Stefan Bielmeier

This is an executive summary of my thesis at Prof. Isabell Welpe's Chair of Strategy and Organization at TUM. While I wrote most of the content, I use "we" to refer to myself and my supervisors, Isabell Welpe and Michael Fröhlich.

Outline

1. Research question, research needs, model, and methodology
2. My results
3. Discussion and limitations
4. Limitations
5. Contribution to research and implications for practice
6. Conclusion

Research question, need, model & methodology

University graduates and alumni contribute largely to the economy through the companies they found, e.g. in the case of Stanford and MIT between $2-3 trillion in annual revenues (C. E. Eesley & Miller, 2017; Roberts & Eesley, 2009). However, most research in university entrepreneurship has focused on what drives academics – faculty and staff – to spin-off their own companies (Halilem et al., 2017; Muscio et al., 2016), despite the fact that recent graduates found 20x as many companies of equal quality as their faculty (Åstebro et al., 2012).

Economically, it makes sense to better understand how universities can make more students found companies. Researchers identified positive influences of intense entrepreneurship education programs (C. E. Eesley & Lee, 2021), specialized STEM curricula with business education (Colombo & Piva, 2020), or mentors and parents as entrepreneurial role models (C. Eesley & Wang, 2017).

However, no single factor was able to explain graduate founders significantly, only in combination with other personal and social factors such as entrepreneur parent genes (Lindquist et al., 2015), parental self-employment (von Graevenitz et al., 2010), high internal locus of control and high risk-taking propensity (Lüthje & Franke, 2003; Zollo et al., 2017), not being female (Brush et al., 2012; Kauffman Foundation, 2016), or socializing with similar, informed entrepreneurial peers (Bergmann et al., 2018).

Figure 1 : Previously identified influences of founder status after graduation

This shows that university entrepreneurship is a very diverse phenomenon with inter-case differences, which requires a combinatory analysis to understand it better (Douglas et al., 2020). We do this by using a method called fuzzy-set qualitative comparative analysis (fsQCA) (Ragin, 2000, 2008) that identifies common pathways and requirements for students with founder status.

We use entrepreneurship activity intensity as an objective indicator of (future) founder status (Carter et al., 1996). We measure it while students are still enrolled to avoid post-graduation influences (Colombo & Piva, 2020). As causes, we analyze being male, being a graduate student, expected degree delay, STEM or non-STEM, curriculum interdisciplinarity, possibility to accredit a voluntary entrepreneurship course in the degree program curriculum (for a def. see Shane & Venkataraman (2000)), entrepreneurship course participation, and peer influences through involvement in student organizations (Colombo & Piva, 2020).

We use a self-conducted survey of 176 active Bachelor's and Master's students enrolled at Technical University of Munich. The results cover 45 out of 170 offered degree programs. We gathered information on the degree programs from the campus management system of TUM (Technical University of Munich, 2021b) and the official websites (Technical University of Munich, 2021a).

Results

We make three observations in our fsQCA analysis.

First, student organization involvement and the inclusion of an entrepreneurship course in the degree program are necessary conditions for founder status. The majority of founders are part of a student organization (91.7%) and complete a degree program that includes at least one accredited elective entrepreneurship course – EEInclusion (98.2%). However, involvement and EEInclusion by themselves do not cause entrepreneurship status: only 16% of students who are involved in a student organization are founders, and only 11% of people who study a degree program with EEInclusion.

Table 1 : Analysis of necessary conditions for high entrepreneurship activity intensity

Second, in the combinatory analysis we find that there are two main pathways at university that can explain founders: they either complete a very specialized STEM master’s program (=<10% non-main topic courses) or complete an interdisciplinary business bachelor’s program (>=25% non-business courses).

Figure 2 : Two main university founder pathways

Assessing the business bachelor’s and the STEM master’s founder pathways in more detail, we find that both male and females pursue either pathway. We also find that for a business bachelor’s degree, the female founder took an entrepreneurship course, while the male founder didn’t. This relationship switches in the STEM master’s pathway, where the female founder didn’t take an entrepreneurship course, but the male founder did.

In total, we found four university founder pathways if we account for gender. However, we are only able to explain founder status in combination with the presence of other conditions: we found that they all (100%) are A) involved in a student organization, B) study a degree program that includes at least one accredited elective entrepreneurship course, and C) expect to delay their studies by at least 2 semesters, which is more than average than most students (1.5 semesters).

Table 2 : Results of finer-grained combinatory analysis: 4 founder pathways

Third, only 5 cases of founders (25%) can be explained by the four pathways we observed. The remaining 15 founders cannot be solidly explained by any of the 256 possible combinations in our model.

Discussion

Our results indicate that only a small fraction of to-be founders are caused by combinations of university educational factors. Here, being male does not uniformly cause founder status which was unexpected, while participating in an entrepreneurship course didn’t either which was expected (C. E. Eesley & Lee, 2021; Oosterbeek et al., 2010; von Graevenitz et al., 2010).

For the majority of students, founder status may be explained by influences we didn't consider: pre-university influences such as intense role modelling from parent or family entrepreneurs, and genetics (Lindquist et al., 2015). Role modelling makes students strongly favor an entrepreneurial career after graduation because it seems so normal (C. Eesley & Wang, 2017; Lindquist et al., 2015), and with genetics probably results in specific founder personality traits (Lüthje & Franke, 2003; Miner & Raju, 2004; Stewart Jr. & Roth, 2001, 2004; Zhao & Seibert, 2006; Zollo et al., 2017).

So, if most shaping of founders is done before university, what is possible for universities to create more founders? The genetic personality traits seem hardly formable at all. But, then there is evidence that the “view of the world” can be formed even for students without entrepreneurial parents: it requires high dosages of mentorship, multiple entrepreneurs mentoring the student for, e.g., longer than a year (C. Eesley & Wang, 2017; Roach & Sauermann, 2015).

It also is useful if students receive instruction in entrepreneurship courses that allow them to develop a growth-mindset, in that they believe to be capable of founding a company (Burnette et al., 2020). There is also evidence that mentorship and growth-mindset increases students' likelihood of founding a company after graduation, for example in the case of intense and specialized entrepreneurship programs, such as the Mayfield Fellows Program at Stanford University (C. E. Eesley & Lee, 2021).

So, shaping students by way of intense mentorship and education is possible, but probably would be very expensive and effortful to implement for all students at existing universities, especially the large ones. If changing current students into founders is too expensive, it may be more efficient to attract students who already have a predisposition for entrepreneurship. By attracting students who already have developed an entrepreneurial mindset or possess a fitting personality before they join university, universities may have an easier job to help these students to become founders.

Whether universities choose to shape intensily or attract, our results indicate that universities need to create a nurturing environment for entrepreneurial students so that they can bloom. They can achieve that by ensuring that all necessary conditions we observed in our study are met: students would have to have the opportunity to delay they studies by at least a year, participate in student organizations, and have the opportunity to take an accredited entrepreneurship course in any degree program of the university. Otherwise, students may not turn into founders, no matter the origin of their entrepreneurial inclinations.

Limitations

Our findings are not without limitations. First, we have not measured important personal factors such as self-employed parents or personality traits such as risk aversion in our study. They likely explain the missing 75% of cases given our literature review. Including them with other university and social factors to find further fitting pathways would be interesting.

Second, TUM is a highly reputable entrepreneurial research university, which makes it predestined for entrepreneurial endeavors (Wright et al., 2008) and skews our results. It would be helpful to repeat this analysis at mid-tier universities.

Third, a survey with more equal distribution and responses across departments would make our results more robust.

Fourth, we didn’t focus on the content taught in single entrepreneurship courses. Analyzing the different pedagogics may tell us more about its influences on future entrepreneurship status, beyond intense entrepreneurship programs.

Contribution to research and implications for practice

We contribute to the literature by confirming the view that founders who complete business degrees are generalists (Lazear, 2005a, 2005b), and those who complete STEM are specialized, but take some courses orthogonal to their specialization (Colombo & Piva, 2020). We also provide a finer-grained understanding of the link between university education and recent graduate entrepreneurship (Douglas et al., 2020), and call for more research in this field.

For the practice, we recommend university leaders to implement four things to create more founders. First, attract more talented students with a mindset and personality leaning towards entrepreneurship. One way to do this could be to increase the quality of teaching and content in degree programs the university is already known for to attract talent.

Second, introduce specialized, intense entrepreneurship programs for the most talented students, selecting those with startup interests and personality leaning towards it, and providing mentorship by entrepreneurs and specialized growth-mindset education.

Third, create liberal rules for students so they can unconditionally and unlimitedly delay or pause their degree program, if they want to pursue personal entrepreneurial projects or get involved in a student organization.

Fourth, introduce the possibility for students to take and accredit at least one elective entrepreneurship course in every single degree program the university offers.

Conclusion

Student and graduate entrepreneurship is a research field that deserves more attention than it has previously been getting. The economic impacts of creating more founders through university education can be enormous. If universities want to contribute to that, previous literature, our findings, and interpretation suggest university leaders to attract great students and create a nurturing entrepreneurial environment for them.

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