Teaching Entrepreneurship: Obstacles and Opportunities
The United States is known for producing world-changing innovations and industries that are able to grow and flourish because of America’s free market system. Continuing to create new products and services, however, requires a steady supply of motivated, dedicated entrepreneurs. In the effort to create jobs – most of which stem from new and small businesses – there has been a steady national drumbeat promoting entrepreneurship and the benefits it brings, but is the country doing enough to cultivate and inspire future generations of entrepreneurs?
“The entrepreneurship education field is definitely growing,” says Michael Simmons, CEO and co-founder of Empact. “But the need far outstrips what’s being provided. There are very few programs focusing on young people, and there need to be a lot more.”
Empact works to foster a culture of entrepreneurship among young people, using events, public recognition, and startup support to teach and inspire future generations of business leaders. Simmons says one of the largest needs in promoting entrepreneurship is increasing exposure to the idea of starting and growing one’s own business.
Speaking at a meeting of the Atlantic’s Small Business Forum, Gallup’s executive director of education Brandon Busteed cited data showing that nearly half of U.S. school students in grades 5-12 say they want to start their own business, yet a far smaller percentage had the direct experience – such as internships, mentorships or full employment – to help them reach their goal.
Meanwhile, the current education system may actually be stunting the entrepreneurial aspirations of young people. Busteed noted a recent Gallup study that found a negative correlation between standardized test scores and entrepreneurship.
"Not only are our school systems failing to embrace entrepreneurship, I would argue we are actually neutralizing it," Busteed says. "What we need to think about doing is creating the world's most potent entrepreneurial pipeline, and that starts with our schools."
While more work remains, there are many institutions and organizations that offer opportunities for students to learn about entrepreneurship – and some of these organizations are employing new teaching methodologies.
Learning to Think Like an Entrepreneur
In the past, entrepreneurship learning focused on the nuts and bolts of starting a company, like creating a business plan and acquiring capital. Simmons calls this approach outdated and says a new methodology focuses on business modeling and customer development.
“The old ways of teaching entrepreneurship with war stories of successful entrepreneurs and a mindset and theories taught in a straight line from the practice of large, existing organizations is dying (if not dead everywhere already),” Babson College professor Andrew Corbett writes in Forbes.
Babson College offers one of the country’s top-ranked entrepreneurial education programs, offering blended-learning – that is, a mix of classroom study and hands-on experience. Corbett rejects the notion that entrepreneurship cannot be taught, that entrepreneurs carry an innate drive and desire the rest of the population lacks and can never truly learn. Entrepreneurship education that focuses only on how to build a business teaches how to act like an entrepreneur, but to be successful, one must also learn to think like an entrepreneur. To this end, many programs offering entrepreneurship education are shifting their approaches to include activities and experience that cultivate an entrepreneurial mindset.
At the college level, entrepreneurship education is expanding rapidly, using classroom study and real-world experiences to teach students how to act and think like an entrepreneur. Entrepreneurship has long been a part of the business school curriculum, but increasingly, universities are offering formal degrees in entrepreneurship, including majors, minors, and certificates. The number of formal degrees quadrupled over the last 30 years, rising from 104 degrees in 1975 to more than 500 in 2006, according to a report from the Kaufman Foundation. The report advocates for entrepreneurship to become a field of study at all universities, calling entrepreneurship the “natural ally” of academia, enabling learning and moving towards American education’s “most consequential results” – innovation and discovery.
Because experience is such an important part of teaching entrepreneurship, it presents challenges for integrating entrepreneurship education into the current K-12 U.S. school system. Beyond the challenge of taking time away from other subjects, a teacher who has never started a business will be hard-pressed to effectively teach how to be an entrepreneur, Simmons says. Yet, there are organizations bringing entrepreneurship education to young people outside of the classroom walls.
The Young Entrepreneurs Academy (YEA!) offers a year-long program for students in middle and high school. Founder and CEO Gayle Jagel describes the academy:
“The program shows kids how to develop their big ideas, create actual business plans, pitch their plans to a panel of ‘investors’ that make the decisions to put real money into the students’ ideas based on merit, and then help the students turn those ideas into real businesses.”
This is an experience-focused program that has helped numerous students develop and launch profitable businesses. Through YEA!, Eric Meyer launched Spotlight Video Productions while still a sophomore in high school; and Elishia Ortiz founded the educational exercise company Young & Fit Forever, securing region-wide sales while still in the program. Overall, YEA!’s 870 students have launched 552 enterprises. While not all YEA! graduates and other students of entrepreneurship go on to start new businesses, the benefits from the experience and learning nevertheless build skills and attributes that are important for the American workforce.
Benefits Beyond New Business
The National Foundation for Teaching Entrepreneurship (NFTE) offers programs that teach young people in low-income areas about entrepreneurship. While NFTE focuses on learning about entrepreneurship, the overall goals are to encourage students to stay in school, recognize opportunities and plan for the future. In evaluating the impact of its programs, NFTE found several positive effects (beyond new startups), including a 32% rise in interest in attending college, a 44% increase in occupational aspirations, and an 8.5% rise in leadership behavior.
The Labor Department cites numerous other benefits from entrepreneurship education, such as work-based experiences and interpersonal skills development, better money management and financial literacy. All of these advantages serve to improve the strength of the U.S. labor force, making entrepreneurship education critical not just for the growth of new business but for strengthening the caliber of American workers.
Learning about entrepreneurship also has benefits for individuals who are not in the education system. Resilience Education funds entrepreneurship education programs for inmates at two Virginia prisons. The intent is to give inmates the tools and knowledge to re-enter the workplace and ultimately start their own business. A similar program in Texas, the Prison Entrepreneurship Program (PEP), has shown positive results. Interestingly, the rate of inmates returning to prison after release is dramatically lower for those who went through the program – only 5% return, versus 25% for the wider prison population.
By better integrating entrepreneurship education into the American educational landscape, America has an opportunity to cultivate generations of ambitious and determined innovators and job creators.