Yesterday NPR (LINK) reported that the State of Massachusetts has already spent 90% of the federal stimulus money that was earmarked for the 2009, 2010 and 2011 fiscal school years. The problem? Because of the state’s current deficit, this money is actually being spent over the two year period of 2009 and 2010. You can see where that’s headed, right?
Ironically, I was in my car while listening to this story, heading into Boston to judge a competition called “Fenway Pitch.”At Fenway High School all students are required to participate in“Fenway Ventures: a unique program that prepares students to enter the adult workplace.” By teaming students with adult mentors (many of whom come from Blue Cross Blue Shield, which also donates its facilities), the initiative brings students together in teams and leads them through the process of developing an extensive business plan in only 15 weeks.
The thing is, these presentations were impressive! As a mentor to entrepreneurs and Connector for Boston World Partnerships’ entrepreneurship action team, I see and hear a lot from the front lines of business development. While the Fenway students will (predictably) need to continue developing their areas of expertise in finance and market research, they weren’t far behind ‘real’ entrepreneurs in terms of analytical capability, vision and the competence to communicate effectively.
The students were well prepared, appearing in professional attire and demonstrating excellent eye contact, posture and tone. Their ideas were interesting, timely and relevant. The proposed businesses included:
- ECOnomic: a one-stop shopping center for eco-friendly products
- The Generation Center: a community center for retired folks and babies
- Future Focus: a teen college and career prep program.
- MySkate: a new family-friendly skating rink
Throughout the morning I listened to the kids explain their ideas, detail their preparation and articulate their strategies. They had to think on their feet, as many of the judges threw them real-life questions such as “how do you justify these salaries?” or “how will you differentiate yourselves from current competitors?”Consistent in every pitch was an underlying theme: these kids want to generate economic development; they want to create jobs.
This got me thinking: why is k-12 built on a non-profit model? Here’s a bit of personal background to put things in perspective:
My son is 15, which is still too young to get most summer jobs (the state’s minimum age is 16). To further complicate the logistics, he’ll be going to Eagle Scout camp for two weeks in July. It’s obviously challenging for him to find a traditional employer who’s willing to work around that schedule, so most likely he will end up spending the rest of his summer on the beach with his friends.
My 11 year old daughter is currently leasing a horse, with $250 she saved on her own. Much of this savings came from birthday presents and allowance, but some came from extra income she generated on her own. Sometimes she’ll ask for extra chores to do, and last summer she ran her own business. We live on a corner next to the town park, which is always busy with summer activities. It’s the perfect spot for a lemonade stand.
When Noah told me she wanted to start one I agreed to help out and fronted the cash for her initial supplies. The deal was that this investment had to be paid back before she could keep any profits.
Lesson #1: The difference between income and profit.
I got reimbursed in only two days. Off to a flying start, Noah saw greater opportunities to increase sales. She reinvested some earnings into an assortment of candy (for kids) and organic fruit salad (for the moms and dads), and even began including dog treats for pet walkers. I helped her to calculate margins so she could find the right price points for her products.
Lesson #2: Know your customers.
Lesson #3: Merchandising.
I ask you this: if my (then) ten year old daughter can learn this with very little supervision, why aren’t schools teaching business skills at this age? Going back to my son for a moment, he wants a job and could contribute a reasonable ten hours per week on average. There are two hundred students in each grade at his high school. That’s eight hundred potential employees. If every student is available for ten hours per week, that’s:
200 students
x 10 hours per week
=2,000 total work hours per week
x 52 weeks per year
=104,000 available labor hours per year
Over one hundred thousand hours of available labor gone to waste! To put that in perspective, I worked for a magazine that employed four people at 40 hours per week each. Do the math (subtracting two weeks of vacation each) and that comes out to 8,000 total labor hours for the entire year!
My takeaway: the best way for schools to serve their constituents is to be profitable. There is a vastly untapped and willing student labor pool here, so schools should be self-serving and become responsible for their own economic development instead of waiting for local, state and federal funding.
At this point you might be wondering how schools can capitalize on contributed labor and generate income. The answer: start businesses! Teach business planning but take it to the next level; launch viable local companies that are student-run (in collaboration with mentorship from sponsor organizations).
Now you might be wondering how this could be funded, right? Sell stock! We hear a lot about “investing” in education, but where’s the real return on investment in that? Instead of ‘fund raising’ and selling me $40 worth of candles that I don’t really want anyway, how about the students ask me to invest $50 in the stock of a school-based co-op? If it’s profitable I’ll get a dividend. And if the business fails, at least my kids are earning valuable real-world experience.
By the way, there are 6,000 people in my town. At $50 per person we’d be looking at $300,000 in start-up capital. That’s not too shabby, especially for a business (like a sub-shop or ice-cream parlor maybe) that would launch with immediate community buy-in and goodwill. But how about doing something really audacious, like raising $1,000,000 ($166 per person) to launch a Dunkin-Donuts franchise? That’s something the town could use, and it’s a business with high likelihood of success.
My final word on this (for now): after it launches and runs successfully for a year or two, integrate the business curriculum for junior varsity and middle school students. It’s never to early to start!
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