By Scot Lowry, Richard L. Osborne Professor of Entrepreneurship at Weatherhead School of Management
Entrepreneurship Through Acquisition (ETA) offers a lower-risk path for individuals aspiring to go from employee to business owner. ETA involves entrepreneurs either self-funding or securing investor support to identify, acquire, operate, grow, and potentially sell a small company, typically ranging from $5 million to $15 million in revenue at the time of acquisition.
Here are five things to know about ETA in Cleveland that distinguish our region and Weatherhead as frontrunners in ETA education and community outcomes:
1. Lower Risk with ETA
While only 10% of startups succeed, and a mere 1% become businesses generating $1 million or more in revenue, ETA entrepreneurs, according to the 2022 Stanford Search Fund Primer, have a 67% chance of owning businesses averaging $8 million in revenue. ETA significantly reduces the risks associated with becoming a first-time business owner compared to startups.
2. Weatherhead's ETA Pioneering Legacy
Dating back to the 1970s, the late Professor Richard L. Osborne started teaching ETA at Weatherhead, making it one of the earliest institutions, alongside Harvard and Stanford, to delve into this field. In 2023, I became the inaugural Richard L. Osborne Professor of Entrepreneurship, leading Weatherhead's ETA initiatives. The expansion of ETA coursework, a thriving ETA club with 61 members, ETA programs for non-degree executives/students, and a highly acclaimed annual ETA conference underline Weatherhead's commitment to ETA education and outcomes.
3. Unparalleled ETA Ecosystem in Cleveland
Cleveland's ETA ecosystem stands unparalleled, shaped significantly by Richard Osborne's founding of the Promise Partners ETA Accelerator in 1992. With 65 Promise Partner Members becoming owners of 85+ companies, including 44 Weatherhead alumni, are evidence of the mature ETA ecosystem in Cleveland. Collaborations with organizations Manufacturing Works and the Kent State Ohio Employee Ownership Center, Jumpstart, Magnet, Center for Family Business at Weatherhead, Exit Planning Institute, TeamNeo, Burton D. Morgan Foundation, and more contribute to the robust network of ETA investors and advisors available to support ETA entrepreneurs in Cleveland and beyond.
4. First ETA-focused Doctorate at Weatherhead
Reid Tileston started his Doctorate of Business Administration (DBA) program journey at Weatherhead in the fall of 2023, focusing on ETA seller behaviors and motivations. This makes Reid the first doctorate student in the U.S. to concentrate on ETA. Reid brings 16 years of ETA entrepreneurship experience as an owner and investor in addition to co-creating the ETA program at Chicago Booth. Reid will also offer an ETA for executives course open to the public and Weatherhead students on Jan. 5-7, 2024.
5. Comprehensive Support Throughout the ETA Journey
Despite being a concept studied at Weatherhead for over five decades, ETA is still relatively novel. With both degree and non-degree offerings, a substantial network of experienced ETA entrepreneurs, investors, and advisors, and the support of the Promise Partners nonprofit ETA Accelerator, aspiring ETA entrepreneurs in Cleveland receive practical strategies, education, and mentoring at every stage of their ETA journey.
Learn more about the ETA program at Weatherhead by visiting our program page.