COLLEGE PARK – Zachary Milne, 24, wants to be an entrepreneur, and he’s just made his first “pitch.”
“All you have to do is come here with an idea, and then they support you with everything else you need,” said Milne, an economics major at the University of Maryland, College Park.
He’s one of more than 25 students who pitched business ideas last month at the campus’ Dingman Center for Entrepreneurship in a competition that awards monthly and annual cash prizes for proposals ranging from board games to microbreweries.
More than $190,000 has been awarded since the Pitch Dingman Competition began four years ago, according to center records. Forty-five businesses have been launched, and 67 businesses have been financed.
Many of the nation’s premier business schools — including Babson College, Duke University, Pace University and Rice University — offer a business plan pitching competition. But Maryland’s competition, housed in the center at the Robert H. Smith School of Business, is unique in offering monthly opportunities to receive funding, along with full-service mentoring, said Alla Corey, center program manager.
Competition judge Mitch Gorochow, managing director at RSM McGladrey Inc., said it’s a combination that works.
“I’m very impressed at the critical thinking of the students, the energy and the creativity,” Gorochow said. “Frankly, that’s why I come here. I get jazzed about what I see.”
The competition involves two major stages. First, students pitch their business ideas during short, informal sessions with an entrepreneur in residence, investors and staff. They’re told how to develop their idea. When they’re ready, they move to the second stage, which involves a formal presentation to a seven-judge panel, which awards up to $2,500 a month to business startups.
The center also sponsors an annual competition, which awards up to $15,000 to more established student and alumni-run businesses.
The informal pitching sessions run between 11 a.m. and 1 p.m. on the first three Fridays of each month. These sessions work “like a dentist’s office,” Corey said. “They come in one by one” for 10 to 15 minutes.
During October’s first session, Corey welcomed the fledgling entrepreneurs.
Some wore business suits, others wore jeans. According to competition materials, center staff “evaluate the quality of your idea and presentation, not your fashion sense.”
Students are guaranteed that their ideas will not be mocked or stolen, Corey said.
Students receive feedback on how realistic their ideas are.
“If a lot of people have tried the same idea and it didn’t work, we ask them to look at why it didn’t work and modify it,” Corey said.
Students are encouraged to do more research and report often on their progress.
Milne pitched an idea for an online hub for buying and selling products from outside vendors — similar to eBay or Amazon.
John M. LaPides, the senior entrepreneur in residence who attended Milne’s session, said it was a great idea but extremely difficult. Almost everybody wants to create a business like that, LaPides said.
The session inspired Milne to investigate other business models enabling businesses to sell their products online.
Services available to students after their pitch range from free or subsidized office space to the assistance of attorneys and accountants.
“We’re all successful entrepreneurs.” LaPides said. “We’ve been through it a few times, so we’re here to help them get their businesses off the ground.”
The competition’s objective, said Asher Epstein, center managing director, is to provide a low barrier to entry into the business world.
“We offer people the opportunity to get exposed to entrepreneurship in a relatively risk-free and comforting environment,” he said.
During the formal monthly pitches, students equipped with PowerPoint presentations, anecdotes and charismatic pleas for funding present their ideas before the judging panel and an audience.
Students only need to attend one informal pitch session before they qualify to participate in the monthly competition. They’re slated for a time slot as soon as they’re ready — anywhere from weeks to months.
“We don’t select which ideas go forward,” Corey said. “And we never tell students they can’t compete because they have a bad idea.”
Judges change monthly and have no previous interaction with the presenting students.
Five of the seven judges on October’s panel were Maryland MBA alumni. All work as CEOs, investors or consultants.
Each of the five business presentations in October were judged on how realistic the idea was, its potential for profitability, how it would target specific customers, how the product would stand up to competitors, its risk level, how passionate the presenters felt about the product and how the presenters would potentially use the $2,500 top prize money.
Prize money comes through the Smith E-Fund, a combination of donor, endowment and university funds.
Students must itemize exactly how the prize money will be used, Corey said.
“They can’t just spend it on pizza.”
MainLine Automation and Raw Athletics split the top prize in October.
MainLine Automation founder and President Suyan Hu and CEO Nicholas Rapagnani, both MBA students, said their company would enable printing houses to convert billing statements into PDFs.
“Winning the prize money was validation that it is a great idea, and it will succeed,” said Hu, whose company was awarded $1,500.
Stephen Steinberg, founder and president of Raw Athletics and a senior majoring in economics, was awarded $1,000. He also won the Audience Choice Award of $250. His company already markets natural deodorizer for sports equipment, but he hopes to expand his business into natural laundry detergent for sports clothing.
“The money is going to help a lot in the first step of my business plan,” Steinberg said.
The competition originated with Epstein, who became managing director of the center six years ago. While researching successful Maryland alumni, he came across the story of Kevin Plank, chairman and CEO of Under Armour, who began his business career as a student selling Valentine’s Day roses on campus.
“I realized that there were probably another half dozen, dozen or two dozen students with ambition like Kevin and with energy like Kevin, walking around campus but not getting support to be able to build their business,” Epstein said. “I wanted to create a program to help identify and support the next generation of entrepreneurs.”
He later shared the idea with Plank, who suggested creating another annual competition, to be held each February. In 2006, they founded the Cupid’s Cup, named for Plank’s first business.
That competition accepts only student or alumni businesses that have generated at least $5,000. Judging is almost identical to the monthly competition, except awards run up to $15,000, drawn from a donation by Plank.
Businesses receiving assistance have generated 140 jobs and more than $9 million in revenue last fiscal year, Corey said. Most have remained in-state.
Amanda Nachman, 24, pitched her idea in spring 2007 for a magazine targeting college students. She was an English major in her senior year.
“After I pitched, they loved the idea,” Nachman said. “Hearing those words from the Dingman Center saying, ‘You have something great here. Make it happen,’ was really encouraging.”
The center assisted her with both design and advertising to print the first issue.
By the end of 2007, Nachman was founder and publisher of College Media Group, and thousands of issues had been distributed to area colleges.
In February 2009 she competed in the Cupid’s Cup and won the $15,000 top prize, as well as the $2,500 Audience Choice Award. She used the money to create and expand the magazine’s Web site.
Today her magazine and Web site serve more than 120,000 readers. The magazine is distributed at nine universities: the University of Maryland, College Park, George Washington University, Georgetown University, American University, Towson University, Johns Hopkins University, Loyola University, University of Maryland, Baltimore County and Goucher College.
“You need to find something that you really love, because it’s going to be hard,” she said. “What keeps me going every day is that I love what I do, especially the creative aspect of running this media company,’ she said.
Epstein said that in addition to working hard, beginning entrepreneurs need to start early.
“Get involved and take some bumps now, because it’s a heck of a lot harder when you’ve got a mortgage, a couple kids and a wife or husband and all sorts of other responsibilities,” he said.
Milne is optimistic that he can become the center’s next success story. With the help of the center, he has significantly streamlined his business model.
He now plans to focus on providing individual businesses with tools to sell their products online. He is testing his idea on his sister-in-law’s business, Little Miss Goody Tutus, which creates ballet tutus for young girls.
He said he plans on presenting his business in the monthly competition after the holiday season.
“I’ve learned that being creative and combining different aspects of my experiences has led me to a business idea that is very unique and very competitive,” Milne said. “I’m just so excited about it.”