According to the National Chamber Foundation (NCF) The Millennial Generation Research Review, more than 2,100 US colleges and universities have added an entrepreneurship curriculum. However, according to this report, a large portion of students claimed that the coursework did not adequately prepare them to start a business.
How can student inventor-entrepreneurs gain the necessary tools and knowledge to take their idea to market?
Successful early stage innovators have access to a mix of hands-on coursework and training, coaching, and networks outside of the classroom. We’ve seen the impact of this formula firsthand. To date, nearly 800 ventures have emerged from VentureWell programs. Even more impressive, these companies have raised close to $1 billion in funding.
In this article, we’ll highlight the types of support early stage innovators need most, and the impact it has on their success.
“VentureWell helped us get out of the tunnel vision of engineering and gain a broader vision of business and entrepreneurship.” – Abimelec Mercado, CEO of Blu Horizon, E-Team grantee, University of Puerto Rico
Without proper guidance, it can be difficult for inventors to navigate complex business processes, such as product commercialization and investor due diligence. Through hands-on activities, early stage training provides tools – the terminology, processes, and common practices – that aspiring student entrepreneurs need to run a successful company.
The most effective entrepreneurship training curriculum includes the customer discovery process. This methodology encourages entrepreneurs to “get-out-of the-building” and shift their focus from the invention to the user. By adopting a more holistic view of their product and its value proposition, rather than honing the technology, inventors can make a more useful product and find the right market for it.
Many training programs advocate a get-out-of-the-building approach, where entrepreneurs are required to conduct interviews with key stakeholders, which includes listening to input from potential customers, talking with industry experts to better understand value chains, and consulting with legal experts on red tape and regulations.
They can then use that data to create a sustainable business model, develop a marketable “story” for their product, and make any necessary pivots while still small and nimble. Taking time to find an appropriate product-market fit during the development stages allows startups to avoid potentially costly pivots down the road.
Download two primary market research worksheets from our recent article. Use them when conducting your next interviews.
“I always feel like I can reach out to someone at VentureWell with a question about intellectual property, incorporating, or any of the next steps we have to take. Having that support system has been amazing.” – Rosalie Sinclair, co-founder of Plantea, E-Team grantee, Massachusetts Institute of Technology
Entrepreneurs have questions. With lots of enthusiasm and limited experience, startups need people to turn to when they don’t have the answers. This includes mentors who can demystify business and explain the complex processes surrounding things like intellectual property, fundraising, exits, and other steps they’ll have to take to grow their venture. Having a network of experienced professionals – industry experts, lawyers, professors, other entrepreneurs – willing to offer expertise, insights, and advice is crucial to early success.
Mentorship is often an underutilized resource, simply because it requires strong commitment from both parties, and can take a lot of effort. However, the end results – the lessons, connections, and opportunities that mentors provide – are invaluable. According to the 2016 Deloitte Millennial Survey, 94% of those with mentors felt that their advisors were giving them impactful advice.
“The biggest value of VentureWell’s E-Team program was the network we created as a result attending the workshop.” – Andy Dalman, co-founder of Advanced Bone Technology, E-Team grantee, North Dakota State University
A strong network is a necessity for entrepreneurs. As a group with (typically) few resources, startups rely on a host of institutions, experts, mentors, and other entrepreneurs, who realize their value and are willing to offer support.
Startups can benefit from their network in countless ways. For instance, if you’ve identified a CEO you would like to speak with for your customer discovery interview, ask the mentor from your incubator for an introduction. If you want guidance on manufacturing regulations for medical devices overseas, have coffee with the manufacturing sales rep you met at a business plan competition. If you need a rockstar marketer to help develop your company’s message, ask the seasoned entrepreneur from your training program to highlight what to look for in a branding consultant.
More importantly, staying connected with peers and mentors is critical when the going gets tough or you hit a roadblock. Whether it be financial concerns or difficulty finding suitable teammates, talking with people who have experienced your struggle can provide the motivation and support you need to get back on track.
If you’re looking to build your network, professional conferences, business competitions, and university entrepreneurship events are all great places to start. If you’re an E-Team alumni, participating in annual gatherings like OPEN and OPEN Minds is a great way to reconnect with colleagues and meet new ones.
“VentureWell’s E-Team grant funding really helped us get through the past year.” – Nathan Swift, COO of Hedgemon, E-Team grantee, Case Western Reserve University
It can be expensive to start a business – especially for student entrepreneurs. Of course, all businesses are different, and can require different types of costs. In 2009, The Ewing Marion Kauffman Foundation estimated that the average startup cost was approximately $30,000.
Many startups don’t generate income right away, and it can take years to make a profit. It’s also important to remember that expenses are in flux at this early stage as the startup looks for a repeatable business model. It’s important – and relatively straightforward – to plan for typical overhead costs such as compensation, rent, equipment, and supplies. Yet hidden startup costs including insurance, license, and permit fees, or legal and financial consultation can quickly drain the bank account. If you need help determining your startup costs, consider using the Wall Street Journal’s Startup Calculator.
Since few people have the finances to bootstrap their venture, startups often seek outside funding sources. Unfortunately, investors are hesitant to fund early stage startups for many reasons. That’s why grant and training programs like E-Teams, or competitions like BMEidea and Cleantech UP, provide student innovators with much needed injection of capital to keep the doors open, or to refine their prototype or technology.
And stability is something investors and funders look for in a startup. Just ask Tyler Wanke, CEO and co-founder of Innoblative. He said that winning the $10,000 first-place award at the 2014 BMEidea competition was critical to their early success: “The financing provided some stability and allowed us to function as a real company, which in turn made us more attractive to investors and strategic partners.”
Ugwem Eneyo, CEO and co-founder of Solstice Energy Solutions, echoed Wanke’s sentiments. “Winning the 2017 Berkeley Cleantech UP competition definitely helped kick-start our fundraising process. We were able to connect with investors and institutions that have proven to be valuable relationships.”
Early stage innovators need support from entrepreneurship ecosystems to grow and thrive during school – and when they graduate. Access to hands-on training, professional networks, and finances is vital to success, while coaching and mentorship help young entrepreneurs avoid costly mistakes. As the nurtured companies grow into small businesses, eventually creating jobs and attracting industry to their local area, they can help spur regional economic growth with lasting impacts. Visit VentureWell’s Tools for Innovators page for useful resources on business models, customer discovery, funding, and more.
VentureWell’s E-Team Grant Program includes training through our early-stage innovator training program. The training provides peer networking, expert coaching, national recognition, and hands-on workshops to move your innovation forward. Learn more about the program and application deadlines here.