Entrepreneurship Basics at Carnegie Mellon

I dropped by the McGinnis Venture Competition last Friday at Carnegie Mellon's Tepper School of Business. The Venture Competition featured business plan presentations by MBA student teams from all around the country, and at least one team from a Canadian program. This was a little bit like a moot court for business school students, except that they were presenting real companies and real proposals, and they were angling for real prize money. The judges were a very impressive mix of local entrepreneurs, investors, and lawyers. I learned a few things:

1. The typical business student and the typical law student should spend some time together learning techniques of rhetoric and persuasion. Not everyone can be a great presenter, and some people are great presenters without any training, but everyone would benefit from some basic training. People in business need the same sort of training that people in law do.

2. "Intellectual property" protection for the ideas in the plan was fairly far down on the list of issues that reviewers considered important, at least judging from the questions that I heard put to competitors. This is consistent with what I teach my students: Intellectual property rights, and patent rights in particular, aren't as important to the start-up venture as some other things. In particular, entrepreneurs need to carefully assess the competitive landscape and understand barriers to (competitive) entry. IP rights may supply barriers -- or they may not.

3. There is no shortage of good ideas out there -- though often, the best ideas are copied, legally, from other people. (Sometimes the difference between success and failure is simply timing.) And there seems to be no shortage of money to invest. There is a shortage of ideas that are compelling enough to justify investment, and a shortage of ideas that are married to management teams that have track records that justify investment.