Y. Student Moguls Hope Trip to N.Y. Brings in the Cash
Deseret Morning News
April 23 2004
PROVO -- In the world of small business, dreams often flow easily, but getting someone to back them with cash can thwart even the most energetic entrepreneur.
Many would-be business moguls find themselves tapping into their personal savings, seeking parental investment or even cajoling close friends.
For two Brigham Young University student-created companies, such financing might become a bit simpler. After all, $1 million shouldn't hurt anyone.
On Saturday,David Bateman, who created Property Solutions (which markets computer software to aid management of rental housing units), and Barry Ehlert, who created Shaggy Bag (which manufactures beanbag furniture), will be in New York City to participate in the Venture Bowl 2004 business plan competition. If they convince judges and other venture capitalist that their businesses will fare well, the teams could accrue the funds needed to further their dreams.
The competition they face as they jockey for funds against nine other schools -- including the Massachusetts Institute of Technology, Harvard Business School and Columbia Business School -- shows the strength of the BYU Marriott School of Management where the entrepreneurs hatched their ventures.
"All we have to do is point them in the right direction," said Don Livingstone, director of the BYU Center for Entrepreneurship.
The school created the center nearly 30 years ago, and over the past decade it has grown considerably. Currently, more than 1,300 students participate in classes and lectures on how to turn good ideas into viable businesses.
"When they get taught by a real-life entrepreneur, they get a fire lit beneath them," Livingstone said.
Livingstone attributes much of the recent business plan growth to BYU's push to involve all campus colleges. A number of entries for this year's Business Plan Competition came from outside the Marriott School of Management, including one of the finalists in this semester's T-Spline, an animation software company.
Livingstone also believes the school's "RM factor" -- returned missionaries -- is at play in the number of business plans being submitted, noting that many of the entrants have completed two-year missionary stints for The Church of Jesus-Christ of Latter-day Saints.
The school also makes use of successful local entrepreneurs like Larry H. Miller -- owner of numerous car dealerships and the Utah Jazz -- who teach classes that help students learn to whittle ideas down to a viable concept.
Property Solutions is one of the ventures that has benefited from the center's help. The company won the BYU Business Plan Competition last year, netting $50,000 in prizes.
The company released its first software in August and is currently seeding its second version. The company has clients in Houston, Las Vegas, Southern California, Provo and Rexburg, Idaho. The software helps manage nearly 13,000 rental housing units.
Since July, the company has generated $250,000 in revenue.
David Bateman, Property Solutions president, said he and vice president Benjamin Zimmer have not taken any salary thus far. Winning a little extra cash could improve living and transportation prospects for the owners.
Bateman said they want to keep the company private. Ownership is currently divided between the employees and a few board members.
Bateman put $300,000 of his own money into the project to get it started. Most of the money came from a previous venture called DearElder.com -- which involves getting cookies and mail to LDS missionaries. To date the new company has attracted nearly $500,000 in funding and services.
"It's a great process," Bateman said.
As for Shaggy Bag, the other BYU entry into the competition, that venture started two and a half years ago. The company produces a line of giant beanbag furniture, albeit protein free and filled with foam.
"(BYU's business school) can compete with any of the schools across the nation," said Barry Ehlert, the company's president and founder.
The Canada native opened his first store in Grapevine, Texas, just outside of Dallas. Ehlert said he has no plans to franchise the spongy seat stores. Instead he said he hopes to grab even more market share when the company introduces faux fir and micro fiber covers for its bags.
Following Saturday's final competition, the winners will remain in New York to open the NASDAQ stock market the following week. The event is being funded by Carrot Capital, a New York venture capital firm.