Education and Humane Entrepreneurship

Sep 5, 2021 | The Latest

Education and Humane Entrepreneurship

Sunday, September 5, 2021 by Dr. Ayman El Tarabishy

Education sits as the cornerstone of creating socially and environmentally conscious entrepreneurs. When we imagine the future of humane entrepreneurship, it includes empowered employees and well-educated entrepreneurs making intelligent decisions to heal the environment and benefit the world. To enable entrepreneurs to make these changes we envision, we must educate them on the issues that truly matter, such as integrating social entrepreneurship with sustainable entrepreneurship and employing business practices that protect our planet, communities, and future generations.

First, we must consider the significance of climate change and the role that government officials and entrepreneurs play in preventing further damage to the planet. Although governments are making changes to reduce negative impacts on the environment, we are still concerned about whether profitability and sustainability can coexist. We must educate all stakeholders about climate risk and their duty to promote sustainability in response to this. As observed by Dr. Mariya Yesseleva-Pionka, Global Certificates Manager for ICSB and adjunct professor at University of Technology Sydney, “With every new business venture comes a great responsibility for making climate-friendly decisions.” Therefore, we need to continue developing and supporting eco-friendly solutions such as green start-ups, fin-techs, and sustainability reporting and educate entrepreneurs on how to implement SDGs and sustainable business practices properly. It is imperative to note that long-term profits will not matter if the planet deteriorates due to climate change.

This sustainability education is inherently tied to education about social entrepreneurship, as both of these entrepreneurial approaches target issues on a human and environmental level. Although there exists an increasing amount of research on social entrepreneurial intention (SEI), or the motivation of entrepreneurs to build new social enterprises, we still lack knowledge about different SEI antecedents, such as personality, cognition, and experience, as well as variables moderating antecedent-SEI relationships, including economic and social influences. According to Dr. Phillipp Kruse, a scientific staff member at the Dresden University of Technology, the solution to these research issues lies in examining SEI in countries with different cultures and economic situations and developing a validated instrument with which to measure SEI. Additionally, social entrepreneurship educators must include more psychological input in university courses to strengthen participants’ motivational ties to social entrepreneurship.

With the amount of power entrepreneurial learners possess to change the future of business and the environment, we owe them the best education, educators, research, and settings. We must listen inclusively to the voices of these learners and new and small businesses alike. As stated by Dr. Norris Krueger, Senior Research Fellow at the College of Doctoral Studies, UOPX & Entrepreneurship Northwest, “Students are our secret weapon. In terms of learning and educating, and especially in terms of the ecosystem.” To provide entrepreneurial learners with the best resources, we must shift from top-down systems to bottom-up, from institutions to people, and from hierarchies to networks. Inclusivity and active listening are the keys to discovering what our entrepreneurial students need to flourish, improve their communities, and shape the future of humane entrepreneurship. In educating entrepreneurs and stakeholders on their sustainable responsibilities, increasing students’ ties to social entrepreneurship at the university level, and providing high quality, comprehensive education, we grant entrepreneurs the tools necessary to implement safer business practices and create long-term, positive change for our environment, communities, and ways of life.

For more on the importance of entrepreneurial education, watch the session below.

The Entrepreneurial Journey Part 4 – Do You Have the Right Brand?

Aug 25, 2021 | Gazette, The Latest

The Entrepreneurial Journey Part 4 – Do You Have the Right Brand?

Wednesday, August 25, 2021, by Dr. Frederick Crane

I have argued for more than 20 years that building and sustaining a powerful entrepreneurial brand is critical if a venture is to survive, grow, and endure in a complex and competitive marketplace. Moreover, a new venture has a relatively short time frame in which to establish its brand. If it misses this critical window of opportunity, it is very likely to fail. Entrepreneurs must focus on creating brands that clearly communicate the value desired by the customer as well as reinforce the intended position the entrepreneurial firm wishes to occupy in the market. Importantly, the brand must be consistent and sustained over time.

One of the most basic definitions of a brand is that it is something of “value” for both the customer and the company. At a practical level, a brand embodies your offer of value—your promise—to the customer. Ultimately, a brand is a blend of what you say it is, what others say it is, and how well you deliver on your promise—from the customer’s perspective. Finally, a brand is a powerful asset that must be carefully developed and managed.

For you and your venture, the brand you select is important because it can set you apart and truly differentiate your venture (and its products/services) from your competitors. But branding brings other benefits to your venture. First, branding can be an integrative tool for the entire venture. For example, the branding process, even the simple naming of your business, forces you to consider very carefully the core “value” you will create and deliver to your key customers. In addition, branding also helps you sharpen your business model (how you will make money and from whom you will make it). Second, branding increases the chances of acquiring your initial set of customers in the early stages of your venture. And, of course, branding will help solidify customer loyalty to your venture in the later stages. Third, branding can increase your access to suppliers and improve your chances of channel support. Fourth, branding can increase access to new venture capital.

While a brand is extremely important to you and your venture, it might be argued that customers, in fact, may benefit most from branding. Recognizing competing products by distinctive branding allows customers to be more efficient shoppers. Consumers can recognize and avoid products with which they are dissatisfied while becoming loyal to other, more satisfying brands. Strong brands reduce customers’ perceived risk when purchasing and can increase their trust with the brand. Finally, strong brands also help the customer visualize and better understand the product or service.

A good brand will possess a number of important characteristics. Keep these characteristics in mind as you begin the branding process. For example, a good brand has the following qualities:

Effectively communicates the distinctive value you wish to offer the customer
Is “relevant” to the customer
Reinforces the company’s intended positioning in the marketplace
Is consistent and unifying
Is easily understood by your customers and your employees
Can be sustained over time

You should consider these characteristics as you begin to ponder your possible brand(s) for your venture. It is clear that brands lacking the above characteristics are likely to be weaker brands that may not survive in a crowded and competitive marketing environment. My advice: test your brand with your potential customers – find out what they think and how they feel about your brand concept.

Author

Frederick Crane serves as a Senior Project Manager for the International Council for Small Business (ICSB).

Dr. Crane is an Executive Professor of Entrepreneurship & Innovation at the College of Business at Northeastern University; Former Editor of the Journal of the Academy of Business Education; and co-founder of Ceilidh Insights LLC – an innovation management training, intellectual property consulting
and consumer insight company. He was formerly a professor of marketing and entrepreneurship at the University of New Hampshire and a Chair and Full professor at Dalhousie University.

At Northeastern, he developed the graduate new venture creation course; the undergraduate innovation course – which is now taught campus-wide; and developed the online MBA course on innovation and enterprise growth. He also serves as the Faculty Advisor for the Private Equity and Venture Capital Club. Every semester at least one of his teams from his new venture creation course goes on to commercialize a business.

Citation of Article:

Crane, F. (2021, August 25). The Entrepreneurial Journey Part 4 – Do You Have the Right Brand? The International Council for Small Business, Small Business Gazette. https://icsb.org/the-entrepreneurial-journey-part-4-do-you-have-the-right-brand/

Alternative Investments and Pink Diamonds

Aug 17, 2021 | Gazette, The Latest

Alternative Investments and Pink Diamonds

Tuesday, August 17, 2021, by Dr. Mariya Yesseleva-Pionka, PhD

There has always been a great allure to owning diamonds among investors worldwide. Investments in precious stones and gems fall under the category of alternative investments and collectables with a high-risk factor. Argyle mine has been well-known for supplying natural-coloured diamonds, including white, champagne, cognac, blue, violet, and extremely rare and highly-priced Argyle pink and red diamonds.

The Argyle Diamond Mine was established in 1983 in the East Kimberley region in Western Australia. Argyle mine quickly took leading positions and was classified as the largest diamond producer based on the volume in the world. Last year, in November 2020, the Argyle mine announced its closure after 37 years of production and delivering a staggering 865 million carats of rough diamonds. This announcement has made a significant impact on the world diamond market due to the fact that Argyle mine was supplying up to 90% of all pink diamonds. Due to the drastic reduction in supply, the anticipated increase in prices is expected to affect the world diamond market. The 2021 Argyle Pink Diamonds Tender is set to present to the world a final collection of extraordinary diamonds, and all the closing bids must be submitted by the 1^st of September 2021.

There are many layers of certifications that have to be done to assess the precious stones. The price of each stone depends on many factors such as cut, clarity, shape and colour. Typically, darker shades of pink, which are close to purple, are very rare and, as such, have a much higher value. Once you have decided to purchase precious stones from an auction house or dealer, you have the right to insist on independent assessment. Generally, it is common that two different evaluations of stones will provide different prices. Precious stones and gems trading is typically conducted in illiquid markets with quite high sales commissions. There is a drastic difference in the retail and wholesale gemstones prices and quality. It is essential to follow the strategy of buying at a low wholesale price and selling at a higher retail price.

Trading in precious stones presents many challenges due to the lack of stringent taxonomy in the quality standards. For any new investor, it is difficult to distinguish between different types of diamonds and, as a result, they try to seek an expert opinion of value based on the quality of the stone. There are many cases when inexperienced investors become involved in a scam and end up losing their money. Thus, it is vital for any investor to understand, research, and educate yourself about the potential risks associated with precious stones investing choices. For investment portfolio diversification, it is essential to keep in mind not to overexpose their investment position to high-risk investments and keep it to a lower level. Always have proper insurance in place for precious stones and keep in mind that the long-term strategy of owning your investment position might not work to your advantage, should the supply of rare stones, such as pink diamonds, increase due to the findings of new pink diamonds deposits.

Author

Dr Mariya Yesseleva-Pionka is Global Certificates Manager at ICSB, a Higher Degree by Research Supervisor at Excelsia College and Adjunct Academic at the University of Technology Sydney, Australia. Dr Yesseleva-Pionka held teaching and senior academic management positions in Central Asia (Kazakhstan) and Australia. She specialised in general investments, personal and corporate superannuation investments while working for Westpac Banking Corporation and BT Financial Group in Australia. She was invited to join The Housing Connection, a not-for-profit organisation in Sydney, Australia as Treasurer and Board Member from November 2019. Her research interests include entrepreneurial finance, traditional and alternative ways to finance small and medium enterprises (SMEs), corporate finance, policies for the small business sector, innovation and SMEs, FinTechs and Blockchain. Dr Yesseleva-Pionka is the Associate Editor for the Journal of the International Council for Small Business (JICSB).

The Entrepreneurial Journey Part 3 – Do You Have the Right Business Model?

Aug 4, 2021 | Gazette

The Entrepreneurial Journey Part 3 – Do You Have the Right Business Model?

Wednesday, August 4, 2021, by Dr. Frederick Crane

Even if you have the right venture opportunity (discussed in Part 2 of this series), without the right business model your venture is likely to fail. Once you have identified and screened your opportunity well, the next step is to determine how you will make money from this opportunity. This is where your business model decision comes in. In short, a business model is a framework for making money. It outlines the set of activities that the enterprise will perform, how it will perform them, and when it will perform them to create customer value and earn a profit. I have argued for many years that the right venture opportunity always requires the right business model.

Your business model is central to the firm’s success. Thus, the right the business model should answer the following questions:

How will the enterprise make money?
How will the enterprise create value?
For whom will the enterprise create value?
What is the enterprise’s internal source of sustainable competitive advantage?
How will the enterprise position itself in the marketplace?

Successful entrepreneurs also ask themselves the following questions with regard to the business model.

Where is the money?
Who has the money?
How do I get the money?
What do I need to provide to get the money?
How do I get it faster than anyone else?
How do I get it time and time again from the same customer?
How can I add other revenue streams later?

A major component of your business model is your revenue model. There are several revenue model options for you to consider including: production model (manufacturing), subscription, licensing/royalty, and franchising. Each has its own strengths and weaknesses, and you should examine which one makes sense to you given your specific opportunity and business context. Voice of consumer is very valuable in determining which revenue model is right for your given the customer you are seeking and how they wish to do business with you.

It is critical for you to target the right customers with the right business model. You must focus your efforts and determine which customers you wish to serve (target market/segment) and how much of each customer’s needs you want to serve. What is also very important for you to consider is not only creating recurring revenue but also obtaining incremental revenue. In fact, many customers can produce more than one source of revenue (e.g., buying a car and having it serviced). Moreover, some customers might wish to buy a product, but others might wish to lease, rent, or rent-to-own a product. An enterprise that only wishes to “sell” its product may be losing out on other potential lucrative revenue streams!

In summary, it is critical that you develop the right business model for your venture. In fact, without one, you are not very likely to attract venture financing. And, just like you would vet your opportunity with your potential customers, you also want feedback from those potential customers about your proposed business model. This input will help you determine how to best configure your venture to create value for your target market as well as select the best strategy for making money and sustaining the growth of your enterprise.

Author

Frederick Crane serves as a Senior Project Manager for the International Council for Small Business (ICSB).

Dr. Crane is an Executive Professor of Entrepreneurship & Innovation at the College of Business at Northeastern University; Former Editor of the Journal of the Academy of Business Education; and co-founder of Ceilidh Insights LLC – an innovation management training, intellectual property consulting
and consumer insight company. He was formerly a professor of marketing and entrepreneurship at the University of New Hampshire and a Chair and Full professor at Dalhousie University.

At Northeastern, he developed the graduate new venture creation course; the undergraduate innovation course – which is now taught campus-wide; and developed the online MBA course on innovation and enterprise growth. He also serves as the Faculty Advisor for the Private Equity and Venture Capital Club. Every semester at least one of his teams from his new venture creation course goes on to commercialize a business.

Citation of Article:

Crane, F. (2021, August 4). The Entrepreneurial Journey Part 3 – Do You Have the Right Business Model? The International Council for Small Business, Small Business Gazette. https://icsb.org/the-entrepreneurial-journey-part-3-do-you-have-the-right-business-model/

Environmental Sustainability and Global Finance

Jul 20, 2021 | Gazette

Environmental Sustainability and Global Finance

Tuesday, July 20, 2021, by Dr. Mariya Yesseleva-Pionka, PhD

Back in 1987, when United Nations introduced the definition of sustainability, it emphasised that sustainability is about responding to the needs of the present without undermining the ability of future generations to meet their own needs[1]. In the early 1990s, Triple Bottom Line (also known as People, Planet, Profit) was introduced by John Elkington. He advocated for business reporting, which provides information about the economic, environmental and social performance of business entities[2]. In September 2015, the General Assembly implemented the 2030 Agenda for Sustainable Development that includes 17 Sustainable Development Goals (SDGs) based on the principle of “leaving no one behind”[3]. This Agenda emphasised an all-inclusive approach to attaining sustainable development for all. According to OECD data, many countries are taking action, but progress is insufficient to achieve the goals of the 2015 Paris Agreement. The adoption of renewable energy is on the rise; nevertheless, it still represents 11% of energy supply and 27% of electricity production in the OECD[4].

The public disclosure of information about the social and environmental impacts of business operations has become widespread since the early 1990s, typically among large companies worldwide. The Global Reporting Initiative[5] (GRI) provides a conceptual framework and guidance for social and environmental reporting. The GRI Reporting Framework provides direction on reporting an organisation’s economic, ecological and social performance. It was created for application by businesses of any size, sector or location.

Climate and environmental impacts will be at the heart of global finance. Can profitability and sustainability co-exist? In answering this question, it is vital to emphasise that long-term profits will not matter if there is no planet. Overall, if we continue to underestimate the importance of environmental resources and our role in promoting sustainable behaviour, this could lead to highly detrimental outcomes for the planet. Thus, there is an immediate urgency for educating everyone concerning climate risk and their role in promoting sustainability.

We are already witnessing green start-ups that provide various tools that measure storm and flood risks and assess the level of pollutions created by businesses. In the financial services industries, many green FinTechs successfully combine finance and technology while promoting and embedding sustainable behaviour among customers. For instance, digital banks allow their customers to round-up their transactions to support tree planting, give cash-back for using climate-friendly business services or products, provide green loans for various solar energy projects and deliver a customised analysis of customers’ spending to emphasise their carbon emissions footprint and sustainable behaviour. Other FinTechs provide online app-based wooden credit cards with the portion of profits going to reforestation projects; introduce loyalty programs based on carbon points that can be converted into products and services with selected business partners that promote climate-friendly sustainable behaviour.

There is an onset of transformative generational wealth handover from baby boomers to millennials, with new business leaders becoming increasingly attentive to climate risks. Thus, they tend to choose sustainability in business operations. According to an EY study, millennial investors are almost twice as likely to invest in businesses or managed funds that target specific social or environmental goals, and 90% of them want sustainable investing as an option within their pension/superannuation plan[6]. Originally sustainable investing started in equities; however, over the years, government and private companies have been issuing various debt instruments to finance environmentally friendly projects.

There seems to be an assumption that carbon footprints and environmental impacts are mainly connected to large organisations. However, the MSMEs account for over 90% of all businesses worldwide. Thus, it is evident that MSMEs collectively are classified as significant polluters globally and there are increasing requirements for these enterprises to participate in and implement sustainable business practices. There is an urgency in educating entrepreneurs, MSME owner-managers and future business leaders in general, on how SDGs require changes to business finance, management and investment.

[1] United Nations Brundtland Commission, 1987

[2] www.hbr.org/2018/06/25-years-ago-i-coined-the-phrase-triple-bottom-line-heres-why-im-giving-up-on-it

[3] https://www.un.org/development/desa/disabilities/envision2030.html

[4] https://www.oecd.org/environment/climate-data/

[5] https://www.globalreporting.org/

[6] www.ey.com/en_au/financial-services/why-sustainable-investing-matters

Author

Dr Mariya Yesseleva-Pionka is Global Certificates Manager at ICSB, a Higher Degree by Research Supervisor at Excelsia College and Adjunct Academic at the University of Technology Sydney, Australia. Dr Yesseleva-Pionka held teaching and senior academic management positions in Central Asia (Kazakhstan) and Australia. She specialised in general investments, personal and corporate superannuation investments while working for Westpac Banking Corporation and BT Financial Group in Australia. She was invited to join The Housing Connection, a not-for-profit organisation in Sydney, Australia as Treasurer and Board Member from November 2019. Her research interests include entrepreneurial finance, traditional and alternative ways to finance small and medium enterprises (SMEs), corporate finance, policies for the small business sector, innovation and SMEs, FinTechs and Blockchain. Dr Yesseleva-Pionka is the Associate Editor for the Journal of the International Council for Small Business (JICSB).