March 2006 Archives

As a Professor at a small Division I school I can't help but cheer for George Mason this weekend. As proud as we all are at Belmont just making the tournament this year, I can only imagine what the students, alumni, faculty and staff of George Mason must be feeling right now.

But, my colleague Dr. Larry Hall, Dean of our College of Arts and Science, passed along an article from Slate.com that will make me cheer even louder on Saturday as GMU plays Florida. It seems that both in their basketball and academic programs they are behaving in many ways like a smart entrepreneur.

Opportunity Recognition

GMU has excelled on the court and in the classroom by daring to be different. Its basketball team and academic programs began with the (correct) assumption that they couldn't hope to compete against the top schools in their fields--say, Harvard Law School or the Duke Blue Devils--by directly imitating their methods. GMU lacks the resources and reputation to recruit McDonald's All-Americans or Alan Dershowitzes. So instead, GMU has hunted for inefficiencies in its markets.

Bootstrapping

Coach Jim Larranaga follows the Moneyball model of recruitment: hunting for the undervalued players--the ones who everyone else thought were too short, too thin, or too fat--and then building them into a team. In its astonishing defeat of UConn, GMU's players were giving away 4 inches at nearly every position.

Exploiting Under-served Market Niches

From the 1960s into the 1980s, a small university such as GMU could hire conservative and free-market thinkers of true genius for the same kinds of reasons that, in the mid-1960s, a middling school like Texas Western University could recruit some of the best basketball players in the nation, so long as they were black, and win the 1966 NCAA championship. Conservative and free-market economists were so undervalued that GMU could afford the best of them.

So this free-market, entrepreneurial-minded professor from a small Division I school will be cheering like a mad fool for George Mason. Go Patriots!!!

"Moving into the real world" used to be a standard phrase used as students prepared to leave the protected confines of the university and headed into the workforce. But as a student entrepreneur once told me as she was wrestling with balancing her new venture, class projects, final exams, and a college social life, "This Already Feels Pretty Real to Me!"

A generation ago when people like Michael Dell started a business in their dorm room it was considered an anomaly. Today, it is one of the fastest growing trends on campuses across the country.

I have written before about the Entrepreneurial Generation now populating our classrooms and dormitories. We now have three student business hatcheries for these students, with over 50 students operating 40 businesses on our campus the competition for our space is beginning to heat up. And those are just the students we already know about! More come in almost every week.

Entrepreneur.com offers some suggestions for collegiate entrepreneurs contemplating the transition from owning a campus business to one that can earn them a living when they graduate.

Before you burst onto the post-college business scene, spend time evaluating your product or service, and see if there is a realistic market outside the college environment. Do you have to modify your offering in some way to transfer it to the outside world? Research is key here -- while you're still on campus, use all the resources at your disposal, including entrepreneurship centers and professors whom you can easily turn to for guidance. "Try to find a mentor in a [similar] industry," says Minor [director of the Neeley Entrepreneurship Program at Texas Christian University]. This mentor can help you plan your transition to ensure you're fully prepared for the change--and that you don"t miss anything.

Universities are attracting major funding from foundations and donors to build up their entrepreneurship programs. Use the resources at your finger tips to help build a sustainable business.

It might help to liken your transition to that of a college athlete turning pro, notes Justin B. Craig, assistant professor of entrepreneurship at Oregon State University in Corvallis. You'll be doing everything on your own, so prepare yourself mentally and financially to leave the safety of the college infrastructure, including the fun stuff like free broadband access, phone lines and web space. "The playing field changes--it really gets competitive," says Craig. "If you take this on, and [entrepreneurship] is going to be your career, make sure you step up. You're going into the majors."

But, don't be afraid of this challenge. In today's economy, starting a business of your own with the proper education and preparation can be a smoother ride than trying to make it in the cubicle jungle of the corporate world.

As I mentioned in a post yesterday morning, we had Eric Flamholtz, author of Growing Pains, on campus for a lecture. His book is at the top of my "must read" list for all entrepreneurs.

Here are some highlights from his lecture here at Belmont:

- "What you can't measure, you can't manage."

Developing systems that allow you to collect and track key data that helps you see where your business has been and where it is going is critical to the success of a growing business.

- Set a specific quantitative goal for your business and develop a plan to get there.

Having a clear goal will allow you to understand the infrastructure you will need to develop to reach your goal. It will help you develop specific plans that map the developmental steps your business will need to take as it grows.

- Niches are not always small -- they are defensible positions within a market.

Entrepreneurs often equate a market niche with a small business. Actually, many large companies have well developed and well defended large market niches.

- A mission should have a qualitative and a quantitative component.

Flamholtz offered the example of Starbucks' mission statement from 1994:

To establish Starbucks as the leading retailer and brand of coffee in North America by the year 2000, by creating distinctive daily coffee experiences for our customers wherever they live, work or play.

2 Billion + 2000 Stores = 2000

- Companies compete not just with products and within markets, but through their operating systems, management systems, and culture.

Wal-Mart offers the same basic products in the same markets as K-Mart. Any questions?

- "You make your own luck by being prepared."

I have read more books about entrepreneurship than I could possible even count. But a very few stand out for me. There are some that have stood out because they were inspirational, while others provided very useful with important how-to's. A few even made me laugh (sometimes due to the author's intent...).

But one book has stood the test of time as being the most influential book for me first as an entrepreneur, and more recently as a teacher of entrepreneurship. Growing Pains, by Eric Flamholtz, helped me find my way through an incredibly challenging time of rapid growth in our business. It has also changed the way I think about teaching entrepreneurship. I no longer think of what we do in Entrepreneurship education as helping people start businesses, but rather helping them start and grow sustainable businesses.

We have the pleasure and honor of having Professor Flamholtz here at Belmont today. I look forward to sharing new insights on managing growth with all of you from his lecture.

What is the most influential book for your entrepreneurial career?

There are those out there who believe that all real entrepreneurial activity comes to us thanks to venture capitalists and their funds. But a story from Red Herring illustrates how limited their interests, and therefore their impact, are due to the investment criteria they use to evaluate deals.

Despite the promise of cleantech like biofuels and water purification technologies, some venture capitalists say it can be tricky to invest in the field because it doesn't necessarily offer the fat and easy returns that make them drool.

The challenges aren't obvious from the numbers. Cleantech investments in North America grew 35 percent to $1.63 billion in 2005, according to the Cleantech Venture Network, the industry monitor that held the Cleantech Venture Forum conference in San Francisco last week.

But some of the most promising clean technologies just don't fit the classic VC model of a six-year exit with returns of 10 times the original investment, industry watchers said.

So while VCs do play an important role in our entrepreneurial economy, keep in mind that they only fund a fraction of a percent of new businesses formed each year, they are rather selective on the types of businesses they like, and as this story shows they can have a very near-sighted view of the world.

We will be recognizing the contributions of small business in our economy and society during Small Business Week, which will be April 9-15, 2006.

Here are some quick facts about small business in America from the Census Bureau:

Small Businesses With Employees

- There were 5.3 million business establishments with fewer than 10 employees in 2003. Among these businesses, 3.9 million employed fewer than 5 people.

- There smallest of our small businesses employed 15.9 million in 2003.

- In 2003 there were 796,000 businesses in the retail trade industry that employed fewer than 10 people. Another 652,000 were in professional, scientific and technical services, with 595,000 in construction and 500,000 in health care and social services.

Nonemployer Businesses

- They generated $830 billion in receipts for 2003, up from $586 billion in 1997. These nonemployers, often "mom and pop" corner stores or home-based businesses, comprised more than 70 percent of all businesses.

- There were 18.6 million nonemployer businesses in 2003.

- There were 1 million nonemployer businesses added to the nation's total between 2002 and 2003.

I wrote a post a few weeks ago about the pros and cons of choosing to buy a franchise as a way to start a business. A new study from Cornell Hotel and Restaurant Administration Quarterly linked by Docuticker looks at franchising from the other side of the relationship: the franchisor. It found that two types of restaurant chains benefited from using a franchising model to grow.

The use of franchising by the manager-scarce and money-scarce franchisors supports the concept that youthful companies take up franchising to gain access to resources in an economical fashion.

Using a franchise model helps push the cost of development onto the franchisees allowing more rapid growth.

Businesses that had more experience and more resources tended to favor, and performed better, by growing their businesses through company owned stores. Given the headaches that can come with franchisee relations, it is probably wise to only use a franchise model when resource scarcity offers no other alternative.

COTC can be found at Decker Marketing this week.

In a recent Harris Poll on who Americans have confidence in, small businesses came in second only to the military. At the bottom of the confidence list were the press, major companies, organized labor, Congress, and law firms.

Many entrepreneurs seem to believe that the primary objective of their business is to raise investment capital. This is the wrong mentality to have in any start-up, as your focus should be on building a sustainable business. I tell my students in our Entrepreneurial Financial Management class that my primary goal is to teach them how to start a business that needs as little outside money as possible through careful cash flow management, realistic forecasting, and bootstrapping.

Seth Godin (author of Bootstrappers Bible) strongly agrees in this post at Impact Lab from last Friday.

If you fund your company, even a little, you've just sold it. Maybe not today, or tomorrow, but one day. That's because rational investors are funding your company in the expectation that you are going to sell it and make them a profit. (sure there are exceptions, but not many). So, if you don't expect that your company will be easy to sell for a big profit, or you don't ever want to sell your company, it's not a smart idea to raise money for it....[I]f you absolutely need a lot of money to do a particular business and the terms you'll need to accept to get that money are unacceptable, find a new business. Nothing wrong with that. The market might be trying to tell you something.

Entering into business relationships can be tricky. The Internet proves to be a great tool to gain information that can help inform possible business deals. Public Records Blog offers some advice:

By conducting simple due diligence and developing your own profile on any person or business you will have a much better understanding of a particular business and its associates which is vital to your business decisions. 90% of the information you need to know can be found on-line. You just have to know where to look for it, and how to look for it.

The post offers several specific tips on tools to use to search for information.

Welcome to the Carnival of Entrepreneurship! Those of you who are regular visitors to my site are familiar with Carnival of the Capitalists. This is a similar project, but this travelling collection focuses just on Entrepreneurship. Each week we pick seven (7) posts, often from sites that you may not have visited before. If you are interested in submitting posts and/or hosting this Carnival in the future, please visit About Entrepreneurs for more information. Thanks to all of you for the great submissions! As always it was hard to pick only seven.

Marketing and Business Relationships

Chris at Adventures in Capitalism lasted longer than I did watching American Inventor. He was reminded in the first episode about the importance of creating real value when introducing a new product or a new service. The "cool" factor is not enough to sustain a new venture over the long-term. You need to think like your customers and truly provide something they need. If it does not create real value to its intended customers, a new business will not have the legs to last.

One was to prove that you offer your customers real value is by letting current customers tell them. Testimonials can be a powerful marketing tool for small businesses trying to demonstrate to the market that they are legitimate and effective player in the market. Small Biz Survival offers an excellent summary of why and how to use testimonials. Even a fairly new business can build testimonials if it provides what the customers really want. Don't be afraid to ask!

One critical skill that many people overlook when preparing to launch a new business is selling. As much as you'd like to think it will, very few products or services will "sell themselves." The entrepreneur has to learn to sell not only to new customers, but to prospective investors, lenders, employees, landlords, suppliers, and so forth. David offers his thoughts on how to be more effective at selling at Career Intensity. His main point is to be yourself!

I was reminded of one of my favorite chapter titles from You Have to Be a Little Crazy by Barry Moltz is "Networking is not a Verb" when I read this post from Brain Food Blog. It is an interview by David Teten with Pamela Walker Laird about the power of strategic relationship building (a.k.a. networking with a purpose in mind).

It is amazing to me how little civility there is today in business. Common courtesy is not so common any more. Jason reflects on all of this at A Thought Over Coffee. What people fail to recognize is how inconsiderate behavior toward potential customers ruins so many chances to build their business. Returning phone calls, being honest, building a real relationship are all critically important marketing tools. The good news it that those who are considerate and polite will stand out from the crowd.

Financial Management

The whole idea of budgeting can be overwhelming for a new business. Creating and monitoring a budget can take time and energy away from what you need to do to bring business in the door. Many entrepreneurs fail to keep up with a traditional line item budget from month to month. After all, many of us are our own bookkeepers when we first get started. Firevalt offers a simple approach to get you started on budgeting that gets you to focus on what is really important when your business is getting started: getting to positive cash flow each month.

So why do we need to keep track of our numbers? Michael at Marketing and Entrepreneurship offers a lesson he learned from working out and getting in shape. As he learned in the gym, what gets measured gets improved. Powerful words for any growing business!

Fewer people are getting their MBAs paid for by their employers. Also, more people are pursuing MBAs for their own career goals, including enhancing their skills as a small business owner or even making a move out of corporate America to become an entrepreneur. The NFIB has an article on the possible tax break you can get for pursuing a business degree.

A United States Tax Court ruling last August could make that advanced degree more affordable, saving small-business owners thousands on their taxes each year....

So does this mean that small-business owners can run out and get their own tax-deductible MBA? Possibly, says Bill Smith, director of CBIZ Accounting, Tax, and Advisory Services' national tax office in Bethesda, Md.

"For small-business owners, there's a very good argument that, if they get an MBA, it would be deductile. Likewise, we see a lot of small businesses passed on from generation to generation. The deduction would be especially good there, too," he says. "This ruling sets a precedent."

(Thanks to James Shewmaker for passing this along).

Immigration is fast becoming a major political issue in the US. And while illegal immigration is a valid concern, we need to be cautious not to restrict legal immigration during the current entrepreneurial economic boom. The latest evidence of the positive economic impact of controlled immigration can be seen in the large number of Hispanic entrepreneurs starting businesses across the country.

From the Tennessean:

Hispanics owned nearly 1.6 million businesses in 2002, a 31% increase from five years earlier, according to a report yesterday by the Census Bureau. The number of all U.S. companies grew by 10%, to about 23 million, during the same period.

It is inspiring to see so many new people coming into this country and embracing our system of free enterprise. They come here to add to our national wealth. But, illegal immigration at the level we now are experiencing can only hurt these entrepreneurs. It fuels animosity from the general population and can even unfairly casts doubts over the legitimacy of these small business owners. Getting control over immigration will be a benefit for Hispanics who are trying to legitimately become a part of the American economy.

I believe that now is not the time to restrict the flow of new people into this country. Quite the contrary. We are in the early stages of a new economic era we have not seen the likes of in this country in over 100 years. The last great entrepreneurial economic boom was created in large part by first generation Americans and sustained by a large, but controlled, wave of immigration that helped to build an economy that last through most of the 1900s.

However, if we want immigration to be a positive contributor to this new era it must be managed properly. We have lost control of our borders and this threatens both our economic health and our national security.

NFIB has sent out two important regulation alerts that will have a direct impact on small business.

ADA Lawsuits

The first alert regards the practice of "drive-by" Americans with Disabilities Act lawsuits. In these cases, the claimants and their attorneys threaten small-business owners with expensive lawsuits rather than allow a small-business owner the opportunity to correct an alleged ADA violation. There is no intention to correct any problem for the disabled that may or may not exist under the ADA, but simply to to recover attorney's fees. In fact, it is not uncommon for these plaintiffs to file several suits a day claiming that numerous businesses discriminated against them on a single day.

"Small-business owners need to be warned of a potential ADA violation and given the opportunity to rectify the problem before they are dragged into court by professional claimants whose only concern is collecting attorney's fees, not creating access for the disabled," said Karen Harned executive director of NFIB's Legal Foundation. "Small-business owners often can't afford to defend themselves against potential ADA violations and are therefore forced to settle these claims. If they are first given notice and the opportunity to update their facility, access for the disabled can be achieved without dragging a business through a costly lawsuit."

The estimated total cost to California small-business owners of litigating these claims each year is $34 million ($5,000 for the defense plus $12,000 for plaintiffs' attorney's fees and damages, multiplied by 2,000 annual cases filed).

Required Health Insurance Coverage

The second alert is about the attempt to move to require universal health care coverage by all employers of all sizes through a back door maneuver called the "Fair Share Health Care Fund Act." This law requires employers with more than 10,000 employees to spend 8 percent of their total payroll costs on health insurance for their Maryland employees. This controversial law also became known as the "Wal-Mart bill" because the corporation is one of four Maryland employers directly affected by the law, but the only one that does not meet the 8 percent threshold.

So what does this have to do with small business?

Although the Maryland law only applies to large businesses, the proponents of this bill made it clear that they want to impose a payroll tax on small-business owners to establish a government-run health-care system in Maryland. In fact, legislation (HB 1510) has already been introduced in the Maryland General Assembly to mandate that ALL businesses with less than 10,000 employees provide health-care coverage for employees, or face a payroll tax. Similar bills have been introduced in New Hampshire, Rhode Island and Washington, all with much lower employee thresholds.

"This has always been about forcing small-business owners to provide health insurance," said Karen Harned, executive director of NFIB's Legal Foundation. "However, the law does nothing to address the issue of access to affordable health care. Businesses that do not provide insurance do so for a reason; they can't afford to buy health insurance. To force a business to provide something their bottom line can't afford is bad for the economy, bad for job growth and is a violation of federal laws. If the court does not find the Maryland law to be in violation of ERISA law, the survival of small-business across the country will be in jeopardy."

There seems to be a pervasive opinion that I hear time and time again that small businesses, while plentiful, don't do much to move the economy ahead through innovation. That is the domain of big corporations receiving massive government assistance of economic planning, tax incentives, and money.

Next time you hear someone say that, show them this list put out by the SBA. It shows a long list of innovations, everything from air conditioning to zippers, developed by entrepreneurs in small businesses.

Carnival of the Capitalists is up at CaseySoftware.com.

I will be hosting Carnival of Entrepreneurship later this week, which this week can be found at Business Opportunities.

Tick Marks blogged about a great article at Accounting Web that clearly spells out five strategies that help a new professional service or consulting business take advantage of a niche market quickly and effectively. It actually has good insights for anyone looking to start a new business in a niche market.

Here are their five strategies for niche markets and my thoughts on each:

"Strategy One: Aim at one and only one niche at a time."

For years I have had a rather corny poster on my wall that has a picture of a golf hole that is one of those intimidating island greens. It has one word at the bottom: Focus. I have thought about putting it away each time I move into a new office, but time and time again I find that its message is important to reinforce with new entrepreneurs. Too often they forget the importance of keeping their eye on the competitive advantage of the niche they have discovered.

"Strategy Two: Craft a 'dynamite and irresistible' marketing message"

The best niche markets are those that have not yet been satisfied. Therefore, don't forget to get the word out to your customers that you are open and ready for business. Your message should tell them who you are, why you are worth their attention, and how you will take care of their needs. Find inexpensive, but effective ways to get in front of your market. Become a marketing bootstrapper.

"Strategy Three: Become the 'obvious expert' in your niche"

The key to this strategy is having a clear and compelling mission statement that has an obvious focus. The answer to the question "Tell me what you do," should take you no more than 15 seconds. You want your customers to become your sales force. You want them to say to others, "When I had the problem, I called __________."

"Strategy Four: Create a 'hit list' of your most desired 100 clients in your niche"

Your marketing plan should have you going for the low hanging fruit. Find the customers that need you the most and have the best chance of paying for what you offer.

"Strategy Five: Implement auto-pilot referral systems"

Word of mouth does not just happen. Make your customers want to refer clients because it makes them look good to do so. Find a simple and meaningful way to say thanks. It may have some monetary value, or may not. Hand written notes have become so uncommon that when you send one, it really can mean something to your customers.

Globalization has become synonymous with unchecked corporate and political power that hurts average citizens around the world. But in a speech this past week to the World Summit of Young Entrepreneurs, Abdel Hamid Mamdouh, director of Trade at the Services Division of the World Trade Organization (WTO), offers a very different view when globalization is viewed in terms of the emerging entrepreneurial economy.

From the Brazil-Arab News Agency:

According to Mamdouh, the WTO sent him to the meeting as their representative due to the theme, which is the liberalization of trade and is of great interest to the organization. To him the objective "is to liberalise trade as it is newly defined, to encompass movement of capital and movement of people, to liberalise it through agreements between governments, in order to open up new investment opportunities for entrepreneurs, to open their horizons."

Mamdouh called globalization one of the great facilitators of entrepreneurial activity in today's economy.

Mamdouh stated that the current generation of entrepreneurs is the best that the world has ever seen. "IT and technology have greatly helped entrepreneurs supplying them with tools that did not exist in the past, providing them with information about markets that were not available for previous entrepreneurs. Their work is simplified by market globalisation and by the reduction of barriers between countries," stated the Egyptian.

A new study conducted by the UCT Graduate School of Business and just released by the Global Entrepreneurship Monitor finds that South Africa is falling behind in the global entrepreneurial economy.

The latest data shows that the South Africa’s entrepreneurship ranking has dropped from 20th position (out of 34 countries) in 2004 to 25th position (out of 35 countries) in 2005. And the country's Total Early-stage Activity (TEA) was only 5.1% in 2005, down from 5.4% in 2004. Significantly, South Africa also has the lowest entrepreneurial activity rate of all the developing countries participating in GEM.

The authors suggest that government policy in South Africa needs to shift its policy away from wealth redistribution toward more support of entrepreneurial activity and the jobs it creates.

Given our high levels of unemployment and the indisputable relationship between unemployment and poverty, we would argue that job creation should supersede poverty alleviation, not as a national objective, but as an SMME objective. Job creation in itself is the most effective, sustainable strategy within the context of SMME policy that could alleviate poverty and reduce inequality.

I would go one step further in this recommendation. I would suggest that attention to supporting entrepreneurial activity should replace South Africa's focus on wealth redistribution. Their policies have proven to decrease total wealth by creating a zero-sum game between the rich and the poor. By focusing on entrepreneurship, more wealth will be created by a much broader number of South Africans of all ethnic backgrounds.

Decrease government regulation of small business, cut taxes, and improve entrepreneurial and economic education is the formula to improve South Africa and all developing nations for generations to come.

(The GEM studies are supported in part by Babson College).

Today is a big day here at our little University. For the first time ever, our men's basketball team is in the NCAA.

GO BELMONT BRUINS!!

It is a good lesson of the power of publicity. If a small school is able to gain the kind of publicity Belmont has gotten over the past week, amazing things happen. See this piece that was front page on USA Today on the 14th as a example. (My students tell me we are getting a news piece somewhere every thirty minutes over the past two days).

Entrepreneurs can also become masters of their own P.R. and this can be a powerful way to get the word out about a business.

Learn how to write a press release and how to use it effectively:

- Be consistent and focused in your message and who you target with that message
- Do your homework on what media like what kinds of stories. Many have business sections that are constantly looking for good stories.
- Include cover letter (e-mail) or relevant article to explain why your story about your business is interesting or trendy.
- Build relationships with local reporters so they get to know you and your business. You can expect multiple stories if you do this well.
- Create your own angle for them for the story.
- Send to newspapers, magazines, radio, television that have an interest in your local market or in you product.
- Follow-up with phone call to see if they have any questions. This is sometimes where the interest gets momentum.
- Be persistent and don’t be afraid to break the rules.
- Quality counts, so write it well and write it like a real news story.

One of our MBA alums from here at Belmont, Charles Hagood, has set up a blog for his newest business venture Healthcare Performance Partners. It is a great example of how a blog can be used to keep connected with customers. Lean Healthcare Exchange is the name of the site. It offers a good model for those of you thinking about using blogging as a tool for your business.

Here are a few tips to help make sure an investment in time and money is worth it for your business:

- Provide meaningful and useful content. This cannot just be a billboard for your business. Blogs are best when they are forums for discussion.

- Keep it current. Take it from me, blogging on a regular basis can become a bit of a drag some days. But your readers are looking for regular new posts, so be ready to blog at least a couple of times a week if not daily.

- Make it look professional. Although there are cheaper ways to set up a blog, spend a little money to make it look good and function properly. People will not stay long nor come back to a cheap looking site.

- Keep up with maintenance. Spam is real, and you need to monitor and set up systems to keep in under control.

- Break a few rules. This is blogging, so it should be fun and a little more informal. Blogging is one big conversation.

There are many rankings that highlight certain states as being business friendly. Usually my adopted home state of Tennessee ranks fairly high. However, even within a business friendly state different cities can have very different business climates. A new study released by the Tennessee Center for Policy Research examines the differences in business climate in cities across this generally business friendly state.

For example, Franklin (where we live) is a suburb of Nashville. But where Franklin ranks near the top in terms of being business friendly, Nashville (where I work) is in the middle. In general, the middle and eastern parts of the state have the highest rankings, while the west has generally the lowest. And which city is at the bottom? Memphis, which has a political climate that has been dominated by anti-business types for generations.

So when looking for a location for your business, make sure to understand the business climate of that city. Look at local taxes, local business regulations, business amenities, and available work force. Moving just a few miles down the road can make a world of difference for you and your business.

(Thanks to Dean Larry Hall for passing this study along).

From the NFIB:

Confirming their view that the nation's economy is moving solidly ahead, small-business owners nudged the February NFIB Small-Business Optimism Index up four-tenths of a point to 101.5 (1986=100), reinforcing the positive-growth message that they have been signaling for some time.

Small Business owners' optimism is supported by their plans to increase inventories and capital outlays. They also are forecasting stronger sales and earnings.

We did not enter adolescence and early adulthood quietly in the 60s and 70s. We made a big splash into the job market in the 70s and 80s. We have made advertisers rich for decades as they try to coax us to their clients products. And now? We are front stage once again, but this time for how poorly we are handling our own children's journeys into young adulthood. We have come know as "helicopter parents." From the Tennesean:

Universities and colleges are coping with a growing number of these well-meaning yet hyper-involved parents. They jump to the rescue whenever their kids don't like roommates, struggle in a class or can't get along with a professor.

Some parents are calling deans of students, advisers and residence halls. Some fill out applications. Others try to go to class registration, dominate school visits or even complain about grades to professors.

My concern with this is less about how it impacts my life as a professor (but believe me, it does sometimes). I am more concerned to what we are doing to one of the most entrepreneurial generations to come along in many, many decades.

I remember how my father told me that when I went to college I would learn more outside the classroom than I would sitting in my classes. I didn't understand this at the time, but as my own children went off to college I remembered his words and how true they were. I learned how to get along with people. I learned how to solve my own problems. I learned how to make my own decisions. My parents were there as a safety net, but they no longer held my hand.

I also remembered his words when we were building our businesses. I appreciated how the successes I had, and more importantly the mistakes I made while in college helped in so many ways to prepare me for the challenges of being an entrepreneur. Two of the greatest lessons I learned were to be confident in myself and to learn from my mistakes, and these lessons served me well.

If I had had helicopter parents I really believe that I would not have been as successful in life, or at least as an entrepreneur. I would have sought security in my career, looking for an employer that would protect me like my parents did. Instead, because of the freedom to succeed and to fail, my independence was made firm and it helped to shape my character and my career.

Our economy is relying more on our entrepreneurial spirit than it has in over a century. But if we continue to hover over out kids, that is our young adult children, they will never be ready to become true leaders in this entrepreneurial economic era in America.

COTC is at ProHipHop this week.

Q. What is amassing more power in the federal government, providing more hassle than help for the citizens it is intended to benefit, making large corporations wealthy, and killing small businesses?

A. The new Medicare prescription drug plan. Are you surprised? Me neither......

NFIB is co-sponsoring a business plan competition for student entrepreneurs.

Young entrepreneurs from across the United States can win one of 10 $1,000 scholarships and up to $7,500 in seed capital as part of a business plan competition sponsored by BizFilings and the National Federation of Independent Business through its non-profit education organization, the Young Entrepreneur Foundation.

Need something to read this weekend? O'Reilly Radar has a long, but very good post titled Entrepreneurial Proverbs.

Here is one of my favorites:

Start with nothing, and have nothing for as long as possible -- small budgets give big focus (probably another line I'm stealing from Jason Fried: it sounds like something he'd say...) Don't go out and raise a ton of money right away. Instead, give yourself just enough to get going, and use the limits that imposes to motivate yourself.

Worth a visit and worth your time reading.

(Thanks to Pablo at the World Bank for passing this along).

Off to one last Spring Break round of golf.....

Based upon survey data from more than 107,400 respondents in 35 countries, today's GEM Women report, prepared by scholars at the Center for Women's Leadership at Babson College, gives a clear indication that while women entrepreneurs often exhibit patterns of behavior similar to those of men, a gender gap nonetheless exists for entrepreneurial activity across the globe.

Women most likely to be entrepreneurs are those who hold jobs, have higher levels of household income and education, and have confidence in their level of skill and in the possibility of their success.

For the first time, GEM divided countries into middle- and high-income clusters, on the basis of per capita gross domestic product (GDP), and identified entrepreneurs by stage of business process. The report found that women's businesses in high-income countries are just as likely to survive and thrive as men's. It;s a different story in the middle-income cluster where the survival rate is significantly lower than that of a man's business. Also, young women (25 to 34) are more active in 'early-stage' enterprises in middle-income countries while women 35-44 are the most likely to lead 'established' businesses.

Despite these encouraging signs, a gender gap nonetheless persists. On average, men remain nearly twice as likely as women to start a new business. In high-income countries, the gender gap is greatest, while in middle-income countries it narrows somewhat.

I had planned to take a few days off of blogging this week for spring break, but my neighbor brought over the latest issue of Fortune Small Business. I just had to respond to its cover story "Can Entrepreneurship Be Taught?" My short answer is, "yes," if by entrepreneurship you are talking about what a person does as they start and build their business.

I will start with my own experience. When we started our health care company I had three, count 'em three, business degrees in hand. What I soon learned was that my MBA in Finance (from 1980) and my DBA (from 1983) offered me no clue what to do day-to-day as our business grew. I could calculate the time value of money until the cows came home, but that did little to help me manage the uncertainty of our cash flow and negotiate terms with our banker. I could tell you why GM's structural changes were needed given the torrent of new competition from overseas, but I struggled with which key manager I needed to hire next (a Controller, HR, Operations) and how to group our employees into functioning departments that would help us better manage our growth. Much of my formal business education was irrelevant for the experience I was facing in the rapidly expanding venture.

So I looked to two sources of information to help. First, I drew from what I had learned from being in and around our family businesses. Second, I "went back to school" by reading everything I could about managing a growing company effectively. And as I learned from our successes and failures I swore that if I ever got back into teaching I would focus on providing the skills and knowledge it takes to start and grow a business. (I need to provide a little historic context. When I first taught in a business school, there were only a handful of schools teaching entrepreneurship.)

Let's get back to the Fortune Small Business article. Rather than affirm those famous entrepreneurs that they quote in the story who believe in educating entrepreneurs, I will address some of our skeptics.

"You cant' teach someone to be afraid when he is almost out of money or to believe in his idea no matter what." Wally Amos, Founder of Famous Amos Cookies

We actually can teach someone about the emotional aspects of being an entrepreneur. We do this in any number of ways. We bring in guest speakers who tell of the reality of being an entrepreneur. We give them case studies that immerse them in entrepreneurial experiences. We give them internships with entrepreneurs so they see first hand the daily struggles they will face. And at least here at Belmont, we throw them in the water to learn how to swim. We offer hatcheries where they can develop their own ideas into businesses within the context of their education or we give them campus-based businesses to help start and run. Failure is a real option with all of these experiences. We tell them that and we mean it. And out of these experiences some come away deciding to change their major to something, anything, other than Entrepreneurship. To me, that is just as much as a success as helping the next Michael Dell to open his new business.

And speaking of Michael Dell.....

"Most of entrepreneurship, for me, is about instinct and intuition. Many times I have been asked by someone considering a new venture if he should go for it. But an entrepreneur knows instinctively when to go for it." Michael Dell, Founder of Dell.

True enough, but once they make the decision, for goodness sake let's make sure they know what they are doing. People know instinctively that they want to be surgeons, airline pilots, and engineers. But I don't want someone cutting open my brain just because they "instinctively" know that they want to be a surgeon. I guarantee you that the success rates of those who have been properly trained in brain surgery are much higher! And so, too, for entrepreneurship. In fact, when you look at all of the studies of entrepreneurial success rates, we find that with education about the process of entrepreneurship, success rates almost double. Some studies show success rates of 80-90% for those who have been educated. That is probably a higher success rate than those who have taken a management position with Dell have had!

I believe there are two critical aspects of entrepreneurship education that increase success rates. First, we teach them what deals not to go into through the process of opportunity assessment. We teach them how to "fail on paper." They learn how to create discipline around their instincts and drive to move ahead blindly into the pursuit of their ideas. Second, we teach them about how to manage growth effectively. Any banker will tell you that this is where most businesses fail. We teach them about the challenges that success can create as their ventures grow. As one banker likes to say, "Too much success leads to failure."

"If you're passionate about what you are doing, you don't need to go to school. From the time I was 8 years old, I loved making clothes." Vivienne Tam, Founder of East Wing Code

What we teach in entrepreneurship programs is about the process, not the content. I don't know anything about making clothes (or picking them out, according to some of my students). But guess what? When your business grows you very quickly move out of making clothes (or what ever the content of your business is about) and into managing a growing venture. That is where we can help you succeed.

Soaring health care costs are forcing small businesses to cut or even drop their plans, as seen in this article from Inc.com.

[A] California survey, which was released March 2 by the San Francisco-based Union Bank of California, found that 52% of the 2,000 small businesses polled said they no longer offer employee health-care plans -- the first time in the annual survey's six-year history that a majority do not.

Of the 48% of firms that still do provide coverage, about a quarter said rising costs have forced them to shift a larger burden to workers, while reducing overall benefits.

And as can be expected, health care is quickly becoming a political football. The battle is beginning to build between Republicans who want so-called market-driven plans (which they really are not given all of the regulations that dictate health care plans, much of which backed by these same Republicans following the lead of their special interest supporters) that allow small businesses to band together to buy insurance versus Democrats who either want to force all employers to provide coverage or move toward a state supported health care system (at least they are honest.....).

Both sides seem to think they can fix the health care crisis. That is highly suspect, given the fact that all of their previous attempts to fix health care have created the mess we have now.

In case you hadn't heard, Belmont is going the the Men's NCAA basketball tournament.

Belmont's Dan Oliver (an Entrepreneurship major!) holds up the trophy after Belmont beat cross-town rival Lipscomb in overtime, 74-69, to win the Atlantic Sun Conference tournament.

Time after time governments look to the private sector to bail them out of financial and performance failures that are a result of their own incompetence.

The No Child Left Behind legislation established performance standards for public education. Many of those schools that cannot meet these standards are looking to privately owned educational businesses to improve their performance. In Memphis, privately owned tutoring businesses have become a growth industry with the public school system becoming their biggest customer.

One irony of such privatization efforts is that the same government agencies that cannot perform in the first place, often serve in an oversight function over the private businesses they hired to pull their bacon out of the fire.

One of the benefits of working at a University is Spring Break. We will be starting our spring break this weekend here at Belmont. Although we will be hanging around Nashville, my blogging may be hit or miss this next week. I have business plans to grade and golf courses to conquer......