Corridor Student Entrepreneurs Face Many Challenges
It's not that she's a lazy student or a party animal. At 22, the University of Iowa junior owns two businesses: The Megan Amanda Collection clothing line, and a store called Premiere Prom and Pageantry in Mount Pleasant.
"If someone doesn't show up for a shift or is sick, it falls back on the owner to come in," she said. "That's hard. You plan on going to class, and your plans change. You're going to work now."
Juggling responsibilities is just one challenge of owning a business in college. Student entrepreneurs take on startup debt without a guaranteed paycheck, and getting clients to take a college student seriously isn't easy.
Despite the challenges, the UI is seeing more students interested in entrepreneurship. Enrollment in entrepreneurship courses grew from 500 in 1996-97 to more than 2,000 in 2004-05. Since 1997, 500 students have earned certificates in entrepreneurship.
"If you can come up with a viable business opportunity, (college) is a great time to start it," said David Hensley, director of the UI's John Pappajohn Entrepreneurial Center. "You're young and energetic and you can work those 20-hour days. Presumably, you don't have a lot of debts (or) a family to worry about."
Two certificate programs—one for engineering students and one for students with any major—teach skills like recognizing entrepreneurial opportunities, creating a business plan, sales, and marketing.
JPEC staff mentor students who start businesses, and at any given time, 17 student businesses utilize free office space at the Bedell Entrepreneurship Learning Laboratory, a former fraternity house at 322 N. Clinton St.
"We have many more apply than we have space for," Hensley said.
Hensley attributes the interest partly to the dot-com explosion of the 1990s.
"They've read about all of these 20-year-olds who became multimillionaires, so they say, 'Hey, I can do that,'" Hensley said.
Sour attitudes toward corporate culture also are fueling the interest in self-employment, Hensley said.
Take the owners of Bio::Neos, a bioinformatics software company in Iowa City. By this fall, all three will have master's degrees in computer and electrical engineering.
"We could all go get jobs," said one owner, Mike Smith, 25. "But we'd be in a cubicle writing code, doing what our bosses told us to do. Here, we're in control."
Instead, Smith and his partners, Steve Davis, 26, and Brian O'Leary, 25, are doing something they believe in: creating computer programs to aid researchers. Their first product, Bio::Pod, helps identify gene mutations.
Starting a business in college allowed Brad Phillips to stay involved with a sport he loves: motocross.
Phillips, 24, raced for eight years but quit because he got burned out and broke too many bones. While in school, he started Premis, a company that makes motocross videos. He travels the country filming quad races and stunts. So far, he's made three videos and sold 14,500 copies. "I love what I'm doing, and it's a way I can stay in the sport while not having to race and beat my body up," said Phillips, who earned a business management degree and an entrepreneurship certificate in May.
Starting a business in college isn't perfect, though.
Wettach missed out on a traditional college experience. She lives with her parents to save money, and she takes correspondence classes because she's on the road so much. Earning a bachelor's degree in liberal studies with a certificate in entrepreneurship will take five years, instead of the usual four.
"I do go out, but it's not like I'm having a traditional social life like most college students do," she said. "I don't have any regrets, but one thing I would have liked to have maybe done was join a sorority, and that was something I was not able to do."
Capital is another issue. Students must win business plan competitions, get grants and loans or convince people to invest in their companies.
"I'm able to pay myself a little, but not much," Phillips said. "We're six figures in debt, which isn't that high for a startup. . .(but) it's always looming over my head."
Inexperience is another hurdle.
None of the Bio::Neos owners studied entrepreneurship because the idea for their company came too late in their college careers. They're learning about sales as they go.
"We went to two conferences in October, and (we) strongly agree that we didn't at all know what we were doing," Davis said. "We didn't do a good job of presenting our capabilities (to potential clients), and we didn't do anything toward . . . understanding their research to know whether it was worthwhile to follow up with them."
Phillips paid $10,000 to use a Rob Zombie song in his videos and spent $8,000 on a full-page magazine ad.
"When I started out, I blew money like it was just everywhere," Phillips said. "Now I'm paying for that."
Getting respect is hard, too.
At conferences, the Bio::Neos guys get strange looks, as if they're too young to be there.
"I personally feel out of place a lot of times," Davis said. "But every once in awhile, you'll get that person who doesn't look down on you but is actually very impressed, and is like, 'Man, you're doing this, you're taking this risk and you're only 26? That's awesome.'"