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Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
Center for entrepreneurial studies nasf 2-12-2010
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Center for entrepreneurial studies nasf 2-12-2010

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A presentation on entrepreneurship by Lisa Sweeney, Center for entrepreneurial Studies (Stanford School of Business). Meeting held as part of the NASF (www.nasf.es) trip to Silicon Valley

A presentation on entrepreneurship by Lisa Sweeney, Center for entrepreneurial Studies (Stanford School of Business). Meeting held as part of the NASF (www.nasf.es) trip to Silicon Valley

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  • 1. Entrepreneurship in Silicon Valley and at Stanford December 2, 2010 Center for Entrepreneurial Studies
  • 2. Agenda <ul><li>Entrepreneurship in the U.S. </li></ul><ul><li>Silicon Valley – What Is So Special? </li></ul><ul><li>Entrepreneurship at Stanford and the Graduate School of Business (GSB) </li></ul><ul><li>Q&A </li></ul>
  • 3. Entrepreneurship in the U.S.
  • 4. New Ventures in the U.S. <ul><li>Many U.S. businesses start small (1-5 people) </li></ul><ul><li>Three common misconceptions are: </li></ul><ul><ul><ul><ul><li>The typical founder is a “serial entrepreneur” with a technical and business background </li></ul></ul></ul></ul><ul><ul><ul><ul><li>New ventures are started by young, highly-educated entrepreneurs </li></ul></ul></ul></ul><ul><ul><ul><ul><li>Entrepreneurs must raise hundreds of thousands or millions of dollars to achieve profitability </li></ul></ul></ul></ul><ul><li>Surveys show otherwise… </li></ul>
  • 5.  
  • 6.  
  • 7. Silicon Valley – What is So Special?
  • 8. Where is Silicon Valley? Dec 2, 2010 Center for Entrepreneurial Studies
  • 9. Silicon Valley Ecosystem Entrepreneurs <ul><li>Sources of capital </li></ul><ul><li>Government </li></ul><ul><li>Private </li></ul><ul><li>Risk capital (angels and VCs) </li></ul><ul><li>Skilled human capital </li></ul><ul><li>Workforce </li></ul><ul><li>Service providers and advisors </li></ul><ul><li>Institutions that generate ideas and talent </li></ul><ul><li>Research universities </li></ul><ul><li>Labs </li></ul><ul><li>Think tanks </li></ul><ul><li>Incubators </li></ul><ul><li>Unique culture </li></ul><ul><li>Free markets </li></ul><ul><li>Stable legal system </li></ul><ul><li>Reliable infrastructure </li></ul>
  • 10. The Secret Sauce <ul><li>Unique Culture </li></ul><ul><li>Free flow of people and information </li></ul><ul><li>Supports experimentation </li></ul><ul><li>Innate desire to discover and disrupt </li></ul><ul><li>Continual innovation </li></ul><ul><li>Collaborative </li></ul><ul><li>Rewards risk taking and tolerates failure </li></ul><ul><li>Sharing of risk and reward </li></ul><ul><li>Meritocracy </li></ul><ul><li>Ethic of extreme work habits </li></ul><ul><li>Highly sophisticated support system (lawyers, developers, marketers, accountants, headhunters, designers, etc.) willing to share early risk </li></ul><ul><li>Free Markets </li></ul><ul><li>Encourage labor and capital mobility </li></ul><ul><li>Tax regime that does not penalize new venture creation </li></ul><ul><li>Support real competition </li></ul><ul><li>Provide many potential options for exits </li></ul><ul><li>Sufficient, but not overwhelming, government regulation </li></ul><ul><li>Government funds and turns over new ideas to private sector </li></ul><ul><li>Stable Legal System </li></ul><ul><li>Well defined corporate and securities law </li></ul><ul><li>Clear intellectual property rights </li></ul><ul><li>Low barriers and costs to start a new venture </li></ul><ul><li>Well-defined corporate governance </li></ul><ul><li>Reliable Infrastructure </li></ul><ul><li>Utilities </li></ul><ul><li>Transportation </li></ul><ul><li>High penetration of technology (internet, broadband) </li></ul>
  • 11. New Ventures in Silicon Valley <ul><li>Silicon Valley supports larger, more technically and scientifically-based new ventures or “start-ups” </li></ul><ul><li>These businesses are supported by well-developed funding models and networks (e.g., series financings by venture firms) </li></ul><ul><li>Founders typically bootstrap the business - goal is to develop a business plan, prototype, proof of concept and customers </li></ul><ul><li>Founders then shop the business to angel, VC, private equity or strategic investors </li></ul><ul><li>Financing is typically done in “Rounds” (A,B,C,D) that gradually dilute founders’ stakes </li></ul><ul><li>Founders do not try to keep control of company long term - they usually are not creating a family business </li></ul>
  • 12. New Ventures in Silicon Valley <ul><li>Many new ventures in Silicon Valley fail - some never return all of the capital invested </li></ul><ul><li>Despite this, professional financial investors are willing to invest, and entrepreneurs willing to try (sometimes repeatedly) </li></ul><ul><li>Professional investing models take a portfolio approach when investing. Their economics often rest on having a few big successes (e.g., Google) amid the many failures </li></ul><ul><li>Entrepreneurs who are funded bear substantial risk </li></ul>
  • 13. Selected Silicon Valley Demographics
  • 14. Professional Investors <ul><li>Silicon Valley has a well-developed network of professional investors that support a vibrant start-up environment: </li></ul><ul><li>Angels – high net-worth individuals </li></ul><ul><li>“ Super Angels” – angels who invest their own money and have raised “micro funds” of additional capital (e.g. $10-30 million) </li></ul><ul><li>Angel Groups – associations of high net-worth individuals </li></ul><ul><li>Venture Capitalists – professional managers of institutional money </li></ul><ul><li>Corporate Venture Capital – company-sponsored venture arms </li></ul><ul><li>Private Equity – often venture capital, but includes management buyout firms </li></ul>
  • 15. Other Investors <ul><li>Silicon Valley also has other investors: </li></ul><ul><li>Friends and Family </li></ul><ul><li>Government Grants – SBIR and STTR grants </li></ul><ul><li>Bank Debt – Common with equipment purchases </li></ul><ul><li>Real Estate/Law Firms </li></ul><ul><li>Suppliers </li></ul>
  • 16. Some Comparisons…
  • 17. Venture Capital in Silicon Valley
  • 18. Entrepreneurship at Stanford and the GSB
  • 19. Venture Capital Firms Near Stanford
  • 20. Stanford University Office of Technology Licensing <ul><li>Disclosures </li></ul><ul><li>Licenses* </li></ul><ul><li>Royalty Income </li></ul><ul><li>Staff </li></ul><ul><li>Majority of disclosures are never licensed; many disclosures have one license; some disclosures have multiple licenses </li></ul><ul><li>Source: Stanford OTL </li></ul>1970 28 3 $50,000 2 Cumulative 8000 2900 $1.3 B 2009 438 77 $65.1 M 33 Active ~3000 ~1000
  • 21. How Entrepreneurship is Taught at the GSB <ul><li>“ Foundational” Entrepreneurship Electives </li></ul><ul><ul><li>Formation of New Ventures </li></ul></ul><ul><ul><li>Managing Growing Enterprises </li></ul></ul><ul><ul><li>Entrepreneurship and Venture Capital </li></ul></ul><ul><li>Experiential Electives </li></ul><ul><ul><li>Evaluating Entrepreneurial Opportunities (business plan class) </li></ul></ul><ul><ul><li>Design for Extreme Affordability </li></ul></ul><ul><li>Specialized electives </li></ul><ul><ul><li>Sales Management </li></ul></ul><ul><ul><li>Aligning Start-Ups with Their Markets </li></ul></ul><ul><ul><li>Social Entrepreneurship </li></ul></ul><ul><ul><li>Information Technology </li></ul></ul><ul><ul><li>Sports Business Management </li></ul></ul><ul><ul><li>Entrepreneurship from the Perspective of Women </li></ul></ul><ul><ul><li>Environmental Innovation, Sustainability and Entrepreneurship </li></ul></ul>
  • 22. GSB Entrepreneurship Offerings for non-MBA Students <ul><li>Summer Institute for Entrepreneurship (http://www.gsb.stanford.edu/sie/) </li></ul><ul><ul><li>~70 Masters, PhD, MD and Post-Docs (mostly from Stanford) </li></ul></ul><ul><ul><li>4 weeks full-time </li></ul></ul><ul><ul><li>Certificate program </li></ul></ul><ul><li>Program in Innovation & Entrepreneurship (http://www.gsb.stanford.edu/prie/) </li></ul><ul><ul><li>5 months part-time </li></ul></ul><ul><ul><li>½ Stanford graduate students (non-MBA) and ½ Silicon Valley technologists </li></ul></ul><ul><ul><li>Certificate program </li></ul></ul><ul><li>Executive education course </li></ul>
  • 23. The Role of the Center for Entrepreneurial Studies <ul><li>Recruit practitioners to teach side-by-side with faculty to bring academic and “real world” perspectives </li></ul><ul><li>Develop timely and meaningful courses </li></ul><ul><li>Continual supply of up to date cases in entrepreneurship courses </li></ul><ul><ul><li>20-30 cases/year written for our courses </li></ul></ul><ul><li>Bring case protagonists into the classroom for most case studies </li></ul><ul><li>Foster a sub-community of alumni entrepreneurs </li></ul><ul><li>Bring investors and entrepreneurs on campus frequently for co-curricular activities </li></ul><ul><li>Provide ample opportunities for students and alumni to “test drive” their idea </li></ul>
  • 24. Program Offerings from the CES <ul><li>Students </li></ul><ul><li>Student/alumni banquet </li></ul><ul><li>Student advisory sessions </li></ul><ul><li>Opportunities to pitch </li></ul><ul><li>BBLs with companies and entrepreneurs </li></ul><ul><li>Annual Entrepreneurship Conference </li></ul><ul><li>Entrepreneurial Summer Program </li></ul><ul><li>E-treks (visits to early stage companies) </li></ul><ul><li>Women’s Mentoring Program </li></ul><ul><li>Personalized counseling </li></ul><ul><li>Brainstorming sessions and small group dinners </li></ul><ul><li>Structured and informal interaction with students “across the street” </li></ul><ul><li>Alumni </li></ul><ul><li>Founders’ Forums and Entrepreneurship Commitment Groups </li></ul><ul><li>Continuing education for alumni on entrepreneurship </li></ul><ul><li>Alumni entrepreneur reunions </li></ul><ul><li>Online community/email groups/discussion boards/Facebook page </li></ul><ul><li>Personalized counseling </li></ul>
  • 25. Useful Resources
  • 26. Useful Resources - Stanford <ul><li>http://www.gsb.stanford.edu/ces - GSB Center for Entrepreneurial Studies </li></ul><ul><li>http://otl.stanford.edu – Office of Technology & Licensing </li></ul><ul><li>http://sen.stanford.edu – Stanford Entrepreneurship Network </li></ul><ul><li>http://stvp.stanford.edu – Stanford Technology Ventures Program </li></ul><ul><li>http://ree.stanford.edu – Roundtable on Entrepreneurship Education </li></ul><ul><li>http://www.gsb.stanford.edu/sie - Summer Institute for Entrepreneurship </li></ul><ul><li>http://www.gsb.stanford.edu/prie - Program in Innovation and Entrepreneurship </li></ul><ul><li>http://ecorner.stanford.edu – Entrepreneurial Thought Leaders Seminar </li></ul>
  • 27. Useful Resources – Entrepreneurship Organizations (a select sample) <ul><li>http://www.churchilllclub.com – Churchill Club </li></ul><ul><li>http://www.svase.org – Silicon Valley Association of Startup Entrepreneurs </li></ul><ul><li>http://www.sdforum.org – SDForum </li></ul><ul><li>http://www.astia.org – Astia (women focused) </li></ul><ul><li>http://www.fweande.org – Forum for Women Entrepreneurs & Executives </li></ul><ul><li>http://www.springboardenterprises.org – Springboard Enterprises (women focused) </li></ul><ul><li>http://www.women2.org – Women 2.0 (women focused) </li></ul><ul><li>http://www.tie.org - The Indus Entrepreneurs (focused on entrepreneurs with roots in the Indus Region) </li></ul><ul><li>http:///www.orrick.com – Orrick, Herrington & Sutcliffe (law firm) – see Entrepreneurs Toolkit: http://www.orrick.com/practices/corporate/emergingCompanies/startup/index.asp </li></ul>
  • 28. Useful Resources – Incubators (a select sample) <ul><li>http://www.plugandplaytechcenter.com – Plug and Play Tech Center </li></ul><ul><li>http://www.ycombinator.com – Y Combinator </li></ul><ul><li>http://www.founderinstitute.com – The Funded Founders’ Institute </li></ul><ul><li>http://www.techstars.com – TechStars (Boston, Boulder, Seattle) </li></ul><ul><li>http://ventures.io/ – i/o Ventures </li></ul><ul><li>http://fbfund.com – fbFund REV (Facebook, Founders Fund, Accel Partners) </li></ul>
  • 29. Q&A

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