Entrepreneurship, education, and business. At first glance, these words don’t seem to go together. Why. Let’s start by combining Startup and Education. College lectures come to mind first. It also reminds me of government-funded projects. When you combine education and business, the keyword entrepreneurship seems to stand alone. While entrepreneurship education is more common than it used to be, the idea of doing business with entrepreneurship education still raises question marks. There are three main questions to ask.
Can entrepreneurship be taught through education?
Can I make money from entrepreneurship education?
③Can entrepreneurship training help me grow my business?
There are some people who answer yes to this question. Underdogs, a company that specializes in entrepreneurship education. Underdogs says that entrepreneurial education can create entrepreneurs and create a revenue structure. The company even announced that it is expanding and entering the corporate training market. They are about to go public. To summarize, we can say that we have verified ① and ② and are ready to tackle #3.
The rationale. In fact, Underdogs has produced more than 12,000 entrepreneurs in nine years. Chuncheon Potato Field, famous for its ‘potato bread,’ Gunsan Seomgim, a local specialty seaweed brand, and Odooje, which sells basalt-shaped muddle crayons and muddle books with Jeju values, experienced Underdogs entrepreneurship training. Cumulative revenue is around 50 billion won. That’s a rare number in the entrepreneurial education space.
Of course, the question remains. Why a company specializing in entrepreneurship education is moving into corporate training. The latter, which is aimed at employees, and the former, which is aimed at entrepreneurs, are very different. The growth of the entrepreneurship education business does not guarantee success in the corporate education market, so how does it translate into business? If the underdog is 1) How do you continue to nurture entrepreneurs and 2) As you make sales 3) The clue is in the scalability of your business.
Let’s remind ourselves that entrepreneurship and education don’t go together. Entrepreneurship education was an untapped market. That’s where the Underdogs built their business and survived for over a decade. The graph gradually shifted upward. A market has been created where tens of billions of won can be earned. During this growth, companies see things that others don’t. You have a golden opportunity to prepare for the future half a step ahead.
Underdogs says entrepreneurship is not limited to “starting a business. Even if you look atthe long view, there are more and more places that want entrepreneurial skills. The need for “entrepreneurial talent” in the first place is what led to the growth of the entrepreneurship education business. So I decided to move into the corporate training market. Could their challenge be a leap forward? In this article, we’ll analyze Underdogs’ process of scaling its entrepreneurship education business and discuss the possibilities and challenges for future growth.
[Article Overview]
1. Does ‘entrepreneurial skills’ really matter?
2. Entrepreneurial Training Discover opportunities to expand your business
3. Entrepreneurial talent, will corporate education help them settle down?
1. Does ‘entrepreneurial skills’ really matter?
“Entrepreneurial skills are increasingly sought after.” We need to interpret this sentence to determine the business of underdogs. First and foremost, we need to define “entrepreneurial skills”. Luckily, there is a concept we can use as a reference. It’s entrepreneurship. If you follow the discourse surrounding entrepreneurship today, you can get an idea of what an entrepreneur is capable of.
Originally, there was no such thing as entrepreneurship. The word entrepreneur also appeared in Europe in the early 17th century. At the time, an entrepreneur was defined as “someone who does business for a living. The word entrepreneur itself comes from the French word “entreprendre,” which means to undertake, start, or take on. Back then, “people who set up their own businesses and earn an income without a fixed wage” were called entrepreneurs.
“To translate entrepreneur into English, adventurer is appropriate.”
The 18th century French political economist Jean-Baptiste Say said. Adventurers are similar to entrepreneurs in that they gather friends and resources to go on an adventure, and lead a team to find new opportunities. In that sense, the early entrepreneur was read as “someone who raises capital, takes responsibility, takes risks, and challenges the opportunity to make money.
But the definition of an entrepreneur has changed since the 20th century. Research has emphasized the importance of entrepreneurship and its competencies. For example, entrepreneurship is not limited to creating new businesses. New production methods, developing new sources of supply, exploring new markets, redesigning and reorganizing processes, and growing existing businesses in new ways have created a discourse of “entrepreneurialism.”
In other words, the definition of an entrepreneur has broadened beyond livelihood or motivation to trying new things and new ways of doing things. As a result of these changes, two capabilities ultimately emerged as the competencies of entrepreneurs. They are learningand value creation. Interacting with the external environment to understand its dynamics and create new value is the hallmark of an entrepreneur, the researchers said.
The evolution of the entrepreneur has crystallized the notion of “entrepreneurial talent. This is because entrepreneurship has expanded to include not only entrepreneurs, but also people within the organization who have entrepreneurial skills. Self-actualization, impact, and new businesses have been redefined as the domain of the entrepreneur. The broadening of the concept of entrepreneur to entrepreneurship has led to the emergence of a new breed of entrepreneurial talent.
“More and more companies are looking for entrepreneurial skills.” If entrepreneurship has changed in the past, what will it look like in the future? Underdogs noted that social uncertainty is growing. For example, the Collins Dictionary’s English word of the year for 2022 was “permacrisis”. It’s a combination of the words “permanent” meaning “forever” and “crisis” meaning “crisis”. An academic term for “long-lasting instability”.
This increase in uncertainty is not limited to macro conditions such as the climate crisis, international events (war in Ukraine), and economic crises due to high prices. This is an irreversible change for individuals and organizations. Professor Linda Creighton of the London School of Economics said that three forces are fundamentally changing our lives: ageing, technological advances, and social trends. This is such a fundamental change that confusion is inevitable.
Old age: Life expectancy has increased by 2-3 years every 10 years, extending late middle age to early old age. How to live the second act of your life after retirement. It’s inevitable that the formula will change physically.
Technological advancements: Everything from manufacturing to domestic labor is affected. As individual productivity increases, women are entering the workforce, starting their own businesses, and living differently than past generations.
Social trends: Toward a society that is less bound by age, gender roles, and job stereotypes. Along the way, individual needs have become much more complex. We call this “irregularity of desire emergence.”
Career strategist Paul Millard describes individuals today as being on a “road lesstraveled.” We can’t continue with the legacy we’ve always taken for granted. So people are at a crossroads where they have to create their own path. It’s the same for businesses. In Millard’s view, people who can cut through the chaos and create business opportunities in an uncertain business environment will be increasingly valuable.
At this point, we compare how Underdogs defines entrepreneurial talent. The Underdogs Hustle, a training program focused on startup leadership talent, identifies three characteristics of entrepreneurial talent.
(1) Talents who can go beyond efficient thinking to ‘effective thinking’
0 to 1, people who can build a business on their own.
③ Talent that can validate market demand with fewer time and money resources
All three requirements are a modern reflection of the entrepreneur. Entrepreneurs are not just practitioners, but people who think about the “effectiveness” of a business, people who build the framework of a business in the midst of uncertainty, and people who discover uncharted markets and create value propositions. Entrepreneurial talent is driven by the virtues of “adding value” and “pursuing opportunities” that go beyond survival. It’s clear that the company has chosen one of the most recognizable talents for its business in an uncertain market environment.
Unfortunately, we are being asked to be entrepreneurs without knowing what an entrepreneur is and how to be one. The OECD report notes that entrepreneurship education is “the most powerful response to the need for individuals and organizations to build entrepreneurial capacity as societies become more complex and uncertain.” However, he also pointed out that “current education policies and systems are narrowly focused on teaching test subjects.”
What if we put entrepreneurship education in the category of “the most powerful response to social complexity and uncertainty”? As entrepreneurial skills are in high demand, now is the time for entrepreneurship education to scale. The demand for entrepreneurial talent is growing, but there are only a handful of providers who can systematically teach it right now. This is why we’re excited to see Underdogs expand.
Now it’s time to change the question. If entrepreneurship education is a viable alternative, we need to answer the question of how to make it sustainable and scalable. Ask if you can broaden the stage without losing any of the keywords: startup, education, business. Can you prove your business is unprecedented. The underdogs will find their way, and that’s how they’ll grow.
2. Entrepreneurial Training Discover opportunities to expand your business
How can we train entrepreneurial talent? Is it possible to ‘train’ in the first place. When we think of “education,” we think of a classroom. Entrepreneurs and entrepreneurship have less in common. This is one of the reasons why entrepreneurship education is so difficult to translate into business. As recently as a decade ago, entrepreneurship education took the form of sit-down classes. It just didn’t make business sense.
This is where the problem of underdogs comes from. The core of entrepreneurship education is ‘hands-on’. “Learning by doing” is the most effective way tolearn. Several researchers have noted that hands-on learning is key to becoming an entrepreneurial person. This means that the juggling act of starting a business is not something you can do with the knowledge you learn at your desk. You can only learn by seeing, trying, and experiencing.
However, entrepreneurship training was far from hands-on (even though its effectiveness was self-evident). There are two possible reasons for this 1) because they’re stuck in one-way training, or 2) Training is a distraction from the core business. This meant that training was either ‘business as usual’ or training itself needed to be revolutionized. Entrepreneurial talent development is ironically the most stagnant sector.
Let’s go back to 2015. To learn about entrepreneurship, I had to seek out school classes and other online and offline training. Entrepreneurs, professional trainers, professors, investors, and other people who know what it takes to start a business taught the course to entrepreneurs and aspiring entrepreneurs. The content varies. This could be your own experiences, case studies, or specialized training in areas such as investor relations, finance, or human resources (HR).
This kind of entrepreneurial education has a blind spot. It was mostly a listening session. The content also depended on who was doing the training. It was either too general or too specific for each trainee. No two e-commerce, manufacturing, or software startups are the same. Everyone’s situation is different, and you have to be lucky and hope that the training is relevant to you. The personalized labs were uninspiring.
It’s not that there aren’t quality hands-on programs for entrepreneurs. An example is Silicon Valley accelerator Y Combinator’s (YC) “YCStartupSchool” and semi-annual placement program. Startup School is an online course that is free and open to aspiring entrepreneurs. The next step is for startups to apply to the placement program, where they will receive individual coaching and hands-on training. One of the strengths of starting a business in Silicon Valley is learning from people who have done it.
Education is a great outreach and recruitment tool. If you’re a venture capitalist or accelerator looking for seed funding, educational content can help you find prospective and early-stage entrepreneurs. They can be the first to evaluate and weed out the “wannabes” when they join the lab. So investment firms and education are a synergistic combination. Education is good for PR and branding, and it’s good for sourcing investment.
In this relationship, entrepreneurial education serves the so-called ‘portfolio strategy‘. We prioritize coaching hands-on experience and nurturing the potential of our students while nipping the budding talent in the bud. Betting on the 1% that will explode, because that’s the revenue model of venture capital. Entrepreneurial “education” doesn’t mean you can’t commercialize it or prioritize talent development.
It was a stark reality. Hands-on labs are important to improve the quality of educational offerings, but there has been little precedent for introducing them. When we introduced labs, we leaned more toward monetizing the investment portfolio than the training itself. I had to make compromises to make money around teaching. For profitability reasons, they would either charge a high price for training from a small number of potential customers or find a way to get away from the keyword “startup” quickly.
But the underdogs had a different game plan. First, we set out to “solve the problem” of entrepreneurship education. After defining the problem (“Entrepreneurship should be taught hands-on by people who have started a business”), they focused on differentiating their product. Finding a revenue model that aligns with market changes. Luckily, I was able to put a structure in place to monetize the entrepreneurship training product. In the meantime, we invested in things that would allow us to scale our business. We created our own training content for coaching and built a system to train future coaches.
Interestingly, you can compare this to the growth strategy of a B2B SaaS company. 1) Solving the customer’s problem is the starting point. 2) Open the customer’s wallet with a glance from the existing player. 3) Prioritize marketing, a product that makes money from the start. 4) Original educational IP mimics the scalability of software that can be used over and over again. This is because an IP can be transformed into multiple training programs. This experience in differentiating, building a revenue model, and investing in scalability has been invaluable as we’ve scaled the business. (More on this later in the article).
1) Differentiation: How ‘hands-on’ is being introduced to entrepreneurship education
Entrepreneurs create value by solving problems. There are two main types One is when you are the party in question. Create value by solving your own problems. Close the deal. The other is when you find the problem externally. We build businesses by capturing and solving problems. The Underdogs were the former, solving entrepreneurial problems as entrepreneurs.
“I wish we’d done this from the beginning.”
Prior to joining Underdogs, Sangrae Cho founded a social venture called Water Farm, which provides water conservation solutions. He also built an IoT shower and developed a service that compares your water usage with your neighbors. I haven’t tried it in two or three years. However, by the time we finished our last service, we were winding down the company. I didn’t regret it.
However, I was disappointed. As an entrepreneur, I wish I knew then what I know now. That’s why he decided to join the Underdogs. Founded in 2015, Underdogs started out as an entrepreneurial academy founded by Kim Jung-heon, who now heads the holding company New Black. Mr. Cho entered the education business with the mindset that “I have a lot to share with early-stage founders because I started my first business inexperienced.”
“I realized I can’t hire people based on their resume.”
Originally, the Underdogs Entrepreneurship Academy was started to gather talent. It all started with a free entrepreneurship education program offered by CEO Kim Jung-heon. My intentions were clear. I wanted to overcome the limitations of a resume. The goal was to find and train people who could take on the unique and daunting challenges of starting a business. It’s understandable that they started with entrepreneurial education to find the entrepreneurial talent they needed.
In early-stage startups, the skills of each team member are critical. It can make or break a company. So we decided we couldn’t build a team based on resumes alone. So how do you find entrepreneurial talent? Kim held a six-week, 300-hour entrepreneurship training program, including room and board. We wanted to make it as robust as possible.
In effect, the entrepreneur was solving his own problem. This type of entrepreneur is characterized by knowing the problem they want to solve better than anyone else and doing their best to solve it. The intensity of the entrepreneurial education is not unrelated to this. They know because they’ve been there. “You can‘t teach entrepreneurship in moderation.’ In doing so, Underdogs was able to define a non-negotiable point of differentiation in entrepreneurship education.
Underdogs Entrepreneurship Academy is a 1) As a team building exercise 2) What do you wish you had known when you started your business? 3) Teach like you’ve been there, done that is our motto. As a result, coaching has become 70 to 80 percent of the overall training curriculum. To do this 1) Solve a startup’s team-building problems by finding or teaching entrepreneurial talent. 2) Reduce the trial-and-error costs that entrepreneurs face in the early days of their business, and 3) We hypothesized that changing the format of entrepreneurship training would increase its effectiveness.
Some of our hypotheses were correct. Through the entrepreneurial academy, Underdogs recruited 10 initial members. We proved that team building is possible by identifying and training entrepreneurial talent. It’s also worth noting that the entrepreneurship training itself has performed well. The number of people who started a business after the program was 2,000, the business retention rate was 63%, the investment rate was 34%, and the job creation rate was 50%. You’ve created a quantitatively positive metric.
(See also: Entrepreneurial Underdogs to raise 100,000 ‘underdogs’ to revitalize neighborhoods – Business Post)
Of course, back in 2015, there weren’t many programs that offered hands-on entrepreneurship training. Nevertheless, Underdogs left labs as the default. I specifically focused on the “entrepreneurial coach” part. That way, we could build a one-on-one coaching system and differentiate ourselves. Differentiation is how startups survive. That way, you can make a name for yourself and build demand when you first hit the market.
In fact, about 90% of Underdogs’ 250 domestic coaches have entrepreneurial experience. From the beginning, the focus was on creating a one-on-one coaching program with people who had learned to start a business through entrepreneurship. Trainees benefit from being coached by a coach with similar startup experience. It’s great to get timely feedback that I can apply right away.
‘An entrepreneur knows an entrepreneur’s heart’
When entrepreneurs face challenges, they often look to their peers. It’s not often that you have someone who can tell you how to navigate the challenges you’re facing. Until now, entrepreneurs have had to seek out other entrepreneurs on their own to fill in the gaps in traditional entrepreneurial education. One-on-one personalized coaching acted as a system to reduce this cost.
We produce an entrepreneur every year. Get a coach who is an entrepreneur. The two sentences go together. Entrepreneurs who have graduated from Underdogs are potential partners who can provide training. Any business in any field can have a senior entrepreneur in the Underdogs’ network who can give them advice. This way, the education doesn ‘t end with the education, but with the asset of the network.
“The coaches are pacemakers who work as a team with the entrepreneurs in the program to figure out how to execute the business idea, how to meet the customers, and how to improve the idea,” said Underdogs CEO Cho Sangrae. A pacer is an athlete in a sport, such as middle-distance running or swimming, who paces the field to help athletes achieve their best performance. In entrepreneurship education, this means that the educator is a business partner who can be a one-on-one, hands-on coach and provide practical support.
So the network didn’t just contribute to education. Underdogs can do business together or become each other’s customers. As an accelerator, it’s also a great place to look for investment opportunities. This network of entrepreneurs has been a great source of support for our education business and other business opportunities. By sticking to the “one-on-one coaching” differentiation, we were able to build a foundation for long-term expansion.
2) Revenue structure: from social contribution to partner boosting
No matter how meaningful the education, no matter how many entrepreneurs you produce, if you can’t make money, you can’t sustain your business. How the underdogs made money. Interestingly, they linked entrepreneurship education to corporate social responsibility activities. By creating a link between ESG management and entrepreneurship education, they were able to win business-to-business (B2B) and business-to-goods (B2G) deals. They found a revenue structure to support entrepreneurial education. This led to a model of providing free education to trainees.
ESG is a big topic in the business world these days. A term that encompasses the non-financial factors of a company’s environment, society, and governance. ESG management refers to the long-term pursuit of eco-friendly, socially responsible, and transparent management in light of these indicators. It’s the latest version of “giving back.
Corporate social responsibility has changed with the times, as has the concept of entrepreneurship. “Corporate Social Responsibility” (CSR) was first proposed by Richard Boen in 1953, as a way for companies to actively share their wealth with society. For example, it’s not uncommon to see a press photo of a company’s employees volunteering to deliver briquettes at the end of the year. The correlation between a company’s activities per se and social responsibility was weak.
Since the 2000s, other claims have been made. It has been argued that there is a business opportunity in solving social problems, and that it is therefore possible to pursue both business and social objectives at the same time. This is what Harvard Business School professor Michael Porter calls “creating shared value” (CSV). A prime example is the Silver Courier program, which has created senior jobs helping deliver packages on a community basis.
In 2023, the Sustainability Standards Board (SSB) will publish an international standard for ESG disclosure. In Korea, the draft ESG Basic Law has been released and the debate is heating up. As a result, companies should plan their CSR efforts with a long-term perspective, not a one-off. The question of how to build a business that makes business sense and is socially acceptable became more of a concern.
Underdogs combines these social issues with entrepreneurship education. The idea is to foster entrepreneurs who build sustainable businesses while solving social problems. Social impact has evolved to include incubating social ventures that solve environmental problems or supporting entrepreneurial teams that revitalize local economies. Along the way, he began to build relationships with large companies that entrusted him with their work.
Entrepreneurship training was an attractive option for companies that were considering ESG management. For example, fostering local entrepreneurs can be a strand of social impact. Historically, entrepreneurs have been seen as the main engine of economic growth and job creation. Growing entrepreneurs locally was in line with the social nature of supporting small businesses while solving the social problem of localization.
For example, Underdogs ran Localize Gunsan, a project with SK E&S to train young entrepreneurs in Gunsan for three years. Gunsan was a special industrial crisis response area and an employment crisis area, as it is neighboring Iksan, where SK E&S has a subsidiary. In 2019, the project launched entrepreneurship training, office and residential support, and more, with the goal of “revitalizing tourism and creating jobs and local income using local resources.
Over the course of three years, the project has selected and incubated 26 startup teams. ‘Laura Week’ (Localization Week), a festival that brings together startup teams and local small businesses, has become an annual event. Overall founding team revenue grew to KRW 1.2 billion in 2019, KRW 2.9 billion in 2020, and KRW 5.65 billion in 2021. At the time, entrepreneurship education and ESG were a fresh combination. Localize Gunsan has set a precedent that a large-scale entrepreneurship training project can produce quantifiable results on ESG.
In addition, entrepreneurship training linked to social contributions was provided free of charge to trainees. Underdogs lowers the barrier to entry for entrepreneurial talent by making entrepreneurial education free, whereas previously, individuals had to pay a small fee or be in an investment firm’s portfolio. Entrepreneurship training has created value for clients through ESG management and for trainees through free education.
Hana Social Venture University is the largest entrepreneurship education project between Underdogs and Hana Financial Group. It’s a unique endeavor. This is because it provides entrepreneurship education to more than 1,500 pre- and early-stage entrepreneurs nationwide. Educators are also selected from among entrepreneurs in each region. We have partnered with 30 local universities to organize training venues and recruit trainees.
Provide free education by supporting entrepreneurship education in the social contribution market.
Connect stakeholders: community-based coaches, universities, and entrepreneurial talent.
Social contribution activities create jobs and revitalize local economies.
Establish ESG projects on a national scale as a kind of “entrepreneurship university.”
What’s unique about this project is that it’s partnered with a university. Local universities play an important role not only in talent development, but also in local culture, knowledge, and networks. However, as the school-age population plummeted and young adults flocked to the metropolitan areas, regional decline accelerated. As a way to overcome this crisis, experts suggest that local university governance should be based on local characteristics.
Through Hana Social Venture University, Underdogs will be able to use the 1) Social Impact Capital is 2) Provide free entrepreneurship education across the country 3) You’re trying out the startup university model. This program lays the groundwork for solving the problems of local universities, regional depopulation, and the cultivation of entrepreneurial talent at the same time. It is a unique experiment in growing the entrepreneurship education business in that it aims to create a system rather than a one-time project.
Ultimately, the alignment of entrepreneurship education with ESG has led to opportunities to work with leading companies. KT&G <Imagine Startup Camp>in collaboration with GS Retail <Eco Social Impact Projects>Agtech Youth Entrepreneurship Campus in partnership with Nonghyup <NH Seed>and the Hankook Tire Sharing Foundation <2023 Dreamweed> projects, and more.
It was a natural springboard for building a network of partners. If we wanted this to be a lasting partnership, we couldn’t just offer startup training and call it a day. As a partner, you’ll need ESG performance and metrics. With that in mind, it’s worth noting that we have separate programs and systems for our partners, including results reporting, performance management, ESG consulting, and events. This relationship paved the way for the second and third generations of social entrepreneurship education.
After ESG social contribution, entrepreneurship education began to be utilized as an opportunity to spark new business engines. An example is “open innovation” entrepreneurship training. Through our Open Innovation program, Underdogs partners discover new items to collaborate on, companies to invest in, and more. During the discovery process, we review the business case with the Underdogs coaches. Through entrepreneurship education, we create a springboard for collaboration and connections. Underdog entrepreneurship education is being conducted in a form that directly benefits the businesses of our clients, such as the Group’s “Entrepreneurial Discovery Competition.
We’re also seeing a growing number of partners that have entrepreneurial development as a goal in and of itself. It’s what we call a third-generation change: “partner-boosted” entrepreneurship education. For example, a platform company might introduce entrepreneurship training to grow the entrepreneurs working on its platform.
As a start, NAVER and Underdogs are launching the SME Brand Launcher. The goal is to grow small and medium-sized enterprises (SMEs) in Smartstore through entrepreneurship training and coaching. By increasing their transaction volume and sales, NAVER Smart Store will naturally grow as well. Entrepreneurship education aimed at the shared growth of platform companies and partner entrepreneurs. The need for this is likely to grow.
Entrepreneurial education doesn’t end with “training. But because it’s “education,” we’re able to create the synergy we have now. These various collaborative relationships with partners have come full circle and have positively impacted Underdogs’ core business. They can broker corporate clients for entrepreneurs taking entrepreneurship training, and they have direct access to a sales network that can help them enter the entrepreneurship training market in the future. Underdogs has turned entrepreneurship education into a profitable business and a business networking opportunity.
3) Scalability: Quality control is the way to grow your business
One-on-one hands-on coaching has its pitfalls. This can lead to a heavy reliance on coaches. There is a risk that the training will be choppy. The downside to this is that it’s individualized, so there may not be any quality control. This ties into the scalability issue. If you can’t control the quality of your training, it’s hard to scale your business. Operational uncertainty is fundamentally fatal from a business perspective.
Re-evaluate underdogs from this perspective. How to grow a national entrepreneurship education program. The bottom line is that the original training content was the hero. Unusually, Underdogs invested in developing its own content early on. Coaches were also nurtured. Entrepreneurship education materials and methodologies were the domain of underdogs. That’s how we were able to achieve consistent quality.
Understand the training content from an IP business perspective. Underdogs’ own curriculum and training is like the original. Based on this, the coaches deliver training that is both individualized and embedded with the original IP. It’s like movies, TV shows, dolls, and theme parks that utilize IP, but are unique in their own right and contain IP. Training is derived from the IPs of the underdogs, not the individual coaches.
The Pink Fong Company, a character IP company, likens itself to a talent management company. Characters are entertainers that we discover, organize, and produce. Publishers create original content (settings, stories, worlds, etc.) for their characters. Characters are a powerful component of an IP, but they come from the IP. The influence of IP extends to character cartoons, advertisements, toys, and more. The IP is controlled by the organizer.
This allows companies with original IP to expand their reach without sacrificing quality. This is because they have control over the content. Underdogs has also spent nine years developing entrepreneurship methodologies, skillsets, and frameworks. With the original training IP as the backbone, we were able to consistently deliver hands-on training. It was the foundation for connecting entrepreneurship education with ESG and eventually corporate education.
The entrepreneurship methodology underlying Underdogs’ entrepreneurship education has experienced two inflection points. What was initially a six-step methodology evolved into a seven-step and then a four-step version. As we’ve grown, our training has become much more diverse, with a focus on prospective or early-stage startup teams. Original content has also evolved to accommodate more trainees as the company has grown.
In 2015, we literally applied a “dummies” startup methodology. At the threshold of entrepreneurship, trainees were either one or the other. You’ve identified a social problem you’re passionate about solving, or you’re armed with a strong sense of purpose. Entrepreneurship education should give them a chance to get their hands dirty before they take the plunge into the real world of entrepreneurship. Theory was organized to provide a springboard for action.
As the number of entrepreneurial training participants grew, the point became clear. Ultimately, they found that “defining and analyzing the problem and establishing the entrepreneur’s own perspective” is crucial for social innovation startups. Soon after, the Underdogs startup methodology was expanded from six to seven steps. We refined the previous step of analyzing items and tried to find items that we could get our hands on.
The second inflection point came around 2019. More and more enterprise customers were looking for underdogs. The audience stretched from early-stage small businesses to the entire spectrum. Internal feedback indicated that the 7-step entrepreneurship methodology, which heavily emphasized the fundamentals of entrepreneurship theory, may not be appropriate for everyone. It’s time for a new version that focuses on execution and validation. I decided to compress the content into four steps.
We’ve gotten more sophisticated, not just in our methodology, but in our teaching. IF matrix, ST matrix, and I.O.I problem exploration methodologies. This is a voluntary skillset developed by Underdogs for entrepreneurship education. In the context of the importance of team building in early-stage startups, he also designed the DOGS Entrepreneurial Aptitude Test. It consists of five personality tests and workshops.
As a result, we spent nine years investing in IP to ensure that our individual coaching sites were able to deliver content that was personalized to each student, yet consistent. The sophistication of IP has had significant implications for underdogs’ ability to achieve economies of scale in entrepreneurship, education, and business.
Advances in education IP foster professionalism. This is because at each stage of the entrepreneurship methodology, you will know which methodology to apply, which process to go through, and which outcome to achieve, depending on who you are. Along the way, expertise leads to trust, and trust leads to education. This means that entrepreneurship education can be broadened.
Being recognized as an expert in the field of education is quite important. Especially if you’re a startup, you need to be trusted by your customers to survive as an education company. In that sense, Underdogs’ approach of investing in original educational content was a smart long-term strategy. It’s helped us build a reputation that says, “There’s this place called Underdogs, and if you go there, you’re going to do something right.”
Next came enterprise customers. Along the way, underdog training products tended to become upsells. Trading horizons have also lengthened in years. Upselling is an approach to convincing people who have already purchased your product or service to purchase an upgraded product, rather than attracting new customers. Expertise has led to scalability, reputation, and increased revenue.
Entrepreneurship education is a pointy, specialized product. This made it difficult to sell or scale consistently. Still, it’s worth noting that the repurchase rate for Underdogs training is high. Entrepreneurship education, with its emphasis on hands-on coaching, has been reimagined in partnership with the social impact marketplace. Here, the original IP ensured consistency, scalability, and expertise. It has helped us not only attract enterprise customers, but also retain them. Get a glimpse into the strategy and process of how the underdogs built a stable revenue stream.
Square founder Jim McKelvey once said, “Innovation is about building on top of each other.” This means that one innovation doesn’t change everything at once. Instead, it’s the innovations that slowly build up to create an irreversible advantage. Underdogs are 1) Differentiate your entrepreneurial education with hands-on coaching, and 2) Run free education with ESG and make a profit. 3) Grow the game by enhancing the original IP. It showed the possibility of a business that could be scaled up into a business education business. It’s a good case study because it shows the utility of entrepreneurial education on the ground as well as on the macro level.
3. Entrepreneurial talent, will corporate education help them settle down?
Of course, there are limitations to the entrepreneurship education market. At least in the Korean education market, which is dominated by entrance exams and language courses, entrepreneurship education is not as big as it should be. If you’ve been focusing on entrepreneurial education and growing your company, it’s time to start looking for a bigger pie. At the same time, you don’t want to have an unreasonable number. One of the most prominent candidates identified by the underdogs was the “corporate training market.
The keyword “entrepreneurial talent” reveals the ambition of Underdogs. It’s not just a focus on “startups,” it’s a commitment to educating people. It’s been that way since the beginning. The Underdogs team said, “We haveorganized the entrepreneurship methodology to strengthen job/practical capabilities based on education, even if you don’t necessarily become an entrepreneur.” Initially, the Underdogs Entrepreneurship Academy was designed to serve a larger market, with the goal of team building for early stage startups.
However, there is no denying that corporate education is not the same as entrepreneurship education. The ultimate goal of corporate training is to get a return on investment for the entity paying for the training (the company). As a result, expect to see increased worker productivity and lower turnover. There is less of a direct connection between learning about entrepreneurship and becoming an entrepreneur. Furthermore, entrepreneurship seems to be incompatible with “low turnover”.
Underdogs entering the corporate training market face three main challenges. 1) Position yourself as an “entrepreneurial talent” in the corporate training market. 2) Be able to capture demand in the specialized education market of Korea. 3) Respond to the demand for online training introduced in the post-COVID-19 corporate training market. A different challenge is in store for the entrepreneurial education business.
A major issue in the corporate training market is upskilling/reskilling. As mentioned earlier, these are uncertain times. In particular, advances in IT technology are automating tasks. The trend is toward retraining. The buzzwords are upskilling to develop people into more senior roles and reskilling to redeploy them. The idea is to increase performance through training, not new hires.
In this market trend, underdogs need to capitalize on their entrepreneurial edge. An edge can be a differentiator, but it’s often one that requires convincing customers to recognize. The need for one-on-one hands-on coaching was also recognized in the entrepreneurship training, with the first suggestion being one-on-one coaching. This time, the challenge is to convincingly communicate their edge in the existing corporate training market.
In addition, we need to consider the specificities of the Korean corporate training market. For example, few of the existing players in the corporate training market are affiliates of large corporations. Multicampus, a leading corporate training company, is a B2B training organization within the Samsung Group. This means that you can get a stable demand for corporate training from affiliates of the same group (captive market). Hewett, which is not part of a conglomerate, has also been in the corporate training business since 1999. Given that corporate education in Korea is not as large as in other cultures, it will be difficult for latecomers to break into B2B sales.
In the post-pandemic era, corporate training has also embraced the convergence of online and offline. The market, which was originally dominated by offline collective training, has begun to recognize the efficiency, personalization, and training management benefits of online. Workers also said they most prefer to receive company training online. The three years of COVID-19 have been a time for traditional corporate training companies to get their act together online.
We faced a daunting challenge. How Underdogs plans to expand into the corporate training market. Underdogs is approaching the corporate training market in three main ways. They seem to be making the most of their foundational skills, competencies, and assets from their entrepreneurship training business.
Diversify entrepreneurship education with job and in-house venture training
Leverage the partner network you’ve built through your education business
Enable online training platforms and hybrid online/offline training
I mentioned earlier that through entrepreneurship training, the underdogs formed a network. In fact, we’ve made a concerted effort to stay connected with our partners. A prime example of this is the “pacemaker program” that we used to run separately. It is a program that provides insights and case studies on ESG business for corporate partners that support entrepreneurship education. We provided separate trainings for trainees, coaches, and partners.
The strength of the network determines the quality of the information. In particular, how tight the network is determines the freshness of the information. By investing in a network of entrepreneurs and partners, Underdogs would have been able to quickly identify what they want now and what they feel is lacking. It’s a great time to leverage your network to get information and find your next business opportunity.
For example, Underdogs is trying to provide in-house venture training and job training. At first glance, it may seem like a low-touch entrepreneurship program, but it’s a worthy attempt to expand entrepreneurship education. It’s similar to how entrepreneurship scales. Entrepreneurship has expanded from an innate quality of individuals to an organizational entrepreneurship. Organizational entrepreneurship is the English term for corporate entrepreneurship, or “entrepreneurship at the organizational level.” It has two meanings
A startup is not only the founder, but the organization itself is an entrepreneur.
Organizational antiprinciples for both new and established organizations.
Let’s start with ①. In the first half of 2023, Underdogs held a job training class. Underdogs Hustle, a startup-type core talent development program, was launched as a B2C program. Although it was not a startup education, it was an entrepreneurial talent education in that it taught competencies similar to those of an entrepreneur. It was launched with the goal of practicing business development, strategic planning, etc. for office workers. The competition is 50 to 1. The response was overwhelming.
We borrowed the know-how that we applied to startup education for job training. For example, the business developer training process was divided into two parts. The first six weeks are action-based workshops that take you from the idea stage to customer validation. The second six weeks are devoted to real-world startup business practices and case-based “scale-up projects. We were able to maintain a hands-on approach to training talent not limited to startups.
The Underdogs Hustle was a way to validate the demand for entrepreneurial talent. Presumably, through their entrepreneurial networks, underdogs have heard that the same HRD challenges apply to mid- to late-stage startup teams at Series B and beyond. We don’t have enough lead-level talent to make hands-on, business decisions. But startups can’t afford to train their own people. If individuals are willing to come to job training, then we can assume that there is enough demand for training for ①.
If job training that fosters entrepreneurial talent is faithful to ①, then ② (“Organizational entrepreneurship is carried out not only by startups but also by established organizations”) is represented by in-house venture training. An internal venture is an independent task force (TF), business team, or department within a company that aims to develop a new business in a short period of time. It is an example of organizational entrepreneurship in that it is an organizational decision to enter a different market than the main business or to develop a new product.
The statistics are a stark reminder of a rapidly changing business environment. The 2019 McKinsey study calculated the “age” of the top 10 companies on S&P’s list. The median age has plummeted from 85 years in 2000 to 33 years in 2018. Startups have swept in, and traditional powerhouses have been pushed out of the rankings. Even large organizations are not immune. Organizational Entrepreneurship is being talked about as one of the quick fixes to the crisis.
Internal entrepreneurship is the primary driver of corporate spin-offs. If you are an employee or team in an organization and you exhibit entrepreneurial innovation, initiative, risk-taking, autonomy, and competitive drive, you may have the seeds of an intrapreneurial venture. This is where in-house entrepreneurship training comes in. As a solution, Underdogs suggests training to develop in-house entrepreneurs with an entrepreneurial mindset.
We expanded our entrepreneurship education to include job training and in-house venture education. What strategies will it take for underdogs to break into the corporate training market? Don’t forget two things 1) Don’t lose sight of both content and systems. In particular, online competencies are required. 2) Differentiation is alive and well. In order for a latecomer to establish itself, it needs to sharpen its edge. Don’t give up on convincing the market.
In corporate training, online competencies don’t just mean “online content”. As corporate training has gone deeper online, it has been joined by an industry that has taken over training management and assessment. That’s why you see people in the industry doing “business process outsourcing” (BPO) on the side. With the learning data that remains online, you can try to monitor learning, make personalized recommendations, and evaluate training performance and assessment. If you’re budgeting for training, there’s no reason why you shouldn’t consider a training provider that also offers BPO.
Underdogs’ strength is its experience in building education management systems that connect ESG and entrepreneurship education. We have the system and know-how to provide not only training products but also the entire process of planning, operation, and evaluation for corporate clients. We need to think about how to apply this to corporate training. Another way is to actively leverage your customers’ experience with your online capabilities.
On the other hand, be careful not to get caught up in increasing your “online content“. Online competency is required, but it shouldn’t be seen as a sign to go “all in” online. Rather than just copying your competitors who already have a wide range of online training content, either in number or virtual, you need to think about what online content you want to create. Since Underdogs has been doing “hands-on” training, we can take a long, hard look at how to implement “hands-on” online, and across online and offline.
The weakness of online training is that it’s less engaging than in-person. As a result, online corporate training content is gradually shifting away from one-way lectures. The aforementioned “personalized training” is a prime example. To be engaging, the training needs to be relevant to me, and relevant to my job. This is why “workflow learning” has become so popular in online corporate training.
Workflow learning is a 1) led by on-the-job experts from within the company, and 2) delivered through short-form videos, hands-on projects, and on-the-job training. This ensures that when online training is introduced, learning is engaging and results are achieved. These are familiar conditions. This reminds me of Underdogs’ point of difference in the entrepreneurial education business (coaches who are entrepreneurs, one-on-one coaching).
After all, that’s what corporate training is all about. In the end, content that educates wins. This is especially true when less than 30% of corporate training is used on the job. If you rush to increase the quantity of your online content, you may end up stagnating. This comes at a time when demand for in-person training is picking up. In this case, it’s better to use the edge and dig in.
Entrepreneurship training is the difference between underdogs going public and
Entrepreneurship, education, and business. Three words that didn’t seem to go together. I was skeptical until I looked at their business model and revenue structure. Preparing for this article has given me a new perspective on Underdogs’ expansion. You now understand the context of how entrepreneurship education can be scaled to corporate education. The three most memorable takeaways were
(1) By combining ESG management and entrepreneurship education, we found a revenue structure and free education model.
Developed education IP, gaining consistency, scalability, and expertise to increase revenue.
I was able to build a business network and leverage it to expand my business.
All three have one thing in common: along-term perspective. You’ve already set the company up for growth in the long run. The one-on-one coaching system, training IP, business network, etc. are all long-term investments that the company made with the idea that it would grow 100x more than it is today. These assets are acting as manure to accelerate our business expansion.
The combination of ESG management and a free education model is particularly impressive. After holding out for a long time, we were able to catch the trend of ESG management, provide free education, and maintain our vision that anyone can be an entrepreneur. In the end, luck favors the startups that last the longest. The underdogs were able to hang in there for a decade and build their business for the long haul.
“Don’t get stuck on innovations you’ve made in the past.”
Hanyang University’s Impact Research Lab concluded that the underdogs have been consistently innovative for nine years. He credits being an “entrepreneurial organization” with keeping them innovative. It was the epitome of finding opportunities, trying new things, and creating value. His theory is that by training entrepreneurs, he is modeling entrepreneurial talent.
Where will the underdogs be in 10 years? Right now, we specialize in entrepreneurship education, but in 10 years, I think we’ll be a much broader company. It can be an education company that also includes corporate training, or a B2B company that all entrepreneurial talents go through. The future is not set in stone. “There’s still a long way to go.” For the underdogs, this sentence should give them hope for the future. I hope that the story of Underdogs’ growth will serve as a good reference for those who create pathless paths.
Source: https: //eopla.net/magazines/7193