The Profit-Minded Professor

There's never been a better time to teach entrepreneurship at a business school -- and enterprising professors are sure making the most of it.

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THE FUTURE

What ivory tower? Today's entrepreneurship profs are jumping on board student start-ups just as soon as their pupils graduate

Bill Bygrave is on sabbatical, but you'd never know it. Try as he might to focus on the book he's supposed to be writing, the professor of entrepreneurship at Babson College keeps getting interrupted by pleas for help. Alumni, students, parents, and complete strangers E-mail him daily. They corner the poor man in Babson's research archives, where he's desperately attempting to get some work done, and they -- well -- they beg. "Ninety percent of them have Internet-related business plans and are looking for funding," explains Bygrave in his brisk British accent. "I've never seen anything like it. It's the greatest commercial revolution of my lifetime."

He and his colleagues who teach entrepreneurship at the nation's graduate business schools are suddenly finding themselves in a curious position. Rather than being stuck in a traditional academic role, observing and deconstructing the phenomenon of entrepreneurship, they're smack in the center of it.

What's happened is that in academia, entrepreneurship has gone mainstream. The incredible growth in the number of graduate programs focusing on entrepreneurship -- from a handful in the early 1980s to hundreds today -- has exposed large numbers of professors to its lures. Yet only a decade ago, the subject of entrepreneurship was so far under the radar that Babson College professor Jeffry Timmons, an early proponent of the new discipline, called the rise in entrepreneurial companies a "silent revolution."

Consider the traditional academic, whose professional mind-set is geared toward the long haul. A professor gains professional standing slowly, over a number of years, until tenure is won (assuming it is). Now place that person in the catbird seat as entrepreneurship bursts onto the scene, finally exploding in dot-com mania. Even students are making fortunes. The temptation for professors to become players is extreme.

The temptation for professors to become players is extreme. Those who used to simply teach entrepreneurship are looking to make their own fortunes by participating in the general start-up mania.

And so is the wealth of opportunities. Professors trained in the art and science of starting and growing companies are in great demand -- generally not as sources of money, mind you, but as mentors, board members, and investors; critical links between the old economy and the new. Sure, the digital economy has vastly accelerated the entrepreneurial process, but starting a business still requires many of the same skills it always has. Start-up founders traditionally honed those skills through a stint at someone else's company or by plunking down a few thousand dollars of their own and failing a couple of times. But the new playing field demands instant expertise, and if entrepreneurs don't have time to acquire it on their own, then they must have it by association. Enter the professor of entrepreneurial studies.

Of the 400 or so colleges and universities that now offer programs in entrepreneurship, most have grown those programs not just by recruiting ivory-tower academics but by attracting practitioners to the classroom -- men and women with firsthand experience in the start-up trenches.

In the past B-school professors have been tapped as advisers to fledgling businesses started by former students or by entrepreneurs outside the university's community seeking input on their business plans. There might have been a consulting fee or a board seat with stock options; rarely was there the hope that the professor might become fabulously wealthy. Extracurricular consulting was, in fact, sanctioned by university entrepreneurship programs, not only to ensure that professors had real-world experience but also to allow them to augment their less-than-princely incomes. Tainted by their involvement with actual commerce, these individuals were sometimes perceived as less than pure academics and were often the objects of subdued scorn among their colleagues in other programs with less access to outside businesses.

How things have changed! One can only imagine how quickly that disdain turned to envy as entrepreneurship programs began to grow like mad, fueled by the wealth and prestige of newly graduated alumni who contributed generously to endowment coffers. Professors in those programs found themselves at the intersection of what Bygrave describes as three revolutions: digital, Internet, and entrepreneurial. Trained to recognize opportunity and exploit it, they saw the wave coming early -- saw it in the rising caliber of their students and the welcomed participation of entrepreneurs who may never have attended college at all but were willing to support the programs in return for personal validation and a chance to share their stories of struggle and triumph.

"We're in a period of enormous ferment and change, and the opportunities are much greater," says Garth Saloner, codirector of the Center for Electronic Business and Commerce at Stanford University. Stanford's business-school faculty, he says, are besieged with requests from start-ups looking for help; the incentives that are dangled in front of them can be downright irresistible. "Five years ago a typical faculty member would have taken the vast majority of outside income in consulting fees," he explains. "Now the pendulum has completely shifted, and you take very little in cash and the vast majority in investment options."

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