Welcome to Entrepreneurship and New Ventures (BUSI 660),
In the class, you will build real businesses. That is, you will all become entrepreneurs. A number of “challenges” have been designed to facilitate this process, as well as reinforce concepts from class. You will be graded on how well you perform in these challenges as well as how much money the business you start makes. As we move through the course, teams will be eliminated if they perform poorly compared to their peers on the challenges. On the final day of class, no more than four teams will compete for the 660 Championship.
Course: Introduction to Entrepreneurship and New Ventures
Course Developers: Brent Goldfarb & David Kirsch
School: Robert H. Smith School of Business, University of Maryland College Park
- Class is a business startup competition
- Students face series of challenges & elimination
- Failure is feature of course. This strengthens learning outcomes.
- Students evaluated based on earnings and/or performance on course assignments and challenges
- Increases student engagement
Pedagogical Overview: Real Entrepreneurship CompetitionBrent Goldfarb & David Kirsch
The course (#Real660) is an entrepreneurship competition. Students start real businesses and the student who earns the most money earns an “A”. Throughout the course, teams are eliminated based on specific performance dimensions in a series of challenges designed to teach academic content. Thus, business failure is built into the course and this enhances emotional attachment to the business building exercise and consequently, learning. A safe learning environment is achieved by awarding “Karma points” based on alternative performance dimensions in the challenges. For example, in a pitch challenge teams deemed most likely win the competition advance whereas those with the best technical pitches are awarded Karma points. Final grades are awarded as a function of a student’s maximum class rank along either dimension: money earned or karma points. Thus a student can receive a high grade even if their business fails, and risk taking in the business is encouraged. Individuals belonging to eliminated teams become part of the “labor pool” and must join surviving teams. This feature implies that success in the contest requires growth strategies to accommodate additional team members. The earnings ranking is a function of personal earnings and is allocated based upon equity stakes negotiated between students, while Karma points are awarded equally to all team members regardless of equity splits. Students also blog about their efforts on Twitter and Storify to enhance vicarious learning.
Current methods of entrepreneurship instruction are either exercises in the production of business planning documents or are conceived as launchpads for new businesses. Each approach has benefits and shortcomings. Planning exercises are excellent tools to teach theoretical frameworks, but they fail to provide practical skills students need to become entrepreneurs and / or understand the entrepreneurial environment. Launchpad courses provide students with real-world experience, but launching “big ideas” is often difficult in the time-frame of a course. The approach often does not allow students to experience more than the very initial stages of the entrepreneurial lifecycle. It also increases the costs of failure as ideas are high-stakes if students choose their “big idea” as the subject for the course. This does not allow students to explore the entrepreneurial context in a safe environment. #Real660 allows students to learn entrepreneurial skills in a hands-on way before launching their big idea in another setting.
#Real660 combines the best of both worlds through making teaching entrepreneurship the priority as opposed to providing a platform to launch a businesses. The course structure compels students to develop businesses in the short time frame of the semester. While this limits the types of businesses that can be launched, it forces students to generate revenue in a very short time frame with minimal startup capital. Students are required to be resourceful in a resource-poor environment and success requires learning to sell quickly. Importantly, since this isn’t a launchpad course, the long term costs of failure are attenuated. Instead, motivations to pursue the business come through the competition nature of the course. These features afford students a safe environment to learn entrepreneurial skills and explore their personal fit with the entrepreneurial experience. Those with good personal fit learn tools that mitigate their propensity to fail when they do pursue their “big idea” while those with poor personal fit safely learn that entrepreneurship is not for them.
Key to the learning experience in the students emotional involvement in the class and failure inherent in the competition. Shepherd (2004) suggests that a key entrepreneurial skill is developing the emotional intelligence necessary to learn from failure. He suggests several vicarious experience methods to allow people to experience grief and reflect on them. In our experience teaching #Real660 students’ emotional involvement is sufficient to allow students to experience the ups and downs of business success and failure first hand. Consolidating learning requires several strategies. First, learning was significantly enhanced by coaching students following failure and helping them work through their grief and thereby learn the key lessons from the failure. Second, students were required to blog about their failed businesses (and failed strategies). These two strategies: discussion and writing, are suggested by grief researchers and reflected in Shepherd’s writing. Our anecdotal experience from teaching the course is that the emotions associated with experiencing failure were critical in achieving strong learning outcomes. Time is required in each of the challenge presentation sessions to discuss the failures and lessons learned.
The role of writing in consolidating the learning experience. One difficulty with running the class as a competition is that some business experiences may be idiosyncratic, and hence learning may not be distributed evenly. The course incorporates the use of social media and blogging tools to allow students to share their experiences and increases student engagement in the course. It also provides a mechanism for the instructor to monitor activities of the student teams in real time. A search on twitter using the hashtag #real660 will reveal how the tool was used this spring. A search on Storify.com for the same hashtag will show several of the course businesses, student experiences and the instructor’s reflections on the course.
Integration of research with class pedagogy: Key activities have been designed to reflect latest academic research on the entrepreneurial process. Student assessment is based upon performance on a set of class-wide challenges that require students to, for instance, use effectual methods to bootstrap resources from a common, minimal start-up endowment (Sarasvasthy, 2000); evaluate and mobilize existing social network in service of resource acquisition (Hallen, 2008); and articulate, iterate and present versions of their business model (Osterwalder and Pigneur, 2010).
Ben L. Hallen and Kathleen M. Eisenhardt (2012) Catalyzing Strategies and Efficient Tie Formation: How Entrepreneurial Firms Obtain Investment Ties. Academy of Management Journal 55:1 pp.35--70. http://faculty.london.edu/bhallen/assets/documents/Catalyzing_Strategies.pdf
A. Osterwalder and Y. Pigneur (2010): Business model generation: a handbook for visionaries, game changers, and challengers. John Wiley and Sons. http://www.businessmodelgeneration.com/book
Saras Sarasvathy (2008) Effectuation: Elements of Entrepreneurial Expertise. www.effectuation.org.
Dean Shepherd (2004) Learning from Business Failure: Propositions of Grief Recovery for the Self-Employed. Academy of Management Review 28:2 pp. 318-328 http://www.jstor.org/stable/30040715.