Tepper School of Business hosts open entrepreneurial challenge
Carnegie Mellon students pitched their entrepreneurship ideas for companies in this year’s Tepper Venture Challenge, which was held yesterday in the Mellon Auditorium located in Posner Hall.
The Tepper Venture Challenge is an annual competition, started in 1998 by the Undergraduate Entrepreneurship Association, said junior H&SS interdisciplinary major Sachit Gupta. “At first it was a CMU-only business plan competition, but we have since expanded the competition to include regional colleges and universities,” he said.
Gupta and Corey Montella, a senior business administration and physics major, are vice-president and president, respectively, of the Undergraduate Entrepreneurship Association. The competition is currently open to all undergraduate students in Pennsylvania, and the applicant pool has been steadily growing each year. Based on the viability of their proposals, six teams were selected to present their ideas at the competition this year. Each of the teams had 10 minutes to introduce their proposals to the panel of judges, followed by an additional question-and-answer session.
The Tepper Venture Challenge tries to simulate the real process of entrepreneurship.
“The format is that of a pitch to venture capitalists [VC]. In fact, the judges are partners from local VC firms,” said senior computer science major Breck Frensen, who came in third place in the 2007 Tepper Venture Challenge.
“You’re evaluated primarily on the quality of your idea as well as your ability to articulate it to the judges.”
While the Tepper Venture challenge has no specific guidelines for the types of business ideas that teams can submit and be entered into the competition, it asks participants to follow specific guidelines in their presentations to the panel of judges.
Montella explained, “Hands-on experience with pitching your business is one of the best ways to get your business started; it allows you to make mistakes and get feedback before you pitch to venture capitalists when it really counts.”
After the competition, the winning teams are encouraged to start their own businesses based on their proposals. In addition to receiving positive feedback from real venture capitalists and potential investors, students also receive a substantial cash prize that is meant to be used for marketing, business planning, and product development.
“Sometimes the only thing holding you back is the security of a job and a steady paycheck, but when that security is gone, taking that plunge is much easier,” said Gupta and Montella.
“One of our favorite past winners is Luke Skurman. Luke won the Tepper Venture Challenge [TVC] when he was an undergraduate at [Carnegie Mellon] with his plan for his company, College Prowler. After graduating, he started his company and has had success with it ever since. He’s told us the most valuable thing he got from participating in the TVC was the feedback the judges gave him.”
Participants are graded not just on the quality and viability of their ideas, but also on their skill in communicating their ideas to the judges.
“The teams were graded on ... how [clearly] they communicated their proposals in a limited time,” said Meyer, Unkovic, and Scott LLP attorney David Obredeck, who had served as a judge.
Frensen also attributes his proposal’s standing to an inability to convey its potential. “My team’s idea was a website called Mave. The idea was to create a marketplace where people could post a service they needed and local service providers would automatically be alerted to the opportunity,” he explained. “Ultimately, the reason we didn’t win the competition that year was the same reason the website failed. It was a difficult idea to communicate and we were unable to make the connection in people’s minds that Mave was the easiest place to find a service provider.... We didn’t succeed; we failed.”
Obredeck also added, “If you have an innovative idea for a business ... you have to tell investors about it and convince them to trust you ... or it will remain an idea, not a business.”