In her day job, Funmi Orunmuyi was a production engineer with ExxonMobil. She spent eight years at the company, using her Bachelor’s in Mechanical Engineering to analyze reservoirs, optimize drilling, and plan production. She also ventured into non-technical roles in operational efficiency and environmental sustainability.
But, at heart, she’s always been an entrepreneur.
She got her first taste as an undergrad when her siblings gave her money to start her own business She launched her second venture while still at ExxonMobile, a quick-service restaurant focused on supplying healthy meals in her native Nigeria. She later co-founded a 2,000-seat event facility and a fitness-inspired food cafe.
Next? She wants to use technology to enhance productivity in the food and wellness industry and launch an incubator program for young female business owners, especially in emerging markets.
The hands-on experience she’s gaining as a Creative Destruction Lab Fellow at University of Toronto’s Rotman School of Management is certainly giving her a leg up. “The CDL fellowship has been instrumental in shaping my experience at Rotman. I have had the opportunity to participate in workshops, mentoring sessions, and networking events, allowing me to immerse myself in the entrepreneurial ecosystem, learn from industry leaders, and gain the confidence required to pursue my entrepreneurial aspirations,” says Orunmuyi, MBA ‘23.
CREATIVE DESTRUCTION LAB
Creative Destruction Lab (CDL) is a non-profit network of programs with a mission to help launch massively scalable, science- and technology-based companies. It pairs early-stage ventures with seasoned mentors – exited entrepreneurs, investors, academics, and more – to work together for ten months, setting short-term objectives and assessing progress. MBAs act as consultants, sitting in on the meetings and helping the startup founders develop financial models, evaluate markets, and fine tune scaling strategies.
Created in 2012 by Rotman professor Ajay Agrawal, CDL is enjoying a truly impressive growth spurt of its own. CDL now has 13 branches in the world’s top business schools, and CDL companies across the world have generated nearly $28 billion to date, Agrawal says. It now has 23 focus areas, or CDL Streams, ranging from AI to Cancer, from Climate to Space.
Its mission comes right from its name. Austrian economist Joseph Schumpeter described the “gale of creative destruction” as the process by which industrial innovation continually revolutionizes economic structure from within, simultaneously destroying the old one. Without invention, entrepreneurs, and innovation, large companies would grow stale and stagnant. Creative destruction, then, is essentially the engine of capitalism.
A HANGOUT FOR MBA MISFITS
The genesis of the CDL framework started when Agrawal was researching the commercialization of science for his PhD dissertation at the Massachusetts Institute of Technology. He found that science and tech inventors typically followed one of two commercialization paths: They either licensed their technology to a large company and had little to no involvement after the fact. Or, they were intimately involved in developing their tech into products that could be taken to market. To Agrawal, the latter group seemed to have more success.
Later, when he joined Rotman as the Geoffrey Taber Chair in Entrepreneurship and Innovation and Professor of Entrepreneurship, his office became a sort of hangout for misfits in the MBA program, he tells Poets&Quants. MBA graduates, especially a decade or so ago, typically recruited for investment banking or consulting in order to pay down the degree’s hefty price tag. MBAs who wanted to make their own thing found refuge in Agrawal’s office because he was sympathetic to the plight of the entrepreneur.
Meanwhile, Agrawal’s research showed that the main reason that scientist entrepreneurs were failing was because they didn’t know what to focus on. By the time they realized that they were focusing on the wrong priorities out of 1,000 possibilities, they’d run out of money or energy or sanity.
So, Agrawal played matchmaker.
In 2012, he and about a dozen of his misfit MBAs prototyped a small, free program off the administrative grid. He paired the MBAs who wanted to start businesses but had no technology ideas to launch with scientists around the university campus who had inventions but no idea how to start a business. He brought in seasoned entrepreneurs, investors, academics and other experts to help the scientists develop their tech into viable products or companies.
“The way most universities are organized is very siloed. You will have people that come and do an MBA and they’ll spend two years on campus in their business school, and they will never set foot in the chemistry department, or the computer science department, or the electrical engineering department, or the medical school,” Agrawal says. “We knew these people were around, and we just had to figure out how to bring them together.”
They fashioned the meetups like the Ether Dome at Boston’s Mass General Hospital. That’s where, in 1846, a surgeon demonstrated the first public surgery using ether in front of an amphitheater full of other surgeons. In the Rothman meetups, MBAs gathered to watch the back-and-forth between the scientist inventors and the seasoned operators, rather than hanging in Agrawal’s office.
“So the students get to see the advice the mentors are giving the scientist entrepreneurs. They’ll see the investments that they make, they’ll see the people they hire, and how it all works like they’re right there in the operating room.”
A SCALABLE FRAMEWORK FOR SCALABLE STARTUPS
Three years after its unofficial start, the CDL framework became so popular that it was turned into a formal Rotman course. Today, Rotman selects 20 CDL Fellows per year from its MBA program.
CDL is unique from other startup programs in three ways, Agrawal says: First, it focuses on science-based entrepreneurship.
Second is its structure: It’s not an incubator nor is it an accelerator. Every eight weeks for the program year, inventors and operators come together to prioritize and work through the next three most important priorities. When they come back together, they report on their progress and identify the next three priorities, and so on.
And third is the mix of people it brings to the room: University professors, venture capitalists, angel investors, operators, scientist founders, and MBA students.
“It’s like watching a symphony orchestra,” Agrawal says. “In the first row are the operators, in the second row are the VCs, in the third are the corporate partners, and in the fourth are the MBAs. The founders are sitting in the middle, and the scientists are sitting at the ends. And you’ll see as the conversation moves around the room, exactly when the scientists are called to speak, when the VCs are called to speak, when the MBAs are called to speak. It’s all kind of carefully orchestrated.”
During her fellowship, Orunmuyi paired with Mesosil, a CDL venture making antimicrobials to enhance the longevity of dental implants, working through the company’s early fundraising and product launch. During these Large Room Discussions she got to hear accomplished entrepreneurs, investors, and industry experts deliberate on each step. She also participated in the intimate Small Group Meetings, where select groups explored the objectives and the key issues relevant to the venture’s business model.
“The biggest lesson I learned was how crucial it is for founders to have the right mentors and advisors. From my perspective, this significantly reduces the founder’s learning curve and saves them from making costly mistakes,” she says.
CDL IS NOW AT 13 BUSINESS SCHOOLS ACROSS THE GLOBE
Since its founding in 2012, CDL has expanded to business schools around the world, starting with five schools in Canada. Now, it has 13 global branches, including three in the United States and four in Europe. An Australian CDL opened just this June at Monash Business School within Monash University. Each offers its own unique stream.
|Georgia Tech’s Scheller College of Business; Atlanta, GA.
|ESMT Berlin, Germany
|Haskayne School of Business, University of Calgary, Canada
Ag, Energy, Prime
|Rowe School of Business, Dalhousie University, Halifax, Canada
|University of Tartu, Estonia
|Monash Univeristy Business School, Melbourne, Australia
|HEC Montréal, Canada
AI, Supply Chain, Web 3
|University of Oxford’s Saïd Business School, United Kingdom
AI, Health, Fintech, Climate
|HEC Paris, France
AI, Climate, Space
|University of Washington’s Foster School of Business, Seattle, Wash.
Computational Health, Manufacturing
|Rotman School of Management, University of Toronto, Canada
AI, Blockchain, Health, Prime, Quantum, Space, Matter, Neuro
|Sauder School of Business, University of British Columbia, Vancouver, Canada
Compute, Health, Climate
|Wisconsin School of Business, University of Wisconsin-Madison
The vision for the first CDL at Rothman was that companies born through the lab would generate $50 million in equity value over the first five years. Today, CDL companies across the world have generated nearly $28 billion, Agrawal says. To date, more than 7,900 founders and 2,900 companies have participated in CDL programs around the world, including 650 startups last year.
“It’s created a culture where entrepreneurship in the business school is no longer viewed as the island of misfits,” Agrawal says.
CDL-PARIS: CLIMATE, SPACE & AI
The CDL at HEC Paris is led by Aymeric Penven, an entrepreneur with a cool-sounding title: Director of deep tech entrepreneurship.
Science based entrepreneurship requires its own approach to venture creation, Penven tells P&Q. In almost any business school, budding entrepreneurs are taught to study the market, interview experts, identify pain points, and then craft a solution.
Science-based entrepreneurship is just the opposite. Often, these entrepreneurs come out of research labs after serendipitously stumbling across a particular scientific innovation. They start with a technology, invention, or new process in search of a problem to solve. HEC Paris’ deep tech programs work to expand the problem space for these science-based solutions beyond first- and second-use applications.
“You open those doors, and then our job is to apply a process-minded, macroeconomic approach to see which doors should stay open, which doors should close, and which doors do we have to experiment with to find the best use case and business model,” Penven says. “It’s kind of starting from the opposite end. That’s why we cannot support deep tech startups in the same fashion as we would for a traditional incubator born company.”
HEC Paris joined the CDL network in 2020 with its first of three focus streams: Climate, which some have called the 21st century’s biggest business issue. There’s an amazing diversity in the type of climate company that joins the CDL, Penven says, with startups coming from sectors including transportation, greenhouse gas reduction, carbon sequestration, renewable energy and storage, agricultural tech, and more.
The school has since started two additional streams in Space and AI. In the 10-month program, 30 MBAs for each stream act as consultants for the startups while sitting in on the meetings between the inventors and the seasoned operations. They learn how to evaluate early-stage science- and technology-based ventures, prioritize goals for CEOs, and how to tackle climate change, space or AI challenges as well as spot opportunities. CDL Paris offers its MBAs a CDL Certificate upon completion.
“One of the parameters is that we can take on the crazy projects that sound too good to be true, but that we believe in,” Penven says.
For example, CDL-Paris supported a company called Renaissance Fusion in its first year. The company builds stellarators – an efficient, stable fusion reactor – with the ability to create zero-carbon energy. They’ve raised about $50 million so far.
Last year, it worked with a company called Genomines which uses genetically-enhanced plants to sustainably mine the heavy metals they absorb from the soil as they grow. The first-use idea for the technology was as a way to remove pollutants from the environment. By the end of the CDL, however, they essentially became a mining company, Penven says.
The company buys spent mines, plants their seeds, and then harvests the trace amounts of metal from them. “They do actual green mining which is focusing on metals that are necessary to build the batteries we need for electrification,” Penven says.
CDL SPACE STREAM
The CDL Space Stream launched last year as a joint stream with the CDLs at HEC Paris, Rotman, Georgia Tech, and Oxford Said. It just completed its first cohort in Paris, but it rotates sessions between the different schools.
“It’s really an innovation in the CDL model for strategic and global topics such as space – because all of the space companies are walking on the same stage – to see what we can do to merge the expertise that we have in the UK, in France, in the US, and Canada,” Penven says.
Romain Gouspy, an MBA at HEC Paris, was one of the first Space Stream fellows. Previously, the aerospace engineer worked six years at Safran Aircraft Engines where he developed a new engine from design to production and was a product support manager of a French fighter jet turbine engine.
When researching MBA programs, HEC Paris stood out for its stellar network and connections in Europe, where he wants to build his career in clean energy transition.
“As an engineer specializing in technical topics, I needed to learn how companies do business and develop sustainable strategies. Coming from a multinational company in aerospace, I worked on large projects dealing with cutting-edge technologies. This experience was fascinating but I felt to be a small part of a large machine with a limited range of action,” he tells Poets&Quants. “I was looking for an experience with a smaller structure where one has to manage every aspect of the business and has many levers at hand. HEC’s CDL program was an important differentiator.”
Gouspy teamed up with Ion-X, a startup developing a unique ionic liquid electrospray thruster for small satellites. He connected with CEO Thomas Hiriart, a fellow engineer passionate about aerospace.
To understand the real value of the technology, Gouspy visited the Ion-X lab and met with the 10-member team. He conducted a market analysis of the new space and interviewed experts, ranging from an ex-CEO of a space company to insurance specialists. His recommendations influenced several technological choices in Ion-X’s product development. Ion-X will launch the first prototype with EnduroSat in 2024, onboard SpaceX Falcon 9.
“My engineering background helped me understand the physics behind the technology, but I was there to analyze the potential of the technology and give business orientation, not to develop the product!” he says. “Here, I mobilized for the first time the concepts I saw during the first part of my MBA and the CDL program to translate the technological breakthrough of the thruster into economical value added for customers.”
Gouspy attended mentoring meetings with operators dedicated to the start-up. The coaches came from around the world – France, India, US and UK – with various areas of expertise – investment funds, CEOs, program managers, and astronauts. He worked with Anousheh Ansari, a serial entrepreneur and astronaut, and Doug Sinclair, founder of Rocket Lab.
Two moments will stick with him: The first when he was invited to Ion-X’s clean room to see the engine test of the thrust. “The blue plume behind the porthole reminded me of the engine tests I was performing as an engineer a few years ago,” he says.
The second? Getting a picture with Chris Hadfield, former commander of the International Space Station and a CDL Space Stream mentor.
“The new space sector is booming. Since the SpaceX arrival and the drop in the launch costs that unlocked access to space for private players, hundreds of ideas are emerging around the globe. The CDL space stream clearly represents this global community,” says Gouspy who now works as a senior consultant at Archery Strategy Consulting, a firm specializing in aerospace, among other sectors.
“Business in a startup is a compendium of decisions with pragmatic issues. With such a small team and such big stakes, everyone has to be hands-on, especially the CEO. The most valuable part of the experience was to be able to apply what I’ve learned in the real world. The CDL program gives the opportunity to work with the CEO of a start-up, develop business hypotheses and above all test them with senior experts. It was a real chance to be able to meet such a community in the space industry.”
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