Thursday, April 14, 2016

Huh, that's pretty good advice

In the midst of some pretty standard innovationstartupinnovationdisruption talk from venture capitalist Paul Graham, something pretty smart: 
I know it may disappoint some administrators to hear that the best thing a university can do to encourage startups is to be a great university. It's like telling people who want to lose weight that the way to do it is to eat less. 
But if you want to know where startups come from, look at the empirical evidence. Look at the histories of the most successful startups, and you'll find they grow organically out of a couple of founders building something that starts as an interesting side project. Universities are great at bringing together founders, but beyond that the best thing they can do is get out of the way. For example, by not claiming ownership of "intellectual property" that students and faculty develop, and by having liberal rules about deferred admission and leaves of absence. 
In fact, one of the most effective things a university could do to encourage startups is an elaborate form of getting out of the way invented by Harvard. Harvard used to have exams for the fall semester after Christmas. At the beginning of January they had something called "Reading Period" when you were supposed to be studying for exams. And Microsoft and Facebook have something in common that few people realize: they were both started during Reading Period. It's the perfect situaton for producing the sort of side projects that turn into startups. The students are all on campus, but they don't have to do anything because they're supposed to be studying for exams. 
...But if a university really wanted to help its students start startups, the empirical evidence, weighted by market cap, suggests the best thing they can do is literally nothing.
I gotta say, I don't know much about startups, but I'm pretty sure that "try to be a better university" and "do nothing and let stuff happen" is pretty good advice. 

6 comments:

  1. Problem is, I think universities want the startups to generate money for them, and having rules that limit how much money they are likely to generate for them (by relinquishing ownership) and how much control they have over it defeats the purpose of stimulating startup growth for them. (The history of the last thirty years of universities seems to be ""S%^$% being a good university, show me the money (and keep it rolling)!")

    Stimulating startup growth might help them in recruiting faculty (or paying them less) even if the startups don't make money for the university, but since universities are relying more on contingent faculty and less on tenured or potentially tenured faculty, that probably doesn't help either. (I imagine the contingent nature of faculty appointments would also be a problem - businesses are probably harder to move across the country than labs, since (I assume) you're likely to depend on local relationships to run them and grow them.

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  2. I always hated the idea of exams after Christmas - you usually got papers and work to do over the holidays, when you were unlikely to have much time to do any of them (or wouldn't want to). I don't know if it worked as well, but something like IAP (http://web.mit.edu/iap/) might be better for that.

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    1. Poison Ivy LeagueApril 14, 2016 at 9:25 AM

      I've seen firsthand how much students forget if the exam is after Christmas...pedagogically it is pretty indefensible. Honestly, I'm of the mind that Zuckerberg/Gates probably would have eventually done something interesting regardless of reading period (this kind of intrinsic ambition has a way of prompting such things).

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    2. I like the IAP model better as well. Students can come back to campus, hang out with their friends, take short courses, do undergrad research or work on independent projects, etc, without the stress of upcoming finals. The MIT campus during IAP is a much busier place than my current university is during January, even though regular classes start back up at the same time.

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  3. Yeah, get out of the way! Its like telling a bank that the best thing they can do to help people with mortgage is tell them to stop paying and forget about it!

    A direct wealth transfer from taxpayer to already overpaid faculty trying to become filthy rich risking someone else money. What else is new? Elizabeth Warren has been a crusader against high tuitions at the same time she was paid 325K$ a year to teach one class at Harvard. Now they want to flat out own patent financed by the NIH? Give us a freakin break.

    I am in the private sector and the cie own every thought out of my head. Welcome to the real world, biatches, and get real...

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  4. Different types of start-ups require different amounts of infrastructure. For tech start-ups the greatest help may very well be to 'get out of the way' and 'do nothing' while the founders bang on some laptops, but for biotech start-ups a university can really help things along by establishing a easily accessible incubator. Fume hoods, analytical equipment, waste management and the like are all very expensive elements that can get in the way of obtaining vital preliminary data.

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