Poor market heats Fresno State business incubator

Companies not hiring? Program gives students space to create their own.

Published online on Thursday, Sep. 10, 2009

In a sign of just how rocky the job market has become, a program at Fresno State that helps students start and run their own businesses is full for the first time.

All six offices at the Lyles Center Student Hatchery are occupied -- and that reflects a national trend as university students increasingly turn to business-launching programs and entrepreneurship classes, educators say.

Spurred by a bad economy and a shortage of job prospects, today's college students are seeking to create their own future. And at Fresno State, the growing reputation of the Lyles Center for Innovation and Entrepreneurship is attracting lots of interest.

The incubator-like program inside the Lyles Center gives students office space to run a business professionally, as well as access to entrepreneurship experts.

The hatchery started in 2006, and it has had some empty desks until now, said Genelle Taylor, the center's associate director. But this year, the program had more applications than it could accept.

Adam Mortanian, a 22-year-old senior, has a space in the hatchery, where he worked on the business he founded, Adnik Asset Management. The business changes locks, cuts grass and drains pools for bank-owned foreclosures. Mortanian recently sold it for $100,000.

He started the business from his bedroom at his parents' home.

As the business grew -- it employed 15 people from San Joaquin to Ventura counties, including four licensed contractors -- Mortanian needed a more professional space.

He couldn't meet with clients or interview job applicants in his bedroom, so he met them at Starbucks. But even that didn't have the air of professionalism he wanted.

"I'm trying to portray a certain type of image, and I couldn't do that without the office," he said.

Now he's working on several other ventures, including Remove-It, an environmentally friendly water-spot remover for cars, windows and other surfaces.

Mortanian and the other student entrepreneurs are working on businesses that include hair-clip makers and mobile skateboard shops. They work out of offices with floor-to-ceiling windows and a view of Shaw Avenue. They have desks and chairs for visitors and access to fax and copy machines, a receptionist and a mailing address that isn't their parents.' Most students use their own cell phones and laptop computers.

The space is called a hatchery because it's less intense than an incubator program, said Lyles Center director Tim Stearns. The students are welcome to bounce ideas off the center's employees. This year, they are working with entrepreneur-in-residence John Jacobson, who has experience starting businesses and funding them as an investor.

Students qualify for the office space in several ways. Two students qualified by winning entrepreneurship scholarships that include $5,000 and the office space. Another space is allotted to the winner of a Fresno State business plan competition.

Others apply for the space, pitching their businesses to Lyles Center officials, who look for students who are "coachable," said Taylor, the Lyles Center's associate director.

"There's so many great applications coming in, it's really hard to decide," she said.

The Lyles Center isn't alone. In the Midwest and in rural areas in particular, centers like this are rapidly growing, said Heather Van Sickle, executive director of the National Association for Community College Entrepreneurship. It reflects the evolving priorities of students, she said.

"They are more interested in figuring out ways they can create jobs or create opportunities," Van Sickle said.

The Lyles Center -- which opened in 2004 -- is recognized as a leader. In April, for example, Entrepreneur Magazine showcased the center alongside programs at Stanford University and the Massachusetts Institute of Technology as part of a story on what it termed the "entrepreneurial vanguard."

That kind of program appeals to today's college students, who are different from their predecessors, Van Sickle said.

"The younger generation, Gen Y and the Millennial generation, are more interested in creating their own future," she said.

Jacobson agreed, saying the old model of graduating from college and working at a job at a large firm for 40 years is changing.

"You work for yourself," he said. "That kind of culture ... is creeping in and is being driven by the fact that IBM isn't hiring 35 new kids into their program each year the way they were 10 years ago."

The dismal job outlook gives students an even greater incentive to create their own businesses than in years past, Mortanian said.

"Now it's more like 'Wow, am I going to have a job?' " he said. "I think it's really getting students to think twice: Is my idea a business?"