In UT Austin Class, Students Earn Credit Hours by Building Startups

By GRAHAM DICKIE
Special contribution to Silicon Hills News

The world of tech innovation may be colored by mythological dropout figures — Steve Jobs, Mark Zuckerberg, Bill Gates, Austin’s Michael Dell — but at the University of Texas, a course called Longhorn Startup is showing how students can stay in college and still pursue the next Facebook.

Or, to use some ideas from last semester’s group of enrollees, Longhorn Startup is showing how they can start the “Uber for dry cleaning,” the “Netflix and AirBnB for cosplay,” or a powdered drink company while studying for an engineering midterm happening right down the hallway.

Now in its fifth year at UT, the course teaches students through a mixture of talks from community figureheads, Ask Me Anything sessions (lingo borrowed from the website Reddit), and mentor programs. In the fall it functions as a once a week, seminar-style class, and in the spring it becomes a full, one-on-one lab experience about furthering a specific business venture.

In a typical session, Longhorn Startup could include a visit from Bob Metcalfe, the inventor of Ethernet, free pizza sponsored by a business like HomeAway, discussion on how to sell a company, and 30 minutes set aside for open pitches to like-minded peers, most of whom have serious entrepreneurial ambitions. It’s a place for ideas and people to meet.

“It always helps when you’re in a class with people who are similar to you,” said Nelson Tao, who started the so-called “Uber for dry cleaning” with classmate Ryan Norton. “Students are all out there, but it’s just random, different mentalities. It’s very helpful when everyone’s all clustered together.”

On a recent Thursday, inside the gleaming Bill and Melinda Gates Computer Science Complex on the east side of campus, the course’s main instructor, Josh Baer, is giving a history lesson. Baer is a looming figure in the Austin startup scene: In addition to his work with Longhorn Startup, he is the founder of Capital Factory, the downtown crossroads for tech life here that President Obama once visited.

He starts by showing a Youtube video involving jelly beans that draws an analogy about why one should take advantage of every day and do something special. He then begins a discussion about the many people who followed that advice in Austin, giving a primer on the startup scene here back to its origins in the early 1980s.

Baer goes on to note the big Austin success stories of the last few years (HomeAway, RetailMeNot, BazaarVoice) and lists current office spaces available for entrepreneurs, Capital Factory among them.

The class closes with a Q&A session alongside fellow startup guru Damon Clinkscales. The students quickly begin asking: “What’s the importance of a convertible investment?” “Is it appropriate to pass out fliers for our business at another startup’s party?” “How do I stop people from stealing my intellectual property?”

“I wouldn’t say they all have ideas,” Longhorn Startup teaching assistant Sanchana Vasikaran said. “But I think every single student has the same drive and motivation and desire to have a startup or are interested in the startup community.”

Lessons for the class have also touched on somewhat arcane concepts like accelerated financing, how to find a co-founder, and, in the case of student Abel Hernandez, the importance of fashion choices. (Remember the controversy around Zuckerberg’s hoodie during his initial public offering presentations?)

“Always dress nice,” Hernandez says. “Don’t ever show up with a pair of shorts and a T-shirt, raggedy hair and some piercings. Don’t go like that. As much as we’re trying to change the idea that it’s okay, to investors you seem like, ‘You shouldn’t do anything with him.’”

But despite all this information and the large amount of resources available to the class, the startup community on campus is “a little underground,” said Margaret Efthim of Longhorn Entrepreneurship Agency, another organization for student entrepreneurs.

According to Efthim, though, that community is growing every year, and Longhorn Startup serves a big portion of it.

Vasikaran added that the enthusiasm is there — it just comes to down to publicizing what’s being offered.

“If more students were aware of the resources that programs like Longhorn Startup program and Longhorn Entrepreneurship Agency are able to provide, I feel like more students would be involved in this community and more startups would probably be formed at UT,” Vasikaran said.

The serious work for Longhorn Startup, and the students who are still interested in the “underground community,” will start in the spring semester. A handful of nascent companies from the fall seminar advance, and the students behind them will receive credit hours and ample personal time with Baer and community mentors to flesh out their ideas.

Tao, who is behind the dry cleaning app, is already building his case.

“Today we had order number 13,” Tao said. “And order 13 is pretty neat because it was a repeat customer.”

On its website, Longhorn Startup has an extensive list of past companies that have crystallized with help from the class. Cerebri, a creation from this last spring, is focusing on rebuilding how call centers function and recently won $100,000 through a competition. Many others from the first few semesters still maintain social media pages and websites, and the class’s yearly demo day dependably generates local press coverage.

So even though the attendance is still relatively small, Longhorn Startup appears to have struck a chord with more than a few students and the larger Austin tech ecosystem. Dell, the computing magnate who famously found success after a premature exit from UT, has even come to speak to the class.

“You don’t have to drop out of college [to build a successful startup],” Efthim said. “Being at UT gives you some huge advantages.”

Editor’s note: Graham Dickie is a student at the University of Texas at Austin. He wrote this story for Professor Rosental Alves’ Entrepreneurial Journalism class. It is reprinted here with permission.