When it comes to selling a business idea, charm alone doesn’t go very far. Reputation and a robust plan play the big parts.
This is one of the lessons 215 entrants in the second annual Carlson School of Management Business Competition are learning as they prepare for the contest’s March 31 deadline. University students compete with entrepreneurs from around the state for the $30,000 top prize. The winner will be announced May 25.
Last year’s winners have since opened AutoFun, a $2 million auto superstore in Coon Rapids, Minn., with plans for a second store this summer.
For AutoFun’s founders, Jeff Abrams and Lee Schoenfeld, the $15,000 prize money was pocket change compared to the additional $900,000 they needed to start their store when they won the competition last May.
The remaining funds eventually flowed in even easier than before. The vote of approval from the business plan judges and the publicity from their victory loosened investors’ wallets.
“It lent a lot of credibility to our plan,” said Abrams, a former marketing executive at Best Buy.
The competition win “is one more nice tool in our ammunition kit,” Abrams said as AutoFun heads into the second round of funding.
This year biomedical, restaurant, manufacturing and food processing business plans are among the submissions, with Internet service companies comprising a nice chunk of the proposals as well.
The Carlson School of Management’s Center for Entrepreneurial Studies hosts the competition and handles the administrative nuts and bolts. The school benefits by serving as a forum where students, new entrepreneurs and the business community can meet, develop ideas and lay the groundwork for future businesses.
If all goes well, the networking will help in the development of the school’s internship program. Large companies have formal, well-established internship programs, but smaller companies lack the funding and staff necessary to accommodate similar programs.
For now, the Carlson school encourages all University students with a hankering for entrepreneurship to enter the competition and learn what they can from the free business plan workshops.
Entrepreneurs benefit two ways from the competition, said Michael Gorman, general partner at St. Paul Venture Capital and chairman of this year’s competition. First, they get feedback from established business people. Second, it gives them the opportunity to network.
“(Networking) is an overused term,” Gorman said. “But there are a lot of resources and people who have been there and done that who can give advice.”
Sponsors for the $45,000 in prizes, which winners receive in cash and services, are: St. Paul Venture Capital, Dorsey & Whitney, KPMG Peat Marwick, Riverside Bank and Andcor Companies.