Can You Actually Teach Entrepreneurship?
Young entrepreneurs may be an endangered species, but universities are pumping tons of resources into attracting the next startup cool kids. Campuses are investing in startup labs, incubators and courses in entrepreneurship. But how effective are such programs for helping students turn their novel idea into a business venture? To get an answer, I reached out to Scott Gerber, the founder of the Young Entrepreneur Council (YEC), which is an invitation-only network of entrepreneurs age 40 and under. I also spoke to the serial entrepreneur about risk, the barriers of entry and the ill-informed reasons young people jump into entrepreneurship.
Edited excerpts:
Many millennials turned to entrepreneurship after the economic crash in 2008 because of the lack of jobs. What’s driving millennials in 2015/2016 to start their own businesses?
If you look at jobs in the U.S., especially for recent college grads, wages have not increased much. Two, technology in general has removed the barrier of entry to entrepreneurship. There’s never been an easier time to get into the game.
There’s certainly a sexiness to being an entrepreneur, which I actually think is a bad thing. Some are doing it for the wrong reasons. They’re doing it because they saw the ‘Social Network.’ Or they’re looking at the Ubers of the world and seeing these billion-dollar valuations.
I think entrepreneurship can be an opportunity for those who understand it. But for the ones who are getting into it for the wrong reasons, they’re likely going to fail because they have no concept of what what it actually means to be an entrepreneur.
New data, according to The Wall Street Journal, shows that the share of people under 30 who own private businesses has reached a 24-year low. The article lays out some reasons, but what would you say holds young people back from starting their own business?
Healthcare and college debt are a real problem. When you have no real support, this is where people move into the traditional job course. People will make decisions based on the in-the-moment circumstances than what might be best for them. It’s no wonder why entrepreneurs are on a decline. Creating your own job could seem much more daunting than taking one. But what that article doesn't address are the new ways of work. There are new kinds of entrepreneurs like freelancers.
Universities are racing to support entrepreneurs and start-up founders. Based on your experience, what should universities do to better support students who want to launch their own companies?
The vast majority of entrepreneur-related courses at these universities are garbage. You have a lot of people throwing together programs being taught by people who have never been entrepreneurs or have little experience in starting a business. Educators should not be teaching these courses if they’re not entrepreneurs. Universities should look to their alumni groups and work to bring some of those people back to teach these courses.
There are certainly a few that are home runs, Babson [College] being one of them. A winning program is one that has the student start a business on day one. You can’t learn entrepreneurship in a book. Experiential learning is the most important factor in a successful program.
How do you teach an appetite for risk?
The reality is we have a risk-adverse culture. This is why entrepreneurship was foreign to most young people five-to-seven years ago. It’s hard to teach them risk, especially for millennials who have been coddled in their upbringing. The reality is, the best entrepreneurs are not risk takers, they are risk mitigators. The challenge is to teach this generation to think in that way. It’s about mitigating risk, not creating more challenges. The experiential side of this is crucial: Learning by doing. Failure. These are the best life lessons.
How do you advise the entrepreneurs to go from 0 to 1, to take their idea and turn it into an actual product?
You just have to do it. There’s too many people who are stuck in ‘analysis paralysis.’ Get started. Stop making excuses. Not to make it sound so simplistic, but you have to ask yourself what the next step is. Is it achievable? Can I obtain this goal today? If you can’t obtain it [or] figure out where to start and launch with a product right away, maybe it’s not the thing to do.
Some of what I hear is, ‘Oh, I need a million dollars to start.’ Or, ‘I need office space.’ I ask them, ‘What would you do with that million dollars?’ You don’t need much to get started. They need to realize that companies aren’t formed on day one. You grow day by day. You slog it out. It’s organic. Everyone wants the gratification of the ending. People see Steve Jobs, but do you know the story of Apple? How it went bankrupt? Building a company takes time. You have to go through it to get to the end. It isn’t overnight.
What type of person makes a good entrepreneur?
Anyone can be an entrepreneur if they understand one important thing: what they’re not good at. Being an entrepreneur is not for everyone. You have to understand your weaknesses. If you’re not a good operator, it’s probably a good idea to find a cofounder or someone to help you.
Is being an entrepreneur intrinsic to who you are or can it learned?
I don’t think you’re born to be an entrepreneur per se. Everyone has a skill set and you can use cofounders to fill in the skill sets you lack. [But], there are skill sets that are innate. I think there’s something in you, that you see a problem, you see a void and you are the one to fill it.
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