Russ: Welcome back to the show. My guest today: successful entrepreneur, and now Executive Director of the Wolff Center for Entrepreneurship at the University of Houston; the undergraduate Entrepreneurship program that is ranked first, second, or third, nine years in a row, and that’s first second, or third out of 2,700 other undergraduate programs?
Ken: Yes, sir.
Russ: Alright. Welcome to the show.
Ken: Real pleasure to be here.
Russ: You bet. So, here you are, a successful entrepreneur, but now an 18-year teacher of entrepreneurship. What do you say today? What does it take to be a successful entrepreneur?
Ken: Well, I think that would first come down to what we define as successful. To me, successful is, I’m getting out of my car and I’m looking forward to going to work in the morning. That really is kind of a driver. Obviously, we look at profitability, we look at succession, and how long a business can last. And so, for me, it’s really changed over the years. Nowadays, it’s all about the customer. So, a successful entrepreneur is someone who so intimately knows who their customer is and the pain they’re supposed to resolve.
Russ: Wow. Real interesting. So you say that’s what it is today, all about the customer. What was it about before then?
Ken: Well, isn’t it interesting, in the past, we used to build something and hope they came. So, someone would build a great business infrastructure, put all this financing, and then go out and hopefully find a customer because they thought the product was great. And it just doesn’t work that way. So now, things have very much shifted to a customer discovery basis, and in fact, we’ve really gotten away from business plans.
Russ: Ok. You know, that’s interesting. You’ve really gotten away from business plans; why?
Ken: Right, because the business plan is really a great, great document to write as an operational document or for internal purposes, but we really use now the canvas, and we use a lot more succinct tools that someone needs to understand the pain you’re resolving in the marketplace, and then these few other things that have to be in place for that to happen. The financing; raising the cash if you need some, that kind of comes, but it’s not worth even pursuing until we know we’ve got a pain that we’re resolving that’s repeatable.
Russ: Ok. Sort of in another direction, what would you say, say we have two aspiring entrepreneurs, and one just says, they aspire really to get into business, to grow, and maybe have a family owned business for generations to come. And you have another person over here that has seen what’s happened in a lot of all IPOs that have blown the top off. They think they have a great idea and they’d love to take a shot at winning the lottery.
Ken: Well, those are two different things and I would look at those on the risk curve. I look at someone who’s looking for succession, and they want it to be “and Sons” or “and Daughters,” or “and Family,” on like a repeated basis, they almost become risk averse. That once they have something that works, they want to maintain that. And the second example that you provided is someone who is, I think, taking a little bit more risk, i.e. their risk for failure is pretty great, but if, in fact they hit, the upside can be pretty profound.
Russ: Ok, last question, what is it about the Wolff Center for Entrepreneurship here at the University of Houston that enables it to continue to rank so high in these contests? Now, I know a lot of it is attributable to you, of course.
Ken: No, really, we’re lucky to be in the great city of Houston. Entrepreneurship is all about who you know as much as what you know. And we have been able to marshal such great resources. We offer mentoring, such extensive mentoring; I have over 250 people for 40 people that mentor and provide that level of experience, because that’s everything—an entrepreneur always lacks that. That’s the experience. No bank, no investment bank, big customer. If they want to know where that experience is coming from, and this is what I think really lays the groundwork for our success.
Russ: Well, Ken, it seems like about 2 or 3 years ago, the program kind of pivoted to, in an exciting direction. It was always exciting, but it kind of pivoted from the perspective entrepreneurs. Instead of bringing in their own ideas, they sort of were presented some incredible intellectual property from the University of Houston; talk about that.
Ken: Yeah, when you’re dealing with undergrads, especially in the entrepreneurship world, when you say to somebody, “you must come to me with a good idea,” those ideas are forced. And a force idea usually fails. And so, as such, I pivoted our program to align ourselves with the intellectual property portfolio that the University has such a robust collection of, and we turn around and provide exclusive licenses, and we’ll wrap a business idea around the intellectual property. It gives the student teams real, real product to work on, definitively sizeable markets, and we’ve had great successes with that to date.
Russ: Wow, so what happened to that intellectual property before the Wolff Center took it on?
Ken: It either laid fallow, or on occasion, someone would try to find a license for it. And what we do, is we provide so much basis behind the worth of that license that values really increase, and we’ve created some great, great startups already with that program in mind.
Russ: Give us a couple of examples.
Ken: Well, even here in this incubator where we’re being interviewed, we have two great companies. One is called Recycle, and they recycle rare earth elements out of the magnets that you find in hard drives and wind turbines, and electric cars. And that’s a very rare earth element controlled by China, and we’re able to now look to provide the US possibly with up to 20% of it’s need, which is fantastic. The other side is a bead based, for lack of getting too descriptive, and be able to filter water. And we’re working now, handling some specific, including problems up in Flint, Michigan, with some of the water purification issues to be able to make almost any water potable.
Russ: Ok, well I even saw one, I think, that was part of the program, maybe it’s in the earlier stage that was in the recent Rice Business Plan contest, that had this smart concrete.
Ken: Right. We have a product that we are bringing out called Smart Cement, and we basically can give any cement sensing capabilities. So, you can see how that might be really applicable for the infrastructure of the United States. We’re also looking into that in drilling, so you can know whether or not there’s a gap in your casing. And the BP oil spill was the real promulgater behind this technology.
Russ: Ken, thank you so much for sharing your perspective with us.
Ken: My pleasure.
Russ: You bet. And that wraps up my discussion with Ken Jones, the Executive Director for the Wolff Center for Entrepreneurship here at the University of Houston. And this is The BusinessMakers Show.
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