I joined the McCombs Business School at the University of Texas at Austin as Entrepreneur-in-Residence at the beginning of the 2013-2014 academic year. Yesterday marked my last day in this role. I kicked it off with a speech to the entering MBA class about the top-ten lessons I wished someone had taught me when I was beginning my MBA. I loved serving the University and it's students in this capacity. The entrepreneurial energy on campus is really fantastic and very encouraging for the future of both Austin and our nation at large. There is no doubt a huge trend towards entrepreneurship at most top-ranked universities and U.T. Austin is leading the way in one of the most entrepreneurial cities and states in our nation. Consider that Texas has created 70% of the new jobs in the U.S. since 2005, as reported by BBVA Compass, and you start to tune in a bit more into what is happening here. Compared to when I attended U.T. Austin from 1990-1994, where entrepreneurship was hard to find, every major college at U.T. now has its own entrepreneurial club and initiatives. In my Office Hours, I met with hundreds of students who have either launched their own business while at the University or they are actively planning on doing that at some early point in their career (I didn't become an entrepreneur myself until I was 24 and beginning my MBA, so I tell them I was a "late bloomer").
As part of my EIR post, I continued the Speaker Series that Laura Kilcrease began as my predecessor. To that end, I interviewed seven entrepreneurs and one VC during my time in this role. All of these interviews are recorded, and I should thank the Herb Kelleher Center for Entrepreneurship for the funding to do this and promote entrepreneurship all over U.T. Austin.
You can watch the previous semester's interviews in this Lucky7 post, which include Cotter Cunningham (RetailMeNot), John Arrow (Mutual Mobile), Chris Pacitti (Austin Ventures), and Josh Baer (Capital Factory and Longhorn Startup).
For this semester, I started it off with a bang at SXSW with my interviews of Michael Dell and Rod Canion, the founder and first CEO of Compaq. These interviews were a great contrast to each other. Michael started Dell while attending U.T. Austin as everyone knows. His sales took off at an astronomical pace and he decided to drop out as a result. I've used him as an example for students who have visited me during Office Hours and are considering dropping out. It is a trade of sorts - the completion of the degree or the immediate pursuit of the market opportunity. If you are a student and have sales like Michael Dell did at the beginning of Dell, I think it is a rather easy decision. But most of the students that I speak with about this are considering dropping out with very little revenue. Of course, Mark Zuckerberg dropped out with no revenue, but I think that is different as we discussed in the Lucky7 post about Snapchat's $3 billion (at the time) valuation (written before the incredible bet by Facebook on acquiring WhatsApp for $19 billion). Marc had Google's experience to point to - with that astronomical rise in Facebook users, the advertising revenue was sure to come at one point. We cover a lot of topics in this SXSW interview, including trends in the IT industry, why Austin, and what Michael and Susan are focused on philanthropically. Thanks to Josh Baer, founder of Capital Factory, for securing the space at the Omni Hotel - we made this a Capital Factory, SXSW, and U.T. Austin promoted event as a result.
Rod Canion's story was very different. He wanted to work at Texas Instruments long term but got the bug to start his own business and be his own business because of how frustrated he became with the culture. This is similar to Cotter Cunningham's story with the founding of RetailMeNot, which began with a failed venture at the age of 46 (read this Lucky7 post on failure to learn more). Rod recently wrote the bookOpen: How Compaq Ended IBM's PC Domination and Helped Invent Modern Computing and it is a fascinating tale about the beginning of the PC industry. Even though I've been a consumer in the industry since I was 7-years old, I didn't realize that IBM had tried to make the industry a completely proprietary one. Compaq waged a David vs. Goliath battle by building open technology to break IBM's proprietary hold. But they couldn't do it alone so they formed an industry coalition with competitors like Dell and literally gave the industry their open technology. Intel benefited from this as well, and the rest is history. The advance of Intel and the speed at which our computers (and mobile phones) operate today would likely be dramatically slower had it not been for Rod and Compaq's bravery to take down Goliath. Rod also has some fascinating insight into Apple's proprietary nature and how this has affected them in the battle vs. Google (Android), which by far leads the world in the global smartphone platform battle. A fun tidbit in this interview - Rod shows off the very first portable Compaq computer.
The next interview I did was with Matt Chasen, co-founder and CEO of uShip. uShip is very interesting in several ways. First, it represents Austin's largest marketplace business. Bill Gurley, the famous U.T. Austin alum and General Partner at Benchmark Capital, writes about the ten rules of marketplaces in this post and uShip meets most of the ten. Second, not surprisingly given Bill's post, it is backed by Benchmark Capital. I'm pretty sure this is Benchmark Capital's only VC investment in Austin. With their background in eBay, that is quite a nice mentoring benefit for the uShip team. Third, Matt was an MBA student at U.T. Austin, and he and his co-founders participated in the venture competition here. Although they didn't win it, they later won in a more fundamental way. We discuss the intricacies of marketplace businesses, how Matt convinced Benchmark Capital to invest in him and Austin, and the role that U.T. Austin played in helping him get started.
The last interview I did was with Dan Graham, co-founder, CEO, and co-owner of BuildASign.com. Dan's story contrasts with the rest in that he did not take VC funding and instead pulled off something that is nearly impossible (and almost never happens in Silicon Valley) - he bootstrapped a B2C business, cracking the code on low-cost customer acquisition from scratch. The high cost of customer acquisition usually requires an entrepreneur to raise a lot of money to spend on online marketing. The payback cycle occurs over time as those customers continue to spend and hopefully have a high lifetime customer value (LTV). But Dan and his team started with a bootstrapped consulting firm and found a niche to capitalize and focus on with BuildASign.com. Dan didn't drop out from U.T. Austin but he did in fact start his first business while in school. This was a great way to finish the EIR Speaker Series for the academic year, and I learned a lot from this interview. We dive into exactly how Dan achieved this and what some of his low-cost customer acquisition secrets are. We also talk about how philanthropic BuildASign.com has become and why.
There are several other interviews that occurred throughout the semester led by Laura Kilcrease. They include Venu Shamapant, co-founder of Live Oak Venture Partners (which is now very active in Austin as a new early-stage VC); Alan Blake, founder and CEO of GloFish (which was also founded at U.T. with the help of some great mentors and Board members, including John Butler and Bill Cunningham); and Daniel Nelson and Robert Reeves, co-founders of Datical. You can see these interviews on the Herb Kelleher Center for Entrepreneurship YouTube Channel, and I would encourage you to watch them as well.
Well, that is the wrap for this role. I strongly encourage you to serve in a similar capacity in the future if you have the opportunity. As I have told many friends, this was a very soul-nourishing activity and I personally found myself very inspired by the students and professors tirelessly working to encourage entrepreneurship. U.T. Austin is especially lucky to have Bob Metcalfe (founder of 3Com), Josh Baer, and Ben Dyer (founder of Peachtree Software) leading the interdisciplinary startup innovation course Longhorn Startup - this would have been the perfect course for me when I was an undergrad at U.T. and I've heard students during Office Hours rave about it. It also culminates in a huge Demo Day event with keynote speakers like Mark Cuban and Bobby Epstein (founder of the Circuit of the Americas in Austin) this past academic year. I loved collaborating with them and speaking at their course.
I hope you enjoy these interviews, and a special thank you again to John Butler and Sheri Gonzalez for their support in the Herb Kelleher Center for Entrepreneurship. U.T. Austin is lucky to have you.