I have worked with entrepreneurs for more than 20 years and it has always struck me that often these creative, driven individuals feel very alone.
Given that 50 percent of small businesses fail in the first five years according to the Small Business Administration, many entrepreneurs make the mistake of struggling and not asking for help. Why? Frequently it is because they don't want to frighten family members who may not have wholeheartedly supported their decision to strike out on their own. They may also fear that confiding in business contacts would spread doubts about the viability of their business. Finally, they don't want to risk losing valuable employees should there by any inkling that something is wrong.
Who has the best resources to guide entrepreneurs, and provide invaluable advice on how to structure a business plan, enhance products and services, raise money for expansion and further establish their profile to attract employees?
I maintain that local universities are best positioned to offer the innovative thinking, resources, and access necessary to help entrepreneurs succeed and grow. And by doing this, universities can also help strengthen the economies of the regions in which they exist as well as serve as anchor institutions for future economic development.
The University of Pittsburgh's Institute for Entrepreneurial Excellence is an example of how a university works with local entrepreneurs to help them harness the power of knowledge, innovation and collaboration to increase profit margins and create jobs.
The Institute began as a self-funded entity attached to Pitt's Joseph M. Katz Graduate School of Business. It now comes under the jurisdiction of the University's Provost office so that it can work more closely with all its 700 laboratories and technology offices.
In the 20 years since its founding, the Institute has supported the creation of more than 800 start-up companies that have generated over 7,000 jobs. The entrepreneurs working with the Institute have reported an increase in revenues of more than $245 million and have obtained more than $300 million in funding.
Other universities should consider following the Institute's successful formula for engaging the business community through an array of unique consulting programs. These include: Small Business Development Centers, monthly workshops, peer forums and mentoring programs, and most importantly, bringing thought leaders and internationally known experts to the community to share cutting-edge information about new trends, practices and innovative models. These steps will help small business leaders as they focus on growth today and through the next generation.
Underpinning all of this effort is a robust and trusted relationship with the regional business community that facilitates connections to students for internships, experiential projects and case studies. In this manner, students apply their knowledge throughout the year and ultimately enhance their efforts to secure meaningful career employment.
The one caveat is that the emphasis should always be on the practical, not academic theory. Entrepreneurs need knowledge that can be applied immediately in the pursuit of business goals like improving sales performance, launching new products or attracting and retaining good workers.
At Pitt's Institute for Entrepreneurial Excellence more than 1,400 education programs have been developed attended by more than 40,000 business leaders.
Most important, entrepreneurs lose the feeling of isolation through peer forums that explore the business, family and personal aspects of operating a business. Just knowing that others face the same obstacles provides entrepreneurs with the strength to take risks and move their business forward.
University presidents and business school deans may be reluctant initially to get their institutions so directly involved in economic development. But first of all, the advantages flow both ways. Connecting the university with the regional economy will benefit research and teaching at the school as much as it helps local businesses.
Every regional economy is an ecosystem of great diversity, from the skills of the workforce to the quality of the transportation network to the relationships that exist between local political and business leaders. Businesses live within their own ecosystems too, including the financing, tax credits and technical support that are available to them.
Understanding all these moving parts, analyzing their impact on economic development and educating entrepreneurs in how to turn this knowledge to their advantage is a natural role for universities.
Our country depends on the success of small businesses. An alliance between entrepreneurs and their local university can have a significant impact on business growth and job development.
Ann Dugan serves as Founder and Executive Director of the Institute for Entrepreneurial Excellence at the University of Pittsburgh and as Assistant Dean for the University's Katz School of Business.