ENTREPRENEURIAL VENTURING IGNACIO LARRÚ COURSE OVERVIEW How do entrepreneurs evolve from an initial new business idea to the design of a viable business model for it? How can we, as future entrepreneurs, withstand the difficulties derived from growing new ventures? Entrepreneurial Management II will allow you to reflect on these and many other topics regarding the entrepreneurial process by providing a forum for the in-depth examination of the mindsets, methods and managerial activities that make it up. During the course we will discuss various issues from business opportunity framing to scaling and growing new ventures. While the most tangible outcome of this course will be the framing, testing and validation of a business model in so doing you will be exposed to a synthesis of theories, concepts and tools drawn from the fields of economics, strategy, psychology and sociology. Moreover, you will be participating together with your class colleagues in a team based new venture creation process that draws from the core tenants of the Lean Startup methodology while leveraging the years of experiences in startup development residing at IE Business School Honoring the pragmatic nature of entrepreneurship learning, this is primarily a hands-on and highly applied learning course. During the 15 sessions that compose the course we will discuss real business cases while experimenting with tools used in today s business world. As such you will develop skills relevant whether you aspire to be an independent entrepreneur or a corporate manager. In order to develop the required business model development and pitching skills to excel as future entrepreneurs we will have class discussions of selected business cases, business model workshops, coaching sessions and team work sessions. By the end of the course you would have firsthand experience in framing, testing and validating a business model and presenting it in an open forum. OBJECTIVES Upon the completion of this course, participants should: now how to frame, test and validate new venture opportunities, understanding the entrepreneur s perspective as well as other stakeholders who are part of the venturing ecosystem (business angel, venture investors, financing banks, incubator and accelerator programs, etc...); recognize the reoccurring challenges faced when starting a new venture, and be comfortable experimenting with the core skills and tools of the new venture creation process identify the core challenges and hypotheses in a business model understand the nature and purpose of a business model in the context of new venture creation and be able to generate, validate and present a compelling new venture opportunity by building the core elements of a business model 2
The class exercises, workshops and core deliverables will require you to frame, test and validate through iteration (and perhaps pivoting) a coherent and viable and sustainable business model designed to deliver a solution to a real problem with aspirations to scale the business PROGRAM SESSION 1 Course Introduction Where does the course fit into the Entrepreneurial Management curriculum? In this first session of Entrepreneurial Management II we will comment on course organization and introduce the key themes and a course roadmap for the second stage of the EM curriculum. You should arrive to the first class familiar with the course syllabus and assigned readings and be prepared to participate in discussions related to those materials and other course administration issues SESSION 2 Introduction to the Customer Development framework In this session we will discuss the core concepts, frameworks and tools that you will be using throughout the course in your group assignments. As part of the session we review the Customer Development framework, a part of the renowned lean-startup process as well as other useful tools like Jobs to be Done, Business Model Canvas, Lean Canvas, Value Proposition Canvas and One Sentence Pitch. All of the concepts and tools reviewed in this session will be used for the rest of the course so it would be beneficial if you could read the materials in advance of the session. SESSIONS 3 & 4 Framing your opportunity In this session we will organize ourselves in groups for the group work of the course. In these sessions you will expose your individual entrepreneurial ideas to the rest of the class to identify others with similar interests in order to form a team for the group work of the course. Once you have formed your team you will fulfill several assignments in class to familiarize you customer discovery process and will help you reflect on your key value proposition and the customer pain you will be addressing SESSIONS 5 & 6 Advancing in the Customer Development process In this double session you will work together with your work group to advance in the framing of the opportunity you are developing. During the session you and your group will face different challenges that will help you advance in the customer development process in order to refine your key value proposition and solution-customer fit hypotheses. This work will be the foundation of your business model for your selected idea 3
SESSION 7 Value creation and distribution in new ventures In this session we will the Vacation Spot vs. Rent-A-Holiday case to explore and discuss the drivers of both value creation and how that value gets distributed among the different players participating in a new venture (entrepreneurs, investors, employees, etc ). We will analyze these issues from the perspective of two different entrepreneurial teams who tackled the same opportunity from two different sides of the Atlantic to try and understand the different outcomes. SESSION 8 Analyzing a business model In this session the discussion of the ZipCar case will allow us to explore the nine dimensions of a business model. We will be using the Business Model Canvas as a tool for synthesizing a business model in order to aid us in analyzing, testing and pivoting our business model. By using the case as a context for examining business models it will help advance your team s work as well as frame the business model as a managerial tool useful for addressing a wider range of challenges beyond the customer development phase. SESSIONS 9 & 10 Refining your business model In this session you will react to various tasks and challenges related to your idea s business model together with your work group colleagues. During the session you will need to adapt your proposed business model to new information that will be delivered to you during the session. Your commandment of the concepts and tools discussed so far will help you to react with flexibility to the different information you will receive. After the session you will exchange your business model with other groups in order to write an individual report on their business model. SESSION 11 Managing Growth In this session we will review the Golden Star Facilities and Services case to discuss the challenges and opportunities of growing a business after the initial stages. We will use the case to discuss common growth strategies and how can we organize our new ventures to seize the growth opportunities SESSION 12 Entrepreneurial Finance Convertible notes, participative loans, preferred stocks, the entrepreneurial landscape in filled with definitions that need to be discussed as capital marshalling is a valuable skill for entrepreneurs. In this session we will review the fund raising process for startups willing to fund their operations through venture capital. We will review the tools and deliverables needed (elevator pitch and investor deck) together with tactic and strategic guidelines to raise capital efficiently. 4
SESSION 13 Corporate Entrepreneurship In this session we will use the Luminar case study to examine the challenges and process of developing an internal startup as a means of achieving strategic transformation for large incumbent companies. Using the case as a discussion vehicle we will analyze how to obtain internal and external support for disruptive initiatives. SESSIONS 14 & 15 Final Pitch Event In the final pitch event you and your group will present your project to the rest of the class followed by a Q&A session led by the professor. This will your opportunity to receive the feedback on your idea from your classmates. In order to prepare an insightful presentation you will have to work before in a project report that will be one of the main deliverables of this course. This final written project report will include all your analysis and work on your idea based on the tools and techniques we will review during the course. Additional details about the format and submission protocols will be provided in due time. COURSE EVALUATION This course follows IE s guidelines, and is based on individual and team efforts. The nature of this course does not lend itself to objective questions seeking right and wrong answers per se. However, there are different levels of quality in fulfilling the course requirements. Just as an investor ranks the attractiveness of different proposals, collectively we will rank your work against those of your peers and assign an appropriate grade. No late assignments will be accepted! Grades are never negotiable! The components of the course are weighted as follows. Criteria Score % Contribution to learning (class + individual assignments) 25% Individual Feedback to Peer Report 25% Group Final Presentation 15% GroupFinalProjectReport 35% In-class discussions, workshops and coaching sessions all provide you with opportunities to articulate your grasp of the critical issues at hand and to learn by doing. I will be looking for quality contribution rather than mere participation. Attending including being in your seat on time at the beginning of class will earn you one (1) contribution point for each session, so being late or absent will assure that you will forfeit that point. As the following categories demonstrate, up to an additional three (3) contribution points MAY BE earned yet will vary depending on the quality of your contributions. Remember, speaking in class is not, in and of itself, necessarily participation worthy of contribution points. Please note that points can be deducted for behaviors deemed to be disruptive to the class. Point value description: 3 Outstanding: The comment adds substantial value to the discussion; Demonstrates willingness to take risks in attempting to answer difficult or unpopular questions; Breaks new grounds and raises the flow of discussion to a higher level, often by synthesizing material and applying multiple lenses or techniques. 5
2 Good: There is evidence of analysis rather than just the expression of opinion and/or case facts; Comments are linked to those of others, facilitating the flow of the discussion; Incorporates relevant insights from other courses or current affairs. 1 Normal: The comment advances the flow of the discussion (including responses to questions from the instructor); Demonstrates clear grasp of case material; Information presented is relevant to the discussion. -1 Substandard : Attend but are disruptive to the flow of class or frequently distracted by devices (tablets and PCs) or habitually arrive late. Details of the evaluation criteria for the other components of the evaluation framework will be provided in the guidelines documents share on the campus online at the appropriate intervals in the course. PREPARATION FOR CLASS Entrepreneurial Management II is mainly a hands-on experimental course where students learn from each others experiences and class discussion (in the class and in working groups outside of class, in forums and workshops). In order to maximize learning you need to prepare for each session or workshop as much of the learning in this course will depend on you. If you come prepared to class you will be able to participate actively in the class discussions or react quicker to the challenges I will propose you during the sessions. In order to be prepared please follow these rules: For workshops: It is paramount that you and your project team are well prepared for all the workshop activities of the course. Advanced instructions will be provided to guild this preparation, as these structured events will serve as the backbone for peer feedback, project development and iterations, as well as the cornerstones for your learning and personal development from the course For case discussion sessions: it is recommended that students carefully read the case, and take personal case notes designed to capture the key themes and issues of the case. Pre-class discussion of the case with classmates and your assigned work groups is encouraged. For other readings: it is recommended that students identify and note the few key points associated with each reading. These points can take any of several forms, including: major insights revealed in the reading and how they relate to your project; controversial assertions made in the reading; or your personal thoughts and experiences that build on or otherwise evolve from the reading. This will ensure any insights from the readings get integrated into class discussions as some readings many not otherwise be explicitly discussed during class sessions. INDIVIDUAL & GROUP ASSIGNMENTS There will be a number of individual level assignments and deliverables, including a Feedback to Peer Report. The deliverables and your overall contribution to learning will be the basis for the individual portion (50%) of the evaluation for the course. Team work is a crucial part of this course, and each student will be graded as a member of their respective team and receive a shared evaluation for the course (50%) There are group deliverables for the team grade, including outputs related to the customer discovery and the validation and iteration process, the Business Model Canvas, and progress reporting of your collective efforts to frame, validate and model your business. It is important to note that, beyond the deliverables, the wider development process can be evaluated where each student s final grade could be weighed according to their contribution. You are collectively responsible for managing your team, and this effort represents a valuable learning experience to take forward into your entrepreneurial career. 6
The group grading will include evaluating your effort in the coaching session, and be augmented by a peer appraisal process (described below). Before the coaching session, teams will be asked to prepare materials as well as an agenda of issues they wish to discuss. Preparing these deliverables and thinking through the issues will ensure the quality of the discussion for the coaching sessions. More details regarding coaching will be provided in advance of the coaching engagement. At the end of the course each student will complete a confidential peer appraisal reviewing each member s contribution to the process. The peer appraisal is meant to discourage free riding by any member of the team, and encourage sharing the significant workload of the group component of the course proportionately. Peer appraisal will not automatically enter into final grade calculation. However, the professor reserves the right to reduce / increase an individual s grade based on personal observations and the team s feedback. 7