Spring Break
Students learn entrepreneurial skills
Steve Romasko
Issue date: 3/13/09 Section: News
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"[The event] was to cover an area of entrepreneurship that differs from what students are exposed to in class - to really show the new-world entrepreneur," Zachary Howitt, president of NOBE, said.
The new-world leader was Josh Kopelman, University of Pennsylvania graduate and serial entrepreneur.
According to Kopelman, being in college is the best time to be an entrepreneur.
"You already have time, instead of spending the time to party, you can use that time as an opportunity to gain experience and build a business," he said.
As an undergraduate student at Penn's Wharton School, he had his first entrepreneurial experience co-launching Infonautics Corporation in 1992, an Internet information company that went public only four years later. He left the company and went on to develop his most prominent venture in July, 1999 known as Half.com, a fixed-price person-to-person marketplace for books, music and movies.
Within a year, he was approached by eBay and sold the company in a stock deal valued over $350 million, according to a press release.
Kopelman left eBay three years later to found another tech-based venture, TurnTide, which created the world's first anti-spam router. In five months, TurnTide was acquired for $28 million in cash, by Symantec, the de facto anti-virus provider for Drexel. After twelve years of pursuing free enterprise, Kopelman established an early-stage venture capital firm, First Round Capital, dedicated to partnering with entrepreneurs to build innovative technology companies.
In the face of an unprecedented economic environment Kopelman addressed the current headwinds facing the start-up industry.
"It's a lot harder to raise capital across the board - venture firms are holding cash for their existing portfolio companies or they tend to make newer investments in later stage companies so there is less risk," Kopelman said.
He said the bulk of hedge fund capital is gone, debt-raising from banks has dried up as lending standards have increased, and valuations have compressed, forcing start-up firms to raise less capital.
"If you previously wanted to raise $2 million, $1 million is more likely now," he said.
However, despite the doom and gloom, Kopelman provided the audience with a sense of optimism, referring to the current crisis as a time of opportunity.
He compared the current bust cycle to that of 2001 where the rise of venture capital for unviable tech companies brought the market crashing down.
"Back then it was 'our bad,' it was like geeks gone wild that were doing all of this dot-com stuff. Now in 2008 it's 'their bad.' It's Wall Street that really went wrong and it's really not the same as before [for start-ups]," Kopelman said.
Great companies really get created during downturns. Companies like Facebook, Skype, LinkedIn, and YouTube were all created in the shadow of the previous bust and great things get created in the face of adversity, according to Kopelman.
For college entrepreneurs, Kopelman said students should believe in the power of a simple idea, minimize their risks and get the fouls.
"[Josh] taught me how to take smart and well-calculated risks," Christopher Finnin, a LeBow professor who worked for Kopelman at Half.com, said.
Kopelman added that in today's society, businesses create a culture where people are afraid to take chances in order to prevent ruining their career after a mistake. Think of it in relation to a basketball team.
"If you had a player who fouled out in the first ten minutes of the game, the coach would tell the player that he's playing too hard and to back-off. On the other hand if the player is finishing the game with no fouls, the coach would tell [the player] that he's not playing aggressive enough - he has five fouls so use them," he said.
Kopelman also holds eight U.S. patents and has received several local and national awards.
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