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In this article, I’ll cover three reasons why starting a company as a student can be beneficial and the decision to make that company a full-time job.
1. Access To Non-Dilutive Funding
There are a number of ways to fund a business. As a student, you have access to opportunities that other entrepreneurs do not: college competitions and grant programs. Many schools host startup competitions, in the form of pitch competitions, business model competitions or new venture competitions, where the winners receive cash prizes or other similar awards.
In one way or another, these competitions revolve around pitching your business to a panel of professors, local business leaders and others in the community. Over time, we optimized our pitch and felt more prepared when the time came to raise money from real VCs. We ended up meeting one of our principal investors from a university competition.
Because our founding team spanned across two schools, we could double dip in competitions and qualify for more grants. In the end, we were able to gather enough funding to get our business off the ground while retaining equity for future fundraising rounds.
2. The ‘I’m A Student’ Card
As a student, you have a ton of people rooting for you. Professors care about you, the university cares about you and even random strangers in your community want you to succeed. If you start a company as a student, take advantage of this community around you. My co-founders and I did so in a few ways.
First, it’s easier to reach out to business owners and industry leaders for advice as a student. Most of them remember being a student and will be more willing to respond to your request. After you graduate, you suddenly become like every other person trying to get their attention.
Second, to validate our product, we needed to talk to people who might potentially use our product. One of the quickest ways for us to accomplish this goal was going door to door. We found that this was much easier as students. At the door, we would start by saying, “We’re students at the University of ____, and we wanted to ask you some questions about a business we’re starting.” People were more willing to help us out knowing that we were students at the local university.
3. Classroom Learning
Being in the classroom also proved beneficial to us. By the time we were seniors, we had learned about the fundamentals of business. Furthermore, our upper-level courses had direct applications to our business. For example, as a finance major, I took a course about private equity and venture capital. This helped us develop a better fundraising strategy and work with our investors on a more knowledgeable level.
While things can get busy, starting a business also helped ease up school work because we could use the business in place of many classroom projects. Professors loved supporting our business and would allow us to work on the business when the assignment aligned.
When Is It Time To Go All In?
In my experience, there is much less risk if you start a business as a student. If the venture fails to take off, you always have an education and more traditional paths you can follow. However, as an entrepreneur, when do you know it’s time to go all in and work at the business full time?
This is a very personal decision to make. As it turns out, I graduated a few months before my other co-founders and took a job in management consulting. I’d call my co-founders on the way to work, during lunch breaks and on my way home and I’d work throughout the night. For me, the decision to quit my job and go full time at Neighbor came down to a few things:
First, I still felt like it was a low-risk option compared to starting a company after becoming more entrenched in a career. I had a year of experience, a solid degree and could fall back on both if things went south. Another consideration was my relationship with my wife. Not everyone has a significant other to consider in these decisions. We got to the point where it felt like her income could support us, and after having her sign-off, I could commit to the startup full time.
Finally, we chose investors who cared that their entrepreneurs had a paycheck every week so they could focus on the company rather than on paying their bills. This gave us a little more stability. Once funding was secure, I felt better about dedicating all my time to the startup.
If you start a business as a student, take advantage of all the resources available to you, including funding, professional networking and even what you learn in the classroom. Only you will know when it’s right to dedicate yourself full time to your venture. Consider your economic stability, opportunity cost and commitments to significant others before diving in 100%.
May 28, 2019 at 08:30AM
Forbes – Entrepreneurs