Question 1

Ned Kite is a four time business owner. One thing that has served Ned well throughout his entrepreneurial career is his ability to build and maintain relationships with people whose interests are similar or whose relationships could bring advantages to his new ventures. According to the textbook, Ned is a good:
A) networker
B) socializer
C) linker
D) assembler
E) connector

Accepted Answer

Ned's ability to build and maintain relationships with people whose interests are similar or whose relationships could bring advantages to his new ventures is a key characteristic of effective networking. Therefore, choice A) networker is the best answer.

Question 2

According to the textbook, studies show that more than one individual starts ________ of all new firms.
A) 20 to 25 percent
B) 50 to 70 percent
C) 5 to 15 percent
D) 30 to 40 percent
E) 75 to 90 percent

Accepted Answer

Studies show that between 50 to 70 percent of all new firms are started by more than one individual, as stated in the textbook.

Question 3

The What Went Wrong feature in Chapter 9 focuses on Monitor110, a 2005 startup that helped hedge fund managers and professional investors make better investment decisions . According to the feature, Monitor110's failure is an example of how a lack of ________ and ________ can damage a new venture team.
A) teamwork, a well-qualified board of directors
B) money, a highly motivated new venture team
C) industry experience, prior entrepreneurial experience
D) good legal advice, industry experience
E) consensus, a clear leader

Accepted Answer

E

Question 4

Which of the following statements is untrue regarding founding teams?
A) The members of heterogeneous teams are diverse in terms of their abilities and experiences.
B) The members of homogenous teams are very similar in terms of their abilities and experiences.
C) Teams that have worked together before have an edge.
D) Studies show that more than one individual starts 50 to 70 percent of all new firms.
E) It is generally believed that new ventures started by an individual have an advantage over new ventures started by a team.

Accepted Answer

The statement that new ventures started by an individual have an advantage over new ventures started by a team is untrue. Research has shown that founding teams are more likely to succeed than solo founders.

Question 5

The Savvy Entrepreneurial Firm feature in Chapter 9 focuses on how business founders overcome a lack of business experience. Which of the following was not mentioned as a practical way for a new business founder to overcome a lack of business experience?
A) hire consultants from a major consulting firm, like Bain & Company or McKinsey & Company
B) taking on a partner that has business experience
C) getting help from a Small Business Development Center
D) joining a Meetup group
E) participating in online forums

Accepted Answer

The option of hiring consultants from a major consulting firm was not mentioned as a practical way for a new business founder to overcome a lack of business experience. The other options, such as taking on a partner with business experience, getting help from a Small Business Development Center, joining a Meetup group, and participating in online forums, were mentioned as practical ways to overcome a lack of business experience.

Question 6

A(n) ________ is a chart that depicts the most important skills that are needed in a new venture and where skills gaps exist.
A) expertise report
B) talent profile
C) abilities summary
D) skills profile
E) talent summary

Accepted Answer

A skills profile is the most appropriate term as it refers to a chart that highlights the key skills needed for a new venture and the skills gaps in the existing team. The other options do not accurately describe this type of chart.

Question 7

According to the textbook, prior entrepreneurial experiences:
A) is one of the poorest predictors of future entrepreneurial performance
B) is one of the most consistent predictors of future entrepreneurial performance for entrepreneurs under 50 years of age but not for entrepreneurs over 50 years of age
C) is one of the most consistent predictors of future entrepreneurial performance
D) is one of the most consistent predictors of future entrepreneurial performance in service firms but not in manufacturing firms
E) has no relationship to future entrepreneurial performance

Accepted Answer

According to the textbook, prior entrepreneurial experiences are one of the most consistent predictors of future entrepreneurial performance.

Question 8

According to the textbook, which of the following statement is inaccurate regarding the size and composition of the founding team of a firm?
A) There is no relationship between a founding team's size and its effectiveness.
B) A founding team larger than four people is typically too large to be practical.
C) The members of a homogeneous founding team are similar in terms of their abilities and experiences.
D) The members of a heterogeneous founding team are diverse in terms of their abilities and experiences.
E) A founding team can be too big, causing communication problems and increasing potential for conflict.

Accepted Answer

According to the textbook, the statement "There is no relationship between a founding team's size and its effectiveness" is inaccurate. The size of a founding team can impact its effectiveness, and too large of a team can cause communication problems and conflict.

Question 9

Unigo, the company profiled in the opening feature for Chapter 9, is an online college guide. One attribute that Unigo's founder, Jordan Goldman, has that has served him well in building Unigo is:
A) he is a good networker
B) he has substantial prior entrepreneurial experience
C) he has been a college administrator
D) he has a PhD in management
E) he has substantial marketing experience

Accepted Answer

The article mentions that Goldman is "a master networker, the kind of person who seems to know everyone." This attribute has likely helped him in building relationships with colleges, students, and investors to grow Unigo.

Question 10

A ________ is the group of founders, key employees, and advisers that move a new venture from an idea to a fully functioning firm.
A) new venture panel
B) startup team
C) new venture team
D) new project team
E) startup cadre

Accepted Answer

The term "new venture team" specifically describes the group of individuals needed to move a new venture from an idea to a fully functioning firm, which includes founders, key employees, and advisers. "New venture panel" and "new project team" are not commonly used terms in entrepreneurship, while "startup team" and "startup cadre" are more general terms that do not necessarily refer specifically to the group responsible for launching a new venture.

Question 11

The high failure rate among new ventures is due in part to the liability of newness, which refers to the fact that new companies often falter because:
A) they are underfunded and the founder's of the firms don't move quickly enough to put together boards of directors and boards of advisors that can provide them direction and advice
B) they underestimate the complexities involved with starting a new business and the firm lacks a "track record" with outside buyers and sellers
C) the people who start the firms can't adjust quickly enough to their new roles and the firm lacks a "track record" with outside buyers and sellers
D) the people who start the firms can't adjust quickly enough to their new roles and they are underfunded
E) they underestimate the complexities involved with starting a new business and they don't move quickly enough to establish business partnerships

Accepted Answer

The answer of The high failure rate among new ventures...

Question 12

Jason Andersen just finished writing a business plan for a new type of office supply store. One thing Jason included in the "Management Team & Company Structure" section of his business plan is a chart that depicts the most important skills that are needed for his business and where skills gaps exist. Jason included a ________ in his business plan.
A) skills profile
B) talent report
C) abilities profile
D) expertise report
E) talent summary

Accepted Answer

A skills profile is a chart that shows the important skills required for a business and identifies any gaps in the current skillset of the management team or employees. Therefore, it is the most appropriate term to describe what Jason included in his business plan. The other choices, such as talent report, abilities profile, expertise report, or talent summary, do not accurately describe the chart that Jason created.

Question 13

The fact that companies often falter because the people who start the firms can't adjust quickly enough to their new roles and because the firm lacks a "track record" with outside buyers and sellers, is referred to as the:
A) liability of preparedness
B) liability of newness
C) burden of novelty
D) burden of freshness
E) millstone of innovation

Accepted Answer

The liability of newness refers to the challenges faced by new firms, including the lack of a track record, inexperienced leadership, and limited resources. This can make it difficult for the company to establish credibility with outside buyers and sellers, which can impede their growth and success. The other answer choices are not common terms used to describe this phenomenon.

Question 14

The members of homogeneous teams are:
A) diverse in terms of their abilities and experiences
B) diverse in terms of their abilities, but very similar in terms of their experiences
C) similar in terms of their abilities and experiences
D) diverse in terms of their experiences, but very similar in terms of their abilities
E) sometimes diverse in terms of their abilities and experiences and sometimes similar along the same dimensions

Accepted Answer

Homogeneous teams are made up of members who are similar in terms of their abilities and experiences. This can be beneficial in certain situations, such as when the task at hand requires a high level of expertise or when the team needs to function efficiently with a shared understanding of the work. However, it can also lead to groupthink and a lack of creativity in problem-solving if everyone thinks the same way.

Question 15

Which of the following statements is incorrect regarding founding teams?
A) The members of heterogeneous teams are diverse in terms of their abilities and experiences.
B) Teams that are working together for the first time have and advantage over teams that have worked together before.
C) The psychological support that cofounders of a new business can offer one another is an important element of a firm's success.
D) The members of homogeneous teams are very similar in terms of their abilities and experiences.
E) Studies show that more than one individual starts 50 to 70 percent of all new teams.

Accepted Answer

This statement is incorrect as research suggests that teams who have worked together before often have an advantage over teams that are working together for the first time. Familiarity and the ability to anticipate each other's actions can lead to greater efficiency and productivity.

Question 16

Savanna Combs opened a clothing boutique two years ago. Unfortunately, the boutique failed after 18 months. Savanna attributes the failure of her boutique to that fact that her employees couldn't adjust quickly enough to their new roles and because her boutique lacked a "track record" with outside buyers and sellers, which made it difficult to form partnerships and make sales. Savanna suffered from what research call the:
A) burden of novelty
B) millstone of innovation
C) liability of newness
D) liability of preparedness
E) burden of newness

Accepted Answer

The concept of "liability of newness" refers to the challenges that new ventures face due to lack of experience or track record in their industry. Savanna's boutique failed due to its inability to establish partnerships and make sales, which could be traced back to its "liability of newness." Option A ("burden of novelty"), B ("millstone of innovation"), D ("liability of preparedness"), and E ("burden of newness") are not commonly used terms in the context of entrepreneurship research.

Question 17

Anna Templeton is preparing to launch a home security firm. The team of people that will launch Anna's firm are as follows: Anna (CEO), Trevor (VP-Finance), Carrie (VP-Sales), a six person Board of Directors, a five person Board of Advisors, and Anna's primary investor, who will assume an advisory role. The group of people that will launch Anna's firm is called its:
A) startup squad
B) new venture panel
C) new venture team
D) startup cadre
E) startup troop

Accepted Answer

The group of people that will launch Anna's firm is called its new venture team. Therefore, option C is the best choice. The other choices listed, such as startup squad or troop, are not commonly used terms in the business world. Option B, new venture panel, could be a possible alternative, but it implies a more formal, advisory role rather than a team actively involved in launching the venture. Option D, startup cadre, is also not as commonly used and may sound too militaristic.

Question 18

Which of the following was not identified in the textbook as an element of a new venture team?
A) board of advisors
B) suppliers and vendors
C) key employees
D) lenders and investors
E) management team

Accepted Answer

The textbook identifies the board of advisors, key employees, lenders and investors, and management team as elements of a new venture team. However, suppliers and vendors are not included as part of the team, although they may be important stakeholders in the success of the venture.

Question 19

The members of heterogeneous teams are:
A) diverse in terms of their abilities and experiences
B) diverse in terms of their abilities, but very similar in terms of their experiences
C) similar in terms of their abilities and experiences
D) diverse in terms of their experiences, but very similar in terms of their abilities
E) sometimes diverse in terms of their abilities and experiences and sometimes similar along the same dimensions

Accepted Answer

Heterogeneous teams are composed of individuals who bring diverse abilities, experiences, and perspectives to the table. This diversity allows for a range of ideas and approaches to problem-solving, leading to more effective decision-making and improved outcomes. Therefore, option A is the best choice as it explains the definition of heterogeneous teams.

Question 20

The process of building and maintaining relationships with people whose interests are similar or whose relationship could bring advantages to the firm is called:
A) linking
B) socializing
C) networking
D) associating
E) connecting

Accepted Answer

The process described is commonly known as networking. Networking involves building relationships with people who can provide support or benefits to a business or organization. This can include potential customers, industry peers, and other professionals who share similar interests or goals. By actively engaging in networking activities, businesses can expand their contacts and build a stronger brand presence within their industry.

Quiz 9: Building a New Venture Team

According to the textbook, studies show that more than one individual starts ________ of all new firms.

The What Went Wrong feature in Chapter 9 focuses on Monitor110, a 2005 startup that helped hedge fund managers and professional investors make better investment decisions . According to the feature, Monitor110's failure is an example of how a lack of and can damage a new venture team.

Which of the following statements is untrue regarding founding teams?

The Savvy Entrepreneurial Firm feature in Chapter 9 focuses on how business founders overcome a lack of business experience. Which of the following was not mentioned as a practical way for a new business founder to overcome a lack of business experience?

A(n) ________ is a chart that depicts the most important skills that are needed in a new venture and where skills gaps exist.

According to the textbook, prior entrepreneurial experiences:

According to the textbook, which of the following statement is inaccurate regarding the size and composition of the founding team of a firm?

Unigo, the company profiled in the opening feature for Chapter 9, is an online college guide. One attribute that Unigo's founder, Jordan Goldman, has that has served him well in building Unigo is:

A ________ is the group of founders, key employees, and advisers that move a new venture from an idea to a fully functioning firm.

The high failure rate among new ventures is due in part to the liability of newness, which refers to the fact that new companies often falter because:

The fact that companies often falter because the people who start the firms can't adjust quickly enough to their new roles and because the firm lacks a "track record" with outside buyers and sellers, is referred to as the:

The members of homogeneous teams are:

Which of the following statements is incorrect regarding founding teams?

Which of the following was not identified in the textbook as an element of a new venture team?

The members of heterogeneous teams are:

The process of building and maintaining relationships with people whose interests are similar or whose relationship could bring advantages to the firm is called: