Despite the dismal economy, the current state of entrepreneurship couldnt be healthier. Thats because the lure of easy money has weeded out entrepreneurial impostors and get-rich-quick artists. Most aspiring company founders, tempered by the rigors of todays tight capital markets, will be trained, smarter and more dedicated to the idea of entrepreneurship.
We have entered the age of professional entrepreneurs, largely because the nations top business schools, prompted by the Internet startup craze, formalized programs along those lines. As Internet businesses flourished, M.B.A. programs questioned the wisdom of training primarily bankers, consultants and corporate managers.
For instance, Harvard Business School launched its Business Plan Contest in 1996 as the dot-com craze was hitting its stride. Likewise, Stanford Universitys Center for Entrepreneurial Studies was founded the same year.
We can thank the B2B and B2C boom for that. And today, its B2B and B2C of a different sort–back to banking and back to consulting (credit for the pun goes to Harvard Business School Assistant Professor Rob Austin). Entrepreneurship programs have put down roots that codify company building.
One school where entrepreneurship has long been a way of life is MIT. Its $50K Business Plan contest has served as a model for others.
Nothing drives home the notion of professional entrepreneurs more than talking with an aspiring company builder. Michael Parduhn, an MIT Sloan School of Management student, symbolizes the new breed of professional entrepreneur. "Id rather have half the money and twice the impact," he said. Parduhn is unwilling to take investors money until hes had the training in school and seasoning with someone elses company. This sentiment is prevalent among Parduhns peers. In one entrepreneurship class, a mere 10 percent to 15 percent are planning to jump into startups right after graduation, compared with 30 percent a year ago.
So, many in the entrepreneurial classes of 2001 will go back to banking and consulting until the time is right. "This years [Sloan] graduates are genuflecting before big companies and are very nervous about startups," said Howard Anderson, who teaches an entrepreneurship class at Sloan and is founder of The Yankee Group. "Amateur night is over."
So with the characteristic impatience of an entrepreneur, these students wait for better times. But when conditions turn ripe, look out.