In the mid-1990s, Amir Pirzadeh had an idea for improving sawmills. But he struggled with how to turn a technical innovation into a profitable business.
That changed in 2007 when Pirzadeh, an MBA student at Fayetteville State University, and classmates won a business competition — the Opportunity Funding Corporation’s (OFC) Venture Challenge. Three years later, Pirzadeh saw his idea, a machinery company called Smart Saws Inc., grow to $444,000 in gross sales.
By making the machinery more efficient, sawmills can produce more lumber from fewer trees. The process has come a long way from the idea Pirzadeh had 15 years ago.
“It really came together in 2007,” says Pirzadeh, who now operates his company full time. “Before then it was more of a technical idea.”
The Beginning, Challenges
Pirzadeh could not have translated his engineering concept into a business venture if it were not for the OFC Venture Challenge. It began in 2000, when Dr. Mohammad Bhuiyan, now an endowed professor of entrepreneurship and director of the Center for Entrepreneurship at Fayetteville State, joined an effort that sought to tackle economic disparities between Whites and other ethnic groups.
In 1970, a $7.4 million grant from the Office of Economic Opportunity established OFC to test ways of attracting scarce capital into America’s impoverished communities. Bhuiyan discovered at least one reason why there weren’t enough successful African-American entrepreneurs: There were more than 100 historically Black colleges and universities but few had entrepreneurship programs.
For most of their history, HBCUs promoted upward mobility through higher education, offering degrees and graduate training in education, law, medicine, science and other fields. Under segregation, the most successful Black entrepreneurs were usually educated or licensed professionals who ran their own medical practices, law firms, churches or funeral homes.
Bhuiyan, who at the time taught management at Clark Atlanta University’s School of Business Administration, established the OFC Venture Challenge to help HBCUs develop a comprehensive entrepreneurship curriculum. The annual competition held in Atlanta challenges HBCU students to hone their skills by developing sustainable business ventures.
For inspiration, Bhuiyan and his team looked to the Moot Corp Competition, the business-focused contest and conference that began in the 1980s. It takes place annually at the University of Texas at Austin and attracts students from around the world. It was recently renamed as the Venture Labs Investment Competition.
Just seven HBCUs participated in the first venture challenge, but about 40 schools participate today. Bhuiyan says HBCUs don’t have to start from scratch to reach the stature of the entrepreneurship programs at Fayetteville State, Hampton and Jackson State universities. He counsels schools to repurpose existing resources, like eliminating typing and secretarial courses that he says some schools still offer, and incorporate entrepreneurship into traditional programs.
Michael D. Woodard, president and CEO of the Washington, D.C.-based consulting firm Woodard and Associates and the author of Black Entrepreneurs in America: Stories of Struggle and Success, believes HBCUs would be remiss if they do not provide a curriculum on entrepreneurship.
“The most effective way for one generation to transfer wealth to the next generation is to engage in entrepreneurial activities,” Woodard says.
“Entrepreneurship is one way of providing jobs in the African-American community,” adds Woodard, noting that many minority-owned businesses have staffs that are over 50 percent non-White.
“African-Americans have had the same or greater interest rates in entrepreneurship (as other racial/ethnic groups),” says Woodard, a sociologist who has researched work-force diversity and labor force patterns. As evidence, he cited recent U.S. Census data. In July, the Census Bureau released its “Preliminary Estimates of Business Ownership by Gender, Ethnicity, Race and Veteran Status: 2007” report that revealed a 45.6 percent increase in the number of minority-owned businesses from 2002 to 2007.
This number is more than twice the national rate of all U.S. businesses.
As the OFC Venture Challenge grows, it continues to expand its efforts. Bhuiyan says, when it began, it only focused on the small number of HBCUs with entrepreneurship programs. Its new focus will be motivating more HBCU students to launch successful ventures such as Pirzadeh did.
The April conference gives Venture Challenge participants access to some of the nation’s top business leaders. For some, it provides a segue to employment with OFC’s top sponsors, including Wal-Mart, Sam’s Club, OfficeMax and UPS. OFC also added a development seminar for HBCU professors and deans and a national policy forum on minority entrepreneurship education.