Raising and Retaining Entrepreneurs
Entrepreneurship education and support centers are one of the fastest growing segments of Alabama business schools. The growth may be just in time to keep our best entrepreneurs in Alabama.
UA’s Theresa Welbourne (standing) helps students learn the value of story-telling to find success for their clever business ideas. Students, from left, are Shelby Norris, Michael Larsen and Kris Irwin.
There are about 400,000 startups annually, according to the U.S. Census Bureau, so there is no shortage of ideas for new businesses. But since roughly half of all new businesses don’t last more than five years, it would seem the hard part of being an entrepreneur is making your idea work.
University business schools tout their entrepreneurship training in a big way, but can you really teach someone how to be a successful entrepreneur? Well, yes, as a matter of fact you can, according to several business school sources. In fact, entrepreneurship almost always must be taught.
“Entrepreneurship must be learned and practiced, just as any trade, skill or talent,” says Jason Greene, dean of the College of Business at the University of Alabama in Huntsville. “Entrepreneurship is about learning, adapting and developing strategies to address needs in the marketplace with solutions.
“This isn’t just about taking risks or coming up with ideas. Someone isn’t just born with these capabilities, but they can learn, practice and refine these capabilities. In many ways, by teaching business, we are teaching entrepreneurship. By learning business, students are learning things that will help them be entrepreneurs.”
To be sure, aspiring entrepreneurs are exposed to reams of information from textbooks and lectures — everything from new venture financing to financial management and marketing. Just as important or more so, however, they must learn to do things well that are outside the realm of book knowledge and within the realm of people skills and personal development.
Effective communications, working in teams and character building are all part of the process, whether it be in a new business venture or introducing a new product or service idea within an existing business.
“There’s a really important part in all this that I put under the ‘storytelling’ label,” says Theresa Welbourne, an entrepreneurship professor at the University of Alabama’s Culverhouse College of Commerce. “You need to be able to convince other people your idea is going to work so they will work with you and be your customers.
“There is an art and science to storytelling, and that includes communicating and presenting your ideas,” says Welbourne, who also serves as executive director of the Alabama Entrepreneurship Institute, the programming component of the Edge Center for Entrepreneurship and Innovation in Tuscaloosa.
Says Lou Bifano, director of entrepreneurship strategy at Auburn University’s Raymond J. Harbert College of Business: “A successful entrepreneur or innovator, either starting a company or trying to innovate within a larger company, needs to master the ability to communicate at all levels — verbally, in writing, in short conversations, longer discussions, more detailed discussions.
“We focus a lot on sharpening students’ communications skills. There are a lot of other courses while students are here at Auburn where they will have the opportunity to work on their communication skills, but that’s something that I see that always needs work with students in courses I’m teaching.
“A successful entrepreneur or innovator has to be able to express their ideas in an inspirational way so that their project will be selected. ‘Invest in Me.’ They have to be able to communicate that thought and the compelling story underneath it.”
Being able to fit within a team effort is mandatory for aspiring entrepreneurs. “If you’re going to bring an idea to reality, you’re going to have to work with other people and learn how to team,” Bifano says. “A lot of our experiential learning activities center on small teams of people working together to present a business idea. I can tell you for certain that’s the case in entrepreneurship courses.”
The normal process of taking a new idea to fruition is going to involve some roadblocks and adversity that students are taught to overcome. “Along the way, there’s a lot of character building that happens,” UA’s Welbourne says. “Students have to be confident enough to ask questions and take rejection. Also, they must be smart enough to be able to listen, and the word they use now is ‘pivot,’ or change their ideas, not being so arrogant you won’t listen to others and understand that you need to change.”
Many of today’s students are perceived as risk averse and poor communicators. The safety of anonymous online posts and widespread cell phone usage has something to do with that.
But UAH’s Greene sees the glass as half full when it comes to showing students tough love. In an email, he writes that, “While there still might be challenges in helping students understand the importance of resiliency (learning and recovering from “failures”) and patience/persistence (learning that instant gratification is rare), I have observed that this generation’s drive to innovate and make a difference make them great candidates for entrepreneurial activities.”
Interest in the state’s entrepreneurial activities is growing, and so is the support. Both Auburn and Alabama, for example, host entrepreneurial contests each year with prize money totaling $50,000 each. And university incubators and accelerators across Alabama work with students and with area businesses to breathe life into ideas for new products and services.
Bifano says donor interest has picked up for entrepreneur programs at Auburn, where incubator and accelerator facilities are located at Auburn Research Park. Meanwhile, the University of Alabama in Huntsville has broken ground on the $14 million, 45,000-square-foot D.S. Davidson Invention to Innovation Center. Scheduled to open in 2019, the facility will have startup and lab space for up to 40 businesses in a 15-county area.
In Birmingham, plans have been announced for the UAB Commercialization Accelerator, a program of the Bill L. Harbert Institute for Innovation and Entrepreneurship aimed at enhancing the university’s entrepreneur-support efforts.
In Tuscaloosa, the Edge Center for Entrepreneurship and Innovation is being expanded from 9,000 square feet to 26,000 square feet. A joint effort among the University of Alabama, City of Tuscaloosa and West Alabama Chamber of Commerce, the new facility is expected to be ready in 18 months, supporting students and area businesses in their entrepreneurial endeavors.
These incubators and accelerators have supported thousands of students in their attempts to open viable enterprises, as well as helping new businesses that need assistance to survive.
“What we’re offering is not just for students,” UA’s Welbourne says. “We have resources for adult learners and anybody in the community interested in entrepreneurship, and I think it’s something that anybody can do at any age. In a true entrepreneurial ecosystem, it’s not just young students who want to start businesses.”
Dave Ketchen, a management professor at Auburn’s Raymond J. Harbert College of Business, notes that a more robust entrepreneurial ecosystem would help ensure that startups created in the state stay in the state.
He cites a successful start-up, Bellhops, that provides app-based, on-demand moving help. Started by Auburn graduates, Bellhops has raised $20 million in angel and venture funding, according to Ketchen. A second company, beer maker Oskar Blues, was begun by an Auburn graduate and is now the tenth-largest craft brewing company in the country.
The founders of both companies, however, felt the need to leave the state. Colorado-based Oskar Blues left because Alabama’s beer laws at the time were too restrictive. Bellhops went to Chattanooga, Tennessee, to gain better access to capital and other support mechanisms for startups.
Says Ketchen: “Today Oskar Blues would not need to set up shop elsewhere because Alabama’s beer laws have changed to become business-friendly. Alabama now has over 30 craft breweries. Among them are Back Forty in Gadsden, Good People in Birmingham and Singin’ River in Florence, all of which were started by Auburn graduates.
“Our next challenge as a university and as a state is to make sure that the next Bellhops does not feel the need to go elsewhere to get the resources they need to succeed.”
Charlie Ingram and Art Meripol are freelance contributors to Business Alabama. Both are based in Birmingham.