Banking on startup culture

Current and former students discuss the hardships of startups despite ASU’s multiple funding efforts

Since that fateful day in 1976 when college dropouts Steve Jobs and Steve Wozniak brought to life Apple Computer, Inc., there seems to be no limit to the imagination; armed with little more than an idea, some petty cash and a hearty supply of confidence, anyone is capable of changing the world.

The reality, as many will tell you, is not so simple. 

That’s hardly scared off ASU, the University that has a pool of $1 million for Venture Devils alone, an expansive program that aims to give ASU’s entrepreneurs the mentorship and funding required to succeed. In fact, business, management, marketing and related programs have seen an enrollment increase of 67% from 2014 to 2018.

Venture Devils, in particular, doles out a wide array of seed grants ranging from $1,000 to $100,000 to ASU entrepreneurs. It’s a testament to their faith in their community as much as it is a risk — a large portion of the startups they’ve funded are virtually untraceable now. 

The Venture Devils’ repository of its 476 funded startups contains many broken links, suggesting those businesses may no longer exist.

Even with all this funding and ASU’s multitude of resources, students feel stumped and overwhelmed. The zealous support networks can feel just as tricky to navigate as the industry landscape. That, of course, doesn’t stop troves of ambitious students from enlisting the help and funding from the University to launch their brands. 

Without preexisting wealth, most low-income students are fully reliant on the support of ASU’s financial channels. Most students do not have the resources to launch their startups without risking serious financial repercussions. 

Existing socioeconomic inequality has long barred minority groups from getting involved in the startup scene on their own.

“Our community as a whole could be a lot richer,” said Forbes Shannon, an ASU nonprofit management alumnus, about the prospect of increased diversity in startups. 

Rachel Masterson, a second-year master’s student in global management, co-founded Thunderpreneurs with co-president Pauline Nalumansi, a second-year master’s student in global affairs and management.

“We're trying to tap into ASU's resources as much as possible,” Masterson said. “Venture Devils does an amazing job of trying to get the word out, but I think that there's so many resources from all the different campuses and there's so many events always going on. It's kind of hard to keep up with all of it.”

But aspiring entrepreneurs are familiar with the difficulties and risks associated with trying to build something from nothing. 

“Most entrepreneurs fail, especially the first time around,” Masterson said. “Entrepreneurs can't be scared of risks. I think failure is just kind of a learning process that entrepreneurs have to go through, and they're pretty open about it and they're willing to fail.”

Still, the rate of failure may seem alarmingly high from the outside looking in. It’s a well-known and widely acknowledged fact that most startups fail. The exact number teeters somewhere between 50% and 90% depending on who you ask, given the difficulty of charting the lifespan of a business. But the overarching message rings true: You have to be bold to try to start a business from the ground up. 


“A lot of people view that as sort of the American dream — to go out and make yourself,” Dylan Ellis, a junior majoring in chemical engineering and the entrepreneurship and innovation chair of Changemaker Central on the Tempe campus, said. He said there’s a sense of shattering the status quo and addressing a problem no one has thought to. 

But if no one has ever done it, you have to figure it out on your own, he said.

“It's really easy to fall into a pit of doubt, but I think it's really important just to remember why you started and take care of yourself,” Ellis said. “You can’t effectively run your startup if you’re not taking care of the person running it.”

Shannon experienced firsthand the difficulties associated with running a business.

Shannon created Practiclasses, a workshop series intended to teach practical skills, but eventually had to shut the series down due to a lack of passion and funds. 

“Every entrepreneur has that first real hard reality check,” Shannon said. “I learned a lot about my own ego and what I value and how I value myself through the failure of that business.”

Shannon said it was critical to separate himself from the collapse of the business and not see it as an extension of himself. Afterward, he was able to look at it as something he could grow from. 

“A lot of people just fail and don't actually take anything from it,” Shannon said. “So what's the point of failing if we actually didn't learn anything about ourselves or about why we do what we do? To really take apart a failure takes a tremendous amount of self-ownership.” 

Kristin Slice, a senior program manager with Entrepreneurship + Innovation, said there is a tremendous amount of focus on developing ideas rather than a sustainable business in the field. The reality is much more complicated. 

A business is comprised of several departments that each demand attention and unique solutions, adding to the inherent stress of a startup. 

One of the biggest misconceptions about startups, Slice said, is that founders work independently. In reality, the process is incumbent on one’s ability to build a cohesive team that helps the business function. 

Ellis said working on a startup is doing something completely new with no blueprint, which can be equal parts challenging and empowering. 

“You don't have to work based on the industry schedule of nine to five every day. You can create your own schedule and work on your own projects that you really care about,” Ellis said.

But according to Ellis, not having a typical schedule hardly equates to less work. It can be increasingly difficult to balance the stress of a new business with a personal life. 

“You're always on the clock working toward your goal,” Ellis said.

The culture surrounding startups is one that preaches the importance of arduous work and ongoing failure. There’s an idea that you have to fail to improve. It may seem difficult to understand why anyone would willingly involve themselves in a startup.

“Realistically, you’re looking at three years before you see any profit,” Shannon said.

This delayed benefit and the grit it takes to support oneself make it difficult for many people who don’t have that financial cushion to get involved in projects they may be passionate about. 

Through Slice’s work with Peoria Forward, a partnership between ASU and the city of Peoria that aims to grow the entrepreneurial ecosystem in the West Valley, she is able to ensure that one’s socioeconomic status doesn’t affect their ability to share their brilliant ideas and make them a reality. 

And while several programs are in place to support the growth of entrepreneurs from different backgrounds, only so much can be done to reverse what is an uneven playing field. 

Even with all the trials, there are still instances of success. Alexandra Maw, an ASU alumna who graduated in 2008 with a degree in housing and urban development, founded Kaleidoscope Juice, originally Syrup, with a $6,000 Edson grant from ASU.

Maw’s father was a food and travel writer; this coupled with her upbringing eating healthy, delicious food inspired her to start her own company, which was originally in farmer’s markets and eventually in brick-and-mortar shops.

“It for sure has been a lot of pressure, especially since healthy options have become so popular,” Maw said of the increasingly competitive landscape. 

She said startups are emblematic of the American dream and the idea of creating something from nothing.

“Don't be paralyzed by perfection,” she said. “Nothing will ever be perfect. So don't let that stop you.”


Reach the reporter at snalcan1@asu.edu or follow @SarahAlcantar on Twitter.

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