Entrepreneurs in Austin

Record amounts of student debt cause college students to get creative to assure a return on their investment. Some Austin entrepreneurs say they could have done without the degree, but UT faculty and staff beg to differ.

About 42 million Americans bear $1.3 trillion in student debt that’s altering lives, relationships and even retirement, according to a 2016 study by Consumer Reports. While some still persistently hold a college degree to the highest value, other students are taking matters into their own hands. Instead of searching for an employer, the creators of Noble Wolf Vodka and Charity Charge credit card started their own businesses this year.

On average, college grads in the Class of 2016 have a record level of about $37,000 in student loan debt for those with a bachelor's degree compared to the previous record of $33,500 in 2014. Is the price tag worth it?

UT student, Bryce Cottrell, who started his own company before graduation, does not think his degree has been of much value.

“The classes have nothing to do with making a vodka company. I’ve learned more on Google than I have with a college degree, honestly. With different fields I think it is (needed) like if you’re an engineer or something I hope you would have a degree,” said Cottrell.

Cottrell and Friends and the Noble Wolf Vodka launch party June 17, 2016. Photo by Larissa Hayden.

College classes helped Cottrell master public speaking, but not much else.

“Corporate communications taught me how to speak to people 100 percent, how to handle different situations. I’ve taken that from the degree,” Cottrell said. “Other than that, growing up living in Plano (success) seemed almost expected. Everyone’s always expected something from me. I don’t know what it is, but people are always like ‘Oh you’re going to do something great. I don’t know what it is, but it’s going to be something’ and I guess this is something I fell into.”

When it comes to goals, Cottrell said, “I just wanted to be better than my dad.” His dad created the first black hair care product and part owned the Texas Rangers. Cottrell, a 22-year-old UT senior and football player, just launched the first vodka distilled from grapefruit. His dad has been his motivation growing up.

“He taught me a lot, not really about starting anything, but more about the ethics of things. He just said if your going to do it, give it everything you have. Don’t half-ass do it,” said Cottrell.

Bryce Cottrell’s Noble Wolf Vodka Bottle. Photo by: Dominique Wright

His family was skeptical at first, but Cottrell says they love the idea now. Especially after his immediate success, selling out of all of his product within the first two weeks.

In some cases, passion trumps education and students end up working in fields other than the field they earned a degree in.

“I like to talk about, in my career advising appointments,” said career adviser Amira Sounny-Slitine, “that major does not equal career. I think the environment here is to help you grow and learn see what your transferrable skills are to figure out what career you want after you graduate.”

Even though Cottrell followed his passion and experienced success early on, longtime entrepreneurship professor at UT’s McCombs School of Business, Gary Cadenhead, said a business degree prevents entrepreneurs from learning things the hard way.

“There’s a whole body of knowledge about how to start a new business and some people start their new business without knowing any of that, so they’re on the job training from the get go. As opposed to, having a whole lot of knowledge that can avoid a whole bunch of problems. We teach that material, so they can have a higher probability of being successful,” said Cadenhead.

Agreeing with Cadenhead, another entrepreneur Stephen Garten, who created Charity Charge credit card, said that there is value to a degree. Charity Charge is the first credit card that automatically donates the rewards people rack up to charity.

Charity Charge creator Stephen Garten making his first purchase with Charity Charge card at the UT Co-op Store May 20, 2016. Photo by Aaron Chavez

“I wish I had been a little more focused during college,” said Garten. “I think there was a lot more I could’ve gotten out of the academic side. It wasn’t until I moved to Austin and started working at UT for the Austin Technology Incubator that I started soaking up a lot of information and was exposed to all these cool start up companies and the whole concept of building companies that could scale, things of that sort.”

Garten said he didn’t need a degree, but did value his education.

Charity Charge launched their first credit card June 21, 2016. Photo by: Double Z Productions Zac Zlatic

So, back to the question, Is it worth it?

“In 2013 median earnings for young adults with a bachelor's degree were $48,500,” according the National Center for Education Statistics. Compared to the poverty rate of $24,300 for a four-person household, and an average $37,000 in student loan debt, it’s not looking too valuable.