University Officials: Budget Cuts Won’t Hurt Campus Entrepreneurship

Universities and colleges across Michigan may be scrambling to reduce costs as state officials weigh deep budget cuts to higher education. But programs that encourage entrepreneurship and innovation will likely be spared, school officials say.

The programs are well-established and often funded by outside sources and therefore won’t be directly affected by the state funding cuts. However, the poor economy could make it more difficult for centers to raise funds and university-bred startups to survive once they leave campus, officials say.

Bryan Ritchie, the director of Michigan State University’s Entrepreneurship Network, says he doesn’t think the proposed cuts cuts will hurt his organization because 80 to 90 percent of the network’s funding comes from outside MSU. He does worry that a weak economy might discourage donors from writing checks.

“We continue to grow pretty rapidly, it’s just made it a little tougher to get some the resources we need,” Ritchie says. “Even though it’s been a little bit hard, we’ve been able to get them.”

Judy Johncox, associate vice president for research and technology commercialization at Wayne State University, says there’s still strong interest in university innovation from students and faculty and companies looking to commercialize high tech intellectual property.

She remains confident any cuts won’t hurt WSU’s efforts to foster an entrepreneurial spirit on campus. But startups that spin out from Michigan universities might have a tougher time staying afloat, she says.

“The cuts to education I don’t think are the issue, I think the economy itself and financial resources to support those companies once they get started is the issue,” she says.

Tim Faley, managing director of the University of Michigan’s Samuel Zell and Robert H. Lurie Institute for Entrepreneurial Studies, says such programs are “beyond the tipping point.”

Like MSU’s Entrepreneurship Network, Wayne State’s Blackstone LaunchPad or his own center, most campus innovation programs are endowed, Faley said.

Perhaps most importantly, Faley says, university officials understand that they can show state legislators how these programs generate jobs and encourage economic development.

“Ten years ago when we were talking about competitiveness and that sort of thing and then you could talk about research,” Faley says. “But now when the whole discussion centers around jobs, then research is too far out, the discussion is really what are you doing to help job creation. Entrepreneurship is a great thing for that.”

Johncox says she expects WSU and other local universities continue to bring entrepreneurial students and university startup leaders to lobby lawmakers. Nevertheless, the schools will feel some pain, she says.

“It is really important that we talk about those successes in an attempt to not have cuts,” she says. “But the state is in an economic crisis and the state’s trying to balance the budget and if we look at how that’s going to happen we know we’re going to get those cuts.”

David Mielke, dean of Eastern Michigan University’s College of Business, says the budget cuts might actually encourage universities to practice what they preach and get creative.

“It forces us to pay much more attention to the markets that we have and to determine what programs are really needed and what programs can drive enrollments,” he says, “and therefore increase our revenues and as a result serve our students much better and serve our employers much better.”

Jillian Berman is an intern for Xconomy Detroit. Follow @

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