Dr Jeff Cornwall

Entrepreneurship majors, like ours here at Belmont, attract only a small percentage of students interested in business ownership. In fact, an annual survey by the Chronicle of Higher Education finds that about 40% of today’s students cite owning their own business as one of the major motivations for going to college. And yet, even the most successful entrepreneurship major will attract at most 1% of the student body. This is somewhat of a concern given the importance of education in improving the success rates of entrepreneurs starting new ventures. So how do we help the rest of them?
Many schools are beginning to implement programs to reach the rest of these students where they learn. In Art, Music, Theater, English, Political Science, Biology, or whatever program they are pursuing. This is being done by offering them minors in entrepreneurship and by creating a wide array of co-curricular programs that get integrated into their education experiences.
One of the major pushes for this type of initiative is being made by the Coleman Foundation. Belmont University’s Center for Entrepreneurship has just been awarded a $150,000 grant from the Coleman Foundation to expand our program called “Entrepreneurship Across Belmont.”

In the rush of meeting orders and collecting enough cash for payroll, many entrepreneurs don’t take enough time to celebrate accomplishments. It can be big things or little things, milestones and anniversaries. Celebrating on-going accomplishments is a way of building a positive, growth-oriented, and hopefully ‘fun’ culture within your business.
One of my favorite stories about celebrating milestones in business comes from one of our alumni, Charles Hagood co-founder of The Access Group. I recounted their celebratory tradition in the opening of the case study that I wrote about their business:
“The duck quacked. It was a long standing tradition at The Access Group (TAG) to enthusiastically make a stuffed duck they kept in their office quack whenever they landed a new project. In fact, that duck had been quacking much more often in recent months. The recession that started in late 2000 and the aftermath of 9/11 had taken a toll on manufacturing companies, which has been TAG’s main client base. But their fiscal year 2003-2004 had seen improvement in both the top and bottom line, and their forecast for 2004-2005 was for TAG to have its best year ever. Charles Hagood and Mike Brown were once again able to think about strategies to grow their business.”

That’s right. Middle-aged engineers march up and down the hallway quacking a rather homely looking stuffed duck whenever they land new business. What a wonderful way to build a culture that celebrates success.
We had a tradition of celebration in our business that also involved, coincidentally, ducks.
When we first went into business together my partners, both physicians, found a particular piece of art work I hung in my office to be, well, funny. It was a rather nice scene of ducks flying out of a marsh–a painting like you might find in hundreds of offices around the country.
It looked a lot like this picture:

My partners had decorated most of our office space with trendy and modern pieces of art. My picture to them was way too “corporate” for our entrepreneurial venture. But, I liked it and it stayed.
On our first anniversary in business together, my brother (one of my two partners) gave me a present to mark our first year in business. It was–you guessed it–a duck. It was a beautiful carved mallard to be precise. On the second anniversary of going into business he gave me the female mate to my mallard. Each successive year he gave me another duck; each unique.
Over the years these ducks became a wonderful focus of conversation for those who visited my office. The ducks symbolized our staying power in the volatile industry of health care during the 1980s and 1990s. Each year our staff would check in to see this year’s duck for the collection.
Finally, on the ninth and final anniversary of our business he gave me a magnificent carved loon to commemorate the successful sale of our business. I was moving to the land of loons–Minnesota–to begin my current teaching career, so it was a fitting end to our tradition.
The ducks are on prominent display in my office here at Belmont. They allow me to tell stories about tradition, celebration and longevity in business to my students.
Milestones and anniversaries are important, so be sure to celebrate.
What brought this topic to mind today? Well, it is our 27th wedding anniversary! So from Dr. C to Mrs. C — Happy Anniversary!!!

I often get asked whether a new business should form as an LLC (Limited Liability Corporation) or an S-Corp. My non-lawyer answer has usually been that, generally speaking, an S-Corp is a bit simpler and cheaper to set up, so unless an attorney has specific reasons to go with an LLC go with the simpler and cheaper option.
There is a lot more case law on S-corps so their rules have been ironed out more clearly over time (one of my personal business goals was to never have my name or our company name in a famous case in the tax laws). However, for most businesses the differences are not that significant so if you get set up one way or the other by your attorney don’t worry about it too much. Establishing good cash flow is much more important!
If you like to explore the intricacies of the legal pros and cons of each approach to organizing your business, nolo.com has a very comprehensive overview. Reading such things makes my hair hurt, however.
Some states are moving to make forming and maintaining an LLC simpler. For example, Tennessee just enacted such legislation.
It is not a life or death decision, but is one that can be intimidating for first time business owners. You will get conflicting advice. The best course of action is to talk over your long-term business plans with your attorney and your accountant making sure that the organizational form you pick fits your vision for what the company will become. For example, a business that will likely try go public in three years may need a different approach to legal formation than a business that never plans to have more than the original two shareholders.
Also talk through costs with the attorney. There are fees to set up the legal entity charged by your lawyer, fees that the state charges to file your legal entity (different for LLC vs. S-Corp in many states), and on-going yearly fees due to the state (varies by state).

A couple of reports may signal a softening of international entrepreneurial activity in China.
First, Red Herring reports that venture capital investments in China fell in Q1 of 2005.

“Venture capital investment in China dropped 24 percent in the first quarter, and some observers are blaming enforcement of a new government policy….The drop may have been caused by a regulatory initiative known as Document 11, which was circulated in late January. The rule makes it difficult for Chinese entrepreneurs to establish the elaborate structures that facilitate listing on international stock markets.”
Second, the Treasury Department in looking into possible Chinese manipulation of monetary policies to effect trade. Any retaliatory efforts by the US could make outsourcing to China a more difficult and expensive process.
Add these developments to the pervasive reports of Chinese businesses thumbing their noses at intellectual property rights and we may see a rocky road ahead for our economic relations with this government. At a minimum, it all drastically increases the risk for American small businesses doing any business with Chinese companies in the next year.

AnyLetter is hosting Carnival of the Capitalists this week. A long list of interesting posts!

Entrepreneur.com offers some interesting insights into trends related to American consumers. As I have written about related to the entertainment industry, mass marketing based on broad demographic categories is no longer the dominant strategy for reaching American consumers.
We are a country of “micro markets.” This plays right into the hands of entrepreneurs as micro marketing is what we do best. We love finding niches and giving them what they need. There are many factors that have helped to create today’s entrepreneurial economy, and this shift in American consumers is clearly among the most important forces at work.

Coyote Blog offers a glimse into his life as a small business owner through a reflection on all the stuff that has piled up on his desk. A great read!

We had graduation on Saturday at Belmont. I always enjoy the ceremony, but this weekend was a special one for me. We had our first graduates from our entrepreneurship major walk across the stage. The very first was Jason Duncan, of the blog site A Thought Over Coffee, who is moving to Montana with his wife to start their new business.
Good luck to all of the graduates!