Harvard follows MIT lead on student entrepreneurs
05/06/2002 07:49 AM

By Jeff Miller

Harvard University MBAs flooded the market with dot-com startups during the Internet boom, but when it comes to fostering an entrepreneurial culture, MIT has long been the leader in the Hub technology community.

A group of Harvard undergraduates, however, is looking to change that. They’ve organized an event titled “Series A” in which undergraduates present their business plans for critique to angel and seed investors as well as to their fellow students.

“I went to the MIT Enterprise Forum,” said Harvard senior and Series A organizer Jean Moreau, “and was surprised something like this wasn’t happening at Harvard. It just seems that it should happen.”

So Moreau approached the Technology and Entrepreneurship Center at Harvard (TECH). TECH was established three years ago to foster entrepreneurship at Harvard.

A month and a half later, Moreau was ready: a conference room, fliers, pizza and investors.

The hardest part, ironically, was finding the startups.

“Since the dot-com bust, I think that people are less willing to take the entrepreneurial risk on campus,” Moreau said.

Series A had its first meeting last month, with about 30 students turning out on a chilly, wet Thursday evening. Two companies presented — Stack Athlete, a nascent Internet play, and Media Unbound, a more mature online music personalization software company that already has funding.

A panel of three investors critiqued the ventures: James Geshwiler, managing director of the Common Angels, Alain Hanover, managing director of Navigator Technology Ventures, and Eugene Pettinelli, a partner at CambridgeLight Partners.

Nicholas Pallazo, a Harvard junior and a member of the Harvard football team, presented his plan for Stack Athlete, a subscription-based interactive Web site for student athletes.

Members could chat online with professional athletes, receive individual training advice, and read equipment reviews.

“Two years ago, I’d have been interested,” Hanover said. “But I’ve lost so much on dot-coms in the last two years, if I invested, my wife would shoot me. What you need to do is attract a couple of professional athletes to invest.”

Pettinelli gave similar advice. Geshwiler, on the other hand, opted for a more Socratic approach. He rose from his seat, found a piece of chalk, and rapidly ran through an analysis of Pallazo’s business plan, pausing frequently to elicit thoughts from the audience.

“How many businesses do we have here?” he asked the audience.

At least two audience members replied, from a services company and a media company.

“At an early stage, it’s best to focus on just one,” Geshwiler offered.

The second presenter was Michael Papish, co-founder and CEO of Media Unbound. This nine-employee company sells a software platform that suggests songs after analyzing users’ responses to questions about their music preferences.

The company has raised slightly more than $1.5 million from angel groups such as the Common Angels and the Walnut Angels, as well as individual investors.

Media Unbound also has customers, including PressPlay, a joint venture
of music giants Sony and Universal, Streamwaves and Ucentric Systems.

One might think that Papish would be bullish on his company’s future. But although the company expects to break even next year, he’s unsure that the online music market is developing quickly enough to support growth.

Pettinelli suggested that the company move away from selling software. The real value, as he sees it, is in mining the massive amount of data the company has accumulated about user music preferences.

And even if the company doesn’t grow up into a huge company or an acquisition target, Media Unbound could be a nice lifestyle company for the founders, Pettinelli said.

Geshwiler, once again, took the Socratic approach, looking at each of the risks he considers before investing: people, product, competition, financial and market.

The audience gave Media Unbound strong marks on all counts, except, unsurprisingly, for the market risk. It’s uncertain whether online music will take off, as many had thought three years ago.

After the discussion, pizza followed.

“I was pleasantly surprised by how it turned out,” Moreau said. “The planned format was probably a bit more rigid that what actually happened, when James was a bit more Socratic. But I thought that was actually perfect, because it forces the audience members not to just critique, but also to potentially make themselves look stupid.

“For many of them who will go off to business school, that’s exactly what they’ll be doing.”