The first ever 1 Semester Startup class at the University of Texas ended in style on December 1 with a “Demo Day” in which 20 teams from the class of 77 gave formal pitches for their startups.  As you may recall, the syllabus for this class was designed with the intention that student entrepreneurs would create real startups, not just ideas.   They were exposed not only to the wisdom of Professors Bob Metcalfe, John Butler, and Josh Baer but also to many luminaries including Michael Dell and Frank Moss.  Several dozen mentors, including yours truly, did what we could to help teams with which we were paired.

The company theses included lean startup web and mobile concepts, big data analysis, solar energy systems, an automobile company, PC games, “evolutionary” stock trading, and commercialization of novel isotope separation techniques from UT research labs.   (The latter doesn’t need private funding for some number of years, and I heard several eager investors grumble about that.) 

The audience easily numbered 300+ and included a broad cross-section of the Austin tech community.  Most of the tech investment money in Central Texas seemed to be represented, based on my informal observation of the many people I knew.  I even had cards handed to me by individuals asking for help in finding deals for their money.   Sean Parker and Ashton Kutcher were on the EventBrite attendee list, but evidently there was a bit of spoofing going on there.

The venue was the Red McCombs Red Zone in the newer north section of DKR Memorial Stadium.   Bob Metcalfe arranged with UT Athletic Director DeLoss Dodds to display the opening slide at the opposite end of the field on the “Godzillatron” – the world’s largest HD screen at the time it was built.   (Photo at top.)   The team was practicing on the field, and I’m sure there are some future investors in that crop.  About the time the presentations started, the team left and was replaced by The Showband of the Southwest warming for the Baylor game.  Texas fight songs provided a great musical backdrop for the presentations.

It was not possible to actually advance the slides and play the demo videos on the Godzillatron, so the audience watched them on more conventional screens in the luxurious confines of the Red Zone.   This was a highly intimidating setting for the young students, grades and perhaps careers on the line in front of a big and impressive crowd.  They were all very well coached, but probably few had much public speaking practice on that scale.  All in all the show went very well, with just a few of the requisite technical glitches and a couple of freezes (quickly recovered) where students relied too much on rote memorization.  

At half-time Bob Metcalf was asked to give his original pitch from 3Com circa 1980.   It was a very thick spiral bound book that he had to leaf through for investors.   In response to a question he said he probably talked to about 100 prospects before landing the capital that set him on his path to great success.  One novelty of his approach was that he had written a book on networking technology and required visiting investors to buy a copy – for $250!  Bob was later a director of the company that developed PowerPoint and sold it to Microsoft for $14M, but around 1980 the only alternative to paper was the 35mm slide projector, which required expensive outsource services to put graphics on slides.  Even that medium was subject to technical risk, as I discovered many time over the years.  For example, projector bulbs only failed during shows, never before or after. 

This is a bit of an aside, but the greatest demo innovation relative to those times that I recall was one that sprang from the mind of our Peachtree Software marketing genius Julian Puckett.   In an era where both hardware and software suffered from considerable unreliability, Julian made a folding cardboard replica of a microcomputer and display screen.   Software screen shots on their own boards could easily be inserted into the slot on the display, and we could walk through our product much faster than in real life, with never a technical hiccup, and then just fold the whole demo back into our briefcase – along with the check from the sale we almost always closed!

Back to the subject, my guess is that maybe 5 of the 1SS teams will result in real companies.  Some had the advantage of having formed teams and concepts before the semester began, and in fact that will be a requirement for next semester.  Others grouped together only after enrolling in the class in a few speed dating sessions akin to a typical 3 Day Startup format.  The advantage obviously fell to those with a head start.  I know from questions and conversations at the event that there was plenty of investor follow-up to be expected by the teams that really scored well in their pitches and had concepts somewhere within the general guidelines of local investors. 

More important perhaps in the long run is that of the 77 students, the course may have propelled a good number of bright young people who “will be” entrepreneurs as opposed to the “would be’s”.  It’s fun and intellectually stimulating to be part of a startup community, but to actually launch and create a scalable business from whole cloth is an entirely different level of achievement.   On this criterion it may be a few years before the real success of the course can be measured, but I suspect there will be some stars that emerge from this group.

I know the Austin Technology Incubator is actively addressing the problem of where to go next with the teams that have momentum.   Many will enroll again for the Spring Semester, and there’s a pressing need to create a working environment for them close to the main campus so they can get more done while also carrying on their other class loads.

In his earlier appearance before the class, Michael Dell was asked what courses he would liked to have had at UT that would have helped him with his business.   He mentioned that an accounting course would have been handy, but in my opinion he seemed to figure out inventory turns better than anyone else without benefit of formal training.  And, he was on a mission from day one at UT and was hardly distracted by classes as best I can tell.  However, I think with the advent of resources like 1SS, there will be even more Dell-type success stories than otherwise would be the case.  Imagine a music school where the students are not actually engaged in the performance of music, and that’s what traditional education has been in entrepreneurship.  Now we have in 1SS a new model that adds that performance element to traditional scholarship.  

 <photo by the author>