Bill Gates and Mark Zuckerberg both famously dropped out of Harvard to start wildly successful technology companies. In Israel, an innovative program is providing undergraduate students the business tools they need to become entrepreneurs, while also encouraging them to complete their degrees.
The Zell Entrepreneurship Program at the Interdisciplinary Center, a private college here, has spawned alumni-created companies that together have attracted nearly $100-million in investments in less than a decade. The Interdisciplinary Center has long sought to cut across academic silos and attract international scholars and students. The Zell program is one of its most successful efforts to distinguish itself from Israel’s public-university system.
The yearlong course is free, not for credit, and open to 20 final-year undergraduates chosen from applicants in all departments at the Interdisciplinary Center. It emphasizes practical business skills, networking, and students’ interaction with actual entrepreneurs.
“Forty percent of our alumni are working as founding members of start-ups or running their own business,” said Liat Aaronson, executive director of the program.
Alumni of the course, which is financed by the American investor and philanthropist Sam Zell, have helped create about 50 companies, including LabPixies, Google’s first Israeli purchase, for $25-million. Additional Zell graduates have sold their ventures to such marquee companies as Getty Images and eBay.
The achievements of the Zell program are significant, both in Israel and abroad. Noncredit entrepreneurship programs are widely available at American colleges, but many are online or only for graduate students. Most charge tuition. And few can rival the Zell program’s accomplishments.
“This is an unusual success,” said Vivek Wadhwa, director of research at the Center for Entrepreneurship and Research Commercialization at Duke University. “The mentoring network is very strong. Seasoned entrepreneurs are actively helping the new.”
A few universities have so-called proof-of-concept centers, like the Deshpande Center for Technological Innovation at the Massachusetts Institute of Technology, but these primarily involve professors and graduate students working to develop business projects, not efforts by undergraduates like at Zell.
In addition, Mr. Wadhwa says he likes Zell’s sole focus on spurring creative, lucrative ideas without concerns about benefiting financially. Traditionally, he says, universities have been too focused on the possibility of licensing intellectual property created on their campuses as a means to make money.
During the Zell course, students are broken down into teams that develop business ideas while alsotaking classes on marketing, product development, tax issues, and even the psychology of entrepreneurship. The college does not help finance the ventures, though it does provide small amounts of money to help subsidize the costs of travel to trade meetings and such.
A key part of the program is connecting undergraduates with alumni or local businesspeople who have started their own companies. For example, throughout the program, the teams pitch their ideas to panels of experts, including venture capitalists and others from the corporate world.
The program culminates with a trip to Chicago, paid for by the center, where the students take classes at the University of Chicago’s business school and meet potential investors, including Mr. Zell.
Tomer Salvi, who graduated from the Interdisciplinary Center in June and was part of the Zell program, said he gained “real-life experience” through the course. “Most of the classes were not academic but people from the real world coming to lecture us because they have start-ups that succeeded, and working businesses,” he said. “We really hear about their experience in life, not just theoretically. The Zell program was for sure more important for me than my studies,” said Mr. Salvi, who co-founded Segoma, a start-up that will allow diamond dealers to show their wares through the Web instead of hauling precious stones around the world.
Dror Ceder and Daniel Tal graduated from the Interdisciplinary Center and the Zell program in 2008. This past summer they sold Wibiya—a platform for integrating video and third-party applications into Web sites—for $45-million, making them Zell’s biggest single success.
“Without Zell, we wouldn’t be where we are at the moment,” said Mr. Ceder.
He said the program enabled them to avert disaster. Soon after graduation they started Joongel, a search engine that provided users with information about hotels and airline travel, but realized they were on the wrong track. They decided to start again.
“We understood there was a huge opportunity for something else,” said Mr. Ceder. “We pretty much killed Joongel and started working on Wibiya.”
“The Zell program prepared us for the change of direction because it always made you look at your venture and analyze what you’re doing,” he said. “After two years working on something, finally launching it, and after a few days deciding to shift, is not an easy thing.”
“You read about the business world all the time, and it looks far away,” said Mr. Ceder. “The Zell program helped us in a lot of different aspects to really jump into that world: how to accept criticism, how to ask the right questions, how to speak eye to eye, even to the important people out there, and really squeeze what you can from each person.”
Now, $45-million later, the Wibiya founders said they happily share the benefits they gained from Zell.
“We’re part of the alumni,” said Mr. Ceder. “We mentor all of the new students in the Zell program. It’s something that we will continue to do with the Zell program and to anybody out there. We are strong believers in paying it forward.”
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