As someone who is still a full time student and who has started two companies in the past three years, I have developed a clear picture as to how Ireland operates in assisting early stage start-ups in developing their enterprises. As my only experience is in online start-ups, I refer to this sector in this post).
In my view, it takes start-ups a minimum of 12 months to get from the idea in the pub/bedroom to generating early stage commercial traction. Some companies may do it in less time but 12 months is a reasonable benchmark that can be applied for most companies to strive towards. I would add one caveat to this time frame which is that it is on the basis that the individuals working on the business are working full time and have either, the necessary support and mentorship, or have been through the process before.
There are two clear things I have concluded about people setting up online companies. Firstly, that online companies are much cheaper to set up than other companies. The largest overhead is wages as you are paying for software developers/designers to use their time and skills to build a product. This sector is unique in the sense that you don’t have to have to pay for stock or shipment costs etc. This makes setting up an online company comparatively easier than a company in another industry. The resulting benefit from this is that technology in today’s world is very scalable at relatively low cost, and can create massive profits – the growth in Facebook or Google is the clear proof of this.
My second conclusion (which is more of a general rule about all enterprise) is that setting up a business at a young age can have a number of benefits. These include: relatively low level of dependencies and commitments; have the time and stamina to work long hours, and often have massive enthusiasm, energy and drive. There is a downside however in that the younger you are, the less experience you have and more likely also the less money you have. However, experience or lack of it does not necessarily have to be seen as a negative. I have never forgotten a quote from a business book I once read called ‘Anyone Can Do It’ which gave an account from the founders of the chain Coffee Republic as to how they went about building their business. The quote from the founders stressed ‘the importance of being clueless’; neither of the two founders had a business background and so when it came to implementing their vision, they didn’t know how logistically tough a particular task was going to be and instead went about finding ways to make it happen. Often this contrasted with the views of their board who were ‘long in the tooth’ and often thought that something would be too difficult and therefore not worth pursuing. The point was that it was their dogged determination that won the day and confounded the experience of their Board.
In a nutshell then, rather than focus on the fact that someone who’s young does not have the experience, let’s say instead that by being ‘clueless’ they have an advantage because nothing is clouding their strive for innovation. At the same time it is not about being reckless either. Being able to access mentors is vitally important as they can help guide young entrepreneurs along the right path and help them put in place structures within which to grow their business.
The second issue in relation to the downside of young people is that they have no money to start a business. The primary government funding bodies in Ireland are Enterprise Ireland and the county enterprise boards. They, in most cases, ask founders to find matching funding before grants are approved. For someone who may be in their early 20’s and coming out of college wanting to start a company, they would be immediately faced with this barrier. Most people in their early 20’s don’t have any money nor for the most part do their parents who, in many cases may have just paid to facilitate their 4 year college degree.
In summary, young people as entrepreneurs in their late teens/early 20’s have the following:
- Little dependencies = only need basic wages
- Able to work long hours
- Have lots of energy/enthusiasm
- Clueless as to what can or can’t be done
- Little or no experience
- Little or no money
What I propose is that if you have someone with passion and drive for success and you can create solutions and structure to the two mentioned disadvantages, you arguably have the perfect candidate to mould into an entrepreneur.
Masters in Start-up
When I say masters in start-up I don’t actually mean it in the strict academic sense. I mean in the sense of the government giving funding to individuals to develop a project for a set period of time. The way I propose it would work would be to introduce a cross faculty module in entrepreneurship for final year college students which would count towards their degree (this would be equivalent to a dissertation in other faculties). The cross-faculty element could work, for example, by teaming up computer science students with business students or electronic engineers with health science students. This module could be assessed based on submission of a business plan and on a presentation or viva type interview and would give all students involved a set number of credits towards their overall mark.
After this assessment and just before their degree is finished, students could make a proposal to a committee established within the college or indeed to a government body, or a combination of the two, to pursue this business proposition and attain funding for 1 year to develop it further. This is a standard method for granting masters in many other faculties, so why not in the area of entrepreneurship?
Following a proposal and presentation to this committee, if the student or students are successful they would then enter into either an incubator run within the college or run externally from the following September. The offer should allow for: at least one year of funding at an annual salary per person of €18,000 (after tax); office space with all required facilities and mentorship from business professionals.
In doing this it creates an opportunity for students to develop their entrepreneurial flair in a structured environment on a project which will have been worked on for a year prior to commencement as part of their degree. If, by the end of the year, their business idea is not successful and the founders decide not to pursue it further, the benefit is that the country now has a very capable individual with real life business expertise who, even if they end up pursuing employment, they will have developed the ability to think innovatively and to bring a passion and drive to whatever they do; all are attributes much sought after by prospective employers.
As a further point to the risk element, while there is undoubtedly a chance that someone’s failure to develop a successful company will be criticized in terms of the value of a programme like this, there is similarly every chance a Master’s which is funded doesn’t produce results which generate more value than the investment made in it. For the potential cost to the government of an online company failing, those that succeed could be extremely scalable and create huge employment and tax revenue.
In conclusion, whether it’s the long and proud history of unique traditional music and dance which have entertained audiences the breadth of the globe or the sports teams renowned for their ability to perform in underdog situations, Ireland has always been an innovative and punching-above-its-weight kind of a nation on the global stage. What Ireland needs now is to emulate the global stature they have in arts and in sport and to create a similar reputation for start-up enterprise. The way in which I believe this is done is by investing in young people both during and coming out of college and giving them a vehicle upon which entrepreneurial flair can be developed and harvested.