Entrepreneurship
Introduced| English | Meaning |
|---|---|
| opportunity/ɒpəˈtjuːnɪti/ | A favourable situation outside the business that it could use to grow or improve. |
| risk/rɪsk/ | The possibility of an adverse outcome, often assessed using its likelihood and consequences. |
| uncertainty/ʌnˈsɜːtənti/ | Lack of complete certainty about a quantity or conclusion, arising from variability, measurement limits or incomplete information. |
| milestone/ˈmaɪlstəʊn/ | A dated checkpoint that decides whether to continue or stop. |
"Students love bread"
- A friend urges the Nimbus owner to open a bakery on the university campus: "students love fresh bread, it can't fail". A shop would cost about £45,000 to fit out.
- Is this an opportunity or just a good feeling? Entrepreneurs succeed less by being brave than by finding out cheaply whether an idea works. This lesson shows how.
An opportunity answers three questions
- Who exactly has the problem? Not "young people", but, say, students in the library block who want food after 3 pm. How do they solve it today? The campus shop's wrapped sandwiches are the real competitor.
- Why would they switch? The reason must be specific enough to be proved wrong. If the three questions have no answers, the opportunity 机会 is only a mood.
Which reason to switch is specific enough to be tested?
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It names the customers, the time, the price and today's alternative, so a stall can prove it right or wrong. The others cannot fail any test.
Risk or uncertainty?
- Risk 风险 is when the possible outcomes and their chances are roughly known, such as an oven breaking down. You can plan for it with a buffer or insurance.
- Uncertainty 不确定性 is when nobody knows the chances, such as whether students will pay bakery prices. No spreadsheet removes it; only new information does.
Risk or uncertainty?
Sort each worry about the campus bakery. Risks have known chances and can be buffered or insured; uncertainties need a cheap test to learn the answer.
Match each worry to the right response.
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Risks are handled with buffers and insurance; uncertainties are reduced by tests that produce new information.
Buy information cheaply
- Before risking £45,000 on a shop, spend a little to learn a lot: count footfall for £200, run a four-week market stall for £1,200, take pre-orders before baking.
- Each test aims to remove one uncertainty. A five-year forecast spends nothing on information and simply assumes the answers.
A detailed five-year sales forecast removes the uncertainty about whether students will buy.
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The forecast assumes the answer instead of finding it out. Only new information, such as a stall's real sales, reduces the uncertainty.
Milestones with stop rules
- A milestone 里程碑 is a dated, measurable checkpoint whose result changes what you do next. Write its target and its stop rule before the test, so the result cannot be explained away.
- Spending rises only as uncertainty falls. The cheap tests come first, and the expensive commitment comes last.
- The stall must sell 420 a day by week 6. It sells 390.
- The shortfall is 420 − 390 = 30 sales, or 30 ÷ 420 ≈ 7% below target.
- The plan, written in advance, says: pause, change one thing (a later closing time near the library), and retry once.
- The lease is signed in week 10 only if the retry clears 420. If it does not, Nimbus has lost £1,400 rather than £45,000.
The stall's target was 420 sales a day and it sold 390. By what percentage did it fall short? Give one decimal place.
Difficulty 2/5 · 140 coins + a small bonus on first completion today
$\dfrac{420 - 390}{420} = \dfrac{30}{420} \approx 0.071$, so about 7.1% short. The rule written in advance says to adjust and retry once.
Put the steps of the campus plan in the order the money should be spent.
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The cheapest tests remove the biggest uncertainties first; the expensive commitment comes only when the evidence supports it.
Plan a cheap way out
- Before each step, ask: "If this fails, what do we lose?" Keep that loss small enough to survive, for example a three-month break clause in the lease.
- Failing early and cheaply is a result, not a disaster: it frees time and money for a better idea.
Which are good milestone stop rules? Select all that apply.
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A stop rule needs a number and a date, set in advance. A feeling or "until it works" can never trigger a stop.
Marks that slip away
- Vague customers. "Everyone" or "young people" cannot be tested; name a specific group and need.
- Ignoring today's solution. The customer's current habit is the competitor to beat.
- Treating uncertainty as risk. A precise forecast of an unknown is still a guess.
- Targets set after the result. Then every result looks like a success.
You've got it
- An opportunity needs a specific customer, today's solution and a testable reason to switch.
- Risk has known chances and can be buffered; uncertainty has none and must be reduced with information.
- Buy information cheaply with dated milestones whose targets and stop rules are set in advance, and keep every exit cheap.