“Belmont U Startup” Gets Series A Financing

Jeff Cornwall, Prof of Entrepreneurship and writer of The Entrepreneurial Mind blog, provides an update on one of his former MBA students. From Jeff’s blog:

Congratulations for Pathfinder Therapeutics, Inc. (PTI), a medical device company focused on the development of “surgical GPS” systems for the abdomen, announced that it has closed on a Series A financing. Everyone in Nashville is excited that this company will be growing right here where the technology was born.

We at Belmont are particularly proud about this announcement as Dr. Jim Stefansic, COO of Pathfinder, is an alumn of our Massey School MDA program! It was a pleasure to be able to work with Jim on this project in its early stages while he was a student in my classes.

Great to see that students are taking the knowledge gained on campus (not to mention the great talent, such as Jeff Cornwall) in order to launch new firms. Congrats to PTI and Belmont U.

Free Photocopies for Students — Japan

One of the entrepreneurial strategies that Schumpeter laid out was bringing a product/service to a new market. Check out Tada Copy (via Springwise), a Japanese company founded by students at Keio, Chuo, and Hosei Universities. It provides free copies for students.

They can do this by printing adverts on the backside of the paper (check out those full color ads!). Students save money and advertisers can target their ads directly at the student/university market. Sounds like a great idea that can easily be copied (sorry for the lame pun) at just about any campus.

Note* — the Tada Copy site is in Japanese so its hard to learn much about them for those who don’t read Japanese.

Here are a few blogs that have written on Tada (which means free) Copy: Shoko’s Blog & NicheGeek.

Does this sound like something that would go over well on your campus? BTW, here are some models for innovation/entrepreneurship that Schumpeter laid out in his paper The Creative Response in Economic History:

• enterprise that introduces ‘new’ commodities
• enterprise that introduces technological novelties into the production of ‘old’ commodities
• enterprise that introduces new commercial combinations such as the opening of new markets for products or new sources of supply materials
• enterprise that consist in reorganizing an industry

Lawn Mowers & AD/HD Entrepreneurs?

Because I am 35 years old, I missed the ‘rise’ of ADD. When I was in school (elementary thru grad school) I didn’t know anyone who had been diagnosed and treated for ADD. Things have changed and it is commonplace now for kids and some young adults to take meds to control their ADD.

I came across an interesting article in Lawn & Landscape Magazine (its title reminded me of Horse and Hound so I had to click on the link) offering tips for “ADD Entrepreneurs”. Further searching found more information on ADD and entrepreneurship. The Attention Deficit Disorder Association has a page dedicated to entrepreneurs with ADD or AD/HD.

I don’t know if I have ADD or AD/HD, but I do know I get distracted easily and my mind runs in a lot of directions — ask anyone who knows me. Here are some of the tips from the lawn mower magazine.

2. Create a distraction-free environment. It is important to create an environment that is simple and soothing. Do not create a background with bright colors, pictures and decorations because this will easily distract your eye. On the other hand, avoid working in a blank, white-walled room. It helps to have something pleasant to stare at in order to generate thoughts. Your workshop should be mildly interesting but not so interesting that it distracts you.

4. Be well rested and take breaks. Being tired causes you to be more distracted because it takes a lot of effort to concentrate. It’s important not to exhaust your mental energy during an important project. Prioritize your to-do list, decide what you need to accomplish and promise yourself a break as a reward.

These tips should work for anyone, but I can see that for someone like me (whether I have been diagnosed with ADD or AD/HD or not) the tips can be helpful if implemented. BTW, here is wikipedia on AD/HD.

More on the Myths of Angel Investing

We recently highlighted Scott Shane’s new paper on Angel Investing, this morning the WSJ featured part of their discussion on the topic in the paper under “Best of Independent Street.” The article online by Kelly Spors is tight and there are some insightful comments from their readers, plus a big, obvious piece of ‘British spam’ (see picture).

The main critique is likely around the term Angel Investor and what that means to the academic — Shane — versus the practitioner — the entrepreneur.

How do you use/define the term Angel Investor? And do you think one’s conception of the term varies by location (as a commenter on the WSJ site points out); people in and around Silicon Valley, DC, Boston, etc. have different expectations of an Angel versus someone in Omaha, Saint Petersburg, or Midland, TX?

Blog Maverick on the Power Behind the US Economy

A new member of our blog roll (Schumpeter’s Century) reminds us that an old member (Blog Maverick) is posting some great things. Here is Mark Cuban on curing what ails the US economy:

You can cut taxes for 95pct of Americans and raise taxes for the rest. You can cut taxes for businesses and retain the Bush Tax Cuts. You can increase or decrease the capital gains tax 5 or 10pct either way. Under both programs the deficit for the country will increase, we will borrow and print more money. 5 or 10pct variance either way, given the big hole our economy is in wont matter.

The cure for what ails is us the Entrepreneurial Spirit of this country. We are a nation of people who encourage , support and invest in those of any and all age, race and gender who will use their ingenuity and come up with a new idea.

Its always the new idea that re energizes this country. Industry, manufacturing, transportation, technology, digital communications, etc, each changed how we lived and ignited our economy and standard of living. Tax policy has never done that. The American People have.

Entrepreneurs who create something out of nothing don’t care what tax rates are. Bill Gates didn’t monitor the marginal tax rate when he dropped out of Harvard and started MicroSoft (btw, it was a ton higher than it is today). Michael Dell didn’t wonder what the capital gains tax was when he started PC’s Limited, and then grew it into Dell Computer. I doubt that any great business or invention started with a discussion or even a consideration of what the current or projected income or capital gains tax was or would be.

I cannot tell you how many times I have sat in classes or presentations and listened to PhD students/professors argue about the role of policy in entrepreneurship. I have always presented a Cuban-like argument  — that entrepreneurs thinking of big things are not worried about policy to any great extent. For those who are considering running a small biz (ie 3 location dry cleaner, travel agency, law firm, etc.) policy can be of great importance.

But, like Cuban, I believe it is the entrepreneurs who bring about the gales of creative destruction (see Schumpeter) and truly drive economic growth in the US and global economies. They are not deterred by small things like policy.

WSJ on National Youth Entrepreneurship Challenge

Raymund Flandez, a contributor to the WSJ’s Independent Street Blog, has a nice posting on the National Youth Entrepreneurship Challenge; an entrepreneurship contest for kids 18 and under put on by the National Foundation for Teaching Entrepreneurship. From the blog post:

One of the most interesting ideas I came across was making football-helmet shields with photo-chromatic paint that allows them to change color when the lights change. Macalee Harlis, of Ft. Lauderdale, Fla., came up with the concept, having experienced the problem of seeing the football field at dusk as a senior varsity linebacker.

The winner won $10,000 in seed capital or for education.

The contest is sponsored by Oppenheimer Funds Inc. and the National Foundation for Teaching Entrepreneurship, a New York-based nonprofit. With a budget of $19 million, NFTE has a mission to teach entrepreneurship and small-business skills to high school students in low income areas.

Since 1987, the NFTE program has been a part of the curricula of some high schools around the country, providing a way for students to learn what it means to be an entrepreneur and picking up valuable skills. Careful planning, strategizing, critical thinking, collaborating and calculated risk-taking are picked up, along with the basic principles of opening a business.

I really wish that my high school had offered this program — not to mention a basic financial literacy program (this is more a matter of public/education policy).

New Paper on BA Majors and Self-Employment

A new working paper by Chad Moutray of the SBA investigates the relationship between choice of major or field of study as an undergrad and employment choices down the road. The paper follows 1993 grads and follows them through 2003. I haven’t read it yet, but looks like it is going to have some good insights and . From the SBA (download paper)….

This working paper, “Baccalaureate Education and the Employment Decision: Self Employment and the Class of 1993,” utilizes the U.S. Department of Education’s Baccalaureate & Beyond (B&B) data series, to delve into the relation of collegiate education to the employment decision. The study shows that one’s choice of college major is a major determinant of whether one becomes self-employed or chooses wage-and-salary work.

A snippet from the beginning of the paper:

The self-employed, for instance, are less likely to have high concentrations of education, engineering, math or science majors. Business and management majors ar emore likely to work for a for-profit business, with social science and “others” majors gravitating toward self-employment.

The self-employed tend to have slightly lower grade point averages (GPAs) than their wage-and-salary peers. Those with higher GPAs are likely to pursue an occupation in the not-for-profit or government sectors.

The self-employed, in greater proportion than the population as a whole, either earn less than $20,000 or $100,000 or more. Such a U-shaped distribution suggests the wide variation of career options and financial pay-outs among the self-employed; some entrepreneurial occupations pay very little while others pay above average.

Pretty interesting data points that have a lot of potential avenues for analysis. I will share some more thoughts when I read the paper. Any initial thoughts? Sounds like there are lots of struggling artists among the self-employed?

A New Interview with Fred Smith of Fedex

Fred Smith, founder and CEO of Fedex, is a famous campus entrepreneur — having come up with the original idea for the company for a paper while an undergrad at Yale (our first interview post from May 2007  here).

Fred is a supporter of McCain, but more importantly is a brilliant guy. He is the featured weekend interview in the WSJ and it is well worth reading. Here are a few snippets from the piece by Stephen Moore:

Oh, the country is going to get through this and the financial markets will stabilize,” he assures me, but only after we go through a period of “trauma and readjustment.”

I ask him just what he means by “trauma.” He attributes the financial crisis to “the intersection of four long-term developments.” Reckless mortgage lending policies; high energy prices; mark-to-market accounting rules; and national policies that favor what he calls “the financial sector over the industrial sector.”

Later,

Mr. Smith ends our interview with a little sermon about what the U.S. must do to retain its global economic superpower status. “Many of our current policies are not conducive to continued economic leadership. We restrict immigration when we have thousands of highly educated people that want to come to the United States, and some of our greatest corporations [are] crying out that we don’t have the scientific talent that we need to develop the next generation of innovations and inventions . . .

“That’s where all wealth comes from . . . It’s not from the government. It’s from invention and entrepreneurship and innovation. And our policies promote a legal and regulatory system which impedes our ability to grow entrepreneurship. Lastly, if we want to make [America's workers] wealthier we have to quit demonizing quote, big corporations.”

The entire article is worth reading as Smith clearly explains his views on economic growth, the role of government, and the tensions that currently exist in our economy and between various sectors if it.

Jitendra Parajuli’s Social Capital/Open Source PPT

One of the great parts of being in a PhD program is that it lets me interact with others studying some very interesting topics. It is great to share ideas and learn from those looking at different fields. Last month I attended the GMU SPPs Doctoral Workshop.

At each meeting three PhD students/candidates present research to an audience of faculty, peers, administrators, and guests. Its a good time and usually features some very interesting.

At the last meeting my friend Jitendra Parajuli presented some research on social capital and the open source movement. Great lit review and also an interesting and useful case on the development of Linux. Here is Jitendra’s presentation.

Think about the huge increase in applications that we are seeing — for Facebook/Myspace/Iphone, etc. This is all about open standards and programmers/companies joining open networks and building social capital, then turning it into commercial profits. Pretty interesting stuff I think.

Bike Sharing Pioneer — MetroBike LLC (UVA/GMU)

Last week my Social Entrepreneurship course at GMU featured a guest — Paul DeMaio, Owner of MetroBike LLC. DeMaio’s company describes itself as a ‘progressive transportation consulting company based in Washington DC, whose expertise is bike-sharing. Paul has worked with cities in US and Europe on designing and implementing bike-sharing programs.

Bike sharing programs are basically short term rental systems with unattended stations, often based in urban locations and featuring multiple pick up and drop off points. Its a pretty interesting concept and it started in Europe. (DC just launched the first North American program — MetroBike played a role in designing and planning this system)

Paul became interested in this concept while an undergrad at UVA in 1995. Paul was a bike enthusiast and while working in tech support late one night, he stumbled across pictures of Copenhagen’s bike sharing system while browsing the net. He couldn’t read the words, but the pictures were all he needed. He went abroad Denmark and studied the city’s bike sharing program. He was now passionate about the subject.

Paul returned home, finished his studies and took a job working in transportation for the City of Alexandria, VA. As he worked, he continued to study bike sharing, publishing on the subject and going to school part-time at George Mason in order to do more research on bike-sharing and its economic, environmental, commercial, and policy impacts. DeMaio participated in GMU’s Transportation, Policy, Operations & Logistics masters degree program.

DeMaio did not launch his firm until 2005, fully ten years after he discovered bike-sharing at UVA. The lesson from this is that DeMaio recognized an opportunity as an undergrad and didn’t create a firm until 10 years later. Part of this was driven by the fact that DeMaio was way ahead of the market in recognizing an opportunity. But, because he was passionate and dedicated to the opportunity, he was able to spend the years building up his knowledge, market understanding, and experience in the field of transportation.

DeMaio also writes the leading bike sharing blog in order to increase his knowledge and brand, but also in order to grow the awareness and demand for the entire marketplace. I will post more on MetroBike and DeMaio as I spend more time with him, his firm, and the DC bike sharing system.

I have no doubt that bike sharing could be a huge opportunity on larger campuses and also urban campuses. Contact Paul and check into starting up a bike share business on your campus.