Entry to Entrepreneurship
Entry to Entrepreneurship
"I wish I had had an opportunity like this when I was in high school – I would probably be a better entrepreneur today!" - Barth Anderson, co-founder of Barrington Coffee Roasters & "on-call" advisor for students in our Entry to Entrepreneurship program.
This year's program has been sponsored by the following:
As well as: The Turkeybush Foundation, The Elitzer Family Foundation, Nancy Fitzpatrick & Lincoln Russell, The Triplex Cinema, Hellman, Shearn, & Arienti LLP, Ameriprise Financial, Shaker Mill Books, and Keith & Aldonna Girouard.
2016 Entry to Entrepreneurship students presented their business plans to the public on Tuesday, April 12th at Dewey Hall.
The 2016 “Entry to Entrepreneurship” program was offered in partnership with the Massachusetts Small Business Development Center Network's Berkshire Regional Office and Berkshire Community College's South County Center.
In addition, community members Vito Vitrano, Howard Lefenfeld, Rachel Moriarty, Kristina Vaselewski, Charles Ferris, Mark DeCelle, Oskar Hallig, Richard Stanley, Phyllis Webb, Michal Snyder, John Graziano, David Bruce, Billie Best, Keith Girouard, Nancy Shulman, Erik Bruun, Elizabeth Hamilton, Bonnie Silvers, Maia Conty, Betsy Andrus, Brian Hailes, Sierra Watson, Jody Law, Julie Hannum, and Maddie Elling leant their time throughout the course as advisors, mentors, or presenters.
The program was made possible by support from Covestro, 1Berkshire, the Elitzer Family Fund, Nancy Fitzpatrick and Lincoln Russell, Benno Friedman, the Great Barrington Rotary Club, Greylock Federal Credit Union, Hellman, Shearn & Arienti, LLP, Hunt Alternatives & Fern Portnoy, Charles and Angeliki Keil, Lee Bank, Pittsfield Cooperative Bank, Salisbury Bank and Trust Company, Smitty Pignatelli, The Triplex Cinema, and the Schumacher Center for a New Economics.
We began Entry to Entrepreneurship on Tuesday, January 26th with an introduction to the concept of "import replacement" and a presentation from Maddie Elling of Hosta Hill.
Homework: Fill up the import replacement worksheet with as many import replacement ideas as possible. Come to class ready to share some of your favorites.
In this video, class facilitator Alice Maggio takes the students through the welcome packet and discusses expectations and goals for the course:
The following video is an introduction to "import replacement," one of the key concepts underlying the Entry to Entrepreneurship course.
Here's Maddie Elling's presentation:
On February 2, our lesson was taught by Regional Director Keith Girouard and Senior Business Advisor Nancy Shulman from the Massachusetts Small Business Development Center. Keith and Nancy presented a class on the "fundamentals of business" and walked students through the Business Planning Worksheet located at the back of the welcome packet. This worksheet will provide the outline for the business plans that students will be preparing during the course.
Keith introduced a tool for evaluating your business ideas, and explained that often you need to weigh your priorities as you think about your business. Some priorities might be more important than others.
Homework: Choose 2-4 business ideas from among those you listed on your import replacement worksheet last week. Rank them using the Evaluation Sheet that Keith introduced. Look at the results and come to class with a clearer idea about what business you would like to write about for your final plan.
Watch Keith and Nancy's lesson here:
Billie Best was our guest speaker for our February 9th class on marketing and market research.
She introduced the concept of a 'value proposition,' and illustrated the principles of marketing using this worksheet.
We also explored different approaches to market research. Billie Best provided some guidelines for the information that one needs to gather when conducing market research. Her guidelines are here.
Homework: First, email Alice an update on how you're doing – no later than Tuesday February 16th at 12 noon. In this email please include the following:
1. A brief description of your business idea
2. If you are going to work by yourself or with others
3. What your plan for market research is (in person, online, research questions...)
Second, please use what you learned on Tuesday to start conducting your market research. Find out as much as you can from online and in-person research. Use the materials from Billie Best's presentation as a guide.
Our guest in week four was Phyllis Webb, co-owner with her husband Dale of The Magic Fluke Co. in Sheffield, MA. The Magic Fluke Co. makes ukuleles and other musical instruments, sourcing all their parts from within the United States and often from within New England. Phyllis Webb presented her business to the Entry to Entrepreneurship class as an inspirational example of a small manufacturing business in the United States that seeks to be as local as possible.
"We have lived all of the stuff that I'm talking to you about, and we're not experts, we're still learning," concluded Phyllis.
Homework: Write a rough draft of parts a, b, and c of "The Business" section of your business plan (a. Description of the business, b. Target market, c. Competition). Hand in a typed copy at the beginning of class on Tuesday, March 1st.
Glossary of terms
Prototype = a first or early example of a product that is used as a model for what comes later
ex) the first ukulele that Dale Webb made at home in his family's toaster oven
Commodity = a mass-produced, unspecialized product
Income stream = a source of income for a business. (Most businesses have several.)
ex) for the Magic Fluke's main income stream is wholesale sales of ukuleles and other musical instruments. However, Phyllis has recently developed an additional income stream by creating a line of ukulele-themed jewelry.
Diversification = expanding your offering to create more income streams.
ex) The Magic Fluke has diversified their product line by designing a banjo-lele, a short-scale solid body bass guitar, and a violin. Next up, a cello!
Overhead = all of the expenses not directly related to the production of your business's goods or services that nonetheless are necessary for your business to operate.
ex) rent, electricity, heat, website design and maintenance...
Wholesale = selling a product to a retailer who will then sell to the end-user
Retail = selling to the end-user of a product
Distribution = the system or method by which you get your product or service to market
ex) Hosta Hill does their own distribution. They drive their own van to each store that sells their product, delivering kimchi and tempeh and sauerkraut when they need to.
Our guest in week five was Keith Girouard, senior business advisor and regional director for the Pittsfield office of the Massachusetts Small Business Development Center Network.
He started off with a review of material from our second lesson, and then jumped into talking about "The Numbers." Below are notes from his presentation.
Homework: Continue to work on the start up expenses and budget worksheets. Research, confirm or adjust expenses that will be associated with running your business, and fill in the worksheets. Please hand in a rough draft of both part A and part B of the "Financial Data" section of your business plan.
Q: What is an entrepreneur?
There are many different good definitions, but Keith’s definition = “a profit-making individual”
Q: What is a business?
The organization that allows a seller to sell something of value to a buyer, in exchange for the buyer’s time, trust, and money.
Reminder: the buyer determines the value of the product or service being sold.
Q: What is money?
Money may have many meanings to you as an individual, but in a business money is simply a tool. It is the lifeblood of the business. You need to learn how to handle money with skill and discipline in your business.
Often, our thinking about money goes like this: HAVE –-> DO --> BE
In a business your thinking about money should go like this: BE --> DO --> HAVE
In a business, money comes in different forms. The way you use these forms and the way you organize your money and & ‘the numbers is really important. There are laws, regulations, conventions, practices and principles that govern they way you keep track of money in a business. Therefore, you want to have
Why is this important?
You need to know how you’re doing in order to continuously improve your business
When you’re thinking about the financial model of your business there are two phases you need to consider, start up and launch.
For the Start Up Phase you need to brainstorm, research, and find out all the one-time capital expenditures that you will need to get started. You will also need to figure out how much working capital you need. Add all one time capital expenditure costs to the figure you get for working capital, and you will have your total start up costs. (see Start Up Expenses worksheet)
+ working capital
= start up costs
Some examples of one-time only capital expenditures are:
- Research and Development for you product (prototyping, beta testing…)
- equipment purchasing
For the Launch Phase you will need to brainstorm, research, and find out as much as you can about the on-going expenses your business will require. There will be a period when you have expenses, but before you are making enough income to cover your expenses. This is the period for which you will need working capital. When you start making more than you are spending you have reached your break even point!
You will need working capital to get through some “cash-flow negative” months when you first launch your business. Starting a business without enough working capital can lead to problems, and this problem is called being “undercapitalized.” You should therefore include working capital in the calculation of your start up expenses.
In order to calculate your working capital needs you will need to make some projections for both your expenses and your income in the first few months of your business. These assumptions should be reasonable and tested.
Our guests in week six were John Graziano, partner at Hunter & Graziano, Attorneys at Law in Lee, and Michal Snyder, a bookkeeper working in the Southern Berkshires.
Homework: Prepare a full rough draft of your business plan with as much detail as possible, to submit on Tuesday, March 22nd. Continue to conduct research.
Video coming soon.
In week seven we learned about small business lending from local experts--the commercial lending team from Lee Bank!
David Bruce, chairman of the board at Lee Bank, was our guest presenter, and he was accompanied by Lee Bank's commercial lenders Bruce Marzotto, David Harrington, and Chris Kinne.
Mr. Bruce's presentation covered the following:
- an introduction to community banking
- "what is a small business loan?"
- "what are the bank's objectives when making a loan?"
- "what does a bank look for when deciding to make a loan or not?"
- "what happens once they've made a loan?"
Mr. Bruce's presentation is available for download here.
Here's the video from week 7:
In week eight our guest speaker was Erik Bruun, President of SoCo Creamery and founding board member of the Railroad Street Youth Project and Project Native. Bruun presented a lesson called "10 Things An Investor Would Want to Know," in which he offered ten different elements that our students ought to consider including in their presentations on April 12th.
This week we discussed different support systems available to students after graduation from Entry to Entrepreneurship. Julie Hannum, director of off-campus centers at Berkshire Community College, described the different business programs offered by BCC. Keith Girouard, senior business advisor and director of the Berkshire Regional Office of the Mass. Small Business Development center, discussed what his organization offers to people who are interested in starting or developing a business. Alice Maggio also presented a lesson on BerkShares.
In the final event for the Entry to Entrepreneurship program, the students presented their business plans to the public at Dewey Hall in Sheffield. Each student received 200 BerkShares in seed money, presented by BerkShares, Inc. and the Schumacher Center for a New Economics. Students also received feedback from business plan reviewers and mentors, to help them improve their business plans. The video from the event may be viewed here and on CTSB-TV.