Managing (and Getting) Money

By Martha Rush; Chief Educator-in-Residence

Tales and Tips From the Front

What is preventing you from going to market right now?


That brief but telling exchange happened between a judge and one of my student teams at the recent University of St. Thomas Business Plan Competition in Minneapolis.

The students are designing fully biodegradable coffee cups—news flash, your typical paper Starbucks cup won’t biodegrade unless it’s sent to an industrial compost facility—but their minimum order quantity is in the hundreds.

Yes, money is a big barrier for student entrepreneurs. Getting it, managing it, earning it, sharing it—it’s all hard. 

As a teacher/coach who is not a well-endowed angel investor, how can you help students get the seed funding they need to realize their entrepreneurial visions? And once they do get money, what do we need to teach them about banking, cash flow, and records?

Getting money

The good news: There are lots of mini-Shark Tanks and business competitions to help students get seed funding. Including the QØ Cup!

The bad news: It’s easier to win these competitions if you already have proven sales, which means you had to have some money to buy resources in the first place.

Unlike adult entrepreneurs, our students can’t usually access crowdfunding platforms or bank loans because they are still under 18.

Some teams are able to bootstrap their own enterprises—meaning everyone on the team chips in $25 or so—but that doesn’t work when the students are from low-income households. So how do we level the playing field?

Here are a few ideas:

  1. Fundraising – The first strategy is the age-old bake sale updated for the 21st century. Students can be pretty creative about how to earn money, if we give them a little push. One of my teams bought a huge bag of caramel-apple pops and some plain paper and sold “candy-grams” at school. Their $10 investment raised over $100 for their venture. Another team sold henna tattoos to their peers, again multiplying their initial funds by 10x or more. If they don’t have $10, I’m happy to give them that much. This idea also gives students early practice with sales!

  2. Angel investing – In some schools, the principal or a booster club act as an angel investor, providing students (who have a solid business plan) with a $100-$200 jumpstart, in exchange for some equity in the business. Does your school have these resources? It’s worth asking.

  3. Local competitions – Many schools and districts are launching their own Shark Tank competitions, bringing in local business people who love hearing about student innovation, and who might be willing to fund a few ideas. I’m not doing this yet — but it’s on my horizon. Check back next year.

Managing money

You think getting money is the hardest part, but then the students actually get some money, and the question is: How are they going to manage it? If they win $500 or $1000 or even more—which all four of my current venture teams have done—that’s not money you want them carrying around in their backpacks.

Nor do you necessarily want your name or the school name on it. If your name is on it, you may have to report it as income. If you deposit the money in a school account, the students might not be able to access it again.

In my view, if the students win money—it is their money. They are responsible for it, and they can decide when and where to spend it.

Most of my student teams have gone one of two routes:

  1. Junior Achievement works with local banks to help students open business bank accounts. The account belongs to them (although JA and I are technically listed on it), and they can spend the money freely to buy resources, advertising, etc.

  2. A trusted, responsible parent of one of the team members opens a business bank account for the students, which the students can access and monitor online. It’s critical that you and the students trust this adult—because they will have access to the money too.

Another option is to get a safe or lockbox in your classroom, where students can store small amounts of cash. It’s not easy, though, if they’re buying resources (like biodegradable cups) from suppliers in other states or nations and need a debit card. Access to banking is a big help.

Keeping Records

Students might start out with a few hundred dollars or less, but before long, that money can turn into thousands. Some of my student-run businesses have won more than $10K in business competitions, and some bring in hundreds in revenue each month.

They need to learn how to track their money, and that means they need to learn basic spreadsheets—either Google Sheets or Excel. I created this simple spreadsheet for my students to track their expenses and revenues and also be able to project future earnings.

In addition to organizing their cash flow, a spreadsheet like this also helps students remember to record every expense, and it makes it easier for them to create graphics and charts for their pitches later.

One other key: Students need to agree how much they will pay themselves (if anything), and how they will share the profits (if there are any) among team members. It’s much easier to reach an agreement on these topics before the money rolls in than after.

Tell your students this if they plan on making money—and they need to plan for making money.

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