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Jim Boothe, Inventor: CASE 2 Entrepreneurship by Robert Hisrich, Michael Peters, Dean Shepherd

Jim Boothe has invented an automatic derailleur for bicycles and is considering leaving his job of 25 years to start a business selling his invention. He believes there is significant market potential given the growing bicycling industry. Jim has prepared a business plan to submit to his bank to request $100,000 to start the business. His wife is skeptical of the risk but Jim is determined to pursue his entrepreneurial dream.

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Zahra Qamar
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785 views2 pages

Jim Boothe, Inventor: CASE 2 Entrepreneurship by Robert Hisrich, Michael Peters, Dean Shepherd

Jim Boothe has invented an automatic derailleur for bicycles and is considering leaving his job of 25 years to start a business selling his invention. He believes there is significant market potential given the growing bicycling industry. Jim has prepared a business plan to submit to his bank to request $100,000 to start the business. His wife is skeptical of the risk but Jim is determined to pursue his entrepreneurial dream.

Uploaded by

Zahra Qamar
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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JIM BOOTHE, INVENTOR

CASE 2; Entrepreneurship by Robert Hisrich, Michael Peters, Dean Shepherd


Jim Boothe has invented dozens of different products in his 25 years as an engineer to a
large research and development lab. For some time, he has been thinking of leaving his
current company and starting his own but has never seemed to have the nerve to do so. Jim
feels that with his children grown up and on their own, now would be a good time to start
his own business.

Having been an avid bicyclist for many years, Jim had invented an automatic derailleur for
a 15-speed bike. This derailleur can be easily attached to any bicycle. The user does no
shifting as the bicycle shifts the gears of the bicycle automatically (depending on terrain)
much like the automatic transmission on an automobile. Jim feels that this invention has
significant market potential, particularly since he has observed a rapid growth in the
bicycling industry. This growth has been related to Lance Armstrong’s success in the Tour
de France, increased interest in physical fitness, and technological improvements in
derailleur allowing for off-road travel as well as more comfort for longer-distance riding.
In his cycling club alone, the membership has doubled in the past two years and to his
knowledge is consistent with a national trend.

Jim feels that all he needs to do is to write a business plan and submit it to his bank to
obtain the estimated $100,000 needed to get started. He is willing to support this by taking
out a second mortgage as collateral. Jim feels that he can subcontract the manufacturing of
the derailleur and the bicycle separately; then upon receiving the items, he can complete
the final installation and fabrication functions before shipping to customers. Jim’s wife
Nora is a little skeptical about him leaving a good job for the purpose of fulfilling one of
his many fantasies or lifelong dreams. She is the more practical of the two and is concerned
about their financial future and the commitment that will be required of Jim in the first few
months of the start-up. Taking a second mortgage on the house makes her uncomfortable.
She is also not sure Jim is the entrepreneurial type.
In spite of all the concerns, Jim has prepared a business plan that he expects to submit to
his banker in the next few days. The business plan consists of six parts: a one-page
summary of the plan, a detailed description of his invention, forecasts of growth for the
bicycle market, a one-year profit and loss statement, a plan for the manufacturing and final
fabrication of the derailleur and bicycle, and an appendix that contains surveys with some
of his friends who own 10-speed bikes.

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