applications of funds | Summarizes all the projected sources of funds available to the venture and how these funds will be disbursed. |
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| Problem inventory analysis | A method for obtaining new ideas and solutions by focusing on problems. |
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| Product development stage | Third stage in product development process. |
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| Product development strategy | A strategy to grow by developing and selling new products to people who are already purchasing the firm's existing products. |
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| Product-evaluation process | Process for developing and commercializing an innovation. |
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| Product extension merger | Combination of two firms with noncompeting products. |
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| Product life cycle | The stages each product goes through from introduction to decline. |
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| Product planning and development process | The stages in developing a new product. |
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| Product safety and liability | Responsibility of a company to meet any legal specifications regarding a new product covered by the Consumer Product Safety Act. |
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| Production plan | Details how product(s) will be manufactured. |
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| Professional-support network | Individuals who help the entrepreneur in business activities. |
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| Proprietorship | Form of business with single owner who has unlimited liability, controls all decisions, and receives all profits. |
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| Prospectus | Document for distribution to prospective buyers of a public offering. |
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| Public equity market | One of the risk-capital markets consisting of publicly owned stocks of companies. |
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| Quiet period | 90-day period in going public when no new company information can be released. |
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| Red herring | Preliminary prospectus of a potential public offering. |
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| Referral sources | Ways individual investors find out about potential deals. |
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| Registration statement | Materials submitted to the SEC for approval to sell stock to the public. |
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| Regulation D | Laws governing a private offering. |
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| Replacement value | The cost of replacing all assets of a company. |
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| Research and development limited partnerships | Money given to a firm for developing a technology that involves a tax shelter. |
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| Reservation price | The price (the bundle of resources from the agreement) at which the entrepreneur is indifferent about whether to accept the agreement or choose the alternative. |
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| Resources | The inputs into the production process. |
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| Restrictive covenant | Statement indicating the things that cannot be done without approval. |
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| Reverse brainstorming | A group method for obtaining new ideas focusing on the negative. |
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| Risk | The probability of, and magnitude of, downside loss. |
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| Risk-capital markets | Markets providing debt and equity to nonsecure financing situations. |
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| Risk taking | Taking calculated chances in creating and running a venture. |
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| Role models | Individuals influencing an entrepreneur's career choice and style. |
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| S Corporation | Special type of corporation where profits are distributed to stockholders and taxed as personal income. |
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| SBIC firms | Small companies with some government money that invest in other companies. |
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| SBIR grants program | Grants from the U.S. government to small technology-based businesses. |
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| Scope | A choice about which customer groups to serve and how to serve them. |
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| Situation analysis | Describes past and present business achievements of new venture. |
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| Social status | The level at which an individual is viewed by society. |
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| State-sponsored venture-capital fund | A fund containing state government money that invests in companies mostly in the state. |
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| Synergy | Two parties having things in common. |
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| Target market | Specific group of potential customers toward which venture aims its marketing plan. |
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| Technological innovations | New products with significant technological advancement. |
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| Technological knowledge | Possession of information, technology, know-how, and skills that provide insight into new ways to create new knowledge. |
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| Technological uncertainty | Considerable difficulty in accurately assessing whether the technology will perform and whether alternate technologies will emerge and leap-frog over current technologies. |
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| Technology transfer | Commercializing the technology in the laboratories into new products. |
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| Test marketing stage | Final stage before commercialization in product development process. |
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| Third-party arrangements | Paying for goods indirectly through another source. |
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| Time management | The process of improving an individual's productivity through more efficient use of time. |
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| Top management commitment | Managers in an organization strongly supporting intrapreneurship. |
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| Trade barriers | Hindrances to doing international business. |
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| Trade secret | Protection against others revealing or disclosing information that could be damaging to business. |
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| Trademark | A distinguishing word, name, or symbol used to identify a product. |
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| Traditional managers | Managers in a non-intrapreneurial-oriented organization. |
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| Turn-key projects | Developing and operationalizing something in a foreign country. |
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| Uncertainty for customers | Customers may have considerable difficulty in accurately assessing whether the new product or service provides value for them. |
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| Underwriting syndicate | Group of firms involved in selling stock to the public. |
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| Venture-capital market | One of the risk-capital markets consisting of formal firms. |
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| Venture-capital process | The decision procedure of a venture-capital firm. |
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| Vertical merger | Combination of at least two firms at different market levels. |
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| Voluntary bankruptcy | Entrepreneur's decision to file for bankruptcy. |
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| Window of opportunity | 1. The time period available for creating the new venture. 2. The period of time when the environment is favorable for entrepreneurs to exploit a particular new entry. |
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| Work history | The past work experiences of an individual. |