By Brian E. Clark
WisBusiness.com
MADISON – Sherwin Greenblatt calls it the “valley of death,” that high-risk gap between creating a company and either selling it or turning it into a profitable enterprise.
Greenblatt, who runs MIT’s eight-year-old Venture Mentoring Service, says nascent firms need lots of help when they are starting out.
That’s why the former president of Bose Corp. was in Madison recently, speaking with university administrators, students and entrepreneurs.
“Near as I can tell, UW-Madison doesn’t have anything filling that need,” he said. “I absolutely believe it is ripe for a mentoring program. In the two days I’ve spent here, I’ve become more convinced of that.
“There is a gap in the eco-system of entrepreneurship here that a mentoring service could fill to encourage and assist in the creation of more new companies.
“There are so many ideas here,” he said. “Madison is such an inventive place and I hear the frustration of people wondering how they will move these things. The time is right.”
He said the need for a volunteer mentoring service like MIT’s has become more acute in recent years because because larger companies are now relying on start-ups to come up with technologies that can be put into a project.
“Universities realize that they have a lot of patentable technologies, but they don’t have ways to move it forward because potential licensees simply say it’s not well enough developed,” he said.
“That’s where the entrepreneurial ideas come from. We say these technologies need to be pushed forward by entrepreneurs who will take the risks necessary to do the development and perhaps even the first products so that these things can be brought to market.”
And that, he said, requires the small-company infrastructure. Which is where the mentoring program comes in, he added, so companies can move forward to the point where large companies are interested.
“That’s the space where we work, in that gap that I call the ‘valley of death.’ We are trying to develop the boats that will carry people across that valley.”
Greenblatt, who has a master’s in electrical engineering from MIT, spent more than 35 years with Bose, beginning as project engineer in the early development of the Bose speakers and related electronic systems. He later served as director of engineering and held other executive positions.
“It was a very difficult start-up,” he said. “We thought we would use our engineering training to solve business problems. That’s easy to say, but hard to do and the company limped along for about four years and by a miracle stayed in business.
“Then in 1968, almost in desperation, we brought to market an invention of Dr. Bose’s — the 901 loudspeaker — and that was the turning point for the company,” he said.
“It was the right product, introduced in the right way at the right time,” he said.
Greenblatt said the mentoring program serves “members of the MIT community,” and could be duplicated by the UW System.
“In our case, members of the MIT community can be students – undergrad or graduate – members of the faculty, research staff or alumni, all who live within the Boston area,” he said.
He said the program stays within the Boston region because “mentoring is a face-to-face thing because you can be much more effective if you can look at someone and talk to them instead of using e-mail or telephone.”
Greenblatt said MIT mentors — many of who have start-up experience — will entertain any idea, even non-technical ones, and help would-be entrepreneurs figure out how to commercialize it.
“Some people in the MIT community are business people and don’t need a lot of help,” he said. “But engineers, for example, are very smart people but they don’t know a lot about business. Those are the people we can best serve.”
Greenblatt said the mentors often team with engineers or others and then guide them through the often rocky start-up process.
He said the service is currently mentoring about 100 “would-be” ventures, plus 35 enterprises that are launched and “executing” and are using the program’s services.
Some of them are even selling products or are nearly there, he said.
Another four or five have been purchased by larger companies and no longer exist, he added.
“All told, we have served about 470 entrepreneurs,” he added. “It’s a very risky, high mortality effort. Many come and work with us for awhile, then realize what’s involved and then decide they can’t muster the resources or don’t have the time, but will have had a good experience.”
Greenblatt said the mentoring service could also help create a group of managers for the Madison area.
“That is actually the basic motivation behind the program,” said Greenblatt.
“We believe that the chance of success for any one venture is low. If we can take people who would like to become entrepreneurs and have a good technical base and have some outside ideas, but don’t know much about business… we can give them the experience of starting a company.
“Then even if they fail, they will have had that experience. And with that, they will go back and say ‘I have a better idea’ and I want to try again.”
The second time around, Greenblatt said, these entrepreneurs will do better.
“We are creating the CEOs of the future. We don’t know what companies they will start or be associated with, but we think we are creating a pool of people who will be the managers of the future.
“And we’ll be creating it right here in Madison,” he said.
