Last year, MIT Sloan School of Management published a study performed by Professor and head of MIT’s Entrepreneurship program Ed Roberts, and Professor Charles Eesley of MIT’s entrepreneurial impact, which may be typical of several of the country’s major universities.

The study was limited to entrepreneurs who founded companies, not including entrepreneurially motivated professionals who answer to their corporate responsibilities rather than to start their own business! But the points presented in the study implicitly suggest (if not helping to define) the rapid growth in entrepreneurship. While this study provides little data about E trends in the office, we certainly recognize the many corporations which have been including E factors in their organization charts, their promotion criteria, their reliance on outside entrepreneurs for assistance, and so forth.

The MIT study concludes that research and technology-intensive universities (especially via their entrepreneurial spin-offs), have had a dramatic impact on the economy of the United States: MIT is arguably at the forefront of this trend. Thus, extrapolation of the underlying survey data shows 25,800 currently active companies founded by MIT alumni that employ about 3.3 million people and generate annual world revenues of $2 trillion, producing the equivalent of the eleventh-largest economy in the world.

In addition the study demonstrates that more entrepreneurs emerged out of each successive MIT graduating class, in other words the trend is strongly a current acceleration of entrepreneurial activities, and entrepreneurial graduates are starting their first companies sooner and at earlier ages. Also, the number of companies founded per MIT alumnus has also been increasing therefore generating increased economic impact per graduate.

The type of firms founded by MIT alumni may reflect the thrust of the school: companies are frequently knowledge-based in software, biotech, manufacturing or consulting (architectural, business, engineering). These companies may have a disproportionate importance to their local economies because they typically represent advanced technologies and generally sell to interstate and world markets; their global revenues per employee are far greater than the revenues produced by the average American company, and they employ higher-skilled as well as higher-paid employees.

The overall MIT entrepreneurial ecosystem rests on its long history (it has developed thirty new entrepreneurship courses) and aspiring entrepreneurs should learn a lesson from this: where possible focus on networking, including belonging to entrepreneurial focused clubs and organizations.

In 2000, MIT’s “Venture Mentoring Service” was begun to help any MIT-related individual: student, staff, faculty, alumnus, who was contemplating a start-up. It already has seen more than eighty-eight companies formed, from any reasonable MIT source such as friends, teachers and organizations. To find such sources, those who are ambitious with entrepreneurial ambitions need to reach out…in other words, to actively initiate connections with others who might help in designing and promoting new ideas.

Does age affect when one’s entrepreneurial tendencies emerge? The study shows that the more recent entrepreneurs include many from the younger age brackets. But note that entrepreneurs have also emerged from the late forties and fifties age brackets but we believe that individuals can “re-invent” themselves at any age to some degree, in the direction of entrepreneurial characteristics which will stand them well in life.

The representative MIT alumni entrepreneur has founded 2.07 companies over his/her lifetime and interestingly, repeat entrepreneurs seem to have a greater economic impact relative to the overall number of entrepreneurs studied.

Competitive Edge, and Obstacles to Success, both in startups, and in the office (and elsewhere too)

The survey of MIT alumni entrepreneurs asked respondents to rank what seemed vital to competitive advantage: responses in ranked order: (1) superior performance, (2) customer service/ responsiveness, (3) employee enthusiasm, (4) management expertise, and (5) innovation/new technology—all ahead of product price (if a start-up has a cutting-edge product with outstanding performance and good customer service, it reasonably can charge a premium).

What would competitive advantage look like for a regular employee in the office (not the founder of a start-up)? Superior performance, responsiveness, enthusiasm, expertise, innovation, etc. In other words entrepreneurship can be practiced everywhere!

Most MIT alumni companies started with funds from the founder’s personal savings or by re-investing cash flow. Entrepreneurs’ dependence on personal, family, friends and informal investors, is not just an MIT-related phenomenon, but seems to have been true both in the United States and globally; venture capitalists are obviously important to many firms.. In none of these cases were these alternate sources more important at the outset than the founders’ own savings. Although venture capital was not a major source of initial or even later funding for smaller firms, it became important for companies that grew to fifty or more employees.

A reasonable question might be: can individuals who have not benefited from such scholastic involvements share in the opportunities which formal preparation can enable? The answer is presumed to be yes but we have not seen support for this conclusion, it’s is a subjective judgment. Why? The attributes of entrepreneurism are obvious, have been widely documented in numerous ways , and can also be deduced by reading the news and drawing conclusions in industry, and even in daily life!

Check out Gideon's posts here at AlwayasOn and here at his blog.