The Struggle of College Entrepreneurs
When it comes to launching a startup in college, Northwestern sophomore Daniel Knight understands the struggle, having just launched his own app, Turnout, in September 2016. It’s been tough.
“The secret to doing well in school and having a company is not having a company,” Knight said. “…Are you willing to sacrifice one whole GPA point to dedicate yourself to a startup that might not make money?”
There are about 165 million young entrepreneurs, like Knight, between the ages of 18 to 25 globally, according to the Global Entrepreneurship Monitor Report. Though the general outline may be similar, however, each student has a unique story.
The spirit of college entrepreneurship is relatively new. Given the impact that many of these companies started during college years have made (for example, Facebook, Snapchat, Reddit, and many more), they should be given attention as they are shaping the world in real, tangible, and distinctive ways.
The obstacles of being a student entrepreneur are many, according to Knight. The most obvious one is age.
“The trick to seeming like you’re not 19 is just to act as professionally as possible,” Knight said. “If you want to be professional, look professional. It comes into your vernacular. You have to know what you’re talking about.”
Knight learned this lesson during Wildfire, a pre-accelerator program at Northwestern that assists students in their early stages of establishing their startup. In judging a startup, one of the most important metrics for venture capitalists is the total adjustable market, Knight said. When he was pitching his idea, Knight had no clue what the total adjustable market was, as this was his first ever startup. The secret, he said, was just to start — to submerge yourself in the process.
According to a Kauffman Foundation report, entrepreneurial activity as a whole has been increasing in the U.S. since 2013, rebounding from a five-year decrease in growth. This upward trend has been reflected on college campuses. The same report explained that the number of entrepreneurship courses offered has increased from only 250 in 1985 to more than 5,000 in 2008 on college campuses in the U.S. Furthermore, in 1975, only about 100 majors, minors, and certificates were available to undergraduates on campuses, but in 2006, 500 entrepreneurial formal programs were available, according to Kauffman. Moreover, the ratio of national business incubators based at universities also increased from approximately one-fifth to one-third from 2006 to 2012, Kauffman reported.
One subject of contention, however, is the credibility and viability of college students as startup founders. At such a young age, college entrepreneurs who choose to take this non-traditional path can find themselves not being taken seriously, according to Jessica Tan, a senior at Northwestern University and the co-president of EPIC. EPIC is Northwestern’s student-led, undergraduate entrepreneurship club.
“From an investor’s point of view, it is better if you have an idea to drop out of college and do it, just because we need people who are 100 percent committed to their idea and making it successful,” said Tan. “This is no game.”
Eric Tarczynski, on the other hand, saw his young age as a benefit in his entrepreneurial endeavors, especially in building relationships with higher ups. At only 24 years old, Tarczynski has had plenty of experience in entrepreneurship at the university level. At Northeastern University, he studied finance and helped found three startups; after graduating, he helped co-found a Y Combinator back company before he founded his own startup, Contrary Capital, a venture capital fund that invests in university startups.
“I actually think that playing the student entrepreneur card helped,” Tarczynski said. “…I think people in the U.S. are really willing to go out of their way and help other people, especially young people, and that’s really cool. At the very least, they’re willing to hop on the phone call and give advice.”
Another young entrepreneur, Indra Sofian, who is a junior at Georgia Tech studying Business Administration, said that college is the perfect time to create a startup.
“Right now, you’re in this environment where there’s a lot of resources,” Sofian said. “You generally have more time than a working adult. You have a lot more energy. Plus, if you start a company, and you fail, what’s the worst that could happen? You take more classes? There’s not that much risk.”
Thus, despite the rough journey entrepreneurship necessarily entails, it still has a strong appeal, whether it be due to the recent hype, its alignment with many students’ personal values, or its possibilities. According to the Global Entrepreneurship Monitor Report, 69 percent of U.S. entrepreneurs were motivated “by the pursuit of opportunity;” this number is the highest out of all reported innovation-driven economies.
Gabriel Coleman, a senior at University of California, Santa Barbara and the president of the Entrepreneurs Association there, saw this appeal.
“Why would you simply study for a job that you might not necessarily want in the future when you can go out and make a change and become more successful doing so?” Coleman said.
The venture capital firm, Osage University Partners, recognized the potential of young entrepreneurs, hence its specific focus on investing in university-based startups.
“If you look at startups, especially from major universities, they actually have a very good track record of doing well,” Kirsten Leute, the senior vice president of university relations at Osage University Partners, said. “Universities are a ripe place for people taking chances. It’s hard to do that once you get out in the real world.”
Ultimately, for some, the value of college-level entrepreneurship is derived from the experience itself, rather than creating an extremely successful startup.
“Turnout will suck as long as I’m in college,” Knight said. “Because I can’t give it my all. But that’s alright. I’m here to learn, not to make a billion dollars.”
This story was written as a final project for JOUR 201–1: Reporting and Writing, which I took in the fall of 2016.