You’re currently studying at university (it’s expensive), and you believe you’ve spotted a gap in the market for an innovative new product or service that can help you make money. You’re certain you have what it takes to realise your vision and make a success of your idea.
However, you’re unsure what support is available from your university to get your idea off the ground. In this article we’ll guide you to taking advantage of the support available for your fledgling business from grants to incubator programmes and student entrepreneurship competitions.
What is entrepreneurship?
The problem is, entrepreneurship is a very broad term, and some definitions can serve to put off those best suited to running their own business with flair and originality. Entrepreneurship shouldn’t necessarily put you in the mind of Dragons’ Den, lengthy funding meetings with investors and grant applications, but for many it does, and this perspective can be off-putting to potential student entrepreneurs, the demographic most likely to drive innovation when they bring fresh energy and enthusiasm to the job market.
In fact, entrepreneurship can apply to any way an individual makes money on their own; that is, not through traditional employment as an employee of a business.
Investopedia defines an entrepreneur as “An individual who creates a new business, bearing most of the risks and enjoying most of the rewards. They are commonly seen as an innovator, a source of new ideas, goods, services and business or procedures.”
There is a myth that you either have the entrepreneurial drive and skill set required to run a small business or you don’t. We want to dispel this belief and drive more student enterprise. We believe students should be encouraged and supported on their path to entrepreneurship.
Whether you have a unique idea that you think will make you millions and make the world a better place or you have a particular set of skills and ambition and would prefer to strike out on your own and hold your own destiny in your hands, you can become an entrepreneur.
Is there a typical student entrepreneur?
Santander Universities’ report reveals there is a strong entrepreneurial spirit among university students, with over 450,000 students currently running or planning to set up a business while at university. But what type of venture could you start during your degree, and can you secure investor attention and funding for your big idea?
- A third of student entrepreneurs plan to turn their business into a career when they graduate
- Student entrepreneurship generates £1 billion every year
What are the most common student ventures?
So it seems that student entrepreneurship is relatively healthy. But what fields do students favour?
- Technology – 27%
- Arts and crafts – 17%
- Clothing and textiles – 9%
- Administration and business services – 9%
- Tutoring – 8%
- Charity, voluntary and social work – 7%
Unsurprisingly, the most popular student entrepreneurial ventures are technology-based. All students have access to computers and the internet and, with a little entrepreneurial spark, students can set up their own businesses.
Likewise, arts and crafts businesses are popular, possibly because designing crafts can easily be undertaken from student accommodation without the need for business premises, and it’s an activity that can easily fit into leisure time. Examples of students’ arts and crafts companies are greetings card designers, homemade jewellery enterprises, and art and design services.
Can your student business turn into a career?
Santander Universities’ report shows positive trends across the country for many student entrepreneurs. As many as 33% of the student business owners surveyed said they plan to turn their business into their long-term career.
52 % said they will continue their business as a second job for additional income or run it as a hobby alongside full-time employment. 9% said their business would continue with guidance and support from others, and only 4% said they would close their business down on graduation.
What support can universities provide to student entrepreneurs?
There’s a wide variety of support available from most universities. You certainly aren’t on your own when starting a new business! All entrepreneurs need help, support and guidance; no business owner is an island.
The University of Chester for instance through its Venture Programme develops the entrepreneurial capabilities of students across all fields of study, and The University of Bristol were one of the first Russell Group universities to start such a programme with their Centre for Innovation and Entrepreneurship. They do this through enterprise skill development, creating a local entrepreneurial community to connect students with mentors and encouraging collaboration between student entrepreneurs and more.
Challenges bring out the best in an entrepreneur
A challenging environment brings out the best qualities in a would-be entrepreneur. Words such as innovation, problem-solving and creativity are synonymous with what we imagine an entrepreneur to be in the modern day. That’s why many university educators believe in giving students the tools necessary to become entrepreneurs, but not in giving only advice or judging an idea to be right or wrong.
By learning the skills needed to be an entrepreneur, students can apply their knowledge to the field wish to enter. It’s important that young entrepreneurs learn that it’s important to think creatively and be flexible if they are going to be successful running their own venture. That’s why learning to overcome challenges is vital to creating a thriving business.
What skills help entrepreneurs overcome challenges?
- Leadership skills
- Strategic thinking
Mentorship and networking
Some of the greatest entrepreneurs of our time believe they wouldn’t have achieved what they have without the close mentorship of someone they looked up to. A report by the Federation of Small Businesses revealed that 70% of entrepreneurs with a mentor remain in business for at least five years, while 45% of new businesses fail in the first five years.
Bill Gates considers Warren Buffett to be his mentor, and Steve Jobs thought of Ed Woolard – the Apple board member who encouraged Apple’s cofounder to return to the company after several years in the wilderness – as his mentor.
As a student entrepreneur, it’s a good idea to check if your university has a student entrepreneur mentorship programme. Many do. The university programme will connect students with local successful business people, perhaps even successful alumni of the university, demonstrating to young entrepreneurs that their visions of success are achievable.
An incubator programme can help kickstart student-run businesses. Incubator programmes are structured programmes that provide support to startup companies through office space, training and networking opportunities. Incubator programmes are used as catalysts to drive growth and establish successful companies.
Many university business schools have incubator programmes; however, entry may be restricted, so check application deadlines as early as you can to avoid disappointment. Most student applications will be cut off before the beginning of each academic year.
If your university doesn’t have a startup incubator programme they may be able to recommend local incubators in the area that you can apply to.
You may be able to apply for grants from various bodies. Your university may have a grants programme for entrepreneurs.
The Prince’s Trust was set up to provide support for young people. They’ve been providing grants to young entrepreneurs since 1976. The Prince’s Trust Enterprise Programme provides funding and support for your business, including connecting you with a suitable mentor.
Other grant programmes for young people
- Enterprise Nation Student Startup of the Year
- Mayor’s Entrepreneur (London)
- Santander Universities Entrepreneurship Awards
There are many entrepreneurship competitions sponsored by businesses and various other bodies. Lots of these competitions offer significant prize money and provide the seed capital that many new ventures need to get off the ground, expand and set their sights higher.
- Unilever Young Entrepreneurs Award – environmental and social change businesses
- Baldwin’s KickStart Young Entrepreneur Awards
- Shell LiveWIRE Smarter Future Award
Business ideas and execution
When most people think of an entrepreneur, they think of someone starting a tech business. The term has become closely linked to Silicon Valley tech entrepreneurs in recent years. Many people’s reply to the statement “Name the first entrepreneur that you can think of” would be either Steve Jobs or Mark Zuckerberg.
But the range of business ideas and fields developed by entrepreneurs is extremely wide. A more recent development is an individual monetising their online presence, such as bloggers and social media influencers. However, competition is fierce online, and this form of entrepreneurship isn’t necessarily as easy as some might believe.
Young entrepreneurs can be successful in many other areas, from hospitality to entertainment.
The hospitality and entertainment industries have been some of the hardest-hit by the Coronavirus pandemic. These and other industries that have been financially impacted as a result of lockdown measures could represent an opportunity to new businesses looking to pick up the slack and provide essential services to Brits.
This brings into focus the purpose of your entrepreneurship. Some people start a small business at university as a means to an end, to boost their employability. For others, it’s a route to a full-time career, in which case it’s important that your business will have requisite demand and that it is scalable, so it can expand and develop throughout your working life.
As stated earlier, it’s not necessary to be an expert in your field. The most successful entrepreneurs, while talented and well informed in their industry, combine knowledge with hard work and constant personal development. One of the most valuable traits an entrepreneur can have is to learn from experience and apply hard-learnt lessons to future strategic planning.
Disruptive has been a big buzzword in the entrepreneurial community since the mid-00s. But does your idea really have to be wholly unique or disruptive to established industry norms to be successful and scalable?
It’s an easy trap to fall into with all the discourse around disruptive technology. Take the rise of challenger banks, which has revolutionised the banking industry. Rather than focusing on how original or disruptive your idea is, a more valuable action is comparing your idea to what’s already available through rigorous competitive analysis.
Through market analysis you’ll be able to objectively assess the feasibility of your idea. This is such a vital process for any entrepreneur because, if you wish to grow your company, perhaps by seeking investment funds, you’re going to need to be able to provide powerful evidence of the demand in the market for your product, service, and brand.
Access to funding
For many entrepreneurs, raising capital is essential to bringing their vision to life. Funding might be needed for product manufacture, marketing and hiring employees.
Recognising your own strengths and weaknesses and being able to market yourself to stakeholders and decision makers are invaluable skills. Even if they don’t lead to a successful funding application, they will sharpen your pitching skills and understanding of all the functions of your business.
Aside from getting a firm grasp on your business’s feasibility, knowing your market also involves identifying whom you want to approach for capital. There is serious research work in identifying your potential investors.
The network you establish at university will help you get started. By making connections with local business people and your lecturers, you will have the support you need to identify the right investors for your business, and at the same time gain invaluable advice from experienced entrepreneurs. This is also where having a strong mentor can come in handy, because they’ll be able to give you firsthand advice on how they secured funding for their own businesses.
When approaching investors with your pitch, it can be invaluable to know whether they are likely to be receptive to your business model. You’ll understand this by approaching investors at the earliest possible stage. Before you make a formal approach for capital, it’s crucial to ensure your approach is correctly targeted when asking for capital by gauging the interest level of different investors. You can also investigate the track record of potential investors to see where their interests lie, and then ask yourself what the companies that have successfully won investment capital have done well. Take apart their business plan and apply it to your own where relevant.
Investment capital isn’t everything
Don’t despair if you cannot secure investment capital. There are other ways of securing funding, whether you pursue a grant or even put your own money into your business.
There is something to say for investing in your own business. It demonstrates that you believe in yourself and the strength of your ideas. Consider investing your savings in your own business, either as an alternative to securing capital or as a prudent capital injection into your business, which will both help it get off the ground and prove to investors your seriousness in making your enterprise work.
Grants and competitions are an alternative form of investment worth pursuing. However, you’ll still need to firmly prove the efficacy of your business plan. Check with your university the grants that are available to students either looking to start or already running their own businesses.
University grants will usually be available in much smaller amounts than those possible from venture capitalists or small business loans. The benefit of grants, however, is that they are generally not repayable and they will be easier to secure than venture capital, as investors bear a lot of risk should your business fail.
You might be thinking, what about business and startup loans? Business loans can be a valuable source of funding for a student entrepreneur. With a business loan, you could secure anywhere from a few thousand to millions of pounds. However, when researching loans it’s important to assess risks, evaluate the feasibility of repayment schedules and understand all the conditions of the loan before making yourself responsible for repayment.
Remember, if you’re considering applying for a business loan, you will need a dedicated business bank account.
Comparing business loans
As a student running your own business or as a prospective business owner, you’ll now be aware of the support available and the funding options open to you.
If you’re ready to invest in your business to enable scaling and are considering a small business loan, why not read our business loan guide.
We wish you luck with your venture. Small business owners are so important to a healthy economy, as you drive innovations, create jobs and fulfil consumer demand.
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