Two years ago, Arizona State University graduate student Greg Peterson and a friend hatched plans for a TV show that would instruct homeowners how to renovate in environmentally and socially responsible ways. But the two didn't have enough money to cover the production costs, or the expertise to market the show.
They submitted their idea to a new campus program helping students bring business concepts to life, called the Edson Student Entrepreneur Initiative. The program gave them $15,000 in seed money and access to on-campus office space, along with training seminars devoted to student start-ups on topics like product development, intellectual property and finance. It also hooked them up with the chief executive of a local e-commerce business, whom they met with every other week to discuss online marketing tactics.
"That in itself was worth the price of my tuition," says Mr. Peterson, who in December earned his master's degree in urban and environmental planning. He and his partner recently finished the pilot show and are trying to sell it to various cable networks.
Small business is becoming a big deal on college campuses these days. The Arizona State program hands out $200,000 to student ventures annually, accepting about 15 to 20 of the roughly 100 submissions that are made each year. And hundreds of other U.S. colleges and universities also have awakened to the fact that many of their graduates are likely to work for themselves someday. Many are bolstering their courses and extracurricular activities for aspiring entrepreneurs and helping students create businesses before graduation.
It's a far cry from just a decade ago, when most colleges ignored students' entrepreneurial ambitions, or just offered basic business-planning courses in the business school. Now, many schools are adding entrepreneurship majors and minors, holding business-plan competitions for cash prizes and teaming students up with local entrepreneurs. And many campuses are teaching entrepreneurship beyond the business school, to get students in other disciplines interested in business development.
Giving Ideas a Boost
This fall, the University of North Carolina at Chapel Hill will begin offering a three-course certificate in entrepreneurship for graduate students in all academic fields. Those looking to eventually start businesses can pursue an "enterprise" track, while those just seeking basic business skills and an understanding of the entrepreneurial mind-set can choose the "literacy" track, says Ted Zoller, executive director of the university's Center for Entrepreneurial Studies. The school also is creating a venture-capital fund, to be run by professional venture capitalists who will consider investment recommendations from students. Among other things, the exercise is designed to help students learn what it takes to attract private equity investors, Mr. Zoller says.The University of Wisconsin at Madison, which launched an undergraduate entrepreneurship major last fall, wants to encourage its students to learn from one another. It plans to designate dorm rooms by the academic year 2008 so that students who have an interest in entrepreneurship can live together and network. The school also is opening an entrepreneurial-law clinic by this fall, where law students will give free advice to student and faculty entrepreneurs on legal matters such as intellectual-property law and business structure.
Washington University in St. Louis is trying to help student entrepreneurs move past the idea stage with a program it started in 2005 called IdeaBounce. Several times each year, students and locals -- usually about 100 to 150 -- give two-minute "elevator pitches" of their business ideas before a live audience and judging panel. Five winners get $100 each and dinner with the judges, who are often faculty members, venture capitalists and local entrepreneurs.
"We saw lots of situations where people had good ideas, but 90% of the time they wouldn't act" on them, says Ken Harrington, managing director of Washington University's Skandalaris Center for Entrepreneurial Studies. The school hopes that giving students a little boost will compel them to think more seriously about starting ventures.
For-profit schools also are jumping on board. Grand Canyon University, a Phoenix for-profit school with about 13,000 students, opened a new entrepreneurship college in January with 25 students. Starting this fall, a new $30 million venture-capital fund created by a local entrepreneur will dole out $100,000 in seed money to each of about 10% of the business concepts submitted by students. Those students will then be eligible for $500,000 each in second-round funding if their businesses achieve certain benchmarks.
Overall, about 2,140 two-year and four-year colleges now offer entrepreneurship courses, up from about 1,400 in 1998 and fewer than 300 in 1980, according to research from the Kauffman Foundation, a Kansas City, Mo., resource center for entrepreneurs. Kauffman has doled out about $51 million in matching grants to 23 universities in the past four years to expand entrepreneurship education beyond the business school.
'A Very Different Outlook'
Advocates of entrepreneurship education say the new momentum stems partly from a growing understanding of entrepreneurship's key role in economic and job growth, and a realization that more college graduates will start ventures or work at small firms after graduation instead of flocking to corporate America. Also, more young adults are arriving at college having already started businesses or ready to do so -- a shift from the past, when most people didn't launch ventures until middle age.
"We've got a generation coming up that has a very different outlook on life than the one before it," says Jeffrey Cornwall, an entrepreneurship professor at Belmont University in Nashville, Tenn. "They're more interested in balancing their work with their family life, and that makes entrepreneurship attractive to them." Three years ago, Belmont introduced "hatcheries," where student businesses get shared office space and mentoring from faculty, local entrepreneurs and attorneys. About 70 student businesses now participate.
Schools also are starting to realize that traditional business-school curricula do a poor job of teaching the basics of business formation, focusing instead on management and prepping students to work for large corporations, says Judith Cone, the Kauffman Foundation's vice president of entrepreneurship. "What we've learned is really that the M.B.A.'s role has not been to train the entrepreneurial mind -- people who know how to run businesses," she says.
Of course, there are also some financial incentives for schools to push entrepreneurship. Campuses that spur innovation often earn prestige -- and perhaps even more-direct financial rewards. Successful entrepreneurs in many cases have given generous bequests to their alma maters or local universities: Orin Edson, the founder of a luxury-boat company, gave Arizona State $5.4 million in 2004 to start the student entrepreneur program now named for him.
The Dropout Factor
Some skeptics might question the value of teaching entrepreneurship in the classroom. After all, some of today's most successful entrepreneurs -- including legends like Steve Jobs and Bill Gates -- dropped out of college or never attended at all, and learned their business through trial and error.
But supporters and academics counter that while the drive and high risk tolerance natural to most successful entrepreneurs indeed can't be learned, there are helpful skills that can be taught. Entrepreneurial curricula include courses on identifying good opportunities, cash-flow management, handling growth, intellectual-property law, venture capital and marketing. And many courses are now geared toward entrepreneurship in particular fields, such as engineering, science and technology.
"I can't teach somebody to have passion, but I can teach them things to improve their chances of success," says Mr. Cornwall of Belmont. He cites studies that have found above-average survival rates for businesses founded by college-educated entrepreneurs.
Universities also offer a less-hostile environment for starting a business, so students can get hands-on experience without many of the real-world financial risks of business failure. Many schools are offering students seed money or helping them launch businesses with little or no capital contributed by the students themselves, so there's little to lose if the business goes bust.
And campus programs that foster entrepreneurship give students the advantage of an extensive network of people to work with, both on campus and potentially after graduation.
Adam Bates, the 31-year-old head of the student entrepreneurship club at the University of Rochester, in Rochester, N.Y., is launching a social-networking Web site this summer where users can build online family newsletters. He met his business partners at a "preseed" workshop on campus that pairs undergrads with M.B.A. candidates. His team also was assigned a coach, a local entrepreneur who helped them get a patent. "At the academic institutions there's a broad community of people" to consult with, says Mr. Bates, who returned to school after being involved with a few other start-ups. "It's very hard to go at most start-up projects solo."
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