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I was recently honored to give a guest lecture in Dirk Soma’s Entrepreneurship class at University of Hawaii’s Kauai Community College campus.
I was invigorated by the students’ intensity and drive and intrigued with their capstone project: HI Joe!, a startup focused on selling coffee grown and roasted in Hawaii.
Realizing that entrepreneurship is best “taught” by doing, Dirk designed the project such that it can be implemented in a single academic quarter, with the potential for future students to continue working on the student-led company, after the end of the current quarter.
Dirk further enriched the students’ experiences by teaming up with Rob Ladendecker, an outstanding KCC Lecturer who teaches Finance and Accounting for Small Business. Mr. Ladendecker’s accounting students worked with the entrepreneurship students to create financial forecasts and develop a financial system for tracking results and creating financial statements.
The Professor’s Perspective
John Greathouse: You’ve become a respected scholar in the area of Cultural Entrepreneurship, which you define as: “a venture that preserves and perpetuates a set of values, norms, and practices of a distinct people and place.” To what extent does HI Joe meet this definition?
Dirk Soma: Aloha John, you sure you got the right guy? <chuckling> I’ve been just scratching the surface and seeing if CE, as I’ve envisioned it, is getting traction as I share with my students, peers, and other practitioners within in the entrepreneurial ecosystem. From the feedback to-date, the definition has validity.
HI Joe! resonates on a couple of levels – first, as equal partners in this venture, my students and I have established a culture of mutual respect and a sense of commitment to our mission to provide only 100% Hawai`i grown and roasted coffees. Though this increases our product cost, we stay true and don’t look at selling blends.
Second, we come to the table with ideas and suggestions that are discussed, vetted, and agreed upon by consensus, which aligns with our values of openness and inclusion. Third, HI Joe! supports our local coffee growers and shares their stories with our customers. By promoting and selling locally-sourced coffee, we can perpetuate sustainability and provide incremental income to local coffee producers.
Greathouse: Well said. I Agree that the project fits into Kauai’s cultural tenets, but you also encourage entrepreneurs to create “Four-Win Business Models.” Explain to my readers (what you mean by) this approach and how HI Joe’s! business model is delivering multidimensional wins for its stakeholders.
Soma: To summarize, the Four-Win Business Model is in sync when an entity’s operations and outputs lead to benefits for the Planet, the People, and results in Profit, all while being done in a Pono manner (the Hawaiian cultural value of doing things the right way or righteously). I HI Joe! is striving to hit each of the four dimensions and I’m working hard to instill the fourth “P” into my students.
Some other small things we do include use biodegradable coffee cups, lids and stirrers and we add all of our coffee grounds into our campus compost bins. Our customers get a great value and are being served quality coffee, sourced from Hawai`i Island, Maui, O`ahu, and Kaua`i.
Our students get to put theory into practice and flex their entrepreneurship muscles and see the benefits of their contributions to operations, accounting, and marketing and promotions. Conducting ourselves in a Pono way, influences every decision we make, and this experience will stay with my students their entire lifetimes. Oh yeah, and by the way, we are making some nice profits!
Greathouse: Nice, profits are a good thing. You and I are like-minded when it comes to coaching entrepreneurs – we both believe that experiential assignments are the most impactful. Given this proclivity, what were your pedagogical goals going into HI Joe and to what extent do you feel the project has met these goals? Any surprising learnings, for you or the students?
Soma: When I have led this class in the past, I would have students use the Business Model Canvas as a tool to develop their business concept and have them then create a pitch presentation for their classmates, who could either invest, not invest, or make a counter offer. Though this helped meet the Course Student Learning Outcomes (CSLOs), and several students actually used this experience to create businesses on Kauai, I knew that there could be a way to make more of an impact.
Going in, I really wanted to provide a way for students to see, touch, taste, smell, and hear what an entrepreneur goes through. I also wanted them to develop their “sixth sense,” you know, the one savvy entrepreneurs use when navigating through unchartered waters. I wanted to spur interpersonal interactions and leadership within the group and allow for hidden talents to emerge.
We are mid-way through the semester, but I would have to say that what I envisioned by inserting HI Joe! into the course is coming to fruition, as far as meeting the initial goals. The true entrepreneurs are taking the reins. Creative juices are flowing. More enriching relationships are being developed both in the classroom and when they are working side-by-side. Problem-solving and decision-making skills are becoming more focused on the impact to the overall business without losing empathy for classmates.
As far as surprises, I would have to say that I am pleasantly surprised by the level of commitment that some students have shown. Each is required to commit to working at our HI Joe! booth from 6:30 AM until 12:30 PM one Saturday. Several students have come multiple times just because they want to be a part of it.
Students have donated materials and resources and have “boot strapped” by tapping into their networks. The “quiet assassins” – you know, the ones who watch, observe, and then just amaze you with an idea or their talent – have showed up as well. We now have coined a phrase – “The Lincoln Hustle, ” named after Lincoln Emery, a student who created coffee punch cards, with the HI Joe! story on the backside. He walks throughout the Farmer’s Market when we are in operations and hands them out to encourage shoppers to visit us.
Greathouse: I’m impressed that you collaborated with Accounting Instructor Rob Ladendecker. His students worked on the pro forma forecasts and created a general ledger from which to generate financial statements. Tell us a bit about how this came about and to what extent it enriched all of the students’ experiences.
Soma: Rob and his students have been great partners to work with. Last spring, I submitted a proposal to be a pilot school for the National Association for Community College Entrepreneurship’s (NACCE’s) Financial Management for Entrepreneurs Project. NACCE is partnering with Intuit Education (IE) to develop ways to infuse IE’s financial management modules into curriculum to supplement teaching resources and enhance learning. We were fortunate to be chosen as one of the five pilot schools and since Rob was teaching our Finance and Accounting for Small Business course, it was a great way to have him accomplish his CSLOs by supporting our class.
My students benefit because we get weekly financials, with a focus on cash flow, so that they can see where they are and make decisions to improve our outcomes. Rob’s students benefit through being able to apply financial management concepts, which can be a major barrier, to our simple operation.
Greathouse: What advice do you have for other educators who are considering designing similar, hands-on startup projects for their students?
Soma: Here’s some down and dirty tips (edited into bullet format by the author):
· Have a concept thought out and developed in your mind and then guide the students along the way. Having them try to just develop a viable project can take a whole semester, so have something that they sink their teeth into right off the bat.
· Don’t make the business too complicated. With HI Joe! I use the K.I.S.S. principal. You would be amazed at the amount of thought, energy, and planning it takes to just execute a pop-up coffee tent six Saturdays over the course of the semester.
· Guide, but don’t stifle. Students come up with tons of ideas, which they believe are the best. I let the class discuss and vet and gently steer them in a direction that will lead to the best chance for success.
· Make friends on campus. Many of us have systems with policies and procedures that we have live within. By having a network of supporters, you can get things done quicker.
· Celebrate successes and develop strategies to address areas for improvement. You would be amazed on how each student will grow with just a little bit of water and how they will rise when faced with challenges when they know you have their back.
Greathouse: What are the financial and operational results so far? Are their plans to build upon this initial success and continue the project in future academic quarters?
Soma: As an initial investor in HI Joe!, I am happy, whew!, to say that by our fourth operational day, we have netted $600. It may not seem like much, but our startup and operational costs are around $2,800. We project minimal operating expenses for our last two days of operations, so we are projecting a final net profit of around $1,800 to $2,000.
As far as next steps, I may have created a monster! The Kauai Community Farmer’s Market wants us to be a regular vendor every Saturday. My students are already talking about opening a brick and mortar in one of our local shopping centers. Our campus is asking us to consider operating a coffee kiosk. And, Intuit Education is interested in working with us to roll out the hands-on HI Joe! component to the Financial Management Curriculum Project as a way to have students across the nation get this experiential learning opportunity.
The Students’ Perspective
To gain a fuller understanding of the impact of the HI Joe! project, I asked some of Dirk’s students for their feedback.
Greathouse: If you had a do-over, is there anything you would do differently with respect to HI Joe? Any changes you would make to the planning process, execution, team’s organizational structure, etc.?
Kathleen Ganitano: The planning process was hard to deal with, especially before our first pop up, because we had no idea what we were getting ourselves into. The whole planning process was overwhelming, but when you have a team that has the same goal as you, executing our plan helped the business run smoothly and effectively.
The organizational structure was messy in the beginning, but things improved as we met up every week in class, took turns with our shifts, and had discussions about what happened with the last shift. Having the three main groups; marketing, operations and finance really helped with putting the business together. Putting a bunch of strangers together who have the same common goal, which is learning everything you need to know about starting up a business, is surreal. We are ten weeks in, and I have grown to love my group, the finance team, and the entire HI Joe! crew.
Greathouse: Were there any assumptions you were pretty certain of that proved to be false? If so, how did you uncover the truth and what did you do to act upon the new information?
Lilio Masi: Physically working in the booth was definitely my favorite. Honestly, I wasn’t too excited to work, because I had my regular job to go to and I didn’t have too much passion in this project. But the day I worked in the booth changed everything. I loved getting the hands-on experience and working with my classmates. I loved having returning customers come back and seeing that people were happy for us to be there, made all the effort more than worth it. We changed people’s normal schedules of stopping at Starbucks or another coffee shop before heading to school or the market, and now they come straight to us.
Greathouse: Loyal customers are a great measure of your success. Nice job. What was your favorite aspect of the project and why did it get you stoked?
Kathleen Ganitano: My favorite aspect of the project is that this is a hands-on learning experience on how to start up a business, rather than doing book work. You’re not only learning, but by actually applying what you learned – is far more effective. You can learn from the mistakes and hardships than an actual business goes through every day and we learned how to solve those problems by discussing it with the rest of the team – we learned from each other. Knowing that our business is doing well motivates us to do even better.
Mary Williamson: The best part of HI Joe! is the teamwork. I’m a nontraditional college student with over 30 years’ work experience and believe that leadership is situational— sometimes one should sit back to let others grow, at other times nudge or mentor. A hands-on project like this allows us to get ideas from each other, no matter our age or history. Love getting local media coverage.
Greathouse: Now that you’ve helped to run a business, to what extent do you think you’re more, or less, likely to either start a side hustle or join a startup?
Anna Lamotte: Hi Joe! Is a wonderful project and Mr. Soma was great to come up with this idea of business, because it was relatively simple to start , had all the difficulties of a business and we were able to learn a lot practicing what we learn in class. It also showed us the need that Kauai have for more entrepreneurs and small businesses. People want to be able to spend their money in great products and experiences. A great business should provide that, and I believe Hi Joe! does just that.
Kathleen Ganitano: I enrolled in this class to gain the knowledge on how starting up a business works because I would like to run my own business. One day, I want to design, sew, and sell bikinis online. Then, maybe in the later future, I will branch out into designing women clothing and possibly run my business through a store.
Lilio Masi: I am ten thousand percent more likely to start a side hustle business. I’ve always wanted to open a business and literally running a business and hearing feedback and advice from Professors Soma and Ladendecker has made me want to try opening a business, so that I can try to apply what they taught me and see how it works out for me.
My parents own their own business and I’ve already taken some advice and mindset from our two professors and shared it with my mom. We’ve already started changing some things in the business and I’m excited to see how it’ll, hopefully, improve her business.
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“This Pono Startup Project Broke Out Of The Classroom And Became A Legit Business” | Written By: John Greathouse, Contributor / Forbes – Entrepreneurs
November 18, 2019 at 11:40AM
VIEW ARTICLE ON Forbes – Entrepreneurs >> https://www.forbes.com/sites/johngreathouse/2019/11/18/this-pono-startup-project-broke-out-of-the-classroom-and-became-a-legit-business/