Todd
I think you are somewhat familiar with the Online Venture Challenge exercise that several of us are implementing in the US and Canada. In short, we ask students to open online stores, and operate them for a month. All net profits are donated to the registered charity of the students' choice. That does not mean that all of these stores are piloting a not-for-profit business model. In fact, some of these stores are later incorporated and built or sold for huge gains, such as www.GoVoluntouring.com (which was acquired by a massive travel agency).
In this 5 minute video (http://player.vimeo.com/video/120248089) I delineate 3 reasons why student businesses should donate all net profits to charity; 1) motivation to work hard, 2) lowers customer barriers/skepticism, and 3) in the USA and Canada individuals who raise less than $30k per year for a charity do not have to incorporate themselves. As students working on a class project they are still covered by whatever liability regime your university already has in place (for keg parties, chem labs, etc.). After the semester ends these students are of course free to carry on in whatever way they see fit (for profit incorporation vs. B corp/L3C vs. non profit), distributing anything from 0-100% of their future profits to charity, but for the pilot (or the MVP in today's parlance), the students must give away the money (and with it the costs of incorporation).
At the end of the video I mention that one instructor will soon be modifying this model in a way that might really work for you. This Fall a University of Tampa professor will be requiring that all net profits from these student businesses be donated to the university foundation. This is an experiment. It may turn out to reduce the 'social venture' element that empowers students and customers. On the other hand, it might magnify success by invoking school spirit. Either way, I think it could technically be a great solution to the dilemma you pose below.
Geoff Archer, PhD, Associate Professor & Director
Eric C. Douglass Centre for Entrepreneurial Studies | Royal Roads University
T 250.391.2600 ext. 4207 | F 250.391.2610
2005 Sooke Road, Victoria, BC Canada V9B 5Y2 | royalroads.ca
Twitter: @GeoffArcherPhD
LIFE.CHANGING
Dear Ent Listserv Members,
I need your expertise!! I am teaching a new course at Gonzaga University this semester where a team of students is actually creating a new company. A team of students have been working with our Law Clinic in the Law School in the formation of a company (Corporation). This past week, we were contacted by the administration to hold off on what we were doing due to liability/insurance issues. According to one administrator, once the students incorporate, the coverage under Gonzaga's umbrella policy would no longer be available. In order for us to proceed with the class and future classes in our program that create companies, the administration has asked us to contact other schools that are doing something similar (creating companies during a class) and determine how they are controlling for liability/insurance issues. I appreciate any guidance on how to solve our problem. Thanks in advance! My phone number is 509-313-7048 or finklet2000@yahoo.com.
Todd A. Finkle, Ph.D.
Pigott Professor of Entrepreneurship
Gonzaga University
School of Business Administration
502 East Boone Avenue, AD Box 9
Spokane, Washington 99258
509-313-7048
finklet2000@yahoo.com
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************************************** This message is from ENTREP which is sponsored by the Entrepreneurship Division of the Academy of Management. Please do not post messages with attached files. Commercial messages or spammed messages are not allowed on the list. The use of auto-responder "out-of-office" messages may also lead to your removal from the list. You can manage your subscription options, including joining or leaving the list here:
http://aomlists.pace.edu/scripts/wa.exe?SUBED1=entrep&A=1 If you have questions or need help, please contact Dr. John Bunch
jbunch@benedictine.edu. Ventures HO!