CBS Innovation & Entrepreneurship 2

Question 1

Which innovation framework categorizes innovations as sustaining or disruptive based on their impact on existing markets?

Accepted Answer

Clayton Christensen's Disruptive Innovation Theory

Answer

Clayton Christensen's Disruptive Innovation Theory distinguishes between sustaining innovations (improving existing products for mainstream customers) and disruptive innovations (creating new markets or reshaping existing ones).

Question 2

A startup uses a 'freemium' model where basic features are free but advanced features require payment. This is an example of which business model innovation?

Accepted Answer

Freemium monetization strategy

Answer

Freemium monetization offers a free tier to acquire users and a paid tier to generate revenue, converting free users into paying customers.

Question 3

What is the primary purpose of a 'minimum viable product' (MVP) in entrepreneurship?

Accepted Answer

To test core assumptions with minimal resources before full development

Answer

An MVP allows entrepreneurs to validate key hypotheses about customer needs and product-market fit with the least possible investment.

Question 4

Which stage of the venture capital funding cycle typically involves the largest investment and prepares a company for a public offering?

Accepted Answer

Series C or late-stage round

Answer

Late-stage rounds (Series C and beyond) involve the largest investments, funding scaling operations and positioning the company for an IPO or acquisition.

Question 5

An entrepreneur pivots from selling software directly to licensing it to enterprise clients. This change is best described as a:

Accepted Answer

Revenue model pivot

Answer

A revenue model pivot changes how a company generates income without necessarily changing the product itself.

(CBS) Certified Business Strategist Practice Test

(CBS) Certified Business Strategist Practice Test

CBS Innovation & Entrepreneurship 2