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Our mission We excel in developing principled, innovative thought leaders in global communities.

COVER STORY

Design Intervention

Alumna Emily Armenta’s MBA assignment has blossomed into a successful business in jewelry design. Today, the award-winning Armenta line worn by celebrities and royalty is sold at Saks 5th Avenue, Neiman Marcus, and other high-end jewelry retailers across the U.S. and internationally.

16

pg.


in every issue Letters & News 3 Dean’s Welcome 33 Media Mentions

Rice University

Jesse H. Jones Graduate School of Business

Spring 2010

Features

16 Design Intervention

Emily Armenta ’03 finds the business in her passion

by Sarah Gajkowski-Hill

20 Fueling the Movement

Luka Erceg ’07 and Scott Conley ’07 of Simbol Mining turn dreams into precious metal

by Jason Witmer

24 The Road Less Traveled

Three Jones School entrepreneurs tell tales from their unique journeys

by Chris Warren

28 Teaching from Experience Professors share Jones School’s story of entrepreneurship

by Jan Hester

Alumni 32 Alumni President’s Letter 34 Class Notes 36 Resources, Events, and Ways to Get Involved


Dean + H. Joe Nelson III Professor of Management Bill Glick EXECUTIVE EDITOR + DIRECTOR OF ALUMNI AND CORPORATE RELATIONS SHAHEEN LADHANI EDITOR JULIA NGUYEN DIRECTOR OF MARKETING COMMUNICATIONS LAURA HUBBARD CONTRIBUTING WRITERS SARAH GAJKOWSKI-HILL MICHAEL GROJEAN JAN HESTER WEEZIE MACKEY BRENT SMITH CHRIS WARREN JASON WITMER ART DIRECTION + DESIGN FRANK R. JONES CONTRIBUTING PHOTOGRAPHERS Phil Bailiff JUSTIN CALHOUN JON-PAUL ESTRADA JEFF FITLOW Tommy LaVERGNE DAVID ROSALES JOHN SANDERS ADITHYA SAMBAMURTHY

Around the School 4 New Program Supports Would-be Entrepreneurs

JGSEO connects aspiring entrepreneurs with successful alumni business owners

6 Picking Up Steam

Professor Doug Schuler’s journey in creating low-cost, off-grid power

7 MBA 5th in Entrepreneurship

The Princeton Review and Entrepreneur rank Rice MBA Full Time among top 5 in U.S.

7 The Perfect Fit

Jones School hosts shoe gurus Shane and Shawn

8 A Visit with Billionaire

Warren Buffett

‘Oracle of Omaha’ shares wisdom with Rice MBA students

10 Perspectives:

PRINTING CHAS P. YOUNG

11 Executive Education Series The Toxic Leader Part One: A Clear and Present Danger

12 Center of Entrepreneurship Rice Alliance and Jones School hosts global entrepreneurship centers conference

14 Educational Entrepreneurs

Q&A with Angelica Vega of Rice Educational Entrepreneur Program

15 Giving to Jones

Jones Fund, Corporate Investors, and Jones Partners

Q&A with Alumni in Entrepreneurship

33 Giving back, starting a nonprofit

Joe Branch ’04

A Strategic Look

35 First-time entrepreneur

An interview with Alumni and Corporate Relations Director Shaheen Ladhani

Gretchen Penny ’90

The Jones Journal is published semiannually for alumni and friends by the Jesse H. Jones Graduate School of Business. Current and back issues of the magazine are available online at issuu.com/ricemba.

Change of Address? New job? Update the online directory with your new contact information, or send us your class notes at: JonesAlumni.com. Comments or Questions? We’d love to hear your thoughts about the Jones Journal. Send an e-mail to Shaheen Ladhani, Director of Alumni and Corporate Relations, at shaheen@rice.edu.

shares her success

Business.rice.edu


Dean’s Welcome

The Entrepreneurial Edge

We enter this new decade with excellence as our compass and high performance as our reward. The Rice MBA program was recognized in 2009 as the No. 5 graduate entrepreneurship program in the U.S. by The Princeton Review and Entrepreneur magazine. This impressive ranking highlights the fact that entrepreneurship has become an important area of excellence for our school and is the theme of this issue of the Jones Journal. Beyond the rankings, the success of the program rests on a variety of contributions. Full-time faculty — like Ed Williams, who got the entrepreneurship ball rolling and earned the title of second best entrepreneurship professor in the country from BusinessWeek, and Al Napier, our area coordinator and winner of the 2008 Acton Award, a national award for excellence in Entrepreneurship Education — who combine solid academic research and qualified faculty teaching for our classes. In addition to their scholarly roles, both are highly successful entrepreneurs. We could not have attained this level of excellence, however, without our prestigious adjunct faculty, who bring a wealth of entrepreneurial experience and connections into our classrooms. This combination of practice and theory provides a tremendous learning experience and stimulates entrepreneurship activities. Outside the classroom, support comes from fellow students in the Entrepreneurship Club, alumni who serve as mentors for burgeoning entrepreneurs in the Jones Graduate School Entrepreneurs Organization (JGSEO), and the award-winning Rice Alliance for Technology and Entrepreneurship. With enterprises such as the Rice Alliance; the Rice Business Plan Competition; the Rice Education Entrepreneurship Program (REEP), the school’s commitment to social entrepreneurship; and two new areas of concentration — one in Entrepreneurship and a related concentration in Mastering Innovation and Creativity — the entrepreneurship program at JGSB reflects our mission of developing thought leaders in this area. Roughly 22 percent of our alumni have started their own businesses, as you will read about in the pages of this magazine, and many more of our recent graduates aspire to launch a start-up. Please read this issue of the Jones Journal to learn more about our innovative programs, faculty, alumni, and initiatives to discover why entrepreneurship at the Jones Graduate School is recognized for excellence.

Bill Glick Dean H. Joe Nelson III Professor of Management Jesse H. Jones Graduate School of Business Rice University 713-348-5928 Bill.Glick@rice.edu


Around the School

New Program Supports Would-be Entrepreneurs Jones Graduate School Entrepreneurs Organization connects aspiring entrepreneurial alumni and students with successful alumni business owners

L

et’s roll back the clock to the summer of 2009. You have a new Rice MBA, the knowledge you need to run a business, a great idea, and the fortitude required to launch your entrepreneurial career. You want input from experienced professionals who have been down that road, but where do you turn for help?

Jones Grad Rides Wave of Success Lauren Barrash ’08 had a business idea: to create a jitney service for the blossoming night life on Washington Avenue in Houston. She connected with a couple of JGSEO members who reviewed her business plan, put her in touch with the right people, and gave her a much-needed kick in the pants. Armed with a permit, permission to use a city lot for overnight parking and an SBA loan, she launched the ‘Washington Wave.’ Over-served club patrons can now leave their cars parked safely overnight and take a cab home. The city helped promote the service, and business is booming.

business.rice.edu

Now fast forward to today. “Contact the Jones Graduate School Entrepreneurs Organization (JGSEO), a new group formed to provide guidance and support to budding entrepreneurs,” says Shaheen Ladhani, director of Alumni and Corporate Relations. “Our graduate entrepreneurship program was just ranked number five in the country, and backing up our focus on entrepreneurship with a program like the JGSEO is a huge differentiator for the Jones School. The program addresses a critical need by providing a robust support structure for every established and aspiring entrepreneur.”

Filling the need The JGSEO, founded in fall 2009 by Rice MBA graduates and successful entrepreneurs Al Danto ’00 and Blake Roberts ’00, provides aspiring entrepreneurs and individuals who are looking to grow and expand their businesses with the connections and support they need to move forward. The organization already boasts more than 200 members, many of whom are highly successful entrepreneurs committed to sharing their knowledge and experience. Danto says entrepreneurship graduates have different needs from other business school graduates. “Many are in accounting, finance, or engineering. They tend to enter the corporate world, where they’re working with an internal team and responsible for one specific portion of a project. Their paycheck shows up every pay period.” Entrepreneurs, on the other hand, must handle every facet of the endeavor, and their income depends on the success of their business. “Not only are you responsible for the strategy and vision, but you also have to execute and manage finance, marketing, accounting, and every other aspect of the company,” Danto notes.


Around the School

JGSEO Membership Stages

1

In a corporate position investigating entrepreneurship as a career path

2

In the process of developing a business concept or has a rough business idea

3

Has a business plan, is ready to get financing, and launch the company

4

Has an immature, growing company

Each JGSEO member falls into one of the following entrepreneurial stages

Roberts emphasizes the value of connections. “When you’re the person in charge of everything, relationships outside the business are critical. The JGSEO provides an opportunity for entrepreneurs to network with colleagues and bounce ideas off more experienced professionals.”

How the process works The JGSEO has five formalized membership stages (see above). When someone joins the organization, they are assigned to a stage based on where they are in their entrepreneurial journey. “We try to help them understand the stage and provide them with the framework necessary to advance to the next level,” explains Roberts. “Some need help putting together a solid business plan, while others already have funding and just need some encouragement.” The program includes regular educational sessions, CEO roundtable work groups and emerging business teams, and a fledgling mentorship program. The CEO Roundtable work group is modeled after the highly successful YPO (Young Presidents’ Organization) and EO (Entrepreneurs’ Organization) forums. Work

5

Graduate who has a mature company or has sold a business and is interested in helping others and/or being part of the CEO Roundtable

groups, which consist of eight to ten alumni at stages four and five with experience running their own businesses, serve as an advisory board to members who are already running companies by providing intellectual capital, guidance based on experience, and vital personal connections. Emerging business teams provide individuals who are developing a business concept or are in the process of launching a company with input, support, and networking assistance. Those who launch their business within one year join a CEO roundtable for ongoing guidance. As part of the new one-on-one mentoring program, early stage students or alumni are matched with highly experienced JGSEO or EO members, each of whom runs on average an $8 million business. Still an embryonic organization, the JGSEO already offers MBA students and alumni a wealth of intellectual and networking resources. As it grows, the organization will continue to seek new, creative ways to nurture its members’ entrepreneurial dreams.

for more

information

about the Jones Graduate School Entrepreneurs Organization, visit JGSEO.JonesAlumni.com. Jones Journal Spring 2010 5


Around the School

Picking Up Steam

‘Capteur Soleil’ Inventor Jean Boubour (left) and Associate Professor Doug Schuler

Professor Doug Schuler’s journey in creating low-cost, off-grid power

D

oug Schuler, associate professor of Business and Public Policy, wants to alleviate energy problems in some of the poorest regions of the world. As principal investigator on a seed grant from Rice’s Shell Center for Sustainability, he hopes to harness sunlight in a technology called ‘Capteur Soleil,’ which is French for sun capture. “We’re using low-cost technology to capture the sun’s heat for cooking and other uses, such as sterilizing medical instruments and sanitizing water,” said Schuler. “It’s aimed at communities with limited or no access to the grid for their energy needs.” The Shell Center seed grant has allowed Schuler and a team of engineering undergraduates to build four prototypes for testing. The device is the brainchild of French inventor Jean Boubour, Schuler’s co-investigator on the grant. Boubour invented the device almost 25 years ago after searching for a simple solar technology that would be inexpensive enough for rural Africa. Capteur Soleil looks something like an ultramodern lawn swing. Its steel A-frame spine holds a bed of curved polished aluminum panels that angle sunlight onto a steel pipe at the apex of the frame. Water running through the pipe is converted into steam. Unlike

business.rice.edu

Reprinted in part with permission from Rice magazine.

most existing solar devices, it uses inexpensive and commonly available materials, and is relatively easy to build and operate. Schuler gave a talk about the Capteur to the Rice chapter of Net Impact — an international organization whose mission is to inspire, educate, and equip MBAs and professionals to use the power of business to create a more socially and environmentally sustainable world. As a result, Danielle Conkling ’09 conducted a marketing study about the feasibility of potential applications for the Capteur as well as potential sites for its deployment. “[The Capteur Soleil] presents tons of business problems for students. It’s got to make economic sense, and there has to be commercial considerations for the technology. It produces steam. What do we do with that steam? What are the possibilities and challenges?” said Schuler. They will soon find out. The first Capteur Soleil prototype was installed last summer at an elementary school in Haiti. They hope to show that the systems can easily pay for themselves by offsetting the cost of wood, charcoal, or propane, the commonly used fuels in remote, rural communities.


Around the School

Rice MBA 5th in Entrepreneurship

T

he Rice MBA Full-Time program was recently recognized as one of the top five graduate entrepreneurship programs in the U.S. by The Princeton Review’s entrepreneurship survey, published by Entrepreneur magazine. From more than 2,300 programs surveyed by The Princeton Review, 25 undergraduate and 25 graduate schools were selected.

“Entrepreneurship has become an important area of excellence for our school,” said Bill Glick, dean of the Jones Graduate School. “Our mission has been to build a quality curriculum, taught by the best professors and entrepreneurs. We felt adhering to this one principle would ultimately be recognized not only by those familiar with the Jones School but by the larger community involved with entrepreneurship.”

By the Numbers

Media Accolades

4th

globally

Rice MBA Full Time in ‘Top for Finance’ (The Financial Times 2010)

5th

nationally

JGSB entrepreneurship program (The Princeton Review/Entrepreneur 2009)

5th

globally

JGSB Career Management Center (The Economist 2009)

9th

globally

Rice MBA Full Time in ‘Top for Accountancy’ (The Financial Times 2010) Shane and Shawn Ward with Jones School’s Black Business Student Association President David Tate ’10 (left) and Vice President Aaron Sampson ’10.

The Perfect Fit

8th

nationally

Rice MBA for Professionals

Jones School hosts shoe gurus Shane and Shawn

(BusinessWeek 2009)

he Black Business Students Association and the Entrepreneurship Club hosted entrepreneurs Shane and Shawn Ward at the Jones Graduate School early this year. The charismatic identical twins shared their enterprising tale with Rice MBA students: their humble beginnings in Detroit to building a successful footwear collection.

11th

T

Having designed shoes for some of his favorite athletes at Adidas and AND1,

Shane moved to New York to start his own shoe design company. He sought a partner who shared his vision, and his twin brother was a perfect match. While Shane’s strengths were the creative side, Shawn brought knowledge of finances and logistics to the mix. The results? The Shane&Shawn brand whose shoes combine the fit and feel of athletic wear with a fashion-forward focus. Their story and merchandise has appeared in People, Oprah magazine, FOX, and more.

nationally

Rice MBA for Executives

(The Financial Times 2009)

Jones Journal Spring 2010 7


Around the School

A Visit with Billionaire Warren Buffett ‘Oracle of Omaha’ shares wisdom with Rice MBA students “Jesse Jones was a hero of the Great Depression, and I not only read his book decades ago about the RFC [Reconstruc-

“This was an opportunity to learn about Mr. Buffett’s ‘mental lattice work,’ ” said Jose L. Trevino ’10. “Personally, there’s no other business personality that’s as complete as Mr. Buffett.”

tion Finance Corporation], but more recently have watched a tape about his life

On peak oil and investing

that the Foundation sent me. He is a real

The day began with a tour of Berkshire Hathaway’s subsidiary, Nebraska Furniture Mart, where the general manager gave a tour of the facilities and an overview of the business operations. Afterwards, students headed to Berkshire Hathaway headquarters to finally meet Buffett in an informal two-hour question-and-answer session closed to media and business professionals. Buffett addressed questions on topics including social enterprise, commercial real estate, negotiating deals, valuation techniques, global economic growth, and the outlook of the American economy.

T

he Jesse H. Jones name goes a long way — even impressing Warren Buffett, listed by Forbes as the world’s second-richest man in 2009. After a couple of e-mails to the billionaire investor, businessman and philanthropist, Rice MBA students secured a once-in-a-lifetime opportunity to meet him last fall. Buffett, who routinely invites business students to visit him at his Omaha-based conglomerate, Berkshire Hathaway, hosted about 100 students from across the U.S. including 27 Rice MBA candidates, a first for the Jones Graduate School.

On investing, Buffett said to look for simple businesses. “If I gave you $10 million to invest right now and you only had three weeks to spend it and you could only

American icon.” — Warren Buffett

According to Buffett, success is getting what you want, and happiness is loving what you’ve got. Certainly, Mr. Buffett has success, but undoubtedly, he is one happy man.

business.rice.edu

– Marcela Alanis Cantu, Class of 2010


Around the School

spend it in Omaha, you’d look for simple, understandable, strong businesses. You wouldn’t look at the third best fast food chain. You might look at McDonald’s, because it is number one and will probably always be number one. What about Oracle? Too hard. GM? Too hard. You can’t predict the future for these two companies. Too many variables.” “Investment knowledge is cumulative, and things you learn will make you better in the future. Stick to things you understand.” Jan Goetgeluk ’10, president of the business school’s Finance Club, which organized the trip, asked what Buffett thought of the peak oil theory and what he believed would replace carbon fuel. Buffett responded that in 20 years, all the cars on the road will be electric. He has already invested in a Chinese company working on the technology to make it happen.

A personal look In addition to answering questions on investments and business strategies, Buffett offered plenty of advice on life and career. “Find something you’re passionate about, and you will never work a day in your life,” he said. During the two-hour lunch treat at his favorite Omaha restaurant, Piccolo Pete’s, Buffett wanted to know everything about the students — their names,

where they were from, and their dreams. Rohit Reddy ’10 said, “There are very few business leaders who so genuinely take interest in students’ careers.” Buffett emphasized the importance of not only choosing heroes, but choosing the right heroes. “When you surround yourself with people that are better than you, you yourself will rise in your character,” he said. On marriage, “The key to enjoying a long-lasting marriage is not honesty, integrity, or any of that. The key is having low expectations!” The visit ended with a personal photo session where Buffett spent an hour posing with every student, and a visit to Borsheim’s Jewelry where it was evident that Berkshire’s managers were passionate about what they do. “Although I entered the session thinking deeply about business with a strong investment focus, I left thinking more about personal goals, philosophies and morals, and how I can make sure I’m concerned with what matters most in life,” said Scott Silvas ’10. “As people often wonder about how he’s become the great person he has, it’s amazing that it boils down to strong morals, passion, and selflessness.”

Jones Journal Spring 2010 9


Around the School

Perspectives: A Strategic Look An interview with Jones School Alumni and Corporate Relations Director Shaheen Ladhani Director of Alumni Relations Shaheen Ladhani ’10 has taken on an additional title — director of corporate relations. Here is his take on the Jones Graduate School’s new strategic approach towards corporate relations and how alumni, students, and the school will benefit. What is the Corporate Relations mission and how is it relevant to the activities of the JGSB? Literally, the Corporate Relations mission is building sustainable, mutually beneficial relationships with strategic corporate partners. So, what does that mean? We have a strategic focus at the Jones School, and our intention is to identify companies that can partner with us. The school’s objectives are to generate knowledge and innovation, to train and develop today’s and tomorrow’s business leaders, and to impact the community with this talent and knowledge pipeline, both locally and on a larger scale. Corporate partnerships will help to raise the profile of the school, the faculty, and the students.

What do companies get out of the strategic partnership? We are providing them with great value, whether it’s faculty speakers or expertise, continuing education, avenues for professional development, thought leadership, access to talent, or an enhanced profile. That’s what a partnership is — a mutually beneficial relationship.

How will alumni benefit from this new strategic approach? The past year, we’ve committed to doing a lot more for alumni. Providing additional career services, professional development series events, and having a raised profile in the business community will make us a go-to place for companies who want to post jobs for experienced MBAs through business.rice.edu

our MBAFocus site. We want companies to think of us as the premier school to find experienced MBA talent. We also want alumni to hire their fellow alumni as well as investigate possibilities for themselves as a next step in their professional journey. The other big benefit from building corporate partnerships is that it is a huge avenue for raising the school’s profile and securing the future value of the degree. Our goal is to become a core school at these corporations. Alumni should be thrilled by that. We want them to be proud of their Rice degree.

How can alumni be engaged in this approach? Alumni can take advantage of those corporate relationships, be it through experienced hire positions that are posted or the presence of those corporations on campus, speakers, panelists, executive education, and so on. But the fundamental way that an alum can be involved with us is to be our champion. Wherever it is they work, they can be flying the flag for us. Encourage their company that when it comes to recruiting top talent, think of the Jones School. When they want to send their rising star employees through a top quality MBA program, think of us. When they want to train their personnel with leadership education or other executive education courses, think of us. When allocating resources and philanthropic donations to student clubs, first class activities, and cutting edge research, think of us. Alumni champions are how the great business schools not only become great, but stay great.


Around the School

Executive Education Series The Toxic Leader: A Clear and Present Danger Part One

Leadership has taken center stage in much of our considerations about organizational outcomes — for good or bad. We have been inundated with stories of CEOs, public officials, and spiritual leaders who have lead their companies, communities, and congregations astray. Given these issues in recent years, the concept of toxic leadership has crept into our awareness, deeply influencing discussions regarding the role of leaders and the impact they have on their institutions. This article is the first of a three-part series in which we explore our understanding of toxic leaders, identifying how they are created and tolerated, and what organizations can do to prevent or cure toxicity.

T

he most simple description of a toxic leader is a poor leader who relies heavily on abuse, fear, intimidation, bullying, and even harassment. Others say toxic leaders stifle creativity, autonomy, enthusiasm, and innovation through over-control. In the military, these leaders are typified as destructive, focused on visible short-term mission accomplishment, and perceived by followers as inflexible, arrogant, self-serving, and petty. While we agree that poor leaders who possess these characteristics may have a negative effect on organizations, we think that toxicity goes substantially beyond these — toxic leaders cause grave and lasting damage to the organizations, groups, or teams that they lead. These leaders have massive detrimental impact on the organizational culture and the psychological (and perhaps physiological) well-being of organizational members, ultimately derailing long-term organizational performance. Contributed by: D. Brent Smith, PhD, Associate Dean of Executive Education and Associate Professor of Management and Psychology Michael Grojean, PhD, Director of Custom Programs and Professor in the Practice of Management

We can even go so far as to envision toxic leaders who are quietly and competently leading an organization to great harm and disaster. Moreover, we believe that toxic leaders can also vary widely on other leadership aspects: from selfless to selfish interest, calm to abusive, abrasive to overtly charming. Toxicity comes down to at least three factors: a substantial greater concern placed on outcomes than on the people creating those outcomes, a mechanistic view of people as disposable resources to be used at will for mission accomplishment, and a failure (or lack of concern) to consider long-term organizational consequences derived from such a lack of regard. Clearly, toxic leadership appears to be quite different from poor leadership. Indeed, many times toxic leaders are quite effective in accomplishing short-term objectives and goals. It is this point which may provide us with insight as to why they are allowed to reach a point where they cause grave and lasting damage. We will discuss this in more depth in our next article, “Why do we tolerate toxic leaders?”

By the Numbers

Jones Alumni Impact Entrepreneurs today

22

percent

have started a business

76

percent

of these businesses are still in operation

$1.4

million

average revenue of each business

In the Community

55

percent

are in senior management or executive level positions

60

percent

volunteer more than 10 hours/month to various non-profit organizations

Jones School alumni contribute more than six times the average Houstonian to the local economy (approx. $850 million a year)

Jones Journal Spring 2010 11


Around the School

Rice Alliance

Center of Entrepreneurship Rice Alliance and Jones School hosts global entrepreneurship centers conference

W

hat does it take to inspire a group of entrepreneurship program leaders from around the world to cheerfully don giant blue foam cowboy hats with funny stars on them? In a nutshell, it takes a conference with real Texas hospitality and enthusiasm.

Last fall, more than 340 entrepreneurship educators and center directors from universities around the world gathered at Rice University for the 13th annual Global Consortium of Entrepreneurship Centers (GCEC) conference. The GCEC is the premier global organization for university-based centers of entrepreneurship and has become the primary vehicle by which top entrepreneurship centers share information and collaborate. business.rice.edu

“The best entrepreneurship centers in the world shared best practices and ideas for entrepreneurship education, innovation and technology commercialization, research, fundraising, and outreach programs designed to help launch earlystage companies,” said Brad Burke, managing director of the Rice Alliance and member of the GCEC Executive Board. “At the conference, attendees from 220 universities experienced first-hand the outstanding Jones School facilities, faculty, and nationally-ranked entrepreneurship program. It was a tremendous opportunity to showcase Rice, the Jones School, and the Rice Alliance.” This year’s event hosted by the Rice Alliance and the Jones Graduate School featured a more active approach, with diverse panel presentations and interactive Q&A and discussion sessions. Keynote highlights included inspirational speakers with entrepreneurial success stories, including one held at NASA with astronaut and physician Bernard Harris. Former prison inmates brought the audience to their feet as they told stories of how the unique Prisoner Entrepreneurship Program helped turn their lives around. And millionaire entrepreneur Michael Holthouse stirred the crowd with his passion for teaching kids entrepreneurship, one lemonade stand at a time.


Rice Alliance

The effort paid off. Attendance grew by 50 percent, and the timing of the conference provided an excellent opportunity for the Jones School to show off its new fifth-highest-ranked program. Awards were presented to programs throughout the U.S. for their contributions to the field of entrepreneurship education. Top recognition, the NASDAQ Center of Entrepreneurial Excellence award, went to the University of Southern California – Marshall. The Rice Alliance was recognized by two major awards: Excellence in Specialty Entrepreneurship Education and Outstanding Center of Entrepreneurial Leadership. This year’s conference also featured ten new awards voted on by participants, including Most Energetic/Over the Top and Most Shameless Self-Promotion. This competition challenged each center’s representative to demonstrate their prowess at an important tactic they teach their students: how to sell your business in a 90-second elevator pitch. This competition took a

more light-hearted turn, awarding blue foam cowboy hats to the top ten winners. Another whimsical award for the Longest Center Name went to the Irma BecerraFernandez, Eugenio Pino and Family Global Entrepreneurship Center, College of Business Administration, Florida International University. “Rice University went above and beyond to set records in attendance, membership, and sponsorships,” said Donald F. Kuratko, Jack M. Gill chair of Entrepreneurship at Indiana University and GCEC executive director. “Rice University was a phenomenal host, and it is clear that the expectations for future conferences are huge due to the incredible experience provided to the GCEC membership in Houston.”

for more

information

about the Global Consortium of Entrepreneurship Centers conference or how to get involved with the Rice Alliance, visit alliance.rice.edu.

Around the School

Rice Business Plan Competition 2010 The 2010 annual Rice Business Plan Competition will take place April 1517. Forty-two teams from around the world will compete for $800,000 in equity investment cash and services. This year’s event will introduce the Twitter pitch competition. Participants have 140 characters in which to communicate — and sell people on — their business plans. The program will also feature a two-round elimination system this year to determine who goes to finals. Also new this year is the $50,000 NASA “Game Changer” Commercial Space Innovation Prize for the best idea related to commercial space innovation. This year’s title sponsor is Administaff, and the national media sponsor is Fortune magazine.

Jones Journal Spring 2010 13


Around the School

Educational Entrepreneurs Rice Education Entrepreneurship Program

Angelica Vega is part of a cohort of exemplary educators in the Rice Education Entrepreneurship Program (REEP). Currently, Angelica is dean of students and college access counselor at East Early College High School in Houston ISD. As a Harvard student of the School Leadership program, Angelica mentored new teachers, used data-driven strategies to improve student learning, and collaborated with administration and faculty to define and reach school goals at a Boston public middle school. This experience inspired her to help build a program in Texas that would meet the district’s goal of increasing college readiness among students.

What inspired you to be involved in education? I first became a math teacher because it bothered me to know that some people think math is hard to do, so they give up. Many parents think that because they are bad at math, their child will be bad at math, and that it is OK. I wanted to help dispel that myth.

What is the most immediate challenge you see in education? The biggest challenge in education is retaining effective teachers. The classroom is where the magic happens. Teachers must not only be capable in their content and in pedagogy, but responsive to diverse student needs. In return, teachers should be compensated well, recognized for their

students we serve. This year, I experienced successes, supported in their efforts, and provided structure and discipline for them being initiated into the Early College High School model and graduating our first to do the work. senior class. I look forward to continuing Why did you choose REEP? the success of my school. REEP was the only program in Houston that offered me an opportunity to become How do you think your REEP a part of an innovative learning environexperience will help? ment that connected education and busi- The REEP experience has given me a lens ness. The best part of the whole program is through which to view my experiences: the caliber of my peers. REEP participants from questioning the structure of the are interested in finding solutions to the school day, to creative uses of physical urgent problems schools face now while space and people, and to working within making sure the future classes of students different organizational structures. The benefit from these changes, too. entrepreneurship component of REEP set the expectation that we limit ourselves as What are your future plans? leaders when we don’t ask “Why not?” Public education is the new frontier in entrepreneurship. There are new and successful models of schooling from which we can learn and adapt to the needs of the

Rice Education Entrepreneurship Program (REEP) combines a business school education with an intensive educational entrepreneurship curriculum. The programs aims to equip current and aspiring leaders with knowledge, skills, and resources to run underserved schools and districts. For more information, visit reep.rice.edu.


Giving to Jones

Giving to Jones There are many ways you and your company can impact the Jones Graduate School and its current students and programs. The Corporate Investors program, the Jones Partners, and the Jones Fund offer benefits to your company while investing in the premier business school of Texas and the Southwest.

CORPORATE INVESTORS The Corporate Investors program builds a two-way relationship between corporations and the Jones Graduate School. It gives companies greater opportunities to invest in and support the Jones School’s mission, while offering them a strategic competitive advantage through their partnership with a leading business school.

Corporate Investors benefit from: Access to students, faculty, and executives Insight into leading management research and knowledge exchange Affiliation with the Jones School which provides a platform to build corporate brand awareness with students

Corporate Investors support: Areas of excellence in energy, health care and entrepreneurship Top-level faculty from the U.S. and around the world Recruitment of the best students from around the world through competitive scholarship packages The dean’s top priorities: innovative projects that distinguish the Jones School from other business schools Focus on thought leadership in real estate, student-managed investment portfolios, and globalization All of the above contribute to the future of Houston and its stature as a business capital. For more information on Corporate Investors, visit business.rice.edu/Corporate_Investors.

Opening Doors to Partnership and Cutting-Edge Public Programming When you become a Corporate Investor in the Jones School, you also become a member of the Jones Partners. The Jones Partners is a committed group of business professionals working to open doors and increase collaboration between the Jesse H. Jones Graduate School of Business and the Houston business community. Members are provided a valuable opportunity to participate in a forum where senior business leaders and leading academicians meet to address business practices and trends, while interacting with Jones School faculty, deans, and fellow business executives. For more information on giving, visit business.rice.edu/Jones_Partners.

What does Jones Fund support? The Jones Fund is the annual fund that provides unrestricted revenue to support scholarships, program enhancement, and other operating expenses. More than 70 percent of the contributions raised through the Jones Fund in the 2009 fiscal year directly supported scholarships and recruitment efforts for top candidates. The Jones Fund also supports the Career Management Center, international travel programs, and student-alumni networking events. For more information on giving, visit business.rice.edu/give. Jones Journal Spring 2010 15


When Emily Armenta left her career as a trader with Morgan Stanley to pursue her MBA at Rice University, she was prepared to focus on her education full time. Not oxidized silver or exotic gemstones or Spanish poetry. But an assignment in The New Enterprise course with Al Napier changed all of that. Within months of presenting a ‘sweat equity’ case in class, she had launched a future in jewelry design.

Emily Armenta ’03 finds the business in her passion By Sarah Gajkowski-Hill


From Dress Up to Dress for Success As a child, Emily grew up in a creative environment. Her dream was to make jewelry. She played dress-up alongside her mother, an artist, and drew sketches of rings and necklaces while her mother painted. “I can still remember standing on the dining room table and carefully removing hanging crystals from the chandelier to pretend they were earrings,� Emily says. But she traded in her youthful aspirations for a bachelor of arts in Interdisciplinary Studies at the University of Texas at Dallas and a few years with Morgan Stanley.


And then he went on to explain that I needed to build the company’s foundation before going on to take orders that I wasn’t ready for. He said if I didn’t deliver, I’d burn those bridges.” It was the hardest advice she ever accepted. And the best decision she ever made. In an economy that has taken a substantial hit over the past year, the recipient of Town & Country 2008 Couture Jewelry Silver Award now has excellent relationships with Saks 5th Avenue, Neiman Marcus, and other high-end jewelry retailers across the country and internationally.

Building a Team

to take the next step in her practical business path. Enrolling at the Jones Graduate School where she could maximize her strategy, leadership, and creative credentials, she found herself in Napier’s class, where that practical path took an unexpected detour. As it turned out, her ‘sweat equity’ business was viable. “I didn’t know how to manufacture the product much less have product codes or techniques for testing product effectiveness figured out,” Emily recalls. She used her instincts and simply experimented. For capital, she sold “everything that wasn’t bolted down” to create the small and supposedly finite line called Phoeben, a childhood nickname from her father that originated in Greek mythology. With classic influences from the Spanish revolutionary, artist and writer, Federico García Lorca, the high-end jewelry began to take shape. The gods were definitely smiling on Phoeben — now doing business as Armenta — and the MBA candidate who walked into a department store looking for feedback walked out with her first order.

She never dreamed she’d be lecturing about developing a business strategy in the same classroom in which she learned it, but as a frequent visitor to Napier’s classes since graduation, she’s doing just that. “I like to tell the story of how I started Armenta — how you can take a dream and make it a reality.”

Entrepreneurship 101

The Rice MBA program’s commitment to hiring entrepreneurs to teach entrepreneurship has changed Emily’s life and guided her through every step of her early career as a business owner. As that business took off, her classes and professors helped address actual problems she faced every day — such as product development and cost accounting. Emily credits Leo Linbeck III with being instrumental in teaching her how to offer the best product available. After orders for more jewelry from her initial line started rolling in, she began getting calls from large retailers. She tapped Linbeck for advice on how not to lose the sale and make the most of opportunities. “He told me, ‘Turn them all down. You’re not ready — you have to have the best product in place first.’

Continued emphasis on the attributes of hard work and passion that are taught in the classroom, as well as her own gift of discernment, has allowed Emily the rare ability to offer jobs to people who are often overlooked in society. Her first hire was a woman named Lida, who cleaned the building in which Emily worked. “I watched her for months as she sang beautiful songs while she worked,” Emily recalls. “I saw passion in her.” Though Lida did not speak English, had no formal education, and didn’t know the first thing about jewelry, she was hardworking and meticulous to detail. Emily believed in her potential and offered to hire and train her. Lida accepted. Today, Lida not only speaks English but also runs the production floor, manages Armenta’s training program, and analyzes the jewelry line’s efficiency operation. “I refer to Lida as ‘Sea Biscuit’ and warn people never to bet against her,” Emily says, laughing. “My goal is to hire people who are talented and only need an opportunity in order to succeed.” Not surprisingly, most of her employees — women of all ages and ethnicities — have stories like Lida’s.


When describing a normal day at the 10,000-square-foot Houston studio, Emily answers easily. “The energy at the studio is very high paced. There is a buzz in the air, like on Christmas morning. Many of the girls sing as they work, music is playing in the background, and everyone is excited about the work they perform. We’re really a team. When a pressing order needs to get out, the girls stay late to get it done. No one goes home unless everyone goes home.”

Romancing the Gemstone

Each of Armenta’s lines has its own theme. Emily admits that the themes are heavily influenced by the poetry of Federico García Lorca. In his work, he speaks of a mischievous muse-spirit which embodies duende — the painful beauty of life. “Duende is the soul of my workers who have overcome their personal hardships as well as the muse of every artist who yearns to express him or herself through creative works of beauty,” the self-taught designer says. The passion for her work, her employees and her company are clear and unwavering. It is the very thing that Professor Al Napier recognized in her. “Emily went with what she loved. That’s the key to entrepreneurship. You have to be passionate about what you do.” And how you do it. Armenta’s pieces range in style from delicate to bold, from feminine to gallant — stately gold Maltese earrings, handmade diamond toggle necklaces with London blue topaz, marquis stack rings, and wings of fortune bangles. Emily acquires her stones and different materials from Asia, Africa, and South America, and her methods through trial and error. When she wanted to experiment with chemical reactions and fine metals, she set up a small lab in her office, called engineers who worked with industrial paints, sealants for the insides of pools and even antigraffiti paint, and then tested it for

to tell the story of how I started Armenta— “howI like you can take a dream and make it a reality.” a year. Finally, she developed a distinctive technique that resulted in the strong metallic quality of the “Midnight” collection and the 2009 Couture Design Winner for Best in Silver for her use of oxidizing sterling silver.

At this point in her career, stars like Halle Berry, Glenn Close, Lisa Kudrow and Miley Cyrus, and royalty, such as Queen Rania of Jordan, have worn her designs. “I have to pinch myself every day,” Emily says about Armenta’s success. Her advice to young entrepreneurs, which she gleaned from Leo Linbeck, “Follow your heart and the money will come. It has to do with what you want to spend your time doing.” Currently Armenta oversees employees in Houston, Los Angeles, and Tennessee and produces over 6,000 pieces of high-end jewelry annually, including international distribution. While Emily concedes that her creativity to design jewelry came from her mother, she maintains that her business acumen came from her Rice MBA and the entrepreneurship classes that taught her how to find the business in her passion.


Three years ago, two students at the Jones Graduate School of Business had an idea that could transform an industry. Today, that idea has become Simbol Mining, a multimillion-dollar enterprise that could jump start the move to electrically-powered vehicles and create hundreds of jobs in the process.

By Jason Witmer

business.rice.edu


STARTING THE DIG

Five years ago, Scott Conley ’07 and Luka Erceg ’07 met while working on a team at the Jones Graduate School of Business. They had both enrolled in the MBA program to advance in the corporate world, not to become entrepreneurs. Although, that changed quickly once they began discussing business ventures. Before Rice, Erceg had worked as an executive, consultant, and attorney for several major companies, where, among other duties, he represented clients in venture capital transactions. Conley had tried his hand at entrepreneurship fresh out of college, when he bought a small printing and graphic design franchise. It failed miserably and, after three years, he sold it for pennies on the dollar. “That experience showed me you better understand what you’re getting into,” says Conley, who has since worked as an engineer. “I decided I’d never do something like that again unless the idea was good enough.” It took ten years to find that idea. The seed was planted in his time as an engineer and it germinated at Rice. Conley had been briefly assigned to a company that was using a new mining technique. Cal Energy was extracting metals from geothermal brine. The company would eventually decide it wasn’t getting enough yields and shut the plant down. Conley was convinced that, though the plant had been poorly managed, the technology was sound. “I think Luka heard this story enough times that he finally said, “ ‘OK let’s take a look at this,’ ” Conley says.

Luka Erceg ’07 and Scott Conley ’07 of Simbol Mining turn dreams into precious metal

Jones Journal Spring 2010 21


“Most entrepreneurs perceive risk as obstacles or hurdles that can be overcome.”

– Luka Erceg

Today, Simbol Mining

has 15 employees and has raised millions to begin construction on a lithium processing plant in southern California, the first of what could be many. As Simbol’s name is derived from the symbols on the periodic table, the new plant will extract lithium, a key component in rechargeable lithium ion batteries used in laptops and electric cars — but in a unique way. Unlike traditional mining, the zero-waste method piggybacks on power plants that cycle geothermal brine — hot, salty water deep inside the earth — to create electricity from its heat. After the brine is brought to the earth’s surface, Simbol would add one more step — they would filter out valuable metals before the brine is shot back to the earth. One could think of the system as a glass of lemonade with two straws. One straw brings lemonade up from the glass, sugar is filtered out from the water, and then the water is shot back to the glass with another straw. The idea struck them as elegant in its simplicity.

“For a long time it was just an idea,” says Conley, who is now director of engineering at Simbol. “Then I got so enmeshed in it and enthralled with it that I couldn’t put it down.”

MINING INVESTORS

They began by researching the prices of several metals, which were at historical highs. As attractive as the prices appeared, Conley has indeed learned from his early mistakes. He says a successful entrepreneur must research relentlessly to understand competitors better than they understand themselves and to constantly question one’s idea to make sure it makes sense. So, they studied Cal Energy’s process and decided that if the company had done things differently, it would have succeeded with the new technology. They also liked the fact that the technology was clean. After many more months of researching, working with the Lawrence Livermore National Laboratory, and bringing on two other scientists, they were ready to find funding. The hard part would be finding a venture

capitalist firm that would believe in their idea as much as they did. They knew the odds were against them. For every start-up that gets funding, hundreds are passed over. Erceg and Conley pitched their idea relentlessly, using tens of thousands of dollars of their own money flying around the country meeting with investors. They both spent countless hours researching their proposal. Erceg, president and CEO of Simbol, says that if one plotted their emotions throughout their journey on a chart, there would be wild fluctuations from one day to the next. “An entrepreneur has to learn to just keeping working, no matter how high or low emotions get,” he says. At one point, they thought they had secured an investor, only to see the deal fall through. Other investors seemed confused by the technology and unwilling to take a risk on something so unique. Eventually, they got accepted into a prominent technology conference in Toronto only to watch other entrepreneurs receive money from venture capitalists.


They were at a low in their journey. Both are married with children; the time, money, and rejections were taking their toll. “In the back of my mind I knew I couldn’t keep doing it much longer,” Conley says. “Something had to happen.”

JACKPOT

Something finally did happen, months later. In February 2008, Simbol was accepted into the biggest technology conference in the world — San Francisco’s Cleantech Forum. Erceg would have seven minutes to sell investors in the audience on their idea. He worked on the pitch relentlessly, even attending a weeklong “boot camp” to prepare. When the big day came, Erceg, palms sweaty, gave his pitch. “Before I walked off the stage, I had three emails on my Blackberry from investors asking to meet with us,” Erceg says. They ended up winning the award for most promising technology and from that point on, they were in meetings with investors almost constantly. Mohr Davidow, a prominent venture

capitalist firm, would eventually vote unanimously to back Simbol. Days later, the company had a lump sum of $6.67 million in its bank account. “I had to kind of pinch myself,” Conley says. “It was a validation that the idea we had was sound.” Simbol will eventually be capable of mining several different metals but has decided to focus on lithium for now, because the market for it is exceptional — some project the demand for it to triple in the next ten years. And the company is banking that the market for electric cars, and thus lithium, will take off. Simon Moores, deputy editor at Industrial Minerals, says those in the metals industry are watching Simbol intently — especially those that mine lithium using traditional methods such as solar evaporation, which can leave a lot of waste. Moores says Simbol still faces many challenges, but if it succeeds, it could revolutionize the industry. “As an economic development it could be potentially huge,” he says. “If they can do this on a large scale, it could eliminate

the need for solar evaporation and open up a whole new source of lithium anywhere in the world.” One might wonder how Erceg and Conley have been able to develop such a potentially lucrative business so quickly. They say hard work is key — they each describe the other as one of the hardest working individuals they’ve ever met. Erceg says the willingness to sacrifice and take risks is also important. Sometimes he wonders what he was thinking when he got into something so big, but he would do it again. “People who start companies view risk differently,” he says. “Most entrepreneurs perceive risk as obstacles or hurdles that can be overcome.” After all their hard work, Erceg and Conley say it is rewarding to know they are working for themselves. They were attracted to the idea of entrepreneurship because it offered more control over their destiny and, as Erceg says, the potential to add something valuable to society — creating local jobs and producing resources in a sustainable way.

“I had to kind of pinch myself... It was a validation that the idea we had was sound.” – Scott Conley


The

Road LessTraveled Three Jones School entrepreneurs tell tales from their unique journeys

by Chris Warren

As a nation, America is fascinated with entrepreneurs. From Benjamin Franklin to Eli Whitney to Walt Disney to Bill Gates, entrepreneurs have done the heavy lifting when it comes to building some of the most successful companies, brands, and innovations the nation has ever seen. But it’s more than just their accomplishments that make entrepreneurs so intriguing. The archetypal story of how an entrepreneur rises is a uniquely rags-to-riches American tale. However, the romantic image of how an entrepreneur is born or operates isn’t always true.


Jones Journal talked with three highly successful Jones alumni — tequila maker Iñaki Orozco ’05, biotech start-up guru Dr. Paul Campbell ’03, and serial entrepreneur Bryan Emerson ’96 — to see how closely their experiences mirror one another as well as the popular notions of who an entrepreneur is. Here’s a look at their story as entrepreneurs and the different journeys and experiences that led them there.


Inaki Orozco '05

Building a tequila company Iñaki Orozco is founder, president, and CEO of Riazul Imports, a tequila company that is two hundred years in the making. He inherited from his great-great-grandmother 620 acres of land in Mexico’s exclusive Jalisco highlands, officially recognized as the region where tequila was born. Thus grew his vision for harvesting agave and eventually creating a suite of premium tequila. Only a year after Riazul has hit the market, Iñaki has secured $2.1 million in funding and plans to expand the Texas-marketed product nationally.

Jones Journal: Iñaki, how important is education and experience in being a successful entrepreneur? Orozco: In the 1990s, I told my father I wanted to follow in his footsteps and own my business. He said, ‘That’s great, but I strongly suggest that you get some formation in the corporate world so you can give your business a solid structural foundation, as this is something that has lacked in my company.’ So, I put my entrepreneurial dream aside and looked for a job. I’m thankful that I didn’t pursue my own business first. Corporate experience and operational sensibility have been key pieces to my company’s early success. Jones Journal: What do you enjoy most about the business? My favorite aspect is seeing people’s reaction to our product. If they respond well, it means we did our homework. As an entrepreneur, you feel you must invent something out of scratch. It’s tough to, say find the fifth leg on the cat, but improvements can be found anywhere even in the most saturated industries. Key is hitting differentiating competitive advantages that turn people on to your product. Jones Journal: What advice would you give aspiring entrepreneurs?

26

If you choose to have a business partner, finding the right one across the board is crucial, especially one that complements your skills. Human capital is the most important asset to any company. If you don’t have quality people, it will impact your product, the efficiency of your business model, and ultimately, it will be reflected in your bottom line.

On that note, keep listening to everyone and everything around you. Entrepreneurs have to understand that they don’t know everything. It’s a constant learning process, and the world moves so fast; you never know when someone might say something that you’ll end up implementing in your business.

Paul Campbell '03

Scientist turned entrepreneur Paul Campbell didn’t always appear destined to be an entrepreneur. He spent his formative years working in a museum and, frankly, has spent more years in school and as an academic than he has working. But as fate would have it, the scientist, who earned a PhD in biochemistry and cell biology at Rice, has co-founded two biotech companies, Aster Bio and Glycos Biotechnologies, and is a director at Houston-based venture capital firm, DFJ Mercury.

Jones Journal: Paul, it seems you took an unusual path to entrepreneurship. What inspired you? Campbell: I actually come from a very entrepreneurial family. My grandfather started companies in construction and life insurance. My father wanted to be a scientist, but because of family expectations, he went into business, starting his own real estate property management company. While I was in school, I saw a lot of really interesting business-related decisions happening around science. I realized that there was no common vocabulary. Some people understood the science but not business, or understood business but not the science. That’s when I started thinking about science as a business. I said to myself, I know the science, maybe I can learn the business. Jones Journal: It sounds like a start-up was a good fit for you. I was looking for a smaller environment where I would have a broader range of daily activities, so I figured I’d create a company or work for a start-up. I started my companies to


fill a market need, and it seemed like a good opportunity to make money. I also love what I do. I always knew I wanted to be involved in biotechnology. I get excited talking about the technology. Jones Journal: What should one know about getting into tech start-ups? In this business, it’s all about managing and limiting the risk. Get the biggest risks out of the way, so you can focus on developing the technology. Lots of start-ups also spend investors’ money in all the wrong places like new expensive office furniture. If the life of the company depends on it, spend the money. Buy the latest and greatest analytical equipment if it impacts the research and the profits. Most importantly, if you have the money, spend it on your employees, the people who dedicate their efforts for you.

Jones Journal: You mentioned that quality of life is important to you, hence the quality-of-life business. Tell me more. Emerson: Many entrepreneurs can work 24/7 while spouses and families can feel left out. But nobody wants his tombstone to read, “He was a good worker.” I know that I have never been a nine-to-five kind of guy, but surely, getting mugged at knife point when I was 35 living in Mexico City forced me to ask myself, “What do I really value?” A balanced life was the key message, so I made some proactive changes. I moved back to Houston and married for the first time at age 41. I developed a business that I could run from anywhere with a laptop and proved it once we built a log cabin off the grid in Alaska. My wife and I work together, and I downsized properties, possessions, and activities that didn’t support my core life and business missions.

Jones Journal: What other qualities do entrepreneurs need? Campbell: The two words that really jump out at me are humility and confidence. They sound diametrically opposed, but they’re not. You must have the confidence to convince others that your idea is valuable, to buy your product, or invest in your company, but you also must understand that you don’t know everything, so sometimes you need to bring others in to help. You need to realize what your own limitations are and, on some level, that takes humility.

Bryan Emerson '96

Achieving balance in life and as an entrepreneur Bryan Emerson believes that work should revolve around life. A serial entrepreneur, he is founder and managing director of Starlight Investments. He has shown that owning a quality-of-life business — for the past ten years — is more than possible. He works four months out of the year from his off-grid, solar, wind, and cell-powered cabin in Alaska. He may be toting water, cutting wood, and skinning a bear, if need be, in between negotiating deals around the globe.

Jones Journal: Bryan, is it true you launched your first business at age five? Emerson: Yes, I started a lemonade stand after my parents told me I had to pony up half of the $56 for a new twowheel bike at Sears. In high school, I started a snow plow route in Chicago and built this base by buying equipment and hiring seasonal workers to run an asphalt business with seven trucks and 15 employees. Because I looked so young, I hired a retired marine to meet with clients, while my workers, whose predominant language was Spanish, knew me as “El Jefe,” which means “boss.” Working with them encouraged me to become bilingual. The down payment on my first house came from selling that business, run during high school and college.

Jones Journal: What qualities do you see as being essential in succeeding as an entrepreneur? Emerson: Tolerance for risk is essential, but persistence is indispensable. You will erode your savings to pursue a goal that others don’t see as worthy. Every business will have variability, and if you quit when the chips are down, you’ll never get back to where the chips are up. I recognize a lot of entrepreneurs don’t make it. But unless you can persevere through those tough times then there never will be another high. Persistence is underestimated, especially for people who work for companies. Unless they get a taste of it and appreciation for it, I don’t know that it’s something you can teach.

27


All Jones School entrepreneurship faculty members — including adjuncts and part-time professors — have one thing in common: real-world experience in establishing, growing, and selling companies. Founder Edward E. Williams believes this hands-on knowledge is the key to the program’s exceptional success.

Al Napier, professor of Management and area coordinator of the Entrepreneurship and Information Technology groups, agrees. “Everybody who teaches in this program has been a successful entrepreneur. To teach entrepreneurship effectively, I believe you must have been an entrepreneur.” It’s fitting that Napier and Williams knew each other in graduate school at the University of Texas at Austin. Today, they are the only two Jones School entrepreneurship professors who trained as academics.

Professors share Jones School’s story of entrepreneurship

Teaching fromex • pe • ri • ence By Jan Hester

noun Qualifications and experience skill, knowledge, practical knowledge, understanding; background, record, history; maturity, worldliness, sophistication; informal know-how.

business.rice.edu


With the economy in a downturn, s more carefully than ever at entrepr

Groundbreaking endeavor

In 1978, Ed Williams was presented with a unique challenge: to help start an entrepreneurship program in Rice University’s Jesse H. Jones Graduate School of Business.

“We could never have come this far without the contributions of many part-time faculty members who bring their entrepreneurial talents and experience as well as teaching expertise into the classroom.”

Williams, who was then a vice president at Service Corpo-

Other contributions also have impacted the success of the

ration International (SCI), couldn’t say no. He eventually

program including a partnership between entrepreneurship

joined the SCI’s board and committed to teaching one course

faculty and the Rice Alliance for Technology and Entrepre-

each semester while undertaking the work of building up the

neurship. Since it was founded in 1999, the Rice Alliance has

entrepreneurship program and raising the funds necessary to

assisted in the launch of over 230 technology companies. The

sustain the endeavor.

organization sponsors the annual Rice Business Plan Com-

Williams soon encountered his first major obstacle. “At this time there were only a few entrepreneurship programs in the U.S. I discovered that there weren’t many people with both PhDs and real business experience,” Williams explains. “I was

petition, the largest and richest intercollegiate business plan competition in the world.

Entrepreneurial starts

enterprise to Emerson Electric for about $30 million. “He

Named winner of the 2008 Acton Award, a national award for excellence in entrepreneurship education, Napier joined the Rice faculty in 1984, a time when there were only 15 faculty members at the Jones School and no departments.

wanted to teach, but had no college degree,” Williams says.

He started teaching entrepreneurship in the fall of 1996 and

“But we had flexibility on our side.” Ballas came on, and

is now responsible for the day-to-day running of the entrepre-

others followed.

neurship program. Napier, who has a history of starting and

stumped. How do you start a program with academic respectability and engage people who know what they’re talking about?” Weedeater inventor George Ballas had just sold his

Today, the Jones School graduate entrepreneurship program is nationally ranked — number five by The Princeton Review and Entrepreneur magazine, 2009. Both Williams and Napier attribute much of the program’s success to the adjunct faculty.

business.rice.edu

growing successful businesses, has been involved in online retailing for many years and is still working on internet companies and occasional investments with graduates. He says he always knew he was going to be a professor.


“It’s rewarding to guide students through the process — from

tenant guarantees. The business blossomed, and Williams sold

the original idea to harvesting their efforts. I tell my students

for double the money. His next business — a partnership —

they should study to be an entrepreneur whether they plan to

rented furniture to Rutgers students.

be one or not, because they just might need to.”

Since then, Williams has taught at McGill University in Mon-

He was a 10-year-old paper boy when he learned his first les-

treal and at Shanghai Institute of Mechanical Engineering

son in business. “I had to collect money every month. I learned

— and has gained a wealth of corporate experience as chair-

pretty quickly to go on the 25th because my customers might

man, CEO, and president, in venture capitalist and investment

have moved on by the first of the month.” During college, he

firms. Williams, who was ranked by BusinessWeek as the

had a computer consulting company, then later worked for

second best entrepreneurship professor in the country in 1996, now limits his entrepreneurial activities to investments and projects with former students.

students are looking reneurial opportunities.

Conoco for seven years. While at the University of Texas working on his PhD, he observed other professors working as consultants, decided that was a good idea, and ended up owning

a consulting company with 15 full-time employees. He owned

Napier & Judd, Inc., a computer consulting company that also offered training services and composed software manuals.

With over 60 books published and 20 years in the business, Napier sold it to his partner in 2001.

Williams credits Heights grocer Carl Cohen with setting him on an entrepreneurial path early in life. Williams would ac-

company his father to Mexico and bring back merchandise to sell in front of Cohen’s store. Cohen spotted his natural ability to sell, but he turned down an opportunity to go into the grocery business. “The economics didn’t impress me nearly like selling $20 worth of curios for $50. I had to go with the greater profit margin.” After studying economics and finance in the Wharton School at the University of Pennsylvania and getting his doctorate at the University of Texas in 1968 he started to teach in the economics department at Rutgers. Practicing the 20 percent rule, living on 20 percent of earnings and saving the rest, he prepared for his next endeavor. While in New Jersey, Williams put $5,000 down on three quadplexes in an economically distressed part of town and negotiated with the county to secure

Vision for the future

Although Williams and Napier are proud to be recognized for their personal successes as well as developing an entrepreneurship program ranked among the nation’s top five, they aren’t content to rest on their laurels. “With the economy in a downturn, students are looking more carefully than ever at entrepreneurial opportunities,” Williams says. “People like independence, and nobody knows what the future holds.” They have been committed to supporting new entrepreneurial resources for students and alumni, including a growing initiative — the Jones Graduate School Entrepreneurs Organization (JGSEO) — which brings together alumni who are entrepreneurs to network and collaborate with each other and to mentor current students and other alumni. They recognize the current economic situation is helpful to entrepreneurship, but both men are less sanguine about the future of entrepreneurship programs. They worry that down the road, schools won’t be able to find academically-certified people who can effectively teach courses from their practical experience. “Many business schools are adopting the philosophy that programs can be run by pure academics, or ‘theoretical entrepreneurs’,” comments Williams. Napier agrees. “Not everybody who is a successful entrepreneur can teach because they lack the necessary communications skills.” Which is why Williams and Napier continue to be heavily involved with mentoring alumni and keeping their eyes out for entrepreneurs with the talent to teach. Both men have a vested interest in seeing the program thrive. “This will be our legacy,” Williams says. “Every large company started with an entrepreneur. Every organization, school, or program had an entrepreneur behind it, too.”

Jones Journal Spring 2010 31


Jones Graduate Student Alumni Association (JGSAA) 2009-10 Officers and Board Members PRESIDENT Bob Parkey ‘88 President, Americas Linc energy

PRESIDENT ELECT Ted Dimitry ‘02 Account Executive Hays Companies of Texas

Board Members: Erich Bell ‘03 Assistant Controller Quantum Energy Partners Bo Bothe ‘05 President & Chief Creative Officer BrandExtract Phillip Brown ‘08 Manager Hewlett-Packard Company David Case ‘05 Vice President JP Morgan Chase Francisco Castro ‘02 CEO Aliant Capital S.A. de C.V. Mark Courtney ‘94 Director CIMA Energy, LTD Julie Davidson ‘04 Director Cogent Compensation Partners, Inc. Carolyn Galfione ‘97 Financial Advisor & CFO Linscomb and Williams Jay Hawthorn ‘05 Vice President Barclays Capital Jack Ledford ‘02 Project Manager KBR, Inc. Nkem Ogbechie ‘03 Cappello Capital Corporation Pierce Owens ‘98 Vice President CB Richard Ellis

Dear Fellow Alumni, 2009 was filled with expanded alumni services and engagement activities. Many thanks to those of you who were able to stay involved with the Jones Graduate School through any or all of these opportunities. The Jones Graduate School had a marquee year for many reasons: the launch of the PhD program, the rise in rankings for the Rice MBA Full-Time, Professionals and Executives programs, a faculty research productivity ranking of No. 20 in the world, and our Career Management Center earning a No. 5 global ranking. We also received accolades for excellence in specific disciplines, most notably the national ranking of No. 5 in graduate entrepreneurship programs. These successes and others were achieved for many reasons — and in no small part due to the engagement and support of our loyal alumni network. I’d also like to acknowledge all of the hard work that the JGSAA board members have continually put in. They persistently seek ways to enhance the alumni programming and resources. If you have thoughts or feedback you would like to share, please feel free to contact me or my fellow board members. Our information is available on JonesAlumni.com. One of the fruits of the board’s labor has been the alumni survey results that we collected in the fall. It is inspiring to see how successful Jones School alumni are in their professional and personal endeavors. We are proud of the many thriving business leaders, entrepreneurs, and civic leaders. It is clear that Jones Graduate School alumni make a major impact on our society. In closing, I would like to thank you again for your support of the Jones Graduate School. It truly makes a difference to the overall quality and success of the institution — and it contributes significantly to the fulfillment of the school’s mission. 2010 will include a variety of alumni programs, professional development, and lifelong learning opportunities. On behalf of the Jones Graduate School Alumni Association, I invite you to take full advantage. It has been an honor serving as the alumni association president. Best wishes for the year ahead — and please do stay connected to this great network. Sincerely,

Priscilla Plumb ‘01 Cheif marketing officer UHY Advisors Kim-Kay Randt ‘07 Director, Payment Systems Marketing ConocoPhillips Doreen Stoller ‘91 Executive Director Hermann Park Conservancy Kathryn Young ‘04 Vice President, Operations Sirius Solutions

W. Robert Parkey, Jr. ’88 JGSAA President


Media Mentions

Media Mentions

This is a partial listing of the Jones Graduate School community’s appearances in the media. For a more detailed report of international, national, and local media coverage, visit: business.rice.edu/mediamentions. El Paso Signs Pipeline Deal with Chesapeake, Statoil

Ernst & Young CEO on better accounting

Call for smart phone apps answered in Houston

El Paso Corp Chairman and CEO Doug Foshee ’92 discusses the company’s latest major pipeline project.

Ernst & Young CEO Jim Turley ’78 on the need for stronger risk management systems and a set of single accounting standards.

Local technology advocates including Adjunct Professor Blair Garrou and ForeFlight Founder Tyson Weihs ’06 talk about Houston as a hotbed for developing mobile applications.

Wall Street Journal, Feb. 16, 2010

20 Inspiring Women to follow on Twitter Forbes, Feb. 8, 2010

Women like Robyn O’ Brien ’98, childhood nutrition activist and founder of the Allergy Kids Foundation, put their hearts and complex issues into 140 characters: @ UnhealthyTruth

Using Super Bowl to pick stocks is a loser’s game MarketWatch, Feb. 5, 2010

Research about stock trades and the Super Bowl by James Weston, associate professor of management, is featured.

Fox Business, Jan. 28, 2010

The case for insiders CFO.com, Jan. 28, 2010

CEOs hired from within an organization perform better than those hired externally, according to a new study by Distinguished Associate Professor of Management Yan Anthea Zhang.

Targeting energy efficiency Reuters, Jan 22, 2010

Carin Michelle Giga ’10 is mentioned as a fellow for Climate Corps, which is creating a movement for energy efficiency.

Houston Chronicle, Jan. 11, 2010

Qualcomm’s Personal TV is new screen for FLO The Financial Times, Dec. 11, 2009

Bill Stone ’92, FLO TV president, is interviewed about Qualcomm’s new personal TV device.

Scientists prove that Mom was right Christian Science Monitor, Nov. 10, 2009

J. Hugh Liedtke Professor of Marketing Vikas Mittal’s research shows that people who believe more in equality are one and a half times more likely to go for impulse purchases.

What do student athletes gain from this program?

Alumni Spotlight

Joe Branch ’04 Giving back, starting a nonprofit Joe Branch is co-founder of UWantGame (UWG), a non-profit that helps high school student-athletes reach their potential in academics, athletics, and personal growth through one-on-one mentor relationships with successful former collegiate athletes. The three-yearold program is based in New York and made its debut in Houston this year.

What was your inspiration for UWantGame? UWG is the evolution of my relationship with my mentor whom I met during an internship at Chase Bank following graduation. We’ve been close the past 17 years and had an opportunity to build something unique. UWG is essentially about the overall development of the student-athlete. We have a passion for young people and sports, and we happen to love business. We recognize that we’ve been successful, because we both had mentors and coaches that helped pave the way for us.

It’s important for young student athletes to get guidance from people with diverse backgrounds, like successful former athletes, in addition to their parents. These mentors have walked the life they plan to walk. We educate these athletes to think and prepare for a ‘plan B,’ a life off the court. We like to call it ‘building the game behind the game.’ Soft skills including networking and dining etiquette, as well as finance basics, all help with their overall development.

What about the business side? UWG has a targeted audience and works within a niche market. As a business, it’s been a challenge, even as a nonprofit. Under the volunteer based model, it’s vital that we find innovative ways to increase fundraising, build a first class board, and eventually hire a full-time executive director to really make the impact we’d like. We’d love to get feedback from our Jones School friends in the Houston and NYC area. Check us out at www.uwantgame.org. Jones Journal Spring 2010 33


Class

Notes Gary Abdalla ’93 is a director at Accumyn Consulting, an independent, Houston-based consulting firm. Kevin Palzkill ’93 is a finance manager at Dell Inc. in Austin, TX. Julie Hoad ’95 is an international sales planning manager at Continental Airlines. Eric Akopiantz ’97 leads

president of business development and government relations at Infinia Corporation, a solar energy company in Kennewick, WA, and the developer of the Infinia Solar System.

Paranet’s Managed Services and Professional Services business units as COO. Prior to Paranet, he was CEO and co-founder of Digital Reach, Inc., which was acquired by Paranet, LLC on Sept. 30, 2008. As part of the transaction, Eric was also elected to the Board of Directors of Paranet, LLC.

Joann Barry ’89 is a

Chris Burkhart ’98 is VP

6 1980s

Jay Oliphant MAcco, MBPM ’82 is finishing his

third year at Walmart Stores Inc. in Northwest Arkansas. As a director in Real Estate Finance, Jay supports Walmart’s Real Estate Division and is currently in the home stretch of a conversion of financial systems to SAP. Rice alums and current Jones School students are encouraged to contact Jay when in the area or to pursue career interests in retail or real estate.

Chuck Langenhop ’85 is director of CFO Advisory Services, LP in Richardson, TX. Marilyn Miller ’85 is owner

of Flying MMM Management Co., LLC in Houston since 2005. She also serves as adjunct professor in management at the Jones Graduate School.

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business.rice.edu

Peter Brehm ’86 is vice

managing director at Tradewinds Global Investors in Los Angeles.

Keith Buchanan ’89 is managing director of Scotia Capital, which provides investment banking services, in the Houston office.

1990s

Julian Bott ’90 was named CFO of Texas American Resources Company (TARC), a privately-held, independent energy company headquartered in Austin, TX.

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of Marketing at Callaway Golf Interactive in Austin, TX. The company offers asset recovery services to the sporting goods industry.

Norberto Cane ’98 is financial analysis manager at Occidental Energy Ventures Corporation in Houston. Olympia Ammon ’99 is senior vice president of the American Heart Association in Houston.

3

James Deborah ’99 is director of strategic planning at Hunt Oil Company, a privately held exploration and production company based in Dallas. Emily Durham ’99 recently

founded Restaurant Connections, a consulting firm providing real estate and market research for restaurant clients in Houston.

David Warren ’99 has launched Warren Staffing, a division of Warren Recruiting which handles full service contract and temporary staffing. Warren Recruiting is a leading relationship builder that focuses on placing well-credentialed lawyers in top law firms and corporations in Texas and the southeast. Douglas Foshee ’92, a

member of the Jones GSB Council of Overseers, Rice University Board of Trustees, and CEO of El Paso Corporation, was elected to the Houston Endowment’s board of directors.

2000s

1 Caroline Teel Scott ’00

and her husband Jeffrey are excited to announce the arrival of their son Stuart Hudson Brown Scott on Nov. 17, 2009. Big brother, Duncan, and big sister, Ella, are thrilled to have another partner in crime!

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Update Your Contact Info! Visit JonesAlumni.com

and log in to the alumni directory.

Scott Noel MBA/MEE ’04 and his wife Georgianna

Hatley are planning to build a school, Galileo School, in northern Uganda after their involvement in Christian Ministries in Africa. The young couple, Scott, a manager of audit software systems for the IRS, and Georgianna, a teacher at the University of Dallas, are investing their own money in the project. For more information, email scott.noel@ thegalileoschool.org.

2 Tanay Shah ’04

and wife Reena celebrated the birth of their son, Rohan Shah, on Sept. 1, 2009.

Michael Hanna ’05 and his wife welcomed William Morgan Hanna on Sept. 12, 2009. The healthy baby boy weighed 5 lb and 3 oz and was 16.5” long.

Hugo Sheng ’05 is the WW

Director of Field Engineering at a startup called Expressor Software as of December 2009.

Tobin ’05 and 3 Elizabeth Rob Priske ’05

joyfully announce the birth of Rebecca Anne Priske on May 10, 2009. Rebecca was 7 lb and 1 oz and 20” long. Elizabeth is currently a manager with Deloitte’s Financial Advisory Services group, where she focuses primarily on Foreign Corrupt Practices Act engagements. Rob is vice president of Investment Banking at Deutsche Bank, where he advises refining & marketing, exploration & production and oilfield service clients. They both continue to enjoy living and working in Houston.

Alumni Spotlight

Gavazzi Cooper 4 Allison ’06

gave birth to Alexa MiCarmen Cooper on Dec. 3, 2009.

Emily Armenta ’04 and her husband Armando welcomed home their new baby in October 2009. The Armenta family now resides in Houston. Lauren Barrash ’08, a realtor and social worker, recently opened the ‘Washington Wave,’ a 15-passenger bus serving the bar and restaurant scene along Washington Avenue in Houston. Chef and restaurateur Michael Cordua ’08 will open a third Americas restaurant in Houston this fall.

5 Bari Fishel ’08

and her husband are proud to announce the birth of a beautiful son on Jan. 23, 2010 at 8:08 p.m. Max Nathan Fishel weighed 9 lb and 2 oz and was 21” long. The Fishel family now resides in Houston. They are both doing well and just trying to catch up on their sleep!

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Gretchen Penny ’90

First-time entrepreneur shares her success Gretchen Penny sold her first business, Easy Expression Products, Inc., last winter. The company sells the hands-free pumping bra she created and patented to maternity stores, hospitals, and lactation consultants in the U.S., Europe and Asia. She is currently involved in the new Jones Graduate School Entrepreneurs Organization (JGSEO) as a team leader in the Emerging Business Teams and a member of the CEO Roundtable groups.

Did you know that you wanted to be an entrepreneur?

6 Brandon Houston ’09

and wife Brandee welcomed their baby boy, William Henry Houston, on June 3, 2009.

Not really. I went to Rice wanting to work in the airline industry, which is what I did when I graduated. But, while at the Jones School, my friends encouraged me to take entrepreneurship courses and that is what hooked me.

How did the bra company get started? I wanted to give my first son breast milk, but I also wanted to return to work. I learned that breast pumping was very difficult and totally consuming, because it occupied both hands — continuously — for 30 minutes! That’s when I developed my idea for a hands-free pumping bra. I really just started my business to sell the 800 samples I had made when I was looking for a buyer for the patent. Then, I planned to be done. But, the samples started selling, and people were giving me ideas on product improvement and profit. That’s when I knew I might have something of value.

Why did you sell the company? What are your next steps? The business needed to grow much bigger in the near future and that would be a huge change to my family’s lifestyle. After eight years, I was ready for something new. I would like something where my husband can be more involved, too. As part of the JGSEO, I’m hoping to find an exciting venture percolating in that group of eager entrepreneurs. Jones Journal spring Jones Jones Journal Journal Spring FALL 2009 2010 2009 35 35


AlumniResources

Visit JonesAlumni.com to learn more about the opportunities and resources for alumni.

Alumni Career Services

Networking Opportunities

Lifelong support for alumni throughout their careers; confidential access to job postings and other online resources, as well as avenues to recruit top caliber students at the Jones School.

Jones Graduate School Entrepreneurs Organization (JGSEO): The JGSEO provides the systems, processes, and social networks to bring together and support Jones alumni with real-world entrepreneurial experiences. Details are available at JGSEO.JonesAlumni.com.

Lifelong Learning

Discounts on Executive Education Open Enrollment programs; custom programs for your corporation; class audit opportunities; lecture series events; ‘Alumni College’ weekend featuring a Jones School faculty lectures on hot topics.

MBA Council of Houston (MBACH): The Jones School is a member institution of the MBA Council therefore all alumni are invited to Council programming events. These events provide a great opportunity to network with other MBAs in the area from member institutions that include HBS, Wharton, MIT, Texas, Tulane, Kellogg, and others.

Wharton-Rice MBA Alumni Network: The Jones School is proud to announce a collaboration with the Wharton Club of Houston. The Wharton-Rice MBA Alumni Network is designed to assist MBAs who are seeking employment opportunities and career advancement. All member schools of the MBA Council of Houston are invited to attend these meetings. Details available at WhartonRice.JonesAlumni.com. Jones Partners: Join the Jones Partners to network with people from a variety of industries and hear outstanding speakers at events throughout the year. Corporate Investors: Talk to your company today about the networking opportunities and other benefits of joining the Corporate Investors’ annual membership program.

See JonesAlumni.com for directions to join these online networks: Jones Alumni Directory; official JGSB groups on LinkedIn and Facebook.

Rice Business Network (RBN): Connect with fellow Rice alumni for a monthly networking lunch. This is a great way to share business referrals and career opportunities while broadening your network with the Rice alumni in the Houston area.

Save the Date!

Cinco de Mayo 2010. Saturday, May 1. Bring the family and come back to Rice to reconnect with old friends and faculty. Lots of food, drinks, and family entertainment provided. RSVP for the event at JonesAlumni.com.

Online Networking Resources

Jones Alumni Real Estate Club: A club for Jones alumni who are interested in building their network in the real estate community via quarterly happy hours and other events.

AlumniGet Involved

Share your professional and life experiences with future leaders in a variety of ways. Alumni Mentoring Program

Mentor a second-year Rice MBA student who is seeking first-hand information about prospective careers from professionals. Through the mentoring program, alumni:

• Cultivate a deeper connection with the JGSB and our students

Jones Alumni Volunteers for Admissions (JAVA)

The Jones School is actively seeking ambassadors from around the world to represent the school in attracting top-tier candidates to the Rice MBA program. JAVA ambassadors may:

• Share professional and life experiences with future alumni and business leaders

• Interview prospective students

• Provide guidance in an ongoing relationship

• Counsel admitted students during the decisionmaking process

business.rice.edu

• Represent Rice at recruiting events

Alumni-Student Lunches

The Alumni-Student Lunch Series is an opportunity for current students to meet with alumni during lunch sessions. Lunches provide students an informal setting to gain insight into professional areas of interest and to engage the alumni in current happenings at the Jones School.

for more

information

about alumni involvement opportunities, visit JonesAlumni.com.


AlumniEvents

Dean’s State of the School address Feb. 25, 2010

Class Reunion Dinner Nov. 13, 2009

Jay Adkins ’01

Sean Tracey ’09, Tony Oguamanam ’09, and Lavon Washington ’06

Rebecca Bridges ’94

Stacey-Ann Williams ’04

Amy Sutton ’90 and husband, Gary Chiles (Rice PhD ’86)

Walker Barnett ’02 and Ted Dimitry ’02

Patrick Van Pelt ’99

Radu Filip ’08

Homecoming ‘Partio’ Nov. 14, 2009

Alumni Professional Development Series “DNA of a General Manager” – Oct. 21, 2009

Schubert Huang ’08

Todd Cox ’05, Jones School PhD candidate

Speakers Jenna Fisher (Rice ’95) and Steve Newton of Russell Reynolds Associates

Bradley Alford ’83

Danielle Conkling ’09 and family

Michael Weekley ’04

Shell Auditorium

Brian Chiu ’11 and Andrew Sarantapoulas ’11

For more event photos, go to the Jones Graduate School’s official Facebook page. Link is available at JonesAlumni.com.


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permit #7549 houston, texas

P.O. Box 2932 Houston, TeXas 77252.2932

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Jones Journal - Spring 2010