By Sramana Mitra
I know I am entering highly contentious territory. Academia generally looks down upon entrepreneurs even as they teach entrepreneurship in business schools and other university programs around the world.
Meanwhile, I have come to observe that most business school programs have an extensive emphasis on fundraising, especially from venture capitalists, and little pragmatic understanding of what it really takes to get a venture off the ground. As a result, business schools launch students into the real world with completely unrealistic expectations, and in doing so they set them up to fail. I recently launched a discussion on my blog asking my readers in academia to weigh in on teaching bootstrapping in business schools. It generated an active discussion from which I will synthesize a few points.
Robert Hacker is representative of the kind of dismissive attitude prevalent in academia. Hacker writes: “I have been teaching entrepreneurship at FIU in Miami for five years. [The] focus of the course is on building big companies (revenue over $100MM) rather than self-employment or family businesses. I generally focus on friends and family as the first round of capital because of the importance of capital raising in most growth businesses. I generally discuss bootstrapping in the context of capital efficiency and certain business models/industries that lend themselves to this approach, such as certain Web businesses with high margins and low start-up costs.”