By Stephanie Spernak, contributor
A line of natural, cruelty-free, eco-friendly skin care products. An ergonomic trash can designed for people with limited mobility. And an app to help drivers find their vehicle after it has been towed.
Those were the start-ups conceived by JMU students or graduates that received the first three $5,000 investments as part of a new element of entrepreneurship — a program called Bluestone Seed Fund. The program is expected to announce the second round of winning start-up proposals on March 22.
Made possible by donor gifts to the Gilliam Center for Entrepreneurship, the Bluestone Seed Fund is a source of private equity investment for students and alumni with early-stage startup ventures, the first time this type of sought-after venture funding has been available at JMU. The winners not only receive an infusion of cash ideas but also validation and help from professionals, which can help them launch their businesses.
“Our student venture associates and student founders all got a very real-world venture investing experience,” said Suzanne Bergmeister, who started in July as the executive director of the Gilliam Center. “The startups that receive the funding will now be mentored and monitored as they continue to grow. We are thrilled to have three portfolio companies this cycle and are looking forward to adding even more to our portfolio in the spring.”
Jack Oppenheim, a JMU history major from Richmond, founded Tow Ninja, which is the app aimed at helping drivers who become estranged from their vehicle.
As is the case for many entrepreneurs, inconvenience and frustration served as his muse. He said he came up with the idea for the app after his car was towed, and he spent hours trying to track it down. He knew there must be a better way.
The concept behind Tow Ninja is to organize and access towing information using an integrated web and mobile app.
Bergmeister said for the student entrepreneurs to receive the seed funds, they must make their pitches for “real, legal businesses” to an investment committee that includes JMU alumni, donors, faculty, and community experts. Before obtaining seed funding, the founder typically “bootstraps” the fledgling business from personal savings, family or friends, a credit card, or by obtaining a loan from a bank.
“On the investment side, students will be gaining unique experience in venture investing,” she said. “The work these students do with the Bluestone Seed Fund will benefit them greatly no matter what career or industry they choose to enter post-graduation.”
In exchange for the investment, the university receives a 5% equity, or ownership, interest in the business. The amount of equity ownership in a business determines that share of profits, if any, the university will receive in return for its investment.
Successful investments in the Bluestone Seed Fund portfolio then provide a stream of capital for future investments, which the entrepreneurship center’s leaders hope will fuel a cycle of innovation.
At the seed funding stage, the business is still in development and there is no revenue. Expenses, however, must be incurred to conduct the necessary planning and product production activities. Seed funding covers these expenses.
Malique Middleton, who graduated from JMU in 2021 with a biology degree, created Gewd Botanicals, a line of natural, cruelty-free, eco-friendly products formulated from natural botanicals. Like Oppenheim, Middleton received one of the first three $5,000 awards in December.
Middleton said he plans to become a dermatologist and continue developing innovative skin care products.
He also credits his mother, whom he describes as a serial entrepreneur, with his interest in starting his own business.
Chris Dorr, who graduated in 2021 with an economics and management degree, founded Handicans, a patent-pending, ergonomic trash can for those with limited mobility.
He said the idea came to him during a class in small business and entrepreneurship where he began thinking about how trash can design might be improved.
Since graduating, Dorr has worked as an engineer in Reston. He said he credits his grandfather, who started his own business, with instilling in him the goal of financial freedom.
The seed fund is part of the Gilliam Center for Entrepreneurship, which has operated as part of JMU’s College of Business since 1985 and his now housed in Hartman Hall. Over the years, it has fostered a growing network of student, faculty, alumni, and donors interested in starting and supporting student business enterprises.
The Center was officially named the Gilliam Center for Entrepreneurship in 2018 when the family of Leslie Flanary Gilliam (’82) made a $5.2 million gift to the university, the largest in JMU’s history at that time.
Bergmeister manages the Bluestone Seed Fund’s activities and other programs, including Entrepreneurship Bootcamp, an Academic Year Incubator Program, Summer Impact Fellowship and a Summer Venture Accelerator for students’ entrepreneurship ideas. Bergmeister has an MBA in finance from Cornell University and previously worked at the University of Louisville and was founder and president of a consulting firm for start-ups called Sunflower Business Ventures, Inc.
Bergmeister said the Gilliam Center incorporates lean startup methodology in several of its entrepreneurship programs, developed by well-known serial entrepreneur Steve Blank, co-author of “The Startup Owner’s Manual: A Step-by-Step Guide for Building a Great Company.”
Bergmeister was a student in one of Blank’s classes at Stanford. Blanks’ lean startup method is based on the premise that startup companies must use processes similar to scientists, by testing hypotheses about the needs and wants of real customers, rather than guessing about them and wasting time and money.
Sean McCarthy, a faculty fellow in the Gilliam Center and associate professor in JMU’s School of Writing Rhetoric and Technical Communication, also emphasizes the concepts of lean startup in his team-taught digital media classes where students partner with community organizations and are “given a real problem of real people that they have to fix.”
McCarthy said his students “get pushed into the deep end” and they realize that real problem solving requires a lot of time, encounters “with many roadblocks” and “they won’t get it right the first time.”
McCarthy said he believes entrepreneurship and innovation are forms of creativity, especially after some students have told him they didn’t think they were creative until they took his course.
“You can learn to be creative if you are willing to fail and keep trying,” McCarthy said he tells his students.
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