Are Universities Teaching the Wrong Entrepreneurship Process?

I’ve long wondered why so many schools support a business plan/VC model through contests and course work when most of their students will never be in the running for venture capital. Over the past few years through Startup Mason and other activities, we’ve moved to a more experiential model/process for entrepreneurship education. We’ve supported action, iteration and experimentation in lieu of planning. (Though many contests demand plans and/or executive summaries).

Dileep Rao at Forbes.com has an interesting piece arguing against teaching business plans and competitions and for a more hands on approach to learning entrepreneurship. There is much good in this piece for those who care about entrepreneurship education.  From Rao,

 As I am constantly repeating, the capital intensive VC model has worked in Silicon Valley, but seldom outside. While 88 percent of Silicon Valley’s billion-dollar entrepreneurs used venture capital, 91 percent outside Silicon Valley did not.

This means that universities may want to consider the following:

  • Teach students how to build businesses using capital efficiency, not just capital intensity. Most areas do not have successful VC funds. Even if they did, most VC funds do not build home runs. The top four percent of VC funds earn about 65% of industry IPO profits. Getting money from the other 96 percent may not do much to build a great company or to make you wealthy. With capital efficiency, students learn to grow without wasting both time and their opportunity in order to seek VC, only to be rejected by VCs. VCs reject about 98-99 percent of entrepreneurs who seek funds from them

  • Encourage students to build their business with smarts, not money. Less than five percent of VC funding goes to startups. This means that students need to learn how to build their business, and actually get some traction, before anyone will take them seriously. Universities should teach them how to do this.

  • Teach sales. Selling is the oxygen of a new business. To sell is to succeed. Unfortunately, many business schools believe that teaching sales has no academic value. Without sales, there is no business.

  • Encourage business startups rather than business plans. Universities organize business plan competitions with the hope that wise judges can pick winners. VCs, who are the foremost ‘wise judges’ in the business, fail to reach their target 80 percent of the time. If the VCs, who are full-time professionals, fail 80 percent of the time, why do universities think that their own ‘wise’ judges can do better?

  • Teach all students, rather than just entrepreneurship students or business-school students, how to build a business. I have found that many business-school students do not have a new-business opportunity to pursue. I would suggest casting a wider net in the hope that students in other schools have ideas for a new business that they want to develop and grow.

If you are involved in entrepreneurship education or considering studying entrepreneurship, read this entire article by Rao as it will give you many things to consider as your approach university entrepreneurship offerings.

DC Regional Universities Use Lean Startup in Healthcare | NSF I-CORPS

I have been following the NSF I-Corps experiment since its inception and have Screen Shot 2013-10-10 at 3.39.46 PMbeen pleasantly surprised by its growth and expanding reach. GWU, University of Maryland and Virginia Tech have taken the lead in our region (the DC I-Corps) and have some great people working on the program. I came across a piece from Stephanie Baum at Med City News highlighting some of the innovative teams and projects taking part. From Baum,

Here’s a sample of the healthcare and device technologies involved in the program, which runs through November 19.

University of Maryland, College Park

Myotherapeutics is developing a clinical assay for Amyotrophic Lateral Sclerosis or Lou Gehrig’s disease. Eva Chin, an assistant professor, leads the group.

George Washington University

Key Orthopedics has a 3D-printed polymer device for growing stem cells in bone and cartilage tissue and is led by Benjamin Holmes, a Ph.D student.

NanoChon is producing joint injury therapeutic technologies for extended and sustained biologic delivery. It’s led by Nathan Castro, a Ph.D. student.

Its exciting to see our local universities, their leaders, faculty, and graduate students learning to employ lean in the development of their ideas and technologies. Exciting time.

@GeorgeMasonU Alumni @GloboxRentals Launch International Film Kiosk Startup

{DISCLOSURE: I have worked closely with this startup and am mentioned in the article below and am pictured} Great piece on Mason born and Mason Alumni run startup Globox Rentals, a kiosk DVD rental service making top international films available to various consumer markets. The team recently placed its first 10 kiosks, including one in the Johnson Center — the student union @GeorgeMasonU. From Rashad Mulla of the College of Humanities and Social Sciences:

This “Globox” movie rental kiosk, which stands over 8 feet tall, is the pride and joy of Asad R. Ali and Sammy Kassim, the entrepreneurs at the heart of the brand new international film rental company, “Globox Rentals.”

Globox makes movies available for rent through vending kiosks, much like the multi-billion dollar rental service Redbox, but with one big difference: Globox specializes in new and popular international cinema, from more than 100 countries worldwide. This summer, Globox launched its first 10 kiosks, located in the Johnson Center, at various international grocers in Virginia Fairfax, Falls Church, Mt. Vernon, Woodbridge, and Arlington and a 7-Eleven convenience store in Bowie, Md.

“There are a lot of good international titles, content, and movies out there,” Kassim explained. “There just wasn’t an easy avenue for most of the customers and consumers to get that content.”

Today, the Globox team consists of co-founders Ali who studied in both the School of Management and the Department of Economics and Kassim BS ’11, Management, and fellow Mason alumni Ricky Singh BS ’11, Information Systems and Operations Management and Brittany Hill BA ’12, Art and Visual Technology. The Alexandria, Va.-based company appears to be riding a wave of momentum heading into the fall. But to get the ball rolling, Ali and Kassim had to put in a lot of work, and make a couple of unconventional decisions that required passion, drive and, simply put, bravery.

via College of Humanities and Social Sciences | News: World Cinema at Your Fingertips: Young Alumni Start “Globox Rentals” Business.

Google and Their Programs in the Education Space | #highered $GOOG #edtech

Emily Lucas of LifeHack.org has a nice post highlighting some of Google’s many initiatives in the education space.  From STEM and Social Entrepreneurship to Faculty Research and Marketing Competitions — Google is in the space. (Yes Brin and Page are two of the top 10 student entrepreneurs of all time). The entire post lists a bunch of their programs, below is a snippet and one of their interesting offerings. From LifeHack:

As one of the world’s premier companies, Google has truly affected the way everyone accesses information and how people learn online. To further encourage and nurture the leaders of tomorrow, Google has created many different educational programs for all ages. Educational programs at Google are not just informative. They also provide funding for underprivileged and minority students who otherwise would not have had the opportunity to study computer science. This gives so many young students the ambition and dream to pursue a potential career in the burgeoning field of computer science.

Zeitgeist Young Minds Awards

This annual Google competition is aimed at entrepreneurial and ambitious 18-24-year old entrants from all over the world. To enter, the participants make a YouTube video explaining how their project or innovation will impact the world. After the participants are narrowed to 12, they attend Google’s Zeitgeist Conferences in Europe and North and South America. World leaders come to these conferences to raise awareness and discuss how to address the world’s problems.

via Google and Their Educational Programs.

Has Online Education Won Wonders Daniel Pianko @UniVenturesFund

Just received the latest University Ventures letter with a piece, “You Won”, by Daniel Pianko. He explains that his tenured professor brother has acknowledged the future is online and that #highered is going to get whipped by educational equivalents of Amazon and Uber:

As colleges and universities face off against new technology, how does this game compare with the one retailers and taxi drivers have been playing?

It’s true that three million American students – nearly 1 in 6 enrolled at colleges and universities – are earning degrees entirely online, without setting foot on campus. But they are doing so at accredited universities (nearly all regionally accredited). Students haven’t fled the system for an Uber- or Amazon-alternative. Overall enrollment is up 18% over the past 5 years. And new private sector universities (i.e., publicly traded companies like Apollo Group, parent of University of Phoenix), which had seemed on a path to market domination, have experienced enrollment declines.

At the same time, my brother sees clouds on the horizon. As Ben Nelson, the founder of the Minerva Project, explained to me, about 100,000 students at the University of California and California State University systems take Psychology 101 each year. Psychology 101 is a first year lecture class with, on average, over 200 students in each class. That’s 100,000 students, at an average of $1,500 of revenue per student per class. So Psych 101 generates $150M in revenue at a cost of delivery that can’t possibly exceed $50M. As a result, the California systems generate $100,000,000 of gross margin (i.e., profit) on Psych 101 – a contribution that is used to support other activities in the systems. What happens, my brother rightly and fairly asks, when new entrants like StraighterLine and UniversityNow push the price UC and CSU can charge for Psych 101 to the actual cost of delivery? What will UC and CSU have to cut?

That last question… what goes away? Is that the only question? How about… what can get added that people will pay for? Or are their new customers for the traditional goods (face to face interactions, dorms, extra curricular activities?). There is lots of opportunity out there!

Boyfriend’s BestFriend App | Student Startup

Capital One Cross Campus Challenge has some great #student entrepreneurs out there. The idea below is one that one of my students floated a couple years back, she didn’t go after it. Glad to see this team from Hofstra and their Boyfriend’s BestFriend app won the grand prize.

An MVP is not a Cheaper Product, It’s about Smart Learning

David J. Miller:

Excited to share this with @startupmason @basllstonbid @venturecamparl #SIP2013 and others that have been experimenting with #lean, customer development and #bmgen.

Originally posted on Steve Blank:

A minimum viable product (MVP) is not always a smaller/cheaper version of your final product. Defining the goal for a MVP can save you tons of time, money and grief.

Drones over the Heartland
I ran into a small startup at Stanford who wants to fly Unmanned Aerial Vehicles (drones) with a Hyper-spectral camera over farm fields to collect hyper-spectral images. These images would be able to tell farmers how healthy their plants were, whether there were diseases or bugs, whether there was enough fertilizer, and enough water. (The camera has enough resolution to see individual plants.) Knowing this means farms can make better forecasts of how much their fields will produce, whether they should treat specific areas for pests, and put fertilizer and water only where it was needed.drone over farm

(Drones were better than satellites because of higher resolution and the potential for making more passes over the fields…

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