Young and restless: Entrepreneurs start earlier and earlier

| FROM THE PRINT EDITION |
 
 

Back in 2003, Marc Barros and Jason Green were undergraduates with a problem. Both were avid skiers who wanted to create videos of their exploits for friends and family, but the existing technology made that impossible. So they decided to create their own helmet camera and enter the business plan competition at the University of Washington. They finished third and used the $10,000 prize money to start their own company, Contour.

Now the company is hitting the big time. Inc. magazine recently placed Contour seventh on its list of the 500 fastest growing private companies in America.

Entrepreneurs have long enjoyed the support of a well-connected and well-funded Washington venture capitalist community. While recent research by Duke and Harvard universities suggests that the average American-born entrepreneur is 39 with previous business experience, the Washington business community has noticed increasing numbers of young people forming their own companies right out of college or even during high school. The Kaufmann Foundation in Kansas City surveyed young entrepreneurs from across the country and found that 38 percent of people between the ages of 8 and 24 hope to start a business. That figure has remained unchanged from the previous survey in 2007, despite lingering effects of the recession.

Washington has built a network of support to encourage youth entrepreneurship across the state. The UW and Seattle University, in particular, have expanded and devoted more resources toward younger students in their business programs.

At the UW, the Lavin Entrepreneurship Program enrolls directly out of high school students who want to develop skills to grow a business in the future. Connie Bourassa-Shaw, director of the Center for Entrepreneurship & Innovation, says interest among young students has never been greater.

“The group that is the most dynamic is the undergrads,” she says. “Of the students we’ve admitted, half have started their own companies in high school. We create a peer group of students who know their careers will be entrepreneurial. They don’t know what they don’t know, but they make up for that in sheer motivation and devotion.”

Riley Goodman and Jake Director are one example of this type of student. The two friends started talking about running a business in third grade and finally took the plunge their senior year of high school after one of their friends was in a car accident and they realized “anything could happen at any point.”

They designed socks with a Seattle skyline printed on them, found a manufacturer and started selling their Sea Town Lax socks (recently rebranded as Strideline) throughout the city. Riley says they learned a lot from the experience and carried those lessons to the UW, where they decided to start another business. Getting into certain classes was a nightmare, so they created ScheduleShark, a service that uses text messaging or email to notify students when a spot opens. The technology was based on a similar program that existed at the UW, so the young entrepreneurs introduced the service at Washington State University, Santa Clara University, Ohio University and UCLA. They plan to expand into other markets.

Photo by Hansen Belyea

Why are these young people driven to start their own businesses? Steve Brilling, executive director of Seattle University’s Entrepreneurship Center, says students aren’t necessarily motivated by financial gain. Many simply enjoy the freedom of running their own businesses.

“It’s about freedom of choice,” he says. “Students see their chances of finding a job are much less in this economy, so they’re saying, ‘Why don’t I take my career in my own hands?’ You just get that itch.”

Influencing the direction of a business and learning something different every day are two of the main advantages of running your own company, says Adina Mangubat. In 2009, after graduating from the UW with only a few business classes on her college transcript, Mangubat became CEO of Spiral Genetics, which enables scientists to conduct DNA sequencing using cloud computing. She says there is no better time to start a company than when you are young.

“I have little to no risk,” she explains. “My opportunity costs are much lower. My responsibility list is so much smaller. I can make the right business decisions without worrying about my job security.”

Unlike those who start companies after years in business, young entrepreneurs don’t have experience to lean on and they have to be particularly creative and hard working to survive. Barros says Contour’s first warehouse had no heat, which pushed the partners to work even harder on their concept.

Not having any experience helps in another respect: “You don’t have any preconceived notions as you’re starting,” says Barros. “There’s a sort of blindness to the ups and downs. You’re much more tenacious. You’re so in charge of building a successful business. We were just so passionate about starting our business and bootstrapping to make that happen.”

Photo courtesy of Contour

Mangubat and other young business owners cited the support of academic institutions as critical to the success of their companies. The UW provides a faculty mentor to each young entrepreneur in its programs who requests one and Seattle University gives students in its Business Plan competition access to a member of the local business community.

“The support of the business community has been immense,” Seattle U’s Brilling notes. “This year we had 160 businesspeople involved in this effort. I’m so proud of the business folks that help the students do this.”

Important support also comes from an active investment community. One angel investment group with particular ties to young people is the ZINO Society, which connects investors with entrepreneurs seeking funding. Cathi Hatch, founder and CEO, says age is not a determining factor in whether she decides to invest in an idea.

“From an investor standpoint, I want to know if a young person is willing to take advice,” she says. “What is their attitude toward business in general? The ones who are more willing to listen to advice, I like better. It’s exciting to work with a younger person who is energetic. I wouldn’t necessarily prefer one [age group] over the other. It comes down to who the individual person is.”

Emily Marshall has worked on several Seattle-area startups and thinks the business community has been important to developing her concepts. She recently attended a startup weekend and ultimately won the competition with her idea for a private cloud space just for couples. From that initial concept came Snuggle Cloud, recently renamed Couple Fire, which offers a “couples dashboard” and marketplace to inspire gift ideas. The beta version was tested on military families at Joint Base Lewis-McChord. Throughout the evolution of the idea, Marshall and cofounder Kiran Gollu have relied on the support of experienced businesspeople.

“We have a really fantastic community here,” Marshall says. “I probably had five mentors working with me throughout the competition. There are so many people that help with the thinking process. I always appreciate that. Basically, everywhere I’ve gone, the community just loves young entrepreneurs.”

Marshall says the local community has also challenged the long-standing dominance of male entrepreneurs. The capitalist and academic communities have been incredibly supportive, she adds.

“There used to be very few women entrepreneurs but I don’t think that’s the case anymore,” she says. “They want to see us succeed. I think the tides are really changing in that arena, which is great.”

Mangubat believes even more resources should be directed toward the high school level. “The place to look for the most innovative ideas is with the really young people,” she says. “It’s also very important to help nurture those young people. I know I have to rely on the younger generation for that next great idea. In the education system, we don’t do that right now. No one asks why you want to do things. We have to keep that high school spark alive. Sometimes, it gets killed in the system.”

Some great ideas have been clear successes. Since leaving its first heatless warehouse, Contour has grown to 50 employees and has sold hundreds of thousands of helmet cameras around the world. Its latest camera features GPS and allows users to upload their videos to Facebook and Twitter easily. With athletes now endorsing their product, the company seems poised for continued growth.

Dozens of undergraduates hope to transform their ideas into viable, successful businesses like Contour, and the UW’s Bourassa-Shaw firmly believes more great companies will spring from the minds of talented young people.

“Working with undergrads is where the energy is,” she says. “I think they’re just really smart and really perceptive. You should never underestimate undergrads because they can do amazing things—and they are fearless.”

Photo by Matthew Williams