Summer Program Offers Grad Students a Mini-MBA
STANFORD GRADUATE SCHOOL OF BUSINESS—For Rong Xu, the Stanford Graduate School of Business Summer Institute for Entrepreneurship was the answer to four years of searching. The biomedical informatics graduate student at the School of Medicine had made a point of taking business classes before—a seminar here and there—but she still aspired to learn more about how business really works. When she heard about the new Business School program, she jumped at the chance to spend four weeks of her summer in the classroom. "It changed my view of the business world, of what being a successful entrepreneur looks like," says Xu. "The program taught me a lot."
Xu and 69 other graduate students spent parts of June and July taking intensive courses in business disciplines and designing new ventures together in the first Summer Institute for Entrepreneurship (SIE). Created to help further Stanford President John Hennessy's goal of fostering more interdisciplinary graduate student education, SIE was designed and launched by Business School faculty and staff in less than a year.
Based in part on the School's existing summer business program for undergraduates—the two-year-old Summer Institute for General Management—SIE introduced important changes, says the program's academic head, Professor Garth Saloner, one of 14 faculty members who designed the institute and taught its students. Saloner is the Jeffrey S. Skoll Professor of Electronic Commerce, Strategic Management, and Economics. He also is director of the Business School's Center for Entrepreneurial Studies. The undergraduate summer program is built around basic business management. The program targeting graduate students adds a segment on entrepreneurship and business growth.
Though the new program is open to non-Stanford applicants, in its first year all but three student participants in SIE were from Stanford. Thirty-five were PhD students, nine were medical students, and twenty-three were master's or recently graduated master's students. They hailed from engineering and the life sciences, as well as from earth sciences and other science and social science disciplines.
"Students in those parts of the university either go on to take non-academic jobs—going into industry—or they go into academia, but within academia, they advise and mentor students who themselves go off and start businesses and go into young ventures," Saloner says. "The idea was to give people like that an introduction to business and management, so that we could help them jumpstart the process that otherwise takes place in on-the-job training."
Students came away satisfied: On a five-point scale, they rated the program a 4.6. For the next session, set to begin June 18, 2007, Saloner says program leaders plan to recruit students from the other schools and disciplines, such as law, education, and the humanities.
How much can students learn in a month? Classes met every day, with three or four one-hour sessions, and, according to Saloner, students caught on fast to a wide range of business disciplines and skills. "The first two-thirds of the program is really a kind of mini-MBA," he says, covering topics such as finance, marketing, accounting, and business strategy. The last portion of the month is spent on how to start a new business and grow it. Along the way, students learn "soft skills" such as public speaking, leadership, and networking—which for some are just as important as discerning data points on a spreadsheet. "I learned lot of social skills, like networking, which is exactly what I want and need," says Xu.
To facilitate students learning from one another, they were broken up into interdisciplinary study groups. Organizers rearranged student seating once a week so that participants could maximize the number of contacts they made.
For some, the network of people they met may be the most lasting benefit. Katherine Murray, a third-year PhD student in the Department of Communication, knew only two out of 70 students going into the program. "It was this vast group of PhD students, people I'd never had the opportunity to cross paths with before," she says. "Now I have an extended network of people I can bounce ideas off of."
The program also gave students the chance to see real entrepreneurs at work. Participants took field trips to visit six new ventures where they were greeted by CEOs who revealed the companies' inner workings. Students got an insider's view of a full range of startups—including one that had been sold shortly before they arrived to visit. Employees were busily packing up but still stopped to offer encouragement to students. Indeed, one key lesson, Saloner points out, is that while starting a business is risky, it is not career-ending if the company does not take off or is sold.
In the final portion of the program, students presented their ideas for new ventures to an audience of alumni, venture capitalists, and entrepreneurs. "One of the great things about this university is the extraordinary range of technologies that are being developed in the labs," Saloner says. Many of the students' business plans were based on ideas from their lab research; some seem readily commercializable, adds Saloner. Of the 14 concepts presented, "there were easily four or five new ventures that could be successful."
Xu's project was a health search engine. She came away with some surprises. "Before, I thought, I'm going to build the coolest thing in the world and people will come to me—but it's totally different," she explains. "It's not about your technology—you could have the coolest thing, but you need to reach people through marketing. You need to get your product out, to get people to use it," she says.
David Klaus, a graduate student in mechanical engineering at the Hasso Plattner Institute of Design at Stanford's School of Engineering, came away with a similar lesson. Klaus hopes to develop affordable tools for developing countries such as Myanmar. One product he has created is an irrigation pump that uses minimal amounts of metal, instead employing native materials such as bamboo to keep costs low. He knew he needed business knowledge to back up his design expertise. "I realized that in the travels I've done in developing countries it's not enough just to have a good product, to make a product that works well. You have to have the business skills to get it out to people, to market it, to develop a supply chain. If you don't have that, your product just sits in your garage," he says.
For Klaus, SIE was "a very eye-opening experience." At times, confronting the realities of starting a business was "sort of scary and uncomfortable." But knowledge is power: "I need to understand these things and how to leverage them if I'm really going to do something that's going to be productive and beneficial to other people," Klaus says. He has since traveled to Myanmar and launched two of his product ideas—including the water pump—into full-scale production.
For some students, the program fueled their motivation to form their own companies. Many feel that the training will serve them well in any leadership position. "There is a great need for people in leadership to have a basic understanding of business skills—how to read a budget sheet or to do long-term projections," says Murray from the Department of Communication. "I went in to learn a certain set of skills and I absolutely feel that I got that. It was a perfect, really intense month of introductory work in accounting, finance, and entrepreneurship."