Friday was the halfway point of our
class. So far I had learned many
different ways to become an entrepreneur.
At the beginning of class Anthony Rossi came in and talked to us about
becoming an entrepreneur. He gave us a
lot of advice about starting your own business.
He did tell us some of the same stuff we have been hearing all week such
as not being afraid to fail. He also
told us that an important thing to do is just to go out there and talk to
people. He suggested that all of us go
to Biz Brew. Which is basically just a
meeting of young professionals where they talk about different business ideas
they have. This does sound like a very interesting
event to attend. He then took us down to
his office in the entrepreneurship center.
His office was not huge but he did point out that having this office
really allows him to make money because it cuts down on his overhead costs. He doesn’t have to pay for phone or anything
like that. He then brought out this big
list of business ideas that he had. He
has started on almost every one of his ideas.
It was crazy to see all of the ideas he had. He had business ideas from everything such as
a drunk driving service to smart phone apps.
I thought it was really cool and motivational to see how you can be an entrepreneur
at a young age.
We took our first test in this class and I thought it went
alright. We covered basically all of the
material up to chapter 6. At the end of
the test we watched another episode of Shark
Tank. We then had to write a couple
paragraphs about what we thought about the product and if we thought they got
money. The product presented was an app
that allows you to print off a postcard from any picture you take on your smart
phone, and then sign your signature.
The “sharks” all had serious concerns about this business. He started with $1.6 million and was already
down to $185,000. He and the “sharks”
both knew that he was bleeding money and really needed an influx of cash. But most of the “sharks” thought that while
this idea was decent, it was not worth the risk. I agree with the “sharks” for the most
part. I agree that is was an okay
idea. But my concern is that how often people
are going to do this. They download the
free app once and then print out a couple postcards and then lose interest. I did not think that any of the “sharks”
would invest but in the end one did which kind of surprised me. He did ask for a significant amount more of
the company equity and in the end the entrepreneur ended up taking the deal
which I thought was a good decision.
We also covered a part of chapter 7 which was mostly about
the start-up and some more basic financial information about new businesses. I have said this before but being an
accounting major I have seen a fair amount of this information before. This chapter looks at the two basic different
kinds of costs for a business: fixed and variable. Fixed costs are costs that will not change
over the short run, regardless of how much product you manufacture or service
you provide. Examples of this would be
rent. If you are a dentist, you have the
pay the same amount of rent every month regardless of how many patients you
see. This does not mean the fixed costs
will never change, they just cannot change over the short run. If in five years you decided to move
buildings, this will cause you fixed costs to change. Variable costs are costs which depend on how
much of a good or service you provide.
If you are a manufacture of beer, a variable cost for you would be
aluminum for cans. For every can of beer
you produce you must use aluminum for each can, if you don’t produce a can of
beer, you do not need to use any aluminum.
Chapter 7 also looks at some of the most basic equation in
business and accounting. The most basic
being that gross profit equals revenue minus fixed and variable costs. So if you can sell an ice cream bar for $1.00
and your fixed cost is $.30 and your variable costs are $.20,
than your gross profit is $.50 per ice cream bar. Chapter 7 than goes on to give some more advice
about the beginning stages of starting a new business. It says to do things such as make sure you have
good accounting practices and to keep good track of them.
Being half-way through this class I am very happy that I
decided to take it for J-term. I do
believe that I have some entrepreneurial spirit in me and I have learned a
lot so far. At the end of my sophomore year I
was seriously considering switching to just a business administration major and
not accounting. I even had switched advisors
and gotten my schedule. But over that
summer I talked to some people about it and decided that the best path for me
to take was accounting. When people are
giving advice about being an entrepreneur they say that you don’t have to be an
accountant to run a business, if you have a passion than you can run your own
business. But I do think that having a
basic understanding of accounting really helps you in every stage of owning you
own business. I do now know what the
future holds for me but I believe that having a knowledge of accounting will
help me in the future regardless of what path I take in life.
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