Summer Program Links MBA Students with Small Startups
October 2007
STANFORD GRADUATE SCHOOL OF BUSINESS – The two dozen MBA students in the conference room were there to talk about how they spent their summer vacation.
One worked for a company with only three employees, another at a software startup focused on a new market segment. Another worked for a company that sells artificial Christmas trees.
In front of the group gathered at the Stanford Graduate School of Business, Irving Grousbeck, director of the Center for Entrepreneurial Studies, led the discussion by gently asking pointed questions about what it was like working for firms that are still struggling to get established.
“What is the best way to make sure everything is being done well without becoming a micromanager?” he asked. Later he commented, “Turf war is something you’ll face running your own company.”
The one-hour session was meant to give the students an opportunity to reflect on their experiences in the Entrepreneurial Summer Program, in which MBA students spend 8 to 10 weeks working in a company that’s just getting started or in its early stages of growth.
The program, which will mark its 10th anniversary next year, offers financial and other forms of assistance to MBA students who pass up internships on Wall Street or in big corporations to work for small entrepreneurial firms during the summer before their second year.
Grousbeck, MBA Class of 1980 Consulting Professor of Management, said the program was launched to help MBA students who want to gain more entrepreneurial experience but find that they can’t afford to pass up the sometimes hefty summer salaries paid by more established firms.
The Entrepreneurial Summer Program has helped ease that burden. “We can’t fully match the salaries that they [the bigger companies] pay, but we can come close enough” to make it worthwhile for the students, Grousbeck said.
David Benjamin Silver, MBA Class of ’08, said the program offered him a new perspective on the startup software industry. He worked last summer for Scalent Systems, a Palo Alto infrastructure software company that provides software to repurpose servers in data centers.
“It was great for me to see how different enterprise software companies are from web 2.0 companies,” he said. “I used to picture Silicon Valley startups as all run by 22-year-olds, but enterprise software tends to be a whole different ballgame. There are actually sales and revenue forecasts, as opposed to simply user counts, and I think the environment resembles a ‘typical’ business more than an internet startup would. It was also awesome to be at the intersection of a great company and a really hot market segment right as the industry was taking off the ground.”
Grousbeck quipped that students in the program get a chance to know what it’s like to work at Joe’s Bar & Grill instead of General Motors.
“They can see firsthand what the founders are going through,” he said. “They can see what it’s like to be in a 10-person company instead of a 10,000-person company.”
Members of the Class of 2006 who took part in the program said they learned to take ownership of the firm they worked for, to cope with constraints in resources, and to work closely with the CEO or founders of the firm, according to an October 2005 article in the Stanford Business Reporter student newspaper.
“I saw the full rollercoaster,” one student said. “Three weeks into my internship, we thought the company would shut up shop for lack of financing.”
A classmate relished the experience, adding, “I came to the GSB 95 percent sure I wanted to start my own company. This internship has crystallized and confirmed that desire.”
Another said: “It was very refreshing to see the culture the founders were trying to instill, a culture that was one of open feedback and collaboration and also very results oriented.”
Grousbeck also underscored the importance of the CEO in the creation of a new company.
“The CEO has enormous impact on a company’s culture,” he told the student gathering, “even to the point that he creates that culture and can move it in different ways.”
About 30 MBAs take part in the Entrepreneurial Summer Program each year, Grousbeck said.
“I suspect that if we didn’t have the ESP, the number [working for small startups] would be less than half of that.”
- Ben Pimente