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PREPARING FOR THE NEW VENTURE LAUNCH: EARLY MANAGEMENT
DECISIONS (Continued….)

CREATING AWARENESS OF THE NEW VENTURE

In the early stages, the entrepreneur should focus on developing awareness of the products offered.

Publicity is free advertising provided by a media outlet. Many local media encourage entrepreneurs to participate in their programs. The entrepreneur can increase the opportunity for getting exposure by preparing a news release and sending it to as many media sources as possible. For radio or TV, the entrepreneur should identify programs that may encourage local
entrepreneurs to participate. Free publicity can only introduce the company. Advertising can be focused on specific customers.

Internet Advertising

The Internet is an excellent medium to create awareness and to effectively support early launch strategies. Creating a website is the most important first stage. The website should indicate: Background of the company. Its products, officers, address, telephone and fax numbers. Contact names for potential sales. Direct sales from the website may also be available. Significant advertising is needed to create interest and awareness of the existence of the website. It is important to change the content of the website as necessary. The entrepreneur may also consider using a banner ad, small rectangular ads similar to billboard ads that appear on browser websites.

Read more: MGT602 - Entrepreneurship - Lecture Handout 42

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THE ORGANIZATIONAL PLAN

LEARNING OBJECTIVES

1. To understand the importance of the management team in launching a new venture.
2. To understand the advantages and disadvantages of the alternative legal forms of incorporation.
3. To explain the S Corporation and limited liability company as alternative forms of incorporation.
4. To learn how to prepare a job analysis, job description, and job specification.
5. To illustrate how the board of directors or board of advisors can be used to support the management of a new venture.

DEVELOPING THE MANAGEMENT TEAM

Potential investors are interested in the management team and its ability and commitment to the new venture. Investors usually demand that the management team not operate the business part- time while employed full time elsewhere. It is also unacceptable for the entrepreneurs to draw a large salary. The entrepreneur should consider the role of the board of directors and/or a board of advisors in supporting the management of the new venture.

LEGAL FORMS OF BUSINESS

There are three basic legal forms and one new form of businesses. The three basic forms are:

1. Proprietorship.
2. Partnership.
3. Corporation

A new form is the limited liability company, which is now possible in most states. The entrepreneur should evaluate the pros and cons of each of the legal forms prior to submitting a business plan. He should determine the priority of several factors discussed below. It is also necessary to consider intangibles such as image to suppliers, existing clients, and prospective customers.

Read more: MGT602 - Entrepreneurship - Lecture Handout 27