April 8, 2011

Fundamentally flawed

Uncommon Fund suffers from ignorant administrative procedures

The Uncommon Fund is a simply wonderful idea with a history of weak execution. In 2007, the editorial board of the Maroon criticized the Fund for giving money to unforgivably odd projects that were nothing more than fluff hidden beneath a veneer of ‘uncommonness,’ as well as for general mismanagement.

We can report that little headway has actually been made in the intervening years to squash those problems, and that the Fund continues to struggle to be a clear, well-led, and well-organized enterprise.

Last February, the two of us entered into the Fund in hopes of securing funds to jump start the business idea that we had crafted during an undergraduate class at Booth. The Fund’s promotional banner featured the word “Entrepreneurial,” and the application papers said that any idea was acceptable so long as it was “uncommon,” so we went through with our application.

Initially, the application process was pretty straightforward. Upon making it to the second round, we had an interview with two members of the Fund’s board, an event that went decently, with no major concerns being raised over how we intended to use the money that we would hypothetically secure (something we would regret later, unfortunately). We spent several laborious weekends building a slide deck, and pitched our idea to the board along with the other groups who had made it into the final round.

It was at that point that the wheels began to fall off of the truck. Ushered—somewhere around an hour behind schedule—into a room of intensely bored and apathetic persons all staring at their laptops, we went through with our pitch. After finishing within our seven-minute allocation, we strode into the question-and-answer period, eager to tackle any potential challenges to our business model, customer acquisition strategy, and launch plan.

However, the quality of the questions we were actually asked following our pitch were indicative of a board that was either completely business-illiterate or so disinterested in our project that they had ignored our entire presentation.

“Where will the $240,000 go?” one board member asked, referring to our estimate for the total market opportunity of our venture, confusing it with expected initial revenue. “How will you manage payments?” asked another, even though our core business model was clearly a referral service and not an order processing and fulfillment business.

Now, the Uncommon Fund is in essence a very small, specialized venture capital firm. Instead of clean tech or online startups, its niche is student enterprises and ideas. Instead of reaping monetary gains, it seeks to enrich the student body. It listens (carefully, ideally) to pitches and funds the ones that it finds to be the best. Usually however, there are certain qualifications required of venture capital employees. This is not so with the Uncommon Fund, which must vet its board more carefully in coming years to ensure a level of quality that matches its 40,000-dollar responsibility.

Despite all this, we were upbeat, and did eventually receive a small slice of funding: roughly 19 percent of what we originally asked for. We learned that the remaining 81 percent of requested funds were denied because we had planned to use it to pay a talented student developer for his work. While we somewhat accepted the rationale behind the board’s decision, we were more irked that we weren’t notified of this hard and fast rule earlier in the process. If so, we may not have diligently poured several weeks’ worth of time into the Uncommon Fund’s lengthy questionnaires, presentations, and required meetings.

Then, several weeks later, came the final blow: a gathering in which we were told how to, at last, get our hands on the promised cash. After a sermon by a University staffer, we were informed that every Uncommon Funded project would be treated like an RSO. As we had been consistently pitching a business that would impact students, and not an RSO, this was a surprise. Even more, we were told that our monies would not be given to us, but would instead be kept hostage in a University account (you can’t run a business in that fashion, by the way.) We were then told that we were not allowed to buy things with our promised money, but had to purchase things ourselves and then ask for reimbursement. Assuming things went well, it would take several weeks to be paid back (again, you cannot run a business in this fashion).

Ultimately, we found that the Uncommon Fund is not as advertised. If the University truly cares about fostering entrepreneurship among the undergraduate population, it should build programs that accurately represent the professional, intensive, and (excuse me) no-bullshit process of pitching new businesses. Namely, it should select more qualified board members, loosen the Byzantine requirements forced upon funded projects, and fund fewer, better ideas that transcend one-day campus events. This way, projects with the potential to bring lasting change on campus might reach fruition.

Otherwise, the fund might as well pull the word entrepreneurial from its fliers and replace it with a phrase more fitting: offensively ignorant.

Alex Wilhelm is a third-year and Cece Yu is a fourth-year in the College.