How the business school, the university, and the East Bay can support entrepreneurship
Professor Toby Stuart left Harvard Business School last year to become the second faculty director in the history of the Haas School’s Lester Center of Entrepreneurship, succeeding the late Professor John Freeman. Stuart, whose research on entrepreneurship has won several awards, spent six years at Harvard after holding professorships at Columbia and the University of Chicago. In a recent interview, Stuart talked about his vision of entrepreneurship at Haas and in the East Bay.
How does the Lester Center help create more successful entrepreneurs?
There are two roles for the center to play. One is to provide students with courses that help them identify compelling opportunities and to understand the stages of the entrepreneurial process, so they know how to get high-potential ventures off the ground. Second, when students have good ideas and the right backgrounds, we want to do as much as possible to help them assemble the resources required to turn those ideas into actual companies, whether it’s formally through Skydeck or informally through mentors and our connections in the center.
How does Skydeck, the new Downtown Berkeley startup accelerator, fit in?
First of all, the space is spectacular, and it provides a lot of energy. Its presence is aspirational for our students. I have students who want to do independent study projects focused on working their way toward a Skydeck application. Because the Skydeck selection panel includes many distinguished investors and entrepreneurs, Skydeck is a form of imprimatur, which helps bring attention to early-stage companies. Skydeck is one piece of a catalytic process that is occurring here--a big and important piece.
How and why are you changing the MBA introductory entrepreneurship course?
It’s been a very successful course. Students have enjoyed it. The course historically has been structured to include a business plan component. I would like the curriculum to include a true gateway course in which there’s no presumption that you have to have an entrepreneurial idea to enroll. Therefore, rather than have students develop a full-fledged business idea, the students will now use the frameworks in the course to develop a three-slide pitch for a prospective investor. If students take a gateway course before they invest in fully formulating an idea, the idea that they develop will be much better. In the new course, I will also focus on teaching students what the entrepreneurial process is really about because a lot of students think they want to be entrepreneurs but would be happier in other fields such as consulting or banking. Conversely, many students who enter the course planning to enter traditional business school career paths will reconsider their plans to pursue more entrepreneurial roles.
We have terrific workshop courses, like Lean LaunchPad. They are much better suited for students to roll up their sleeves and develop an idea. I’d like to ramp up the number of workshop courses so that students have many options for advancing their ideas while they are still on our campus.
Can you explain your idea of an East Bay “rent gradient”?
I’ve studied geography and entrepreneurship, and I’m a big believer in micro-geographies. What has changed dramatically recently is an explosion of entrepreneurial activity in San Francisco. Venture capital firms like Benchmark are moving offices into San Francisco. The City is bursting at the seams. That has led to very expensive real estate. The rent gradient I refer to is that real estate is much less expensive in the East Bay, and it’s not very far away. As long as the climate remains healthy for entrepreneurial activity, I believe we are on the verge of a big push of startups into the East Bay. We need to be out in front of that. We need to be generating a lot of the companies that locate here.
How do you start that trend?
The rent gradient is going to encourage it, but the cities of Berkeley and Oakland and university administrators can do a lot to promote the creation of companies, including investing in Skydeck, which the university has done. It’s no doubt a start. When students finish here, they want to move down into the Valley. To the extent that we can get them to stay in the East Bay we will have a dramatic impact on the local economy. Having companies very nearby increases the revolving-door feeling of the campus and brings more entrepreneurs and investors here. If we have a couple of visible successes, we can have a tremendous effect on the aspirations of people who are here. I hope Skydeck contributes to that. We want to get to the point that people really pay attention to what happens on the Berkeley campus. We need to put ourselves into the middle of an entrepreneurial ecosystem--more than traditionally has been the case for Berkeley.