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The entrepreneurial process isn't just a checklist—it's a framework for understanding how successful ventures move from a spark of an idea to a thriving (or strategically exited) business. On your exam, you're being tested on your ability to recognize which stage a business is in, what challenges define each phase, and how entrepreneurs make decisions at critical junctures. Questions often present scenarios and ask you to identify the appropriate stage or recommend next steps.
Understanding these stages also reveals the iterative nature of entrepreneurship—it's rarely linear, and smart founders often loop back to earlier stages when conditions change. Whether you're analyzing a case study or answering an FRQ about venture development, you need to know not just what happens at each stage, but why that stage matters for long-term success. Don't just memorize the sequence—know what decisions, risks, and opportunities define each phase.
Before any business exists, entrepreneurs must identify problems worth solving and determine whether a viable market opportunity actually exists. This phase is about reducing uncertainty through research and critical analysis.
Compare: Idea Generation vs. Opportunity Evaluation—both occur before launch, but idea generation is divergent (expanding possibilities) while opportunity evaluation is convergent (narrowing to the best option). FRQs often test whether students can distinguish creative brainstorming from rigorous market analysis.
Once an opportunity is validated, entrepreneurs must build the infrastructure to pursue it. This phase transforms a promising idea into an executable venture through strategic planning and resource mobilization.
Compare: Planning vs. Resource Acquisition—planning defines what resources you need, while acquisition determines how you'll obtain them. Exam scenarios often present entrepreneurs who planned well but failed to secure adequate resources, or vice versa.
With plans and resources in place, entrepreneurs shift to market-facing activities. This phase tests whether assumptions hold up against real customer behavior and competitive pressure.
Compare: Launch vs. Growth—launch focuses on proving the model works, while growth focuses on scaling what works. A common exam question asks students to identify when a business should shift from survival mode to expansion mode.
Every entrepreneurial journey eventually reaches a transition point. This phase is about maximizing the value created and ensuring responsible transition of the venture.
Compare: Growth vs. Exit—growth assumes continued founder involvement, while exit planning prepares for leadership transition. Entrepreneurs who build with exit in mind often create more valuable, transferable businesses.
| Concept | Best Examples |
|---|---|
| Divergent Thinking | Idea Generation, brainstorming, creativity exercises |
| Convergent Analysis | Opportunity Evaluation, SWOT analysis, market validation |
| Strategic Documentation | Business Plan, KPIs, operational plans |
| Capital Formation | Resource Acquisition, funding rounds, investor relations |
| Market Entry | Launch, go-to-market strategy, customer acquisition |
| Scaling Operations | Growth, expansion, new market entry |
| Value Realization | Harvesting, exit strategies, succession planning |
| Iterative Learning | Feedback loops, pivots, continuous improvement |
A founder has identified a gap in the fitness app market and is now conducting a SWOT analysis. Which two stages is she transitioning between, and what key question should she answer before moving forward?
Compare and contrast the Planning stage and the Resource Acquisition stage. Why must planning typically precede resource acquisition, and what happens when entrepreneurs reverse this order?
An FRQ describes a startup that launched successfully but is struggling to scale. Which stage are they in, and what specific activities should they prioritize?
Which two stages share a focus on stakeholder management, and how does the purpose of stakeholder engagement differ between them?
A business owner is documenting all processes and training a successor. Identify the stage and explain why these activities maximize value during this phase.