“Entrepreneurs do not create new companies,” begins Ted Ladd, professor of entrepreneurship at Hult International Business School’s San Francisco campus. It’s a counter-intuitive statement—isn’t that what makes an entrepreneur an entrepreneur?
But for Ted, the single most important factor to being an entrepreneur is simple: solving customer problems.
“Before they build or buy anything, successful entrepreneurs talk to potential customers, vendors, and competitors,” he explains. “It is a myth that some people are born with the ability to find these customer problems.”
Ted has been a professor of entrepreneurship at Hult for five years, and has previously taught at Harvard Business School and Copenhagen Business School. His main business interest is entrepreneurial strategy, with his research focused around hypothesis testing—he says that this is one of the most important things for any budding business-owner to keep in mind.
“Some students recently wanted to build a company that resembled Yelp’s restaurant reviews, but focused on the restaurants’ social and environmental sustainability,” he recalls. “They asked me to introduce them to app developers, and I had to step in and shout ‘Don’t build anything yet!’”
Instead of rushing into building a prototype app, Ted guided the students through customer surveys, asking prospective restaurant-goers which buttons the customer would most like to press on a paper-drawn version of the app. The result was a success—“for less than $1, this experiment revealed how customers prioritized different pieces of information, and helped the team realize that there was insufficient demand for their specific idea.”
The students were wise to take Ted’s advice—he has participated in five startups, the most recent of which was acquired by Google, and also has an MBA from Wharton. His recent research into MBA student projects found that entrepreneurs who actively sought to confirm hypotheses in their initial research “were even more successful than entrepreneurs who had merely listed their assumptions but not tested them,” he says.
Focusing on sustainability
But Ted’s interests go further than entrepreneurship—he also has extensive experience working in the sustainability sector, and considers the topic crucial to an MBA education, as well as a “necessary step” for any new business.
Hult's one-year MBA already prepares students for a future business environment with an in-depth module that focuses on disruptive technology, covering everything from robotics and autonomous cars to blockchain and the Internet of Things (IoT). Hult students even participate in an immersive final team project utilizing some of this emerging technology and design thinking to find a solution for a pressing business problem.
For Ted, sustainability is another topic that business students and entrepreneurs should have in mind when considering the future of business. As a recent UN report revealed that human activity has severely impacted the natural world and reduced the productivity of 23% of the world’s land, sustainability is now an urgent crisis.
Ted believes that businesses should also keep sustainability at the forefront of their business strategy—which could also lead to a more successful business, as well as a healthier planet.
“Sustainability is not just a good idea for your community or for the planet,” he explains. “Startups that build sustainability into their DNA also have an easier time hiring and retaining employees.
“Customers and investors are also less likely to support companies that operate unsustainably. Not only would an emphasis on sustainability lower costs for your business, but it can also boost revenues.”
“A business education gives students skills to become serial entrepreneurs, or to move into and out of entrepreneurship as the market, the idea, and their life circumstances change.” - Ted Ladd
So what other tips does Ted have for budding MBA entrepreneurs? He believes that while an MBA is not necessary for every entrepreneur, strong business education combined with a commitment to sustainability could be the key to succeeding in your venture.
“Starting a new venture is only one small piece of management, and getting an MBA gives students skills to understand how to scale a promising idea into a full company,” Ted says.
“A business education like the MBA at Hult gives students skills to become serial entrepreneurs, or to move into and out of entrepreneurship as the market, the idea, and their life circumstances change.”