CA: What do you think is the most popular program or offering, and what is involved in it? You mentioned the Social Venture Fund and the Open Door, for example.
ST: I am not sure if our student funds is the most popular program, but it’s certainly one of the most distinctive features of our offerings. Ross was the first to have a student venture capital fund. We were also the first program to have a student social venture fund. We now have five funds in total, and I think that’s an experience that students recognize that is rare—they have the opportunity to learn to be an investor by doing it hands on. I’ll often suggest to students when they are considering applying to one of the funds, that even if you never want to be a venture investor, if you are going to be an entrepreneur, at some point you’re going to have to raise money.
Having spent a couple of years on the investor side of the table is an incredibly valuable experience, so that they are not walking into their first real pitch, blind. They will already know what a term sheet looks like, they will know what good deal terms are, they will understand what an investor looks for because they spent time in that role. I think that is something that really tracks well with students.
The other thing that probably qualifies as most popular because it’s mandatory and all students have to do it is our Multi-disciplinary Action-learning Project, MAP Project. All of our MBA students do MAP for the last half-semester of their first year of the program. We try to offer projects that are at large companies, start-up companies, international, domestic, for-profit, and not-for-profit companies. For students who have an interest in entrepreneurship, but are not sure what a start-up is all about, we can help place them in an early-stage company so they can really get a feel for what it’s like to be in this sometimes ‘wild west’, very fluid start-up environment. Some students come back from that experience and say, “Whoa, whoa, that was a little crazy. I want to look for something a little more stable when I get a job.” And others get a taste of it, and just can’t wait to get back for more. That’s really the value of an MBA: Having opportunities to try different experiences, to put yourself into situations that you wouldn’t otherwise encounter.
CA: Are all the student funds open to MBA students? Or is it just a few in particular?
ST: We have one fund that’s just for BBA students. But all of the other funds are open to MBA students. There are capacity constraints. 100% of the students can’t be in the funds, just like 100% of the students can’t take any given course. Funds are set up as courses, students bid on them like they bid on a popular elective.
CA: Do think there is an entrepreneurial offering that is overlooked or under-utilized? In other words, is there a particular offering you wish more students knew about?
ST: There is an offering that is the becoming more popular, the Search Funds.
Many students struggle with the idea of, “How do I come up with a venture? I’m not a techie, so I can’t write software. Or, I’m not a scientist, so I’m not going to come up with a new molecule. Where do I come up with an idea?” We have a course that’s taught each fall called “Entrepreneurship Through Acquisition.” The theory behind it is identifying a small company that has the potential for growth. It has the potential, if managed well, to go from regional to national, or national to global.
Students will go out and actively look for different companies that fit a profile. The ideas have already been thought of, developed and started, but the founding entrepreneur often wants to retire, or all their savings and assets are caught up in the business. So the model is searching for one of these—that’s the Search Fund term, finding investors to help buy the business, and then—by co-owning it with the investor group, growing the business. Think of it as private equity fund, but on a very micro scale, where you bring in capital, acquire a business, run it, grow it, then either sell it or buy it out from the investor pool so they can make a return on their investment. The entrepreneur, who’s responsible for really growing it, is able to get a personal gain.
It is a concept and a program that we launched a couple years ago, and is steadily growing in popularity among the students.
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