Jobs are scarce, barriers to entry are down, and entrepreneurship is all the rage on college campuses these days
Editor's Note: With today's story on the boom in entrepreneurship on college campuses, Bloomberg Businessweek begins an occasional series on the world of startups. The series will focus on MBAs and undergraduate business students who developed their ideas or launched their businesses while still in school, and the many ways their schools helped them get their new ventures off the ground. For a look at some business students trying to build their own businesses, check out our slide show. New York University seniors Katie Shea and Susie Levitt were interning at Goldman Sachs Group (GS) and Citigroup-Smith Barney (C) when their sore feet inspired them to start a $10,000 dorm-room company selling foldable flat shoes that come in their own tote bag. A year later they have imported 70,000 pairs from China that retail for between $10 and $25. Women can don the slipper-like footwear to hike or drive to the office in comfort, then switch back to their high heels when they arrive at work. Inspired by Mark Zuckerberg, who founded Facebook as a sophomore at Harvard University, in Cambridge, Mass., and stymied by the shortage of jobs in the recession, college students are launching businesses before they graduate. They're entering industries that previously required large investments, thanks to websites that offer help with manufacturing, inventory management, and accounting, says Dane Stangler, a project manager with the Kauffman Foundation, a Kansas City (Mo.) nonprofit organization that promotes entrepreneurship. Contagious Enthusiasm
The trend isn't limited to undergraduates. Even MBAs are catching the entrepreneurial bug. Top MBA programs are reporting a surge in interest among students in launching their own businesses, and many schools are ramping up support for budding entrepreneurs.On Friday, Harvard Business School (Harvard Full-Time MBA Profile) announced the opening of its first innovation and entrepreneurship lab in 2011. "If you start a company tomorrow, you can be global your first day," Stangler says. "You can have international suppliers, you can have international customers. Just compared with a decade ago, it's unbelievable how fast barriers to entry have fallen to starting a business from your dorm room." The financial crisis has contributed to growing interest in entrepreneurship on college campuses. At USC's Marshall School of Business (Marshall Undergraduate Business Profile), the number of undergraduates enrolled in business-creation classes has increased 30 percent since 2007, to 1,042 this year, says Gene Miller, director of the Lloyd Greif Center for Entrepreneurial Studies at USC.
Northwestern University, in Evanston, Ill., added six more undergraduate classes in entrepreneurship in the past three years (for a total of eight) in response to student demand, says Michael Marasco, director of Northwestern's Farley Center for Entrepreneurship and Innovation. Forty of the 341 students at MIT's Sloan School of Management (Sloan Undergraduate Business Profile), in Cambridge, Mass., say they are starting their own businesses this year, up from just 9 in 2007, says William Aulet, managing director of MIT's Entrepreneurship Center.
"The enthusiasm for entrepreneurship is at an all-time high," Aulet says. "The rock stars here are the entrepreneurs. It's not the people who go to Wall Street." University of Southern California students Jonathan Shriftman, 22, and Jake Medwell, 21, decided over beers last year that instead of pursuing careers in investment banking, they would become bicycle importers. With less than $25,000, from their families, friends, and a third-place prize of $15,000 in Inc. magazine's entrepreneur competition, they founded Sole Cycle Co. The two students plan to import more than $150,000 worth of bicycles this year that they intend to sell for $260 each online, Medwell says. Exploiting Technology
During the school year, after creating their business plan, they were able to contact their suppliers, retailers, and shippers using eBay's Skype Internet video-chat phone service. "Skype has been phenomenal," says Medwell. "It made communicating with China like talking to my father. One of my roommates goes to work in a suit and looks miserable. I do work from my bedroom." Shea and Levitt, both 23, ordered their shoes from a supplier they found on Alibaba.com, a website that lists more than a million international manufacturers of everything from bicycles to backpacks. Suppliers post pictures and descriptions of their goods, their contact information, and often their prices and minimum-order size. The duo visited China for the first time only a few months ago, enabling them to deploy most of the $10,000 they raised from family to cover other startup costs. The recession also helped the company save money, says Levitt. "It allowed us to negotiate a much better price for our website, for graphic design, and it allowed us to get great interns for the summer." At USC, students are realizing they can become importers through Alibaba, globalsources.com, and exportnation.com, says Shriftman. His classmates have asked him how to contact foreign suppliers, and friends have plans to import first-aid kits and snowboards, he says. Online marketplaces that connect importers and exporters are "really changing the whole game of how products are manufactured," says Shriftman. "Anyone can have anything made right now."