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SIU tries building better ‘mousetrap’ for entrepreneur training


By David Schwartz
Published: March 30th, 2011

Many universities sponsor showcases to give inventors the opportunity to present their technologies to potential investors and partners. A growing number also sponsor courses on entrepreneurism to prepare would-be start-up leaders for the real world. Southern Illinois University-Carbondale has taken an approach that combines both strategies. Its most recent innovation showcase was preceded by a 12-week course, many sessions taught by alumni and others who have achieved entrepreneurial success. The structure of the course was based on FastTrac TechVenture, an entrepreneurship program developed by the Ewing Marion Kauffman Foundation.

“About two years ago one of our offices of economic development’s entrepreneurship committee got funding for entrepreneurial training for low- to moderate-income folks,” recalls Kyle Harfst, PhD, MBA, executive director of the Southern Illinois Research Park and SIU-Carbondale’s director of technology & enterprise development. The program, dubbed Operation Mousetrap, followed the Kauffman model, and though it was limited by parameters of income it “piqued some interest” in the university community.

“We submitted a proposal to the NSF around the same time, and we thought it would be great to do entrepreneurial training for university scientists so they would better understand how to commercialize their IP,” Harfst continues. While only “a sliver” of the NSF grant was dedicated to the program, the Department of Commerce and Economic Opportunity covered more than half the expense, and the state’s Small Business Center also provided funds.

Around the same time, the research park sponsored the first SIU Technology and Innovation Expo. “We had 13 inventors present and 120 people showed up,” says Harfst. “One of the things we noticed was that some of the people who gave presentations were much more advanced in understanding their business case; we wanted to provide help for those who were weaker.” Harft’s colleague, Lynn Andersen Lindberg, MBA, director of business innovation and research in the Office of Economics and Regional Development at SIU, had also started looking at the Kauffman program, “so we decided to follow that program and chose a name that parodied ‘bootstrap,’” Harfst says.

A program for scientists

The Kauffman program, Lindberg explains, is designed specifically for the group she and Harfst had in mind — university-based scientists. And it does take some concerted effort to introduce, she says. “First, I had to receive certification in training. I trained for a week in Florida and then had to be graded by the Foundation.” Individuals who achieve certification are then eligible to purchase the Kauffman curriculum and facilitate their own program. The cost of the course, she says, ranges from $1,200 to $1,500 per participant. “We’d be happy to send an outline to anyone who contacts us,” she adds.

While FastTrac TechVenture was used as a foundation, Lindberg continues, “we brought in quite a few guest speakers to highlight the topic for a particular week.” While the program includes workbooks, which were distributed to all participants, “we did not focus as much on that as the topics, using guest speakers to hammer home some of the points.”

The formal program covered in the workbook given to participants includes 11 modules:

  • Exploring Entrepreneurship
  • Defining the Target Market
  • Conducting Market Research and Analysis
  • Testing Your Business Concept
  • Entering and Capturing the Market
  • Planning for Financial Success
  • Building and Compensating Your Organizational Team
  • Protecting the Business and Your Intellectual Property
  • Identifying Funding and Working with Investors
  • Managing Cash and Operating Your Business
  • Enhancing Your Investor Presentation

The speakers, culled from contacts that Harfst and Lindberg had developed during their years at SIU, included Curt Jones, founder and CEO of Dippin’ Dots and an alumus of SIUC, who spoke about defining a target market; and Jack Goecken, founder of MCI, who addressed entering and capturing the market. Participants also heard about testing their business concepts from Curtis Baird, chairman of the board of the School Center in Carbondale; an expert on SBIRs; an attorney who discussed IP; two venture capital experts; one small venture firm; and an angel group.

“All of the guest speakers were given a list of things we wanted to cover, but they were also given a lot of latitude to tell their stories — their successes and failures,” says Lindberg. “Some of them sat down and talked with the students. Then I recapped the discussion at the end.” If the guest speaker did not cover a topic in the depth Anderson hoped for, she would revisit the topic the following week.

Harfst and Lindberg also taught some of the classes, including sessions on valuation and exit strategy. The students, says Lindberg, were hand-picked. “They were either people Kyle or I knew, or those who were recommended by the TTO.”

One-on-one sessions

To help the students prepare for their presentations, Lindberg and Harfst also met with them on a regular basis in one-on-one sessions. “They could ask anything they had questions about, as well as working on putting together their 60- to 90-second elevator pitch,” says Lindberg. Along with the elevator pitch, students were required to prepare a more complete investor pitch of 10 minutes or less.

The students had to start working on the pitches “from day one,” says Lindberg. “Every day we met they had to give the elevator pitch,” she notes, with each successive presentation becoming more refined. “In the beginning, some went on for quite a while, but by the end most of them had a darn good pitch.”

What makes a ‘darn good pitch?’ “You have to have something that grabs the interest of the person you present to – a quick who you are, what you do, the problem you need to solve, and what you are asking them for,” says Lindberg. “We showed them some good elevator pitches and used some judging criteria from a regional judging contest.” With that stringent preparation, “they knew they could take their pitch anywhere in the country and be credible,” she adds.

All nine participants in the initial Operation Mousetrap “graduated” from the program, but it was no easy grade, Harfst stresses. Each received a certificate of achievement from the Vice President of Research, but not before successful delivering three program requirements — the elevator pitch, a one-page business plan summary, and the investor pitch, he explains.

The participants received scholarships, valued at about $1,500, to be part of the program. The graduates are also eligible for three months of free rent at the Dunn-Richmond Economic Development Center through the Small Business Incubator Program, and can also apply for $5,000 to $10,000 in challenge grant funds from the Southern Illinois Entrepreneurship Center.

A week before their presentations and ‘graduation,’ says Lindberg, the students received a rather unpleasant surprise. “They presented to the angel investor, and he really tore into them,” she recalls. Some of his criticisms: They rambled too much and didn’t say what they really wanted to say early enough; the slide presentations were too ‘busy;’ they focused too much on the technology, rather than the problem they sought to solve; and they did not adequately stress the importance of a strong management team. “The participants all listened, and the next week the presentations were much tighter,” says Lindberg.

An ongoing commitment

Harfst and Lindberg are continuing to work with the participants. “Three of them were start-ups — two were less than six months old and the third is a year old — and they’ve all taken us up on our [free incubator rent] offer,” Harfst reports. “Since then two others are in the process of starting up, one has an SBIR, one has submitted an application, and two others are ready to ‘pull the trigger.’”

“We continue to coach them as much as they want individually,” adds Lindberg. “In addition, we have monthly follow-ups on topics they wanted to hear about but we couldn’t cover, like more information on markets.”

A second “mousetrap” session is planned for the fall. “We based our decision on class participation, interaction, and the number of start-ups that have benefitted,” Harfst explains. “A year from now we will probably have six of the participants as start-ups — and several have been approached by equity investors.”

“At the end of the class we asked for feedback, and it was all positive,” adds Lindberg. “At the beginning of the course they were guarded about their technologies and their departments, but after a few weeks they couldn’t stop talking; they wanted to get on with the networking.” During informal discussions, she notes, it got to the point where participants could answer some of the facilitators’ questions for each other. “I think the networking was one of the greatest benefits of the program,” Lindberg says.

Contact Lindberg at 618-453-3805 or llindberg@biz.siu.edu; contact Harfst at 618-453-3427 or harfst@siu.edu.

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