Marketing, finance, operations, and HR can be studied separately. Entrepreneurship encompasses them all. So Babson College, a business-oriented school in Wellesley, Massachusetts, introduces its entire freshman class to the subject of business by having students start one.
Foundations of Management and Entrepreneurship has been a yearlong undergraduate rite of passage at Babson since 1996. This year, 485 freshmen are creating 18 companies in the experiential version of a survey course. "It sets the stage for their entire business education," says Rob Major, associate dean. "They'll be taking a class in their sophomore or junior year and say, 'Remember how this worked when we did it for FME?' "
Throughout the year, professors teach an introductory business curriculum, which students apply immediately to their projects. Once a team of 25 to 30 students settles on a product idea, it forms a company, assigns roles, and appoints leadership. "Often the person with the original idea is the CEO, because they're the most passionate," says Major. "Those people aren't always the best equipped to handle it, so as early as February, the teams may have to reorganize."
The teams also create departments, such as IT (which constructs websites, for example) and HR (which formulates policies, such as performance evaluations). Students make their cases for financing before a faculty board, which can award up to $3,000 per team. Students are expected to pay back the loan out of sales.
In spring, they sell their product or service. Most teams target consumers—the on-campus market is popular—but a few pursue corporate customers. Last year, students peddled, among other products, hand sanitizers, caffeinated gum, and mug warmers. One team operated a traveling miniature golf course.
At course's end, the students distribute any profits to charities. "We want to show them how a good organization behaves," says Major.
Syllabus for Foundations of Management and Entrepreneurship: