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10.6: Key Terms

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    • Michael Laverty and Chris Littel et al.
    • OpenStax

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    born global
    venture seeking to be a global company from its inception
    build-measure-learn loop
    step-by-step approach on how to maneuver a startup, how to change course if necessary, how to persevere, and how to accelerate the expansion of a business
    business failure
    ending a business due to the lack of goal attainment, which can include low levels of revenue and profit, or not meeting investors’ expectations
    business lifecycle
    stages companies go through: birth, growth (or expansion to new markets and products), maturity, decline, death or rebirth
    early adopters
    people who like to try new things and can be found at the onset of the adoption process for a product
    form of licensing that allows the business (franchisor) to share its business model to expand through various distributors (franchisees) for a fee
    Global Entrepreneurship Monitor (GEM)
    organization that researches entrepreneurship around the world
    innovation accounting
    assesses whether the changes made to the product are creating the desired results
    small changes to the current version of a product to make it better fit consumer needs
    joint venture
    temporary partnership in which two different enterprises combine for the purpose of mutual benefits such as sharing of expenses and to work toward shared goals and the associated potential revenue
    lean pitch
    verbal delivery of an idea or business plan as a request to a group of investors by an entrepreneur
    lean plan
    brief business plan shown to potential investors and employees that is a fast and effective way to set, manage, and evaluate goals and strategies in a business
    lean startup
    methodology entrepreneurs use this method to help them innovate by continuously testing their products and getting feedback from customers in real time
    contract in which one enterprise gives permission to another entity to manufacture and sell its products for a royalty
    mergers and acquisitions
    when two companies combine, or one buys the majority stake of the other
    minimum viable product (MVP)
    early version or prototype of a product that may not be polished or complete but that functions well enough that you can begin to market it or test it with potential users
    crucial change done to test a hypothesis regarding the basic product, its growth potential, and business model; if something is not working, then a change or a “pivot” needs to take place
    strategic alliance
    arrangement created by two entities to work on a project by sharing some of their strengths and resources, but not actually creating a new entity as in the case of a joint venture

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