Since its inception in 2009, IDEA, Northeastern’s student-run venture accelerator, has guided more than 350 Northeastern-based business concepts and awarded nearly $400,000 in grants to the budding entrepreneurs. We asked new CEO Max Kaye, a fifth-year finance major in the D’Amore-McKim School of Business, to explain the secret to its success.
What makes IDEA unique in the world of venture accelerators?
IDEA is unique for two reasons. For one, it’s student-run. Both our management and investment teams are comprised of undergraduates from a range of fields, from engineering and marketing to finance and political science, and most of our coaches are students too. They key is peer-to-peer interaction—our undergraduate staff is very comfortable working in the lab with student and alumni ventures, which represent each and every college on campus.
Our management team experiences turnover because of class schedules and co-op cycles, opening up opportunities for other students to bring in fresh ideas and new perspectives each and every semester. Students interested in getting involved can attend one of our orientation sessions held in the IDEA lab in 01 Hayden. We can also be reached at firstname.lastname@example.org. All of our orientation sessions are posted on our calendar on our website.
Another quality that makes IDEA unique is our funding strategy, which is fundamentally different from other venture accelerators both in Boston and in higher education. When we give out seed funding, we don’t take claim over intellectual property or equity. Plus, there’s no convertible debt involved.
How does IDEA help turn business concepts into successful ventures?
We help entrepreneurs in three ways—by coaching, connecting, and funding. Every venture receives a coach, who works with the entrepreneurs on the business plan, financials, and go-to-market strategy.
Our marketing team helps entrepreneurs showcase their ventures through campus events such as our NEXPO and Pitch-a-thon events. We also work to connect the entrepreneurs to outside service providers ranging from law firms to public relations agencies. These firms take on the entrepreneurs as clients for free, helping them file patents, trademark their logos, or learn how to use accounting software.
We also provide funding, awarding individual ventures up to $10,000 in the form of non-equity seed grants in order to help them accomplish a business milestone. In addition to awarding funding, we also help ventures get face-time with angel investors and venture capitalists. Bob Lentz, chairman of IDEA’s advisory board and the Center for Entrepreneurship Education’s inaugural entrepreneur-in-residence, is instrumental in introducing our entrepreneurs to potential investors in the area.
Your work with IDEA began as a venture coach. What have you learned from working with entrepreneurs on a daily basis?
As a coach, I learned about the value of doing market research and developing a business strategy. In particular, I learned how to summarize a value proposition and pitch it to potential customers.
As CEO, I work with entrepreneurs from different industries and every school at Northeastern. Most of the time I don’t have their level of knowledge in their particular field. Having said that, my job is to make sure I am giving the entrepreneurs the feedback they need to succeed. That means I need to ask the right questions and make sure they are aware of the challenges and opportunities inherent in optimizing their business strategy.
As a unit, we’re constantly trying to improve our operation, from evaluating businesses to tweaking our funding strategies. After all, we’re a startup too.