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Week of November 14 - 18, 2005Welcome to the National Dialogue on Entrepreneurship, an initiative of the Public Forum Institute made possible by a grant from the Kauffman Foundation of Kansas City. Through NDE-news, we bring you short summaries and analyses of various trends driving the innovation economy. Subscribe now to receive your weekly copy. Archived issues are available online. Links to the day's entrepreneurship stories from across the nation and around the world are posted each weekday on the NDE main page - bookmark it and stay informed about the latest entrepreneurship news. |
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This year’s Inc. 500
list is out, and, as usual, it contains interesting insights about the
state of entrepreneurship in the US. This year’s No. 1, Video Gaming
Technologies, hails from Roebuck, South Carolina, and boasts an
impressive three-year growth rate of 9,720%. America’s fascination with
Texas Hold ‘Em and all-things-poker has been very good to VGT, a builder
of touch screen gambling machines. The leading sectors in the Inc.
500—information technology services, health, real estate and human
resources---should come as no surprise. Similarly, the most profitable
sectors—energy and insurance—could also be predicted from a glance at
the daily newspapers. The Washington DC metro hosts the most Inc. 500
members (51), followed by Los Angeles (32) and New York City (28). |
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Understanding Entrepreneurship
A new report on theories,
applications and policies in the field of entrepreneurship reflects the
thoughts of some of the leading researchers on what is currently known
and not known about its impact on the U.S. economy. Published by the
Kauffman Foundation, Understanding Entrepreneurship: A Research and
Policy Report includes chapters on ‘The Role of Entrepreneurship in
Economic Prosperity’, ‘The Entrepreneurial University?’, The
Globalization of Venture Finance, and The Entrepreneurial Path for
Residents of Disadvantaged Communities’. |
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Can Firms Innovate through Acquisitions?
Few companies now operate
big in-house R&D facilities like the famous Bell Labs or Xerox PARC.
Instead, they rely on start-ups to drive a lot of innovation. When a
start-up develops a critical product or technology, large firms seek to
acquire it. For example, during the dot-com boom (1992-2000), Cisco
purchased 70 companies. But, this strategy may have limits, according to
new research from Wharton School professor Saikat Chauhuri. These
mergers and acquisitions (M&As) suffer from all of the challenges facing
mergers between two firms. These difficulties have marred recent big
name mergers like Time Warner-AOL and Daimler-Chrysler. Things become
even more complicated when the mergers are designed to capture and
exploit new technology innovations. Because these acquisitions can
create great complexity, Chauhuri recommends that firms undertake
extensive due diligence before pursuing this strategy. In particular,
acquiring firms should be extremely cautious and work to reduce all
uncertainties before making the final acquisition. In addition, it is
often best to delay integration of the new firm (and its technology)
until the final product is completed and ready for the marketplace. This
delay reduces the amount of disruption for managers on both sides of the
merger, and allows them to focus on their core missions. |
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Using Entrepreneurship to Fight Poverty
In recent years, we’ve
witnessed a boom in interest in how market-based solutions can be used
to fight poverty and promote development. Worldwide, there are thousands
of fascinating efforts underway that seek to both make a difference and
make a profit at the same time. Changemakers.net, an on-line journal and
initiative of Ashoka, recently held a competition to recognize the best
of the best in this field. It has selected two outstanding businesses
that effectively combine both social and business entrepreneurship.
Uganda’s Mango Tree Educational Enterprises manufactures educational
tools that are used to teach people about subjects such as AIDS
prevention and effective communication. Brazil’s Sambazon Sustainable
Acai is a cooperative that purchases and processes palmberry fruits from
local farmers. The fruits are used in flavorings, supplements,
beverages, and ice creams sold in organic food markets. |
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The Key to Entrepreneurial Success? Junk Food! Junk
food is the real driver of a talented and entrepreneurial workforce.
That’s the somewhat tongue-in-cheek message from Nancy Hauge of Ruckus
Network, a digital entertainment service for universities. Hauge argues
that eating junk food offers some compensation for the long hours often
demanded in a fast-growing start-up. It also helps fuel the constant hum
of execution. And, she concludes, when junk food gets replaced by
nutritious food, this shift may be a sign that a firm’s growth is
lagging. Hauge’s article is part of series entitled “The Entrepreneurial
Spirit,” developed by Local TechWire (a North Carolina-based business
news service) and the Council for Entrepreneurial Development, North
Carolina’s major entrepreneurial network. Entrepreneurs pen all of “The
Entrepreneurial Spirit” columns, and they are designed to offer a flavor
of what’s really like to start and grow a business. Other topics
recently covered include: “How to Find the First $1-2 Million for a New
Venture,” and “Should You Be the Leader of a New Venture?” To view other articles in “The Entrepreneurial Spirit” series, visit http://www.cednc.org/news/in_the_news/2005/?link=dhtml |
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The Power of Entrepreneurship Education
A new article in Region
Focus, a journal produced by the Federal Reserve Bank of Richmond,
offers an interesting review of the debate on the eternal question of
whether entrepreneurs are born or can be made. The article notes that,
while some critics question whether entrepreneurship can be taught, many
successful individuals and communities offer powerful testimony of how
access to critical training has transformed their businesses and their
regions. The article reviews several programs in North Carolina and West
Virginia. Overall, it presents a clear and concise review of how regions
can help support local entrepreneurs. |
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