Wednesday, December 10, 2008

Balancing Business and Books

December 4, 2008
By Kelly Sullan, Zack Waldman, Danielle Waugh
Say the words "student-run business" in Syracuse and an image of Hollywood Hookah probably comes to mind. After Hollywood Hookah's highly publicized opening, fire, and NCAA violation, that makes sense.
Photo:Mackenzie Reiss/The Daily Orange
But this is just one of thousands of student businesses across the country, Program
Director Greg Hill of Global Student Entrepreneur Awards says.

What's not always talked about are the student businesses that run better and are more successful.

Hill says there are more than 1,000 student businesses that have generated revenue for at least six months and are registered with national entrepreneur organizations. And he says these registered businesses represent only a small percentage of all student businesses nationwide.

"There's no better laboratory than being a college student," Whitman Assistant Professor of Entrepreneurship Michael Haynie said about the benefits of taking business risks while still in college. "There's a very safe environment in terms of the tolerance for failure."

One of those students is Robert Sherman, a senior at Syracuse University, triple majoring in Finance, Entrepreneurship and Emerging Enterprises and Information Technology. Sherman started Charles River Web Connections, a web design and development company at the age of sixteen.

"It was either I go and work a grocery store or something like that or I start my own business," he said. "I got flexible hours, I got to be my own boss."

Four years later, with the help of fellow SU students Trace Cohen and Pete Kistler he launched another business, This online reputation management company removes the "digital dirt" such as pictures and blog comments on clients that can be dug up through search engines.

After classes end, Sherman typically spends four to five hours a day working with his business partners managing their company. Their record: working 36 hours in two days.

"People ask me: 'How do you do it?' I just think of myself as a regular student with really good time management skills," Sherman said.

Next semester, Sherman will need to make use of those time management skills. He will be balancing his businesses and a 27-credit course load to graduate on time.

One reason he can spend so much time on his business is because he has so many resources at his fingertips. The Whitman School connects him to professors and other professionals when he needs advice.

"You can pull the student card and say, Hey I'm a student, are you willing to help? People are much more willing to help students than if I were 35 trying to do this. They wouldn't give me any time," he said.

Even with all the resources they have, only ten percent of college students continue their businesses after they gradate, Whitman graduate student Justin Carlucci said.

Sherman says this is because students are afraid to take chances.

"Risk and failure, you just have to dismiss those ideas," he said. "You can't worry about that. There's some statistic like 95 percent of businesses fail. Just accept that that's the majority, and go with it."

Entrepreneurship and Innovation Assistant Professor Craig Watters thinks the isolated environment of a college campus can be a safe haven for new businesses to blossom.

"I think college provides a great soft landing for you to start something," he said. "If your business doesn't work: Okay, but I'm still a student. I can graduate and get a job."

One of those "soft landings" can be found in the Whitman School of Management's Couri Hatchery.

The Hatchery is called an "incubator" because student entrepreneurs have access to professional resources and workspace so their businesses can grow and "hatch" like the chicks of its namesake.

"The most useful resource is the interaction with the faculty and staff," Justin Carlucci, manager of the Couri Hatchery said.

Sherman began in the hatchery and said it was helpful to bounce ideas off other students and professors.

"You're able to take a look at your problems from an outside perspective," he said.

Carlucci said there are currently five student businesses taking advantage of the hatchery. They have bi-weekly meetings to consult professors such as Watters and Hainey.

When Adam Gold and Kyle Corea were upperclassmen in 2005, they worked out of the hatchery to develop what is now Funk 'n Waffles, a laid-back restaurant and music lounge close to campus on South Crouse Avenue.

The idea for their business started when they were juniors in college. Gold's band, Sophistafunk, entertained SU partygoers on the weekends as Corea sold waffles on the side. After placing fifth in a Whitman business competition, they began to think they could turn this hobby into a profitable establishment.

"After we won we thought we could make a living selling waffles," Gold said. "So sweet."

Gold said Funk 'n Waffles stayed close to home for a reason.

"We could have opened a Funk 'n Waffles anywhere, but we did it here," he said. "It's my town. Everyone knows me here. Everyone knew my band."

Professor Haynie agrees. He's a Colorado native who chose to teach entrepreneurship at the Whitman School because of the university's attitude towards business.

"When I was trying to decide where to become a professor of entrepreneurship one of the things that drew me here was the fact that everywhere I looked and everyone I talked to was embracing entrepreneurship," he said.

Haynie said the college community is receptive and can be a nurturing place for student initiatives - initiatives such as Naresh Rammohan's franchise of Campus Destinations, based in North Carolina.

Campus Destinations hires student vendors to sell the "Black Card," a student discount card that offers special savings on participating businesses targeted to students. Rammohan is the Managing Director of Syracuse Operations. He works with a student team that promotes and sells the "Black Card" to other students.

"We have already been the most successful campus out of the Campus Destinations network as far as the number of vendors and affiliates we have signed," he said. Rammohan's Syracuse Operations has 29 participating businesses.

"The hardest part of starting a business is starting it and overcoming initial fears," he said.

For entrepreneurs such as Rammohan, it hasn't been easy to balance the books and the business.

"Everything is a lot tougher though as a student. Taking our business to the next level requires a lot of time and energy," he said.

On a typical day, Rammohan says he sends and receives 50 business e-mails and spends hours tending to Campus Destinations.

As a result, Rammohan says he has watched his business grow but has seen his free time and social life move to the back burner.

"That's the nature of the business," he said.

Sherman says because of he has had to adjust his social life as well.

"Instead of going to the bar five times a week I maybe go twice a week. You balance it out," he said.

SU football players Mikhail Marinovich and Niko Rechul had an even tougher balancing act to tackle. On top of academics and athletics, they opened Hollywood Hookah in November of this year.

This Middle Eastern style smoking lounge on Marshall Street close to campus provides a peaceful environment for students to smoke flavored tobacco.

One week after it opened, the co-owners ran into one problem after another. Fire investigators said improper coal disposal started a contained fire on November 20th that caused damage to the building.

On top of that, Marinovich and Rechul violated a NCAA bylaw that prohibits student athletes from indirectly attaching their names to a business promotion says Sue Edson, Director of Athletic Communications.

Edson says the SU Athletic Department told them if they continued to talk to the press they would suspend their athletic eligibility.

The athlete entrepreneurs handed over their management positions to Marinovich's girlfriend, Courtney Burton, until the football season finished.

Employees at the neighboring tattoo parlor said Hollywood Hookah is not operating its normal business hours.

Some student entrepreneurs have decided to leave school altogether to focus their time on business.

Bill Fishel was one semester away from graduating president of his class at Yale University when he dropped out to continue First Class Laundry, a company he and a friend from Depauw University in Indiana created as juniors in 2007.

"I was faced with opportunity where we could expand with the buzz that was generated," he said.

Fishel says he picked business over school because of Yale's demanding academics. Now that First Class Laundry has established several functioning branches at colleges across the country, Fishel plans to finish his degree at Yale in the upcoming spring semester.

"You can have moderate success but if you want to take it to the next level…something's got to give," he said.

After watching students become entrepreneurs, Whitman School Professor Watters agrees.

"To be honest, we found that many students struggled to keep their academic requirements met or the business would suffer. It's hard for anybody," he said.

"The students I've seen succeed are all driven. They're driven in a way that makes them sort of unnatural. They are focused, driven, overworked, hard working-there's no stop," Watters said.

With all the obstacles, pressures and demands that college life can throw at students, Sherman says he has the one thing it takes student entrepreneurs to be successful.
"All you need is passion," he said. "I think the only reason more people don't do it is because they haven't found something that they're passionate about. The second that you get passionate about a topic, suddenly you will find ways to do it."

No comments: