INCORPORATING AN ENTREPRENEURIAL INCUBATOR IN THE
LUNDQUIST COLLEGE OF BUSINESS
The Platinum Outlets:
Tanner Churich, Haley O’Donnell, Jessica Wachowicz,
Derek Papke, and Ethan Carr
INTRODUCTION
Within the Lundquist College of Business, the Educational Enrichment Task Force (EETF) has been established to expand the opportunities provided for business students. We will begin to address the fears that entrepreneurially-minded students ascending into the professional world face. As LCB undergraduates, we propose that the LCB create an incubator program for students interested in starting up their own business during their time in college. Giving undergraduates the opportunity to apply their skills and learn from their mistakes will help them succeed in their future endeavors. In turn, their success will improve the reputation of the LCB as a whole.
SITUATION ANALYSIS
The Lundquist College of Business prides itself on providing its students with experiential learning opportunities. The college’s home page explains, “students work on real projects for real companies, gaining first-hand experience in their careers before they even graduate” (Appendix A). In theory, such a program sounds great but the reality is that few opportunities are actually provided. The LCB has a profound vision and concrete mission statement which serve to guide the college. Unfortunately, the LCB falls short in providing students with the ‘learning by doing approach’ it continues to boast. We interviewed thirty-five students interested in, or currently pursuing their own business ventures. Thirty of them found themselves particularly crippled by the insufficient resources (Appendix B).
“Welcome to the next generation of campus entrepreneurship, in which students don't just want to learn the principles of starting a company, they actually want to start one.” says Bill Aulet, managing director of the Martin Trust Center for Entrepreneurship at the Massachusetts Institute of Technology. This center’s use of a peer advisory network has produced over 25,600 active companies with combined revenues in excess of 1.5 trillion dollars[1]. He goes on to explain that it is crucial for colleges to understand and adapt to students needs by providing them with the resources necessary to help their start-ups succeed.
Entrepreneurial Process
Of the 4,683 LCB students enrolled in the Fall of 2012, 3% or roughly 140 students expressed interest in starting a business during their undergraduate education. However, they have also expressed discomfort and fear executing these ideas because they are unsure of the proper steps to take. While these feelings are normal in any entrepreneurial process, the LCB has the opportunity to benefit the student entrepreneurs through personalized guidance. Providing individualized guidance through each of these steps will allow students the opportunity to develop their business with greater detail and success:
● Filing for LLC
● Building a Business Plan
● Securing funding
● Growing the start-up
The LCB does not currently offer guidance through these major business steps for entrepreneurial minded students, causing the program to fall short in comparison to other schools. Giving entrepreneurial undergraduates real world-learning experiences will increase the students’ understanding of business development.
Current Programs
The Lundquist College of Business only provides its undergraduates with one resource to give them insight into the life of an entrepreneur. The University’s Entrepreneurship Club brings in speakers and keeps students informed on upcoming events. Along with their weekly meetings, they also attend site visits to local companies and travel to venture competitions. While this helps students learn and stay connected, it does not satisfy our students’ needs of individual mentorship.
MBA students in the LCB have far more resources and opportunities at their disposal. The Entrepreneurs on Campus Program lets students connect with successful entrepreneurs once a term. Experienced entrepreneurs come to campus to give in-class talks, participate in roundtable discussions, and hold office hours so students can get the personalized help that they need. One aspect of this program that makes it particularly applicable to our need is the informal one-on-one interaction between the experienced entrepreneur and the MBA students during office hours. This is an excellent program that would be equally beneficial to undergraduates.
Another MBA program, the New Venture Championship, allows entrepreneurs from all over the world to gather in Portland to receive feedback from judges and pitch their ideas to angel investors. This competition is an amazing opportunity for students looking to grow their business. A smaller scale version of this event, the Civil War Shark Tank, is the only service of this nature that is offered to undergraduates. This is a competition between the University of Oregon and Oregon State University where students pitch their venture ideas to a panel of judges and receive cash prizes. In our opinion, the 500 dollar cash prize is not enough to realistically impact the growth of a business.
Comparator Schools
In order for the Entrepreneurship Center to reach its greatest potential, it is helpful to explore the resources that are offered at our comparator schools. We found that seven of the eight schools that the University of Oregon compares with offer several comprehensive entrepreneurial programs. One of the best examples was the University of Iowa. Their business incubator, the Bedell Entrepreneurship Learning Laboratory (BELL), offers students office space, equipment, mentoring, funding opportunities, workshops, networking, and community exposure. To be eligible, students must submit an application and meet the following requirements:
● Want to start a business
● At least one member must be from the University of Iowa
● Must show progress each semester[2]
This is an exceptional resource and one of many things UI provides for its students. They also provide Venture School, an experiential learning curriculum, several different pitch or business plan competitions with cash awards, and the Iowa Small Business Development Center (ISBD). Established in 1981, the ISBD provides free, customized business advice for businesses with 500 or less employees in all 99 Iowa counties[3].
The John Pappajohn Entrepreneurial Center (JPEC) at the University of Iowa reported a total of 363 participants in the BELL since 2004. Those participants have had the pleasure of working with 211 businesses. Last year alone, 48 businesses worked with the laboratory and there were 77 students who participated in the program. These numbers suggest that business participation and student participation could see incredible growth in a short period of time if the program is implemented properly. JPEC has served 174 startups since its inception and has created an estimated 338 jobs. There have been over 9,000 hours of one-on-one consulting as well. Appendix C describes in detail what the eight of our comparator schools offer[4].
When you compare all of these Entrepreneurial programs described above to what is currently offered at the University of Oregon, it is apparent that the LCB is lacking fundamental resources that will contribute to students’ success. If ‘experiential learning’ is a part of our mission statement, it should be of the utmost importance to provide these opportunities for growth.
OBJECTIVES
After assessing the situation, we have established that our three main objectives are:
1. More than 25 business mentors for the 140 potential entrepreneurs that would be interested in the program.
2. 20 start-up business ideas that see continued growth after graduation.
3. Winning UO team in the Civil War Shark Tank within the first two years of the program.
SOLUTION
In order to satisfy our objectives, we propose that the Lundquist College of Business implement an incubator program within the Center for Entrepreneurship. This program will include:
● Application Process
● Individual Mentorship
● Workshops
● Office Space
The primary goal of the incubator is to provide guidance; the financial success of the startups is not our focus. Instead we will base the success of the incubator on whether or not our students meet individual milestones laid out at the beginning of the program. Meeting these milestones will prove that students are learning as much as they can about the entrepreneurial process.
Application Process
Knowing that these professionals have limited time and resources, we will develop a screening process in which students must apply and interview with our hired staff prior to gaining acceptance. All LCB students with an ideas for a start-up are eligible to apply for the program; no prerequisite knowledge is required.
The first step is filling out an application in which they will provide a general description of their startup. They must show proof that they have done an adequate amount of market research that suggests their plans are feasible.
After submitting the application, they will partake in an interview with the staff advisor to make sure that they are serious about the program. Each student or team must also present a business plan highlighting their objectives and timeline. After receiving the business plans and conducting interviews, the staff advisor will determine whether or not the venture will be accepted. The screening process for the incubator is designed to be rigorous in order to ensure only dedicated students are admitted.
Individual Mentorship
Upon acceptance, the start-up will be connected to an alumni mentor with previous industry-specific experience. The group will meet with the mentor in person at least twice a month to collaborate and address any current concerns the team has. This meeting will also allow them to receive feedback on their achievements. Between meetings they will be in contact with the advisor via email, text, or phone whenever they are unsure about an aspect of their business. Providing this individual resource to students will greatly help them understand more about the start-up process and improve their plan.
Consistently analyzing their ideas with an individual mentor will allow students to see a broader view of what they are trying to accomplish. Having been through failures themselves, the mentors can help students work through uncertainty, providing knowledge from their own ventures. Reducing uncertainty will encourage the students to proceed with their idea. The advice that these mentors are providing is integral to the successful development of students understanding of entrepreneurship.
Workshops
While the individual mentor program will allow students to receive advice catered to their specific needs. Mandatory workshops relevant to all young entrepreneurs will be offered to teach broad concepts that apply to all entrepreneurial undertakings. These workshops will range from constructing a business plan, developing a strong web presence, attracting investors, obtaining patents, and more and will be instructed by guest speakers.
Office Space
The Lundquist Center for Entrepreneurship will have a section of space dedicated to members of the incubator program. Students will be able to work on their ventures and hold meetings with advisors and mentors.
Addressing Additional Concerns
In order to track the success of the program, the advisor will check in monthly with the mentors to ensure the students are making progress with their business ideas. Mentors will have the opportunity to express any concerns, comments, or feedback that they wish to share with the advisor regarding the individuals they are working with. By tracking the success of each start-up, our hired staff can sufficiently determine how helpful the program has become and its potential shortcomings.
If a team is failing to progress with their business due to a lack of effort, the mentor will express their concerns to with the advisor. Students with multiple concerns will be scheduled for a separate meeting that will act as an intervention. Consistent progress needs to be shown in order for the program to be effective. If a student fails to put in the effort and time, it may be necessary to expel them. These kinds of students would be wasting the resources that we are providing that another student would benefit from.
The same check-in process will be applied to mentors. If a start-up group feels that their mentors are not providing sufficient help, they can express their concerns to the advisor. Failing to provide the time and effort to help a student would defeat the purpose of the program as well. We want to provide dedicated mentors for the students in the program.
End Result
To convey their newly developed understanding, the student(s) will pitch their idea to the UO Shark Tank, seeking further funding for their venture. Clear, concise, presentations will convey a clear understanding of the business idea that has been developed while working in the incubator program. This will act as a final evaluation of the program’s effectiveness. If our program proves to be successful, we will see a winning UO team in the Civil War Shark Tank.
Our goal isn’t to produce successful start-ups, but to educate the students throughout the entire entrepreneurial process. However, a successful educational and guidance program will inherently produce successful businesses.
TECHNICAL PLAN
Start-up Phase:
Program director is hired and begins to contact alumni and professionals June 2014
Purchase and assemble cubicles for students’ office spaces June 2014
Application Phase:
Applications are opened up to the public Sept. 2014
Applications are due Sept. 2014
Program director reviews applications Sept. 2014
Interview process begins Oct. 2014
Individuals and groups are accepted into the program Oct. 2014
Mentorship Process:
Program director matches each venture with best fitting mentor Oct. 2014
Students meet with mentors on a consistent basis after being matched Ongoing
Presentation to Shark Tank By End of Sr. Year
Example Workshops:
‘Welcome to the Program’ Workshop Oct. 2014
‘Creating a Business Plan’ Workshop Nov. 2014
‘Funding 101’ Workshop Dec. 2014
‘Taxes’ Workshop Jan. 2014
COSTS
Execution of our solution requires limited start-up costs. The majority of our budget will be devoted to the salary of the hired faculty member. We will also create budgets for additional costs such as miscellaneous travel expenses, printing and media expenses, and office space.
Start-up Costs:
Office Space & Cubicles $5,000.00
Ongoing Costs:
Faculty Salary (per year) $45,000.00
Workshop Facilitators* $5,000.00
Miscellaneous Program Expenses:
Travel $4,500.00
Printing and Media $500.00
Total Costs $60,000.00
*The Workshop Facilitators are local professionals with entrepreneurial experience that we will bring in to discuss relevant topics that pertain to all of the students involved in the incubator. We plan to ask speakers to help us with these workshops on a volunteer basis, but we set this budget aside for some speakers who may require compensation.