Families: Nurture Entrepreneurs

Of late, graduating from college has been a source of anxiety rather than excitement for many families. Youth unemployment is at 17%. Parents are concerned about their children’s future. Here’s one way parents and families can help: support their children’s entrepreneurial ambitions.

Family support allowed Vanderbilt University fraternity brothers David Muzzo and Cameron Chalmers in 2000 to found Study Island, an educational software company. Since then, the company has changed its name to Archipelago Learning and gone public, and it did $55 million in revenue last year.

One of their grandmothers had a condo in Fort Lauderdale, Florida, that she was not using, and she let Muzzo and Chalmers live there rent free. The two friends spent a year and a half developing what would become Archipelago.

The idea for Archipelago was to create a software application that let students enter the material they were trying to learn and share it with other students. Muzzo and Chalmers’ vision was that Archipelago would evolve into a shared library of academic content.

Teachers are now using Archipelago’s software. When a student goes to the lab at home, all the student needs is a browser. There is a mini review lesson online of what was taught in class, and the student starts to answer practice questions related to the topic. If the student answers questions correctly, she gets to play a game for 10 to 15 seconds. If she gets a question wrong, she receives an immediate explanation about why her answer was incorrect and the software asks her to answer the question again. The next day, the teacher gets a report that shows how much time the student spent on the program and how well the student did. Archipelago’s software can also create reports for principals and parents.

Archipelago first focused on schools in Ohio and created educational software for that state in a mere six months. “We started with grades 4, 6, 9, and 12,” Muzzo says. “The subjects we focused on were math, reading, science, and social studies. Those grade levels and subject areas were chosen because of Ohio standards testing.”

From the start, Archipelago had high revenue growth. “In 2000 we started off with no revenue,” Chalmers recalls. “In 2001 we made $250,000 in revenue. In 2002 that jumped to $550,000. In 2003 we broke the million-dollar mark with $1.4 million.” (Read more about Muzzo and Chalmers’ story on my blog.)

Gradually, Archipelago moved into Illinois, Texas, and Oklahoma.

Until Muzzo and Chalmers sold the company in 2007, there was not a penny of external financing. What there was, however, was grandma’s condo in Fort Lauderdale. Their rent-free stint probably amounted to about $20,000 in angel financing!

What a difference it can make, these small amounts, in the life of young entrepreneurs with the work ethic to roll out a large chunk of an entire state’s educational content in six months.

Parents, grandparents, uncles, and aunts, America’s youth will need you to give them a hand as they delve into entrepreneurship this year and beyond. And who knows, a great rejuvenation of America could take place as the millennials grow up and claim their place in the professional world.

This segment is a part in the series : Families