The BIG “E” – Big Company Entrepreneurship
So far this semester, I’ve blogged on a variety of topics related to new ventures. For those who aren’t interested (or at least not yet!) in launching their own gig; there are boundless entrepreneurial opportunities within existing ventures, such as start-ups, small businesses, or large companies. To start, let’s talk about the BIG “E” — Big Company Entrepreneurship, often called Corporate Entrepreneurship or Intrapreneurship.
Finding Entrepreneurial Companies
So, how does one go about finding big companies that offer entrepreneurial opportunities, and cultures that foster entrepreneurial thought and action? From what I have learned so far, there is no one answer or approach. But, let me start by throwing out an initial idea based on a great conversation I had this summer.
In late July, I had the opportunity to meet with Babson’s Professor of Entrepreneurship Joel Shulman. In 2010, Shulman created a mutual fund called EntrepreneurShares Global Fund (ENTIX) which invests in global companies that possess entrepreneurial attributes. Shulman and other faculty researchers here at Babson found that organizations focused on entrepreneurial culture, organic growth, and aligned compensation, trump corporate bureaucracy on a regular basis and significantly outperform peer benchmarks.” In addition, Shulman has developed a variety of indices that “track the performance of entrepreneurial companies across geographies, sectors and market caps.” Shulman and his team have identified 15 attributes which they use to evaluate the degree to which they feel a public company is “entrepreneurial.” See the list below from his web-site.
15 Attributes that Define Entrepreneurial from Non-Entrepreneurial Companies
1. Organic growth opportunities
2. Above average ownership stake among key stakeholders
3. Low SG&A
4. Above average return on invested capital
5. Sustainable growth
6. Manageable debt
7. Active strategic alliances/partnerships/licensing
8. Aligned executive compensation packages
9. Low executive turnover
10. Transparent governance
11. Long duration of key managers
12. Low or no dividends
13. Family involvement
14. High EBITDA Margin %
15. Other significant stakeholder relationship
If It Works for Investors, Why Not Job Seekers?
So, if these tools can be used by investors to identify entrepreneurial companies, why can’t they be used by entrepreneurial job seekers to do the same? Check out ENTIX’s holdings on Babson’s Bloomberg Terminals in our very own Cutler Center for ideas on target entrepreneurial companies.