Frank Rimalovski on the importance of entrepreneurship at schools
New York University is in the midst of its annual NYU Entrepreneurs Competition. Over eight months, teams comprised of students from across the university compete for $200,000 in prize money spread across three tracks – new, social, and technology ventures. The competition has been ongoing since 1999, with one notable previous winner being Pinterest (when it was known as Tote).
One of those behind the competition is Frank Rimalovski, Managing Director of NYU’s Innovation Venture Fund, a fund in the process of raising $20 million, which he uses to back startups created by students, faculty, and staff. In addition to this annual competition, Rimalovski is preparing for another big event: NYU’s Entrepreneurs Festival, which takes place on March 1 and 2. This “kick ass party” (as Rimalovski calls it) will include talks from Jack Dorsey from Twitter and Square, Herb Kelleher from Southwest airlines, and New York City’s Chief Digital Officer Rachel Sterne (who will be interviewed by our own Adam Penenberg), as well as others.
I chatted with Rimalovski last week to find out more about ways NYU (my alma mater) is seeking to create a more entrepreneurial culture – and why.
(This interview was edited for clarity and space.)
PandoDaily: You’ve worked in Silicon Valley and in New York at various technology companies before transitioning into founding your own VC firm, New Venture Partners. Why then make the jump to to the educational side?
Frank Rimalovski: When the opportunity came knocking at NYU, I was particularly intrigued, because it was naturally leveraging what I have already done but just switching it from the corporate to university context. On a personal level, I had a desire to be a more integral part of New York City. I had this thought back in 2009. It was during this time New York was kind of exploding, but our model [at New Venture Partners] of focusing on corporate spinouts took me all over the world and less in New York. There was a huge BBQ in my backyard, and I wasn’t invited to the party. Now, I am standing at the grill. The third reason was to really build something, to scratch that entrepreneurial itch of my own.
Tell me about the upcoming Entrepreneurs Festival.
The festival grew out of this realization that there is a richer history of entrepreneurs and startups at NYU that most people I talked to didn’t know about. [It’s] a really well kept secret inside and outside university. It dawned on me that we needed to celebrate this in a big way. It wasn’t just about putting a list of names on a website. It was actually creating some physical manifestation where people could connect, stories could be shared, and hopefully inspire people to learn from their experiences and lessons along the way.
Why does a college need a venture fund?
I think the need for a venture fund is somewhat university specific. I would say Stanford might not need a venture fund, because [it is] tightly interwoven and integrated with the venture capital community in Silicon Valley. Every university needs a robust startup ecosystem that helps empower or enable entrepreneurs across the university to go from an idea to impact and marketplace. The fund is one piece of that puzzle, and to some level it is the last piece. Often before things become investable they need to validate their concept in the marketplace, build a prototype, have a team, and some concept of a business model before people are going to invest. We have invested a lot of time in the last few years to try and build out that ecosystem to help entrepreneurs help themselves. That naturally feeds the fund. Absent the rest of the ecosystem, the fund wouldn’t necessarily have enough impact.
Does NYU need a fund to compete with Stanford and other universities that may be better integrated with their tech communities?
I do think it makes more sense for NYU, and I think it made more sense three years ago before the startup community matured and became richer and more complex. Back then, the ties that NYU had with the startup community were tenuous. My team tries to help build those bridges. Above and beyond just making investments, we try to bring experienced entrepreneurs and investors into the ecosystem we are building, whether serving as entrepreneur in residence, mentors, or being judges in venture competitions. We have learned a few tricks from our colleagues at colleges like MIT and Duke and try to adapt our needs to our environment. We are fortunate being in New York, as we have this thriving ecosystem on top of it.
When evaluating investments, what do you look for?
It’s often that the technology and the idea are one piece of the puzzle, but it’s only one piece of the complicated multi-variant equation. We are also looking for a team that has the drive, but also the ability to build and execute on that. We look for people that know how to be very customer driven, have some deep level of customer discovery or need. The people that have a grounded sense of what it is going to take to take it forward and have shown, the entrepreneurial grit or drive, the ability to make due with their resources they have at their disposable. The ones that make excuses -- "We don’t have this... We don’t have that..." -- are making excuses. Real entrepreneurs somehow figure out how to make it work. Also, investors are going to want to see that you can attract the team to build it, they you can actually build it, and there is some customer that gives a damn about it. There is an upward and to the right trend that we look for in investments, but also in people.
Are you seeing certain trends in the entrepreneurs?
In the technology venture competition this year, seven of the ten semi-finalists have some health care or life science to them, and there are not drugs. There are a couple of medical devices, a bunch of healthcare IT projects, a couple of services. We are starting to see, maybe it is a little bit of a shift, to people solving what I would call “more interesting and meaningful problems.” So, maybe the social venture competition is not the sole domain of do-gooders. How many more social networks and fashion startups do we need?
What do you say to people who claim entrepreneurship can’t be taught?
I don’t agree with that as a flat out statement, but there is something to it at the same time. I don’t think you can teach someone how to be an entrepreneur, but you can refine and hone their skills and support them. I would agree you can’t learn entrepreneurship from a textbook. Can you get it through practical application augmented by a classroom? I would say, to some extent. Some people were born to be something; it doesn’t mean you can’t make them better at it.
What kind of bumps in the road have you seen?
The sheer size of NYU is daunting, and it is spread across three main campuses in New York. Related to that, the cultures are different in some of the schools. In some regards, it is challenging to get the word out, because everyone is overloaded with email these days. We use email, Twitter, and Facebook, but there is no substitution for making eye contact and pressing the flesh. So getting out and presenting to clubs, classes, orientations, faculty staff meetings or town halls, this is a big place to do all that. Also, in a place where 25 percent of students churn every year, we are never done. It is like painting the Golden Gate Bridge. When you are done painting one end, the other side is starting to rust.
Looking ahead, where do you hope NYU is going to end up, relating to funding, services, and the program itself in the next couple years?
More and better. There is a lot more that we want to do, we want to create a physical entrepreneurship space where students from journalism, business, engineering, and IT can come together and connect, collaborate, and intermingle with the startup community. [Having] a VC office and lawyer hours is an important piece. Than there are other programs – I won’t go into specifics right now – that can help support a broader swath of the community. Ultimately that serves to drive both entrepreneurial behavior, thinking and activity, get more technology and innovations to market and at some level, becomes a magnet to attracting the best and brightest students and faculty to NYU. You can never be too good.