Professor Grandhi at SP Jain is a new friend who had been after me to share my thoughts about what business plan competition at a business school should look like. The post goes out to him and all other promoters of entrepreneurship who believe that we should catch this generation young. Preferably corrupt their minds enough to not let them get comfortable with a regular pay check and ideally make them completely unsuitable for permanent corporate employment.
MIT wrote the book on running an effective business plan competition in a university setting. Their 20 year track record of running the competition has a number of lessons for all of us.
- A competition needs to create real companies. For it to be effective it cannot be a week long, one off fling to prove how smart or well grounded your team is. It will more likely be a yearlong affair with a dream that will end in a reality check, heartbreak, recognition, and enough cash to get you out of the university’s incubator program into the real world or some combination of all four.
Which then means that for this to work you need:
- A network of entrepreneurs to make themselves available as mentors, guides, well wishers and advisors
- An incubation program that makes it easier for students to take the vague outline of an idea and turn that into a believable concept. Ideally in a short enough timeframe so that they can test it, pitch it, connect with customers and incorporate their feedback. If they can’t get the product out and close a deal, they should at least graduate with a pipeline of sales calls.
- A support system at the school that is comfortable with a student trying to make it on his own, which means no issues with the same student taking up permanent residence at the school, using the entrepreneurship lab as a mail forwarding address (a phone number and a receptionist to take message would also help).
- Consistency in terms of judging guidelines, contest timelines, qualification criteria, size of the purse (must get larger with time and must start off with a number reasonable enough to support a crazy idea for three months).
Columbia Business School started off with a similar variation. The greenhouse incubator took all of this in its stride and even came up with an interesting variation. Last time I checked Duke also had a 100K program but the winners of the prize had issues with the process around disbursement of the prize money purse.
Remember what makes the program, a program, is the desire to take it beyond a competition. All schools have variation on a competition. Great schools turn the process into a stepping stone for students to realize their dreams. They don’t always end up with fairy tale ending, but they provide enough of a reality check in a sandbox mode that when the time comes for a student to cross the road into Main Street, she can do it with confidence. And pride.