MBA Entrepreneurship & New Venture Creation (Essay Sample)

MBA Entrepreneurship & New Venture Creation
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MBA Entrepreneurship & New Venture Creation
Executive Summary
Bright Fintech Crowdfunding is an organization that will be concerned with helping potential investors to support other companies. They will later receive equity as their returns for investing. There are increasing needs for entrepreneurs in the business environment to access financial services more efficiently. The primary purpose is to give them an investment platform to save them on the costs they will incur when starting their business.
Like any other business, a market analysis will involve analyzing the standard models to ensure that it is within the scope of operations. The analysis will include the PESTLE analysis, Porter’s five model analysis and VRIO. This will help the business to establish a market entry strategy and maintain a competitive advantage.
The business also has identified that who we employ would significantly contribute to the willingness of the investors to work with the company. Enough staff will be available to make sure that customer’s needs are attained. The financial estimates are that the company during the first year of operations will make a profit. The break-even point will be around $10, which implies that investors will still get value for their money with a small investment.
Opportunity
There are increasing needs for entrepreneurs in the business environment to access financial services more efficiently. To start up a business, it is required that the entrepreneurs need to raise money. In the past years, it has been so difficult for start-up entrepreneurs to raise capital for their new ventures because the available banking institutions charge high-interest rates and sometimes inaccessible most of the time. Some banks require security to be attached when they want to get a loan, and they are always worried about defaulting. Sometimes, the individuals do not have the exact ideas and where to invest their capital. It is so difficult and expensive to start a new business in the current market due to competition within the market. But let this not deter the potential investor in doing business, where still, they can support other businesses by backing them up and later receive equity on the invested capital to keep them join the journey of transforming the world. Bright FinTech Company is a proposed new business idea that will help the start-ups to invest or loan in small companies in return for equity and or an annual return.
The target market for Bright Fintech Crowdfunding company is start-up entrepreneurs who are willing to back up small businesses around the world. However, there is competition in the fintech crow funding as there are already existing similar companies that provide the same services to the companies. The company will receive competition from other companies such as CircleUp, which are well-established companies already existing in the market. It has captured a broad market sector, incorporating critical players in the market such as eBay and many other companies.
Execution
As earlier states, the current opportunity that Bright Fintech Crowdfunding has in the market is the need to improve on the investment among the start-up entrepreneurs. The primary purpose is to give them an investment platform to save them on the costs they will incur when starting their business. Understanding and utilizing such opportunities entails a deeper market analysis to help the company obtain the resources and proper strategy to enter the market. The three models that will be used by Bright Fintech Crowdfunding organization are the PESTLE analysis, VRIO, and lastly PORTER’s model. These models will comprise the marketing plan and how the business will enter the market to utilize the identified opportunity.
PESTLE Analysis
Political Factors
In the current business environment, the government plays a crucial role in the success of any business. Some of the ways they influence businesses’ operations are through government pressure and monetary policy that will directly impact the financial and social aspects of the organizations (Tsvirko, 2020). Looking at the current political world, most countries have maintained peace, which is an attractive condition for new business ventures. This means that Bright Fintech Crowdfunding will prosper due to the support that the government is providing.
Economic Factors
The economic situation of a country will always determine how the business will perform. From the recent pandemic of COVID-19, most companies have sought to carry their business activities online. It is known that it is difficult for most companies to change the economic situation. Still, they can make preparations to respond to the fluctuations within the society v. Bright Fintech will therefore take the new opportunity, where most businesses are working online to attract a broad base of investors and many companies.
Socio-cultural Factors
Understanding the target population in terms of gender distribution and age will be necessary for this particular case. This will help to identify the investment behavior among most of the target population. When the target population is risk-averse, they will all be willing to try out the new platform, meaning that it will attract more customers (Tsvirko, 2020). Understanding the social and cultural factors will help strategically locate the business and make sure that the end goals are achieved.
Technological Factors
Technology has taken over almost every sector within the economy, which has changed the business models and some processes of the organization. Online platforms are taking over as consumers look for more efficient ways of getting their goods. This is also related to investment, where many investors who lack a business idea are opting for the online platform as it is convenient for them. Most investors are willing to invest their cash in online companies, which is the right opportunity for Bright Fintech to prosper.
Legal Factors
The significant laws are related to Bright Fintech are the trade laws, which will concern how stocks in the market run. Once invested in a company’s stock, they will always be protected by such laws, hence motivated to work with the company (Tsvirko, 2020). However, other laws, such as those related to taxes, will have some negative implications on the companies.
Environmental Factors
In the current environment of business, sustainability has been a common topic of concern. Significant efforts are put forward to protect the environment from pollution and many other negative impacts. Doing business online is one of the milestones in achieving such goals, an opportunity to strive in the business environment.
VRIO Model
It is also essential to consider the resources and the competitive advantage that the organization has towards the business objective. The resource analysis will be based on the VRIO model, a short form of Value, Rareness, Imitability and Organization.
Value
Basing on the value, the significant resources of the company will be computers, network systems, experts and investors. Looking at all of thesee particular concepts, acquiring such elements is quite expensiveand isre also priced high (Abdullah & Susamto, 2019). The best way to make them available will be through purchasing.
Rareness
The resources required to start Bright Fintech are limited. First, having the expertise skills in this field will be tedious for the owners (Abdullah & Susamto, 2019). Capital will also be scarce because it will be required to finance all the activities that will take place at the conception of the business.
Imitability
Many organizations may still arise to provide an investment platform that many individuals may use to access the market. However, it will be difficult for many organizations to imitate the business’s operations because Bright Fintech aims at small entrepreneurs, giving them some benefits and appealing cashback on their investments (Abdullah & Susamto, 2019).
Organization
The resource is supported by the model adopted, and the employed staff can be in a position to manage them well. This is because it has enough expertise staff who have skills. They will help in using the most recent technology to achieve the set goals of the business.
Porter’s Competitive Model
In the current business environment, most organizations are competing for customers, who happen to be the most important stakeholders of any organization that aims to strive, produce new products, and even access new markets. The following are the major five forces that are used in analyzing a market.
* Threats of New Entrants
When new firms are entering the market, the profits would likely be reduced due to many firms attracting different pools of customers. The future of business is online. The online industry has become very competitive because of the convenience and attraction of many customers. It is also less likely to be risky because of the increased inaccuracy. There are many other Fintech Crowdfunding companies that form the barriers to the new entrants (Ekaterina, 2021). The following are some of how they form the barriers to entry (Ekaterina, 2021).
Economies of Scale: This concept refers to the cost of production over some units produced. This means that when the volume of production increases, ...