Is entrepreneurship the new banking? With the finance and banking sectors frozen or in a holding pattern, business schools are responding to students clamouring for lessons in how to make it in business on your own.
Schools everywhere report increased interest in what makes the perfect pitch, and are responding by drumming up courses and establishing business hub centres. Here, entrepreneurially minded MBAs can learn about what it takes to set up your own business, or even better, get a kick start into a venture from the very beginning of their course.
The University of Chicago Booth School of Business was renamed two months ago after entrepreneur and visionary marketer David G Booth. Here, classroom or hands-on courses in entrepreneurship are among the most popular in the school; and the subject is the second most popular major (finance still pips it).
Steven Kaplan, Neubauer Family Professor of Entrepreneurship and Finance at the university, says students get a chance to apply what they learn in the classroom with internships at local venture capital and private equity firms, and involvement in a business angel network of alumni and friends of the school known as the Hyde Park Angels (HPA). HPA has funded three companies and grown quickly, with Booth students serving as associates and helping run due diligence on companies that apply for funding.
And at the London branch of the school, students gathered in their hundreds recently to hear Dr Riaz Agha, a young entrepreneur, pitch his idea for a new comparison website to a panel of hard-bitten investors – and to hear their revealing feedback on the proposal. One business angel, for example, said that she wouldn't invest in anything without evidence that a venture capitalist might be interested later.
Contact with such investors is vital to MBA students. At the Saïd Business School's annual "Silicon Valley comes to Oxford" event, this season's panel included the founders of LinkedIn, Twitter and Second Life – all inspirational entrepreneurs who are also investors.
And "hubs" where students can gain support for their own ventures, or vital experience with local businesses wanting to benefit from innovative thinking, are taking off. In Edinburgh, at Napier Business School's Moffat Centre, students get advice on setting up their own business right from the start of their course. Nottingham University Business School MBA students use the university's Ingenuity Centre to work with medium-sized businesses, researching for them on campus or taking on projects in house. And Manchester Metropolitan University Business School, which has just launched an MSc in entrepreneurial practice, runs Innospace, a skills centre that has attracted more than 70 young businesses since it opened a year ago, with links to the school's MBA programme.
These centres have a ripple effect out into the community. Lancaster University Management School (LUNS), for example, sees its "New Venture Challenge", which introduces students to entrepreneurs or business start-up operations right from the first term, as an opportunity to deliver a service not only to its students but to small and medium sized business all over the North-west.
Nationally, too, schools are playing a lead role in disseminating cutting edge thinking. Judge Business School's Centre for Business Research in Cambridge and Imperial College Business School join forces this month to establish a new "virtual" national research centre aimed at giving the UK the edge in innovation – bringing together leading academics researching in both the private and public sectors.
But in these straightened times, where is the money for new ventures going to come from? Undoubtedly, says Kaplan, seed funding will be harder to find and more expensive. On the positive side, he says that the opportunity cost of doing a start-up has declined, and it is also easier or less expensive to create the infrastructure for a start-up than ever before.
Creating your own investment fund is also a way forward. A pioneer in this field is ESSEC Business School in Paris, where Julien Morel, the executive director responsible for entrepreneurs has run a seed fund for projects incubated at the school for four years. With the help of co-investors, ESSEC's seed fund money cushions its budding business enthusiasts from the worst of the current crisis.
"Around 20 start-ups emerge from the school every year," says Morel. "But this activity pre-dates the current financial situation and springs more from the increasingly individualistic and network orientated mindset of young French students now. They don't necessarily want to work in a big company – they want to do what they want."
It's clear, though, he says that the current crisis may push the trend for entrepreneurial activity forward. It's one that looks set to be ever more popular as the year progresses.
'I didn't rush into it'
Recent Durham Business School MBA graduate Stephen Prior has made good use of his dissertation: he used it as the basis for his own business. His company Forest Carbon offers carbon offset management and advice for companies such as Marks & Spencer, The Green Insurance Company and Hallmark Cards, and is, he says, the only offset company in the UK specialising solely in forestry. It covers bare British hills with trees bought by its clients, following the Kyoto Protocol's "additionality" principle, to act as carbon sinks.
"The dissertation was about the fundamental principles of environmental economics and how UK forestry could fit into offset markets", he says. "But although I had always wanted to work independently, I didn't rush into running my own business. It's not always an easy thing to do straight away – if you've never worked on your own it may take you a while to even begin to see yourself as an entrepreneur.
"I got to know the market first by doing consultancy work and it took more than two years running the business in parallel with that before I took the leap. This also gave me time to develop good, solid relationships in the field.
"If running your own business is something you want to do, you tend to know when the time has come to take the plunge".Reuse content