Entrepreneurship, Second Edition

Chapter 3. OPPORTUNITY RECOGNITION, SHAPING, AND RESHAPING

Stacy Madison, founder of Stacy's Pita Chips which has grown to $60 million in sales was sold to Frito-Lay in January 2006. (Source: Courtesy Frito-Lay, Inc.)

Entrepreneurship is all about opportunity. Would-be entrepreneurs often have one of two things on their minds: "How do I come up with a good business idea?" and "Is this idea big enough to make a successful business?" This chapter focuses on evaluating ideas and assessing whether they are indeed good opportunities. While an idea is necessary to entrepreneurship, it isn't sufficient. To have a successful entrepreneurial endeavor, your idea needs to be an opportunity.

Belief in your idea is a great thing. But first step back and ask a more important question: "Is this idea an attractive opportunity?" Moving from an idea to a viable opportunity is an iterative process. Entrepreneurs need to conduct a series of tests—what we refer to as market tests—to identify interesting ideas and then see whether they are viable opportunities. Each test is an escalation of commitment, an important step to successfully launching the venture. So the process of recognizing, shaping, and reshaping an opportunity combines thought and action to take the idea from formulation to execution. Both are critical as you embark on your entrepreneurial adventure. In this chapter, we will lay out ...