Category Archives: Funding

Harvard Gets VC Firm on Campus: The Experiment Fund | TechCrunch

This train just keeps on rolling! Yes, the campus is the frontier for high impact entrepreneurship! That is why there is now a venture capital fund on Harvard’s campus and it is in the engineering school! From Greg Kumparak at TechCrunch:

Dubbed The Experiment Fund, the firm describes itself as “a bridge between America’s oldest universities and storied venture capital firms.” Backed by New Enterprise Associates (NEA), the firm is made up of Hugo Van Vurren, NEA co-head Patrick Chung, and NEA General Partner Harry Weller — all of whom have a degree of some form from the school.

When I say it’s “right on the Harvard campus”, I’m not kidding — it’s going to be based out of 33 Oxford Street, which is Harvard’s School Of Engineering And Applied Sciences. It’s a bit more than a stone’s throw from Harvard Yard. With that said, the fund operates with complete independence from the university.

And if you’re not a Harvard student? Don’t sweat it too much. The fund says they’re open to anyone, “regardless of university affilation, nationality, age, or prior experience.” Being a Harvard student — or at least a Cambridge local — probably wouldn’t hurt, though.

Anyone who has read this blog knows that there are many reasons that investors want to be on campus. The questions is, do they know what they are looking for? Do they have a framework for assessing student initiated ventures and campus infrastructure?

via Harvard Gets Its First VC Firm: The Experiment Fund | TechCrunch.

Summer@Highland 2012 Entrepreneurship Program for Student Entrepreneurs

I am no expert, but i think Highland Capital is a well known firm. Well, the partners there seem to agree with me that something is happening on campus with student entrepreneurs.  Check out their Summer@Highland program,

Summer@HIGHLAND is a 5-year old entrepreneurship program designed to provide university-affiliated startups with the environment and resources for taking their initiative/company to the next level. The program is “founder friendly”: Highland receives no equity stake in exchange for a team’s participation, and teams are under no obligation to Highland after the summer. Our only priority is helping entrepreneurs and their teams significantly advance their startup over the summer.

Selected teams will receive $15K, free office space in Highland’s Cambridge or Menlo Park office, and the opportunity to work closely with the Highland team and an incredible network of founders. Teams will also have access to the Summer@HIGHLAND Speaker Series, which has included founders, CEOs and experts from technology leaders.

You have about 68 days to get your applications in. (Early deadline is March 1, 2012, and regular deadline is April 5, 2012).

It is interesting to note that they are not looking for business plans, but for applicants that have taken some action, on a scalable path, and are entering large markets. This is about high impact student firms, not basic t-shirt shops (so yes, they would have rejected Marc Ecko!).

via Summer@Highland 2011 Entrepreneurship Program.

Challenges to Entrepreneurship Education on Campus | Founders Institute Infographic

I have been writing and researching a great deal on how and why start-ups rise from U.S. campuses. I am not willing to say if and how entrepreneurship education and infrastructures influence the number, but I do know that accelerators such as Y Combinator and Excelerate Labs, events such as Startup Weekend and 3 Day Startup, and growing movements such as the Lean Startup Circle and Uncollege are nipping at the heels of university provided entrepreneurship structures.

The Founders Institute has been at it for a little over two years and have recently put out an infographic on what they have done so far (one of my wife’s colleagues is currently part of the group in DC I think — I have no clue what she is working on). From Yourstory:

The Founder Institute is a global network of startups and mentors that helps entrepreneurs launch technology companies. Through the four month idea-stage incubator program, you can launch your company with training, feedback, and support from experienced startup CEOs, while not being required to quit your day job.In 2.5 years 483 individuals have graduated, and 415 technology companies launched through Founders Institute. The Founder Institute was incorporated in April of 2009, and the first class from Silicon Valley graduated in September of 2009. Now they operate in 21 cities across four continents. They say they will soon be launching an average of 2 startups in a day.

via How 415 Startups were launched by Founders Institute in 2.5 Years : Infographic.

Illini Freshman Do #SocEnt in Business School | Business Education

I grew up in Illinois so have always appreciated the intellectual greatness of the University of Illinois (ask Marc Andreessen about the brains and opportunities in Urbana-Champaign). Just found some interesting news that the College of Business had 600 students participate in a professional responsibility course and its obvious social entrepreneurship  and social impact were key components. (I wonder if this is the type of course is the kind of thing @CabreraAngel implemented at Thunderbird — more on George Mason University’s new president Angel Cabrera). From Don Dodson of The News-Gazette:

“The ideas spanned a variety of needs from food, health and sanitation to transportation, education, housing, energy and entrepreneurship,” said Madhubalan Viswanathan, a UI professor of business administration.

The product ideas and business plans came as part of a “poster session” competition that was the capstone project for the Business 101: Introduction to Professional Responsibility course.

The course, required for first-year undergrads in the College of Business, had about 600 students in it this fall.Among the ideas students came up with, Viswanathan said, were:

— A low-cost refrigerator to preserve food.

— A system to help shopkeepers with low literacy levels keep track of inventory.

— An inflatable floating disaster shelter for coastlines.

Some more,

One of the first-place teams, Dentofresh, created a powder-based mouthwash for the Indian marketplace. When mixed with water, the product would help users avoid serious dental-health problems.

Each member of that team — Stephen Murphy, Gregory O’Connor, Eric Tchon, Michelle Wojnarowski and Rebecca Zielke — received $200 awards.

The other first-place team, Do Your Duty, devised the “Duty Bag” as a way to improve sanitation in a densely populated slum in Nairobi, Kenya.

The team described the Duty Bag as “a sanitary, eco-friendly and affordable bag that people can use when defecating.” Its use could decrease the presence of harmful waste and improve the environment, the team said.

Members of that team — John Casey, Nayeli Garcia, Nichole Johnson and Christopher Pastuovic — also received $200 each.

Members of second-place teams received $150 each, while members of third-place teams got $100 each. Money was provided by the College of Business.

Second-place team Back Nap came up with a blanket that could be folded into a backpack for homeless people.

via 28 UI students take home $4,200 in product project | News-Gazette.com.

DC Lean Startup Circle Event with 500 Startups

I am heading out to my first DC Lean Startup Circle event. It features Paul Singh, a principal at 500 Startups. Its interesting to note that the event is sold out (100 seats).

I am looking forward to learning more about 500 Startups, how people use lean startup methods, and what kind of people make it out to this type of event.

Perhaps I will run into a few of my students, as some have become very interested in accelerators and lean methods. I’ll tweet a bit tonight from @campus_entre

Gaining Customer Traction Fast: Tips from a Silicon Valley Vet – DC Lean Startup Circle (Arlington, VA) – Meetup.

MSFT and TechStars Launch Kinect Accelerator | Another Challenge for University Entrepreneurship Structures

As Accelerators, incubators, startup weekends, 1 semester startups and the like rapidly expand, the value of traditional university structures (from liberal arts colleges and MBA programs to engineering graduate degrees and technology transfer offices) is under siege.  Segmentation in the accelerator space continues as Techstars and Microsoft partner on a Kinect focused accelerator. From Techcrunch:

The Kinect has proved fertile ground for hackers and innovators all over the world, from individuals to student teams to established researchers. But as yet there haven’t been many commercial applications. Microsoft and TechStars are hoping to turn the creativity and momentum associated with the Kinect into some functioning startups.

Applications are being taken through January 25th; ten will be chosen and given the opportunity to participate in a three-month incubation program at Microsoft — and get $20,000 in seed funding. Got an idea for a new device, service, or method of using the Kinect’s low-cost real-time depth sensor? This could be a good opportunity — if you can afford to move to Seattle for a while this Spring. Don’t worry: the program is in the downtown area, not Redmond.

via Microsoft And TechStars Launch Kinect Accelerator For New Kinect-Based Startups | TechCrunch.

10 Crowdsourced Funding Platforms | Student Entrepreneur Tools

My entrepreneurship students are were interested in crowd sourced funding platforms after reading an article I provided them. Gonna share this list of 10 crowd source fundraising sites from Dowser. Here are a few:

33needs is a web application that connects investors to small-scale entrepreneurs around the world. The investor receives 3% and 33needs receives 5% of the funding target for a project. The site helpfully divides up projects into categories such as “education,” “the planet,” “community,” and so on. It’s brand new, and looks like it’s off to a promising start.

Profounder aims to help entrepreneurs get a community to invest in their project, creating a support base in addition to bringing in money. The site’s team gives guidance on creating a fundraising pitch, managing investments and returns, and legal issues. Profounder’s blog illustrates various stories of helping small businesses expand and get their products to new markets.

Microplace is a Paypal-owned company that allows investors to put their money into projects that aim to alleviate poverty. Users create an account on MicroPlace like you would at any brokerage firm. Users then receive quarterly interest payments and portfolio statements. When an investment matures, users can either get their money back or roll it over into anther investment.

Kickstarter targets artists and entrepreneurs who need funding to bring their creative projects to life. Its use of video as a means of sharing projects makes it particularly fun and simple. A project cannot begin, and no credit cards are charged, until enough pledges have been made to reach the funding target, so as to discourage poorly-executed projects. Project creators inspire people to open their wallets by offering rewards, such as “thank you” mentions on their personal blogs, or products from their projects.

via Top ten crowdsourced funding platforms | Dowser.

Students and Professors Try Open Innovation | Nature Publishing Group

Crisitina Jimenez has an interesting piece on ‘open innovation’ – where problems are shared publicly and rewards offered for suitable solutions. Jimenez’s piece highlights how students and faculty are using ‘open innovation’ challenges to find funding, work on interesting problems, and make meaning.

InnoCentive, an organization based in Waltham, Massachusetts, that uses the Internet to link ‘seekers’ — client companies struggling with pressing scientific or business problems — with ‘solvers’ — more than 250,000 problem-cracking minds around the globe, InnoCentive claims. The company is one of several, most of which are based in the United States, that are engaged in ‘open innovation’. The motivating principle behind open innovation is that companies and other institutions should take full advantage of widely distributed knowledge in a wired world, finding products, patents and solutions — scientific, technological or social — outside the confines of their own organizations.

Later Jimenez explains,

Scientists who moonlight as solvers can use novel means to explore long-standing problems. Chris Wilmer, a PhD student in chemical and biological engineering at Northwestern University in Evanston, Illinois, solved a challenge that involved the lack of access to clean water in poor villages of developing countries. He found inspiration in the success of a mobile-phone business run by the Grameen Bank in Dhaka, Bangladesh. The bank would lend phones to a local entrepreneur in a poor village, who would pay back the loan by charging others in the village to use a phone. It was a profitable and self-sustaining model. Wilmer described how a similarly structured safe-water business could yield humanitarian benefits. “I enjoy solving social problems, so it was fun,” says Wilmer, who has also won a second challenge involving programming a software tool to help characterize synthetic DNA strands.

For some, pursuing open innovation is a way to achieve career independence and flexibility. Grace Kepler, part-time associate research professor at the Center for Research in Scientific Computation at North Carolina State University (NCSU) in Raleigh, sees the challenges as well suited to scientists who, like her, are not employed full-time and have family responsibilities — as well as those who need more money or are unencumbered by intellectual-property issues.

While some entrepreneurs have developed open and crowd sourced businesses (Redhat to Kickstarter) we should expect to see more open innovation and crowd sourcing on campus (beyond technological innovation) and this presents opportunities for entrepreneurs.

We are trying an open source accelerator at George Mason. Check out StartUp Mason.

via Funding: Researching outside the box : Nature : Nature Publishing Group.

Honest Tea TeaEO Seth Goldman: Dos and Don’ts of Raising Money From Angels

Recently, I was fortunate to interview Seth Goldman and Barry Nalebuff, founders of Honest Tea, as part of my PhD research on the campus as the frontier for entrepreneurship.

Barry and Seth’s insights are incredibly valuable in my attempt to understand how and why more high impact firms are being birthed in and around U.S. campuses.

Beyond being gracious with their time, Seth and Barry have posted their original business plan on their website for years and for years I have been assigning it for reading and discussion in my class. You can download it here.

The one warning I always issued about the plan was that it did not offer financials.  Today, I find a small piece of that puzzle, again, offered by Honest Tea founder and TeaEO Seth Goldman.

In a recent Inc. posting, Goldman tells the story of the initial capital needs and fund raising of Honest Tea. The piece offers his thoughts on Angel investing and how Honest Tea approached it.  The piece is complete with nice clear graphics and clearly provides a real world example of how one high impact firm managed its start-up fundraising.  (The effective use of graphics is one of the reasons I assign the plan to my students — warning them that an all text business plans make it harder for readers to receive their story)

From the Inc piece, The Dos and Dont’s of Raising Money From Angels

First round of angel financing ($500,000)

First round of funding.

Second round of Angel financing ($1.2 million)

Second Round of Funding.

Goldman explains the costs and benefits of Angel investors based on his experience and by doing so adds more life to the business plan. (I am sharing this Inc story with my students as a complement to the plan)

Venture Investors Buying Into Stanford Talent, Not Startups

Bryan Menell at Austin Startup reports that two early stage venture funds are going straight to the source for entrepreneurship — “acquiring” talented students from Stanford and turning them into entrepreneurs. From Menell:

Austin-based early stage venture firm G51 Capital has partnered with notorious party crasher / lifestyle hacker Larry Chiang to mine Stanford for promising startups. “We’re building a farm team of CS [computer science] and engineering majors and helping them to learn to be CEOs,” says Rudy Garza, founder and managing partner of G51. “We’re testing out this model, and if it goes well with Stanford, there is an opportunity to expand it within Stanford and beyond.”

Interesting, but not surprising. Funny that they don’t want to buy MBA students!

via AustinStartup » G51 Partners with Larry Chiang for Stanford Fund.