University Entrepreneurship Programs May Not Increase Entrepreneurship Rates, Stanford Researchers Find
Entrepreneurship classes and programs in colleges around the world have proliferated over the last quarter of a century, yet the literature examining the impacts and effectiveness of such initiatives is still relatively sparse and limited. Do these initiatives make a difference in the long-term entrepreneurial activity and success of their students and alumni?
Yong Suk Lee, SK Center Fellow and APARC’s Korea Program deputy director, and Charles Eesley, an associate professor and W.M. Keck Foundation Faculty Scholar at Stanford’s Department of Management Science and Engineering, have been collaborating on research that aims to fill in some of the information gaps in assessing the efficacy of entrepreneurship education programs.
In a new article published in Strategic Management Journal, Lee and Eesley examine the entrepreneurship consequences of Stanford University’s two major entrepreneurship education programs that were founded in the mid-1990s. Their findings are sobering but offer lessons for improving such efforts. Lee provides a synopsis of their findings in the video below.
[Sign up for our newsletters to get the latest updates from our scholars.]
Using a unique entrepreneurship-focused survey of Stanford alumni, Lee and Eesley investigated how the Stanford Center for Entrepreneurial Studies (CES) at the Business School and the Stanford Technology Ventures Program (STVP) at the Engineering School affect entrepreneurial activity. They administered the survey to a well-defined population of comparable individuals from multiple industries, in total generating 27,783 responses. Respondents reported information on their entrepreneurial status, participation in angel investing and venture capital, and on the founding, duration, and success of start-up ventures. Respondents also indicated to what degree, if any, they had participated in the CES or STVP programs.
The survey results reveal that overall participation in the Stanford Business School CES had a negative to zero impact on entrepreneurship rates and participation in the Engineering School STVP had no impact on entrepreneurship rates. However, the data suggests that participation in the Business School initiative decreased startup failure and increased firm revenue in the long-term. “University entrepreneurship programs may not increase entrepreneurship rates,” Lee and Eesley conclude, “but help students better identify their potential as entrepreneurs and improve the quality of entrepreneurship.”
These findings provide important context to broader questions about entrepreneurship development and incubation, such as whether entrepreneurship is an intrinsic or acquired trait, and as such, whether firms should seek to develop entrepreneurial capabilities internally or acquire them from external sources. This question equally concerns universities and the strategies institutions of higher education employ to foster entrepreneurial talent.
Lee and Eesley note that it is important to take into account variation in entrepreneurship training programs in course content, emphasis, and other dimensions. Their research suggests that general entrepreneurship education that targets a broader spectrum of startups, rather than one that solely focuses on technology startups, may be more effective in reducing the uncertainty in entrepreneurial ability or improving startup performance.
These findings may generalize to other samples of selective-admission college-educated alumni, although there is certainly need for future work that explores the effects of entrepreneurship education in different institutional environments.
Entrepreneurship, Technology, and Economic Development
Read More
A study by Yong Suk Lee, the deputy director of APARC’s Korea Program, and Management Science and Engineering professor Charles Eesley investigates the efficacy of two major Stanford entrepreneurship education initiatives, suggesting they may not increase entrepreneurial activity.
Arthur Bienenstock is co-chair, with Peter Michelson, of the American Academy of Arts and Sciences’ Committee on International Scientific Partnerships. He has also been a member of the National Science Board, the governing body of the National Science Foundation, since 2012. From November 1997 to January 2001, he was Associate Director for Science of the White House Office of Science and Technology Policy. At Stanford, he is Special Assistant to the President for Federal Research Policy, Associate Director of the Wallenberg Research Link and a professor emeritus of Photon Science, having joined the faculty in 1967. He was Vice Provost and Dean of Research and Graduate Policy during the period September 2003 to November 2006, Director of the Stanford Synchrotron Radiation Lightsource from 1978 to 1977 and Vice Provost for Faculty Affairs from 1972 to 1977.
Tim Stearns holds the Frank Lee and Carol Hall Professorship in the Department of Biology at Stanford University and is Senior Associate Vice Provost of Research. He also holds appointments in the Department of Genetics, is a member of the Stanford Cancer Institute and Bio-X, is a Faculty Fellow in Chem-H, and is an affiliated faculty member of the Center for International Security and Cooperation (CISAC). He is a member of JASON, a national organization that advises the government on matters of science, technology and national security. He has also been an advisor to the National Academies of Science and the President's Council of Advisors on Science and Technology (PCAST). Dr. Stearns received a B.S. from Cornell University, a Ph.D. from MIT, and did his postdoctoral fellowship at the University of California, San Francisco. His research concerns the mechanism and regulation of cell division, the organization of signaling pathways within cells, and cell biology of fungal pathogens. Stearns was named an HHMI Professor in 2002 for his work in science education, and has taught international workshops in South Africa, Chile, Ghana, and Tanzania. He is the chair of the NCSD Study Section at the NIH and has served on the editorial boards of several journals.