No relation to pay-to-pitch

by Joe

Our own Chris Hurley

Xconomy’s Wade Roush writes today about the closing of Chris Hurley’s Revolutionary Angels, a for-profit venture with the idea of charging 100 startups $4,995 apiece to enter a business plan competition that would provide the first-place finisher with a $250,000 “angel investment” ($50,000 for second place). The winners would also have to give up 10 percent and 2 percent, respectively, of their companies.

Wait a minute. Chris Hurley? Isn’t he one of the founding members here at Bizplancompetitions? And my own son, no less?

Happy to discover that there are two Chris Hurleys, and to report that they are not related. The most notoriety my Chris Hurley, a 20-year old college junior, has received to date was a recent mention in NYTimes.com reporting on his purchase of a close-to-campus home that provided him with an $8,000 federal tax credit.

The failure of the other Chris Hurley’s venture, Revolutionary Angels, is not surprising. And it is no doubt a good thing. This issue was covered nicely by Lora Kolodny back in November 2009 on her New York Times blog.

We despise the idea of having to pay big dollars to pitch to angel investors, and even more so the idea of paying big dollars to compete in a business plan competition. Even the couple of hundred dollars charged as an entry/workshop fee by some non-profit competitions deserves extra scrutiny.

Many business plan competitions charge absolutely nothing to any eligible participant. That’s really the way it should be.

Did you like this? Share it:
Joe Hurley is a CPA, author of "The Best Way to Save for College - A Complete Guide to 529 Plans", founder of Savingforcollege.com, and co-founder of Bizplancompetitions.com. He has also recently started making maple syrup.
View all posts by joeh → This entry was posted in Featured Posts and tagged . Bookmark the permalink.

4 Responses to No relation to pay-to-pitch

  1. Pat Burke says:

    Nice fish. You should indicate species, length and weight.

    Joe,

    Saw you have rekindeled your WSJ contacts. Nice mention in the paper yesterday.

    Pat Burke

  2. admin says:

    Hi Pat, I believe that is a rainbow trout taken in Lake Ontario on a beautiful summer day in 2009. I took that shot, but don’t recall catching anything that nice myself.

    Thanks for keeping an eye on us. We do love being a resource for business writers.

    Joe Hurley

  3. Eli says:

    Hi Joe,

    I just found your site and have really enjoyed reading your posts. I have a question regarding your belief that business plan competitions should be free. I agree with you that competitions with the goal of encouraging new/young entrepreneurs should be free in order to reach the widest audience possible, but how about competitions aimed at bringing more developed companies before investors in the hopes of receiving an investment? Couldn’t a small fee in that case (more like $75 instead of several hundred) be a tool to ensure that only serious competitors enter?

    Thanks,

    Eli

  4. admin says:

    Eli, thanks for your comment. My opinion is that a fee is generally not the appropriate applicant-weeding tool as it presumes that worthy competitors are willing to pay the fee and unworthy competitors are not. That’s just not always going to be the case. It will certainly reduce the size of the applicant pool but will not necessarily increase its quality.

    There are other more-effective ways to raise the bar: make the application more detailed; ask for W-9 and proof of incorporation; ask for references or peer recommendations. These things may increase the screening effort a bit, but it may also attract more high-quality applicants because they know the competitions organizers are serious too.

    Something de minimis like $75 is probably no big deal, and perhaps would be effective in eliminating a lot of the chaff, so I don’t have a huge problem if it stays in that range.

    I also don’t so much mind fees that are charged because the organizer has to cover administrative expenses. But I would hope that outside sponsors will agree to using some of their money for that purpose, and not just for the prize pool.

    Joe

Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

Submit a Competition Sign Up Now!
  • Business Plan Resources

    Do you have a business idea or want to enter a business plan competition but not sure where to start? See our list of must-read business plan resources.