Posted by: Louis Lavelle on January 25, 2011
Sometimes all you need to get started is a small push. That’s the idea for a new program at Harvard Business School designed to give budding entrepreneurs the financial wherewithal to launch new businesses before they graduate. The program—launched with the help of Harvard students and dubbed the Minimum Viable Product Fund, or MVP Fund—will dole out money to MBA students with promising startup ideas.
“There is a large number of us interested in startups, who wanted to get started on businesses while at school, but there was not much in the way of incubators or an entrepreneur’s scene,” said Daniel Rumennik, a first-year student at Harvard (Harvard Full-Time MBA Profile) who came up with the idea and proposed it with the help of classmates Jessica Bloomgarden and Andrew J. Rosenthal.
When professors caught wind of the idea, they quickly brought it to the dean, who was responsive. Now, HBS’ Arthur Rock Center for Entrepreneurship will give $50,000 in funding to various student startups that have a feasible and interesting business idea, said Rumennik. Each chosen startup will receive $5,000 with the option of asking for more but receiving no more than $10,000, according to the school-issued press release. Students will submit applications by Jan. 28. Meanwhile, the fund’s founders will have students vote for three faculty members and three students to sit on the committee that will review the applications and decide how to divide the available funding.
“This is the first step,” said Rumennik, who aims to launch his own startup before graduation. “We hope it becomes part of a larger incubation program.”
The MVP Fund is based on the premise of the Lean Startup methodology, which focuses on rapid prototyping, a process that brings products to market as quickly as possible and was developed by Eric Ries, an entrepreneur-in-residence at HBS, according to the press release.
Once the school invests financially in these budding businesses, student entrepreneurs will participate in monthly meetings to share ideas among themselves and meetings with a faculty mentor.
Already there is a grassroots group of students who get together to discuss entrepreneurial issues and related interests and ideas. Startup Tribe, as it is called, brings students face to face with alumni who have founded their own businesses and potential funders, said Rosenthal, leader of Startup Tribe. A co-founder of the now-defunct Happier.com, which had visitors paying a fee for access to help on how to be - you guessed it - happier, Rosenthal said there's a reinvigorated entrepreneurial spirit at HBS, where he added there have always been some students interested in startups.
Startup Tribe and MVP, he says, "are the impetus for this exciting new lease on entrepreneurship."
Indeed, Rumennik and Rosenthal both said they hope these efforts are just the beginning. Rumennik is hoping the funding available for student startups grows, and he said he could see venture capitalists or corporate sponsors pitching in eventually.
Some 50 percent of HBS alumni describe themselves as entrepreneurs 10 to 15 years after they graduate, according to the school's press release. Part of the MVP Fund's appeal, is that students can get started on their business ideas while in school rather than waiting a few years after graduation, said Rumennik. Wanting the entrepreneurial spirit to become a bigger part of the culture on campus is a top priority, added Rosenthal.
"Attracting more entrepreneurs to HBS will be an indication of our true success," said Rosenthal.
--By Francesca Di Meglio