Do you have the Next Great Idea?

With apps and technology tools helping fuel the dreams of code-writing college students, could this usher in a wave of techie entrepreneurs?

Everyone, it seems, has an app or a genius idea for one. Credit the lackluster job market plus facile tools and technology — no Ph.D in programming required — for the rise of campus hack cultures that reach far beyond Engineering and Computer Science majors and Stanford and MIT. Big rewards like the $100 billion public offering for Facebook, which was conceived in a Harvard dorm, and its $1 billion splurge on Instagram only feed the fantasies of code-writing college students.

In 2010, four Emory students — Ian McCall, Nir Levy, Giovanni Hobbins and Pat Shea — met in Shea’s dorm room to upgrade the website of a student group but instead decided to build a portal to organise campus life. Thus was born Campus Bubble, a platform for university information and postings from campus groups, students and businesses.

Now headquartered in Shea’s apartment (he graduated in May), the founders have four summer interns and are working madly to launch version 2.0 next month after a pilot run last year attracted 4,000 users. McCall, a senior, recalls early meetings as “really exhilarating.” He’ll also tell you that the adrenaline rush of hatching a hot idea comes with a counter-rush: what now?

Instinct may suggest you head west. That’s the play if you land a spot in Y Combinator (despite a YouTube plea, Campus Bubble did not). Admission to the three-month programme is more competitive than Harvard or Yale, and comes with cachet. You give up a percentage of your start-up’s equity. But those who get in, like Wesley Zhao and Ajay Mehta (Zhao is on leave from the University of Pennsylvania and Mehta from New York University), say the advice, speakers, community and high-power tech network is worth the price. “They provide you with so much value from Day 1,” says Zhao, who with Mehta developed FamilyLeaf, an online site for sharing family photos and news. The accelerator connected them with two additional founders, and $170,000 in initial financing. And their March “Demonstration Day” performance (sporting T-shirts hand-painted the night before with their company name) earned them several new investors.

Inclusion in private incubators like Y Combinator and TechStars is coveted because of their strong track records with start-ups (Dropbox, Bump, Loopt) and the Silicon Valley icons who serve as mentors. But young entrepreneurs can find good help without leaving campus. “It’s possible for a 20-year-old to create something that changes the world,” says Bryce C Pilz, a University of Michigan law professor who works with student start-ups.

That’s revolutionary thinking for a university culture that has long focused on the inventions of graduate students and faculty. But campuses are beginning to put their bets on undergraduates. Who better understands the social media mindset? And what campus wouldn’t want an Instagram founder as an alum?

Booming

Campus incubators are growing. New data from the National Business Incubation Association show that about one-third of the 1,250 business incubators in the United States are at universities, up from one-fifth in 2006. Even non-techie campuses like Northern Kentucky University, Duke and Syracuse have jumped in the pool, recently adding or planning to add start-up incubators.

On campus or off, incubators are not always useful. Some do little more than provide free or cheap space and a coffee machine. What entrepreneurs really need is guidance and like-minded peers.

That’s why George Washington University decided to offer “soup-to-nuts support” for start-ups when it created the Office of Entrepreneurship two years ago, with workshops on crafting an elevator pitch and talks like “Student Start-Ups: From Dorm Room to Board Room.” Jim Chung, the programme director, notes that today’s start-ups are led not just by business and computer majors but by “designers, musicians, anybody with good ideas,” so universities need to connect these students to experts and to one another.

“When students are doing crazy stuff, they need to be around other crazy people who think they’re sane,” says Moses Lee, assistant director of TechArb, a four-year-old university-sponsored student incubator (he prefers “start-up hive”) in the basement of a parking garage at the University of Michigan. Getting into TechArb is competitive. Last fall, 65 teams applied for 20 spots. Its curriculum has students pitching to potential users or customers and leading a monthly board meeting to learn how to justify themselves to investors.

Lee, who is starting up an online student portfolio for job hunting, says that talking about your vision and getting feedback are key early steps. Incubator offices are buzzing at 4 am. “Although universities tend to view incubators aimed at undergraduates as the equivalent of a career office, they can also have claims on a student’s IP (start-up parlance for intellectual property),” says Todd Sherer, president of the Association of University Technology Managers, whose members turn campus inventions into commercial deals. Dr Sherer, who is also director of Emory’s technology transfer office, says undergraduates are typically considered sole owners of their inventions, but there are exceptions: if a student receives a university grant or is paid by the university for the work, if the idea is developed with faculty, or if a student uses significant campus resources to develop the idea.

At the University of Michigan, students had feared that bringing a project to class or sharing with a professor “would trigger university ownership,” Pilz says. The language in its policy — that it could claim ownership if student inventors relied on “direct or indirect support of funds administered by the university” —  was having a chilling effect. In 2009, the university gave students sole ownership of their inventions, even if they work on the idea in a course or use university equipment.

Free help

An Entrepreneurship Clinic, in which law students provide free help to undergraduate start-ups, began in January and is now the most popular clinic at the law school; 97 students vied for 16 clinic spots for the fall. Chung notes that universities would rather foster positive relations than collect shares in student businesses. “Successful alumni breed successful schools,” he says. Yahoo! started on Stanford servers, but the university never sought ownership.  Jerry Yang and David Filo, the founders, endowed a $2 million chair in the School of Engineering and Yang and his wife have given $75 million.
Google is another story. Stanford owns patents on technology developed by two graduate students, Larry Page and Sergey Brin. Federal filings for 2011 show the company paid Stanford $400,000 in royalties, and donated $3 million. Stanford’s president, John L Hennessy, is on the Google board and some 1,300 Stanford graduates work at Google.

The Campus Bubble founders initially “worried about Emory taking some ownership,” says McCall. But they needed the cooperation of the university — it is The Emory Bubble they are attempting to introduce — so they hired a lawyer and made a deal, giving Emory shares for use of the trademark. Charles Goetz, their teacher in an entrepreneurship class, became their adviser. He says the deal has opened doors, including landing the start-up’s first investor. Shea agrees: “The fact that we were working with the university gave us some legitimacy.” The $25,000 infusion means the founders, who did Web development on the side to pay living expenses and a $2,000 legal bill, can now pay their interns and focus on their project.

Few student start-ups become Facebook. Most don’t even make a profit. Jeffrey Babin, business adviser for Wharton’s Venture Initiation Program at the University of Pennsylvania, an incubator with 31 student start-ups, warns that “ideas are a dime a dozen — whoever gets it to market in the fastest and most effective manner wins.” Success is elusive, Babin says, and young founders often decide that it makes more sense to work for someone else. But, he adds: “The value of the venture may be zero. What you have learned? It’s invaluable.”