At a time when fewer young people are starting their own businesses, some prominent businesspeople and educators are looking for ways to teach students to be more entrepreneurial.
The latest initiatives often play down traditional tasks like creating a business plan in favor of preparing participants for broader challenges, such as how to get feedback from customers and knowing when to adapt products or business models.
Last week, a panel of business executives and academics co-chaired by AOL co-founder Steve Case and former Hewlett-Packard Chairman Carly Fiorina called for the creation of a national entrepreneurship competition in which teams of elementary-, middle- and high-school students would propose and pitch to judges their ideas for new ventures. A spokesman for the panel, the University of Virginia’s Milstein Symposium, declined to say who would judge the event.
The proportion of young adults owning a business has fallen to the lowest level in at least 24 years. Roughly 3.6% of households headed by an adult younger than 30 owned stakes in private companies in 2013, according to a Wall Street Journal analysis of recently released Federal Reserve data. That is down from 10.6% in 1989, and it is down from 6.1% in 2010.
Economists point to young graduates’ poorer financial situations after the recession as well as their difficulties gaining work experience in the recent job market, among other factors.
Some believe that high schools and other institutions can do a better job preparing students for the challenges of starting and running their own businesses.
The traditional American education has emphasized preparing kids to execute shift work, and it doesn’t tend to give students enough opportunity “to tinker and compete in a fun, competitive landscape,” said Brian Meece, chief executive of RocketHub, a crowdfunding website, and a member of the Milstein Symposium panel focused on creating middle-class jobs through entrepreneurship.
“The mistake we’ve made about entrepreneurship is thinking that it’s like a job and that you can teach it, like accounting,” added Steve Blank, a veteran technology entrepreneur and lecturer at the University of California, Berkeley; New York University and Stanford.
Many traditional programs, particularly at the high-school level, cling to the notion that “startups are smaller versions of existing companies,” Mr. Blank said. But startup founders confront multiple unknowns, such as whether a new product or service even fits a customer need.
Just 46% of U.S. startups with employees survived five years, according to the latest data from the Ewing Marion Kauffman Foundation, a Kansas City, Mo., nonprofit.
At the Network for Teaching Entrepreneurship, a 26-year-old New York City nonprofit created to reduce the school-dropout rate, students take on the role of restaurant owner and suggest changes to make their businesses more competitive instead of simply listing the advantages of one restaurant over another.
NFTE, which provides entrepreneurship education to about 40,000 low-income students in roughly 300 schools in large urban school districts across the U.S., is also testing a six-hour online program that simulates launching a food truck. Last year, it revamped an online tool, making it possible for students to share business ideas with one another instead of simply filling out an online checklist of steps for starting new ventures.
“We are trying to influence the conversation so that entrepreneurship is not all about writing a business plan,” said Dawn Bowlus, director of the University of Iowa’s Jacobson Institute for Youth Entrepreneurship, which provides a curriculum used by high-school teachers in 30 states.
Ms. Bowlus said she rewrote the Iowa City, Iowa, institute’s teacher-training curriculum last year. Before, students might send out a survey to hundreds of potential customers, but they rarely sat down and talked to them. Now, students must first identify a problem and interview customers, and then adjust their business models accordingly, she said.
In the past, Junior Achievement USA, created in 1919, focused on helping students develop skills such as sales and accounting that would enable them to run their own businesses. It didn’t prioritize determining whether there was an actual consumer need the business could fill. The Colorado Springs, Colo., program was meant to prepare young adults for business careers as the economy shifted away from agriculture.
Enrollment in the group’s flagship program fell 43% to 12,644 students in 2013-2014, down from a peak of 22,106 students seven years earlier. Last summer, it put its entrepreneurship program online, making it easier for students to raise money on the Web and manage e-commerce transactions, among other things. This semester, Junior Achievement officials have begun letting students turn their businesses into actual companies after the 13-session program ends instead of requiring them to liquidate the startups. Enrollment is expected to reach some 17,000 in the current school year, a spokeswoman says.
In the Blue Valley School District in Overland Park, Kan., about 60 high-school juniors and seniors have spent three periods a day identifying a business problem and developing a plan to solve it. They have created a straw that filters water to make it potable, a dryer sheet infused with insect repellant and a chair to calm autistic students, among other ventures.
“In the majority of traditional classrooms, failure is seen as bad,” said Corey Mohn, executive director of the Center for Advanced Professional Studies, which offers the class. The idea is to flip that script: “In the entrepreneurial mindset, failure is a way to learn,” he said.
Hunter Browning, 21, who participated in an early version of the program, said it “took that inquisitive tinkerer I was and allowed me to play in the real world.” He has since founded two companies with partners—a social network for sports fans, and a software startup. Both are still in operation, he said.
Similarly, the private Hawken School in Cleveland introduced a semester-long class two years ago in which high schoolers spend nine weeks solving the real problems facing three local business owners. For one project, Olivia Marino, an 18-year-old senior, conducted market research for an Indian restaurant looking to define its target market and growth strategy.
For their final project, Ms. Marino’s team created a baking service that sent ingredients and a recipe each month so that families with young children could cook together. The class “made me think differently about all the things that go into maintaining and starting a small business,” Ms. Marino said.
“The secret sauce in terms of the kid engagement is that it’s real world,” said Doris Korda, a Hawken administrator and former entrepreneur who created the program.
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