It starts with an idea 1 How to

It starts with an idea 1

How to start your own IT company What does it take to be an entrepreneur? ¢Todd Dorton ¢Nisha Matani 2 ¢Dhiraj Kumar

Objective To define and show the importance of entrepreneurship, highlight the best practices for startups and showcase desirable attributes of an entrepreneur 3

Agenda ¢ ¢ ¢ ¢ Introduction Entrepreneurship Richard Branson N R Narayan Murthy Ingvar Kamprad Comparison & Best Practices Conclusion Questions 4

Mind blocks My own ? company? ? ? Your Mind Blocks 1. 2. 3. 4. ¢ List what are things which come to your mind when you put yourself in place of Doug ¢ We will try to address a few of them through our presentation. “The very idea of entrepreneurship not only conjures up thoughts about starting up businesses and building them, but also the more frightening prospect of taking risks and failing. It’s the last part that puts so many people off [from] taking a leap into the unknown and working for themselves. ” –Richard Branson http: //www. virgin. com/aboutvirgin/allaboutvirgin/richardreplies/default. asp, viewed November 4, 2006 5

Doug Bartlett 6

Some Successful Business Ideas Business Name The Idea Silent technologies To time LSAT Questions Collageboxes College shipping, storage & rental Terra. Cycle Trash to money Platinum Performance CIK Enterprise Supplements for human & animals both Marketing for rental companies Digium This tech support company got Inc. com coolest little startups started while looking for phone 7

What is an Entrepreneur? A person who undertakes and operates a new enterprise or venture and assumes some accountability for the inherent risks. In the context of the creation of for-profit enterprises, entrepreneur is often synonymous with founder. http: //en. wikipedia. org/wiki/entrepreneurship viewed on 2 Dec 2006 8

Startup Companies ¢ ¢ A startup is a company with limited operating history Moves out of this phase when it passes various milestones l ¢ Funded in 2 major ways l l ¢ Becoming profitable, being publicly traded, being acquired/merging Venture capital Angel investor Most startups fail? ? ? “Angel Investor”. Wikipedia. org Dec. 2006. 2 Dec 2006. http: //en. wikipedia. org/wiki/Angel_investors “Venture Capital”. Wikipedia. org Dec. 2006. 2 Dec 2006. http: //en. wikipedia. org/wiki/Venture Capital “Startup Company”. Wikipedia. org Dec. 2006. 2 Dec 2006. http: //en. wikipedia. org/wiki/Startup Company 9

Statistics on small businesses • Small firms represent 99. 7% of all employer firms • Employ half of all private sector employees • Employ 41% of all high tech workers • Generated 60 to 70% of net new jobs over the last decade • Create 50% of non-farm private GDP In 2005 there were approximately 25. 8 million small businesses in the United States. “Frequently Asked Questions. ” SBA Office of Advocacy. June 2006. 26 Nov 2006. <www. sba. gov/advo/stats/sbfaq. pdf> 10

Top 10 Cities for Entrepreneurs Ran City k 1 Phoenix-Mesa, AZ 2 Charlotte/Gastonia/Rock Hill, NC/SC 3 Raleigh/Durham/Chapel Hill, NC 4 Las Vegas, NV 5 Austin/San Marcos, TX 6 Washington/Baltimore, DC/MD 7 Memphis, TN 8 Nashville, TN 9 Norfolk/Virginia Beach/Newport News, VA/NC 10 Inc. com “hot cities” 22 San Antonio, TX St. Louis, MO 11

Three Successful Entrepreneurs 1. 2. 3. Richard Branson Narayan Murthy Ingvar Kamprad Top 2 European Brands to Have an Impact on Consumer’s Lives IK EA 2. Virg in Deutschman, Alan, “The Gonzo Way of Branding” Fast Company, Issue 87, October 2004, p. 91. 1. 12

Richard Branson 13

Richard Branson: “Virgin” Best known for the “Virgin” brand ¢ Born in 1950 in Shamley Green, Surrey ¢ Educated at Scaitliffe School & Stowe School ¢ Dyslexia l Captain of the football & cricket teams l Had a generally curious spirit l ¢ By the age of 15, he had started 2 failed ventures http: //en. wikipedia. org/wiki/Richard_Branson, viewed November 4, 2006 http: //www. askmen. com/men/december 99/6 c_richard_branson. html, viewed November 4, 2006 l X-mas trees & raising budgerigars http: //www. virgin. com/aboutvirgin/allaboutvirgin/whosrichardbranson/default. asp, viewed November, 4 2006 14

Richard Branson: Profile ¢ ¢ Quit school at 16, set up Student Magazine At 17, started a charity, The Student Advisory Centre, to help young people Awarded “knighthood” in December 1999 Today: Has a net worth of over $5 billion l The #1 Admired Businessman in Britain l Is the 2 nd choice amongst youth for Prime http: //en. wikipedia. org/wiki/Richard_Branson, viewed November 4, 2006 Minister (after Tony Blair) http: //www. askmen. com/men/december 99/6 c_richard_branson. html, viewed November 4, 2006 l Lives in London/Oxfordshire http: //www. virgin. com/aboutvirgin/allaboutvirgin/whosrichardbranson/default. asp, viewed November 4, 2006 l 15

Virgin Group: The Beginnings Started by purchasing crates of “cutout” records from a discounter ¢ Sold the records out of the trunk of his car to London retail outlets ¢ 1970: Started a mail-order business selling records under the name “Virgin” l Sold records at a discounted price compared to competitors ¢ Opened a record shop on Oxford Street in London ¢ Built a recording studio with profits and a loan from his aunt http: //en. wikipedia. org/wiki/Richard_Branson. html, viewed November 4, 2006 ¢ 16

Virgin Group: Company Profile ¢ Ranked 2 nd among European brands that have the greatest impact on consumers’ lives (next to IKEA) *annual poll, thousands of consumers 350 companies worldwide ¢ $8 billion annually in sales ¢ 25, 000+ employees ¢ 10% of business in U. S. ¢ “branded venture capital” ¢ Involved in planes, trains, finance, soft drinks, music, mobile phones, holidays, cars, wine, publishing, Hopkins, Michael S. , “ 26 Most Fascinating Entrepreneurs” Inc. Magazine, http: //www. inc. com/magazine/20050401/26 -branson. html, bridal wear, etc viewed November 15, 2006 ¢ Deutschman, Alan, “The Gonzo Way of Branding” Fast Company, Issue 87, October 2004, p. 91. http: //www. virgin. com/aboutvirgin/allaboutvirgin/whatwereabout/default. asp, viewed November 4, 2006 17

Virgin Group: “Through the Years” 1970: Start of virgin mail-order ¢ 1971: 1 st Virgin record shop opens ¢ 1973: Record Label launches ¢ 1984: Virgin Atlantic Airways is born ¢ 1991: Virgin Publishing is formed ¢ 1992: Virgin Records is sold to Thorn EMI ¢ 1994: Virgin Vodka & Cola launch ¢ 1995: Virgin Direct Personal Financial Services opens ¢ 1996: Virgin Trains launches ¢ 1999: Virgin Mobile launches ¢ 2002: Virgin Credit card is offered http: //www. virgin. com/aboutvirgin/allaboutvirgin/thewholestory/default. asp ¢ 2004: Virgin Galactic space tourism ¢ 18

Virgin Group: “Elements of Success” ¢ Constantly looking for opportunities l ¢ Base decisions on hard research & analysis l ¢ ¢ Offer something better, fresher, & more valuable Appropriate rewards vs. risks Networking (friends, contacts, partners) Branding “If you get your face and name http: //www. virgin. com/aboutvirgin/allaboutvirgin/thewholestory/default. asp, viewed November 4, 2006 out there enough, people will http: //www. virgin. com/aboutvirgin/allaboutvirgin/richardreplies/default. asp, viewed November 4, 2006 l 19

Virgin Group: “Elements of Success” ¢ Diversifying the company l ¢ Empowering talent l ¢ “Loyalty means a lot to me… I guess that’s why I prefer to promote from within. People who join Virgin know that there are plenty of opportunities to progress their career. ” Sense of community l ¢ “This enables you to have a contingency plan when the economy is going through a rough patch. ” Shared ideas, values, interests, & goals Management style l Minimal mgmt. layers, No bureaucracy, No massive Global HQ, a small Board http: //www. virgin. com/aboutvirgin/allaboutvirgin/thewholestory/default. asp, viewed November 4, 2006 http: //www. virgin. com/aboutvirgin/allaboutvirgin/richardreplies/default. asp, viewed November 4, 2006 20

Richard Branson: Character Traits ¢ Daring/Risk-taker l ¢ Adventurous l ¢ l “BA Bonus” Donates profit to research environmentally friendly fuels Green l l ¢ Many record-breaking attempts Selfless l ¢ “It is impossible to run a business without taking risks… I have enjoyed all the challenges we have taken at Virgin, so because I’m having fun at what I’m doing what I do, the risk factor takes second place. ” Virgin Fuel Global Warming “Transformational Leader” http: //en. wikipedia. org/wiki/Richard_Branson, viewed November 4, 2006 http: //www. virgin. com/aboutvirgin/allaboutvirgin/richardreplies/default. asp, viewed November 4, 2006 21

Narayan Murthy 22

Narayan Murthy: “Infosys Technologies” Known for “Infosys Technologies” ¢ Born in Mysore, India in 1946 ¢ Masters Degree from IIT Kanpur ¢ Began his career in software in Patni Computers http: //in. rediff. com/money/2006/jun/21 murthy. html 2 Dec 2006 ¢ Founded Infosys in 1981 ¢ 23

Infosys Technologies: Company Profile ¢ ¢ ¢ ¢ Founded by 7 software professionals Led by N. R Narayan Murthy and Nandan Nilekani in 1981 (All members were former Patni Computers employees) Started with $250 borrowed from his wife Revenue: $2. 15 Billion 58, 000 Employees Market Capitalization: US $22 Billion Slogan: “Powered by intellect, driven by values” Growth Rate : 38% in last five years a. Wikipedia(http: //en. wikipedia. org/wiki/Infosys), Viewed on 10/20/2006 b. Infosys Website (www. infosys. com) viewed on 10/20/2006 24

What they thought in the beginning “ We never imagined we would come this far “. ¢ “we were certain of one thing, and that is our value system” ¢ “When we sat down in the bedroom of my apartment in 1981, we discussed for four hours what our objective should be. Should it be revenues, profits, market capitalization? “ ¢ “No, we said it should be none of those. “ ¢ “We will seek respect from every one of the stakeholders. My view was if we sought respect we'd automatically do the right thing by each of them. We'd satisfy our customers, be fair to our employees, and follow the finest principles with respect to investors, we would not violate laws, and, finally, we'd make a difference to society. “ ¢ a. Narayan Murthy's interview by Business. Week Senior writer Steve in New Your Jun 15 th 2006 “And then, I said, automatically you'll get revenues b. http: //in. rediff. com/money/2006/jun/21 murthy. htm on 10/20/2006 and profits and all that. “ ¢ 25

Infosys Techonologies: “ 5 Elements of Success” 1. Openness to learn -Openness to subordinate your ego to take ideas from others 2. Meritocracy -The best ideas are adopted and implemented using data to arrive at the best decision 3. Speed -Assuring you do things faster compared to yesterday and last quarter 4. Imagination -You continually bring better ideas and better innovation to the table 5. Excellence in execution -That is implementation of these great ideas with a higher level of excellence today than yesterday. a. Narayan Murthy's interview by Business. Week Senior writer Steve in New Your Jun 15 th 2006 b. http: //in. rediff. com/money/2006/jun/21 murthy. htm 26

Infosys Technologies: “Success Factors” Pioneer in business practices ¢ Longstanding client relationship ¢ End-to end solution ¢ Global delivery model ¢ Focus on people, A cese study and presentation on Building Successful Software Companies in Developing countries, In Hawaii on May 1921, 2004 (http: //www. iipi. org/Conferences/Hawaii_SW_Conference/Nithya%20 Presentation. pdf) viewed 4 Dec 2006 process & ¢ 27

Murthy’s Stress on Leadership & Learning ¢ ¢ Infosys leadership Institute 98 member faculty , 65 Phd 160+ continuing education courses Individual training program for all employees http: //in. rediff. com/money/2006/jun/21 murthy. htm 4 Dec 2006 28

Ingvar Kamprad 29

Ingvar Kamprad: “IKEA” • • • Estimated net worth of $36 billion Born in 1926 in Sweden Raised on a farm called Elamtaryd, near the village of Agunnaryd. Ingvar Kamprad. Wikipedia. org Nov. 2006. 8 Nov 2006. http: //en. wikipedia. org/wiki/Ingvar_Kamprad 30

Ingvar Kamprad: Profile • As a young boy he knew he wanted to be a businessman. • Started by selling matches door to door from his bicycle. • Discovered that he could by matches very cheap in Stockholm and sells them individually at a low price and still make a profit. • He later expanded in selling fish, Christmas tree decorations, seeds, ballpoint pens and pencils. IKEA. “Timeline” IKEA. 8 Nov. 2006 <http: //www. ikea. com/ms/en_us/about_ikea/full_story. html 31

IKEA: The Beginnings • IKEA was founded in 1943. • He funded the business at the age of 17 from a gift from his father. • IKEA name comes from his first to initials and the first letter of his farm and the first letter of his village. IKEA. “Timeline” IKEA. 8 Nov. 2006 <http: //www. ikea. com/ms/en_us/about_ikea/full_story. html 32

IKEA: Through the Years • IKEA originally sold picture frames, stocking, table runners, wallets, watches and much more. He would sell anything that he could provide at low cost. • 1947 furniture was added to the product line • 1951 the first catalogue was printed and all lines except for low cost furniture were dropped. • 1953 furniture showroom opened IKEA. “Timeline” IKEA. 8 Nov. 2006 <http: //www. ikea. com/ms/en_us/about_ikea/full_story. html 33

Ingvar Kamprad • 1956 Kamprad began using flat packages to ship furniture. This idea is a large contributor to the success of the company. By sending the furniture flat and not preassembled, it allowed IKEA to slash its already low prices. By cutting production and shipping fees. • Good function, Good design, Good quality, with low prices is what has driven IKEA success. Kamprad vision has been a driving force in the success of the company. He believe his furniture should not only improve the people's lives but improve people themselves. IKEA. “Timeline” IKEA. 8 Nov. 2006 <http: //www. ikea. com/ms/en_us/about_ikea/full_story. html Allen, Scott. “Ingvar Kamprad- IKEA Founder and One of The World’s Richest Men. ” About. com 8 Nov 2006 <http: //entrepreneurs. about. com/cs/famousentrepreneur/p/ingvarkamprad. html 34

Ingvar Kamprad • Kamprad has long been pressured to go public with his company. But he refuses. The company is closely controlled. Own ultimately by a Dutch trust controlled by the family. Various holding companies handle different parts of the business from franchising, manufacturing, distribution, even an investment arm. Allen, Scott. “Ingvar Kamprad- IKEA Founder and One of The World’s Richest Men. ” About. com 8 Nov 2006 <http: //entrepreneurs. about. com/cs/famousentrepreneur/p/ingvarkamprad. html 35

Ingvar Kamprad • Kamprad is an unusual man. He claims to be the richest man in the world but is also know for being one of the cheapest. He takes the subway to work and requires everyone in the company including himself to fly econ class on flights. • Can anyone guess what kind of car he drives? “Vast Wealth in One Easy Lesson” Chicago Tribune 27 March 2006. Lexis-Nexis. 8 Nov 2006 <http: //web. lexis-nexis. com 36

Similarities Between the 3 ¢ ¢ ¢ Risk-takers Look for innovative ideas Base decisions on hard research & analysis Sense of community within company Put great value on their people l Customers, clients, partners ¢ ¢ Value-based hiring Recognize the importance of 37

Richard Branson Narayan Murthy Ingvar Kamprad Company name Virgin Group Infosys Technologies IKEA Industry Everything! Information Technologies Furniture Annual Sales $8 Billion $2. 2 Billion 19. 8 Billion Before they were big Sold records out of a truck Worked for Patni Computers. Sold matches in bulk Family Wife, 2 daughters Wife, 1 daughter and 1 son Wife, 3 sons Management style Minimal layers, no bureaucracy Simple and transparent driven by Frugal, Green, and secretive 38

Are You Cut Out to Be an Entrepreneur? o o o o Optimistic & future-oriented Willing to take risks for profit Fast-moving & flexible Determined to succeed Competitive Can deal with legal issues Excellent problem-solvers Know about finances Tracy, Brian, “Are You Cut Out to Be an Entrepreneur? ” Entrepreneur Magazine, March 21, 2005. 39

Best Practices for Start-Ups ¢ Launching a Business l l What opportunities exist? Which ones offer to the most profit potential? Find a new, better, cheaper way to sell the product to reduce operation costs Tell yourself that failure isn’t an option- Be willing to take risks & move out of your comfort zone Tracy, Brian, “Are You Cut Out to Be an Entrepreneur? ” Entrepreneur Magazine, March 21, 2005. 40

Develop the Habits to Win in Business 1. Plan Ahead 1. 2. 3. 4. 5. 6. 7. “Proper Prior Planning Prevents Poor Performance” Get Organized Before You Get Started Find the Right People Learn How to Delegate Monitor Performance Set Timelines to Achieve Results Develop the Determination to Win l “Whenever I experience any kind of setbacks, I always pick myself up and try Tracy, Brian, “Develop the Habits to Win in Business” Entrepreneur Magazine, May 16, 2005. 41

Different Mind-Sets & Some Business Ideas ¢ ¢ Anyone with passion can do it, especially in this global economy when the world is flat. Initially age/money does matter but should not be the hindrance… resources are available if we are willing It starts with an idea… driven by your passion/values Willing to take risk and determined to success 42

References 1. 2. 3. 4. “Richard Branson” Viewed 4 Nov 2006 <http: //en. wikipedia. org/wiki/Richard_Branson. html> 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. 15. 16. 17. 18. http: //www. virgin. com, viewed November 4, 2006 19. 20. “Vast Wealth in One Easy Lesson” Chicago Tribune 27 March 2006. Lexis-Nexis. Viewed 8 Nov 2006 http: //web. lexis-nexis. com “Men of the Week: Entertainment. ” Viewed 4 Nov 2006 <http: //www. askmen. com/men/december 99/6 c_richard_branson. html> Deutschman, Alan, “The Gonzo Way of Branding” Fast Company, Issue 87, October 2004, p. 91. Hopkins, Michael S. , “ 26 Most Fascinating Entrepreneurs” Inc. Magazine Viewed 15 Nov 2006 <http: //www. inc. com/magazine/20050401/26 -branson. html> http: //www. virgin. com/aboutvirgin/allaboutvirgin/whosrichardbranson/default. asp http: //www. virgin. com/aboutvirgin/allaboutvirgin/whatwereabout/default. asp http: //www. virgin. com/aboutvirgin/allaboutvirgin/thewholestory/default. asp http: //www. virgin. com/aboutvirgin/allaboutvirgin/richardreplies/default. asp Tracy, Brian, “Are You Cut Out to Be an Entrepreneur? ” Entrepreneur Magazine, March 21, 2005. Tracy, Brian, “Develop the Habits to Win in Business” Entrepreneur Magazine, May 16, 2005. http: //en. wikipedia. org/wiki/Infosys#History http: //in. rediff. com/money/2006/jun/21 murthy. htm http: //news. bbc. co. uk/2/hi/business/6039390. stm http: //www. thehindubusinessline. com/iw/2006/10/15/stories/2006101501670100. htm http: //in. tech. yahoo. com/061007/137/68 a 9 f. html http: //www. iipi. org/Conferences/Hawaii_SW_Conference/Nithya%20 Presentation. pdf http: //en. wikipedia. org/wiki/BEA_Systems http: //www. inc. com/criticalnews/articles/200610/born. html “Ingvar Kamprad. ” Viewed 8 Nov 2006 <http: //en. wikipedia. org/wiki/Ingvar_Kamprad> “Timeline” IKEA. Viewed 8 Nov. 2006 <http: //www. ikea. com/ms/en_us/about_ikea/full_story. html> Allen, Scott. “Ingvar Kamprad-IKEA Founder and One of The World’s Richest Men. ” Viewed 8 Nov 2006 <http: //entrepreneurs. about. com/cs/famousentrepreneur/p/ingvarkamprad. html> Branson, Richard, Losing My Virginity: How I’ve Survived, Had Fun, and Made a Fortune Doing Business My way. Three Rivers Press, New York, 2004. 43