Is an MBA a Plus or a Minus in the Startup World?

http://techcrunch.com/2010/05/08/is-an-mba-a-plus-or-a-minus-in-the-startup-world/

by jfi • 16 years ago

30 43 16 years ago

dave1619• 16 years ago

I think an MBA can be helpful in the right situation/startup, but in other situations it might not be needed or the person might need to unlearn some things. It's the debate between B-School and E-School (Entrepreneurship School advocated by Steve Blank).

pkaler• 16 years ago

I don't get this either or thing. I got a BSc in Computing Science when I was a kid. I'm 30 now and preparing for the GMAT. I also keep abreast of the latest on the lean startup and on the fat startup. Why not learn it all?

ojbyrne2• 16 years ago

In my opinion you're the ideal MBA candidate - undergrad in either engineering or a science, some work experience, then the MBA. The problem is that so many MBAs have undergrads in Business and go straight to the masters without any intervening work experience. So they don't have experience and the courses have a lot of overlap. They give the MBA a bad name, but they're the cash cow of business schools.

rick_20474• 16 years ago

Where I live (India) most of the MBAs are Engineering or Science Graduates. This year only 9 people from business and 1 from arts got into IIM-A. Its a common choice among Engineers to take up MBA after there Graduation (BE/BS/B Tech).

It kind of annoys me though. Its fine if you are doing an specialization in something like Project Management, Computer Management, E-Commerce or something like that. But it just bugs me if you take up finance or banking. WTF? If you wanted to do finance or banking why the hell did you waste the one seat of Eng/Sci student. In a country where there is already a shortage of Quality Engineering studies, these people take there education from IIT and then join IIMs taking up banking or finance. This is a total waste of the Rs 900,000/- the government is spending on each IIT student. I just hate to meet someone working in a bank and them mentioning "I did an B Tech in Electrical from IIT then went to IIM".

Either I am missing the node joining finance and banking with engineering or this is really just the product of the herd mentality students here have. Its a trend now to go for MBA and they would take any branch if they get into an IIM, "Why bother, its IIM!!!".

profgubler2• 16 years ago

I actually think very few go from undergrad to their mba without work experience. Look at the average years experience for top grad schools. It is normally 3+ years on average. I am about to go to Notre Dame for an MBA and I have just under 3.

It is all great to pick on people who have a business undergrad and mba, but sometimes in life people don't know what they want to do at the undergrad level. I did not start my business undergrad thinking I would get an MBA, but it becomes the logical career move later on. I am way excited for where I am going now with it, but double business isn't inherently a bad thing in some industries.

For me I want to get more into tech, so I am teaching myself rails. People always talk about learning business on their own, why can't someone also learn programming on their own?

barnaby• 16 years ago

It was a very good plug for the authors' own classes that he teaches (link in the last paragraph).

some1else• 16 years ago

I don't mind it. Almost everyone plugs their own stuff in guest posts on TC, and I've read plenty of Vivek's brilliant posts to allow a plug like that in the latest one. I do mind the fact that he maintains his affection towards the MBA and disagreement with Guy although he clearly believes an intense one-year program that focuses on the important bits is a better alternative.

Maro• 16 years ago

In the Startup World, it's not the MBA that matters, it's you!

rick_20474• 16 years ago

I don't know much but I have a slight doubt whenever I read something like this. I presume you get an MBA to give you a better understanding about business. And startups are in essence businesses. Then how come having a better understanding not impact your startup?

PG-13• 16 years ago

Because this assumption is false.

pg5• 16 years ago

The cause of the apparent paradox is that "business" spans a huge range. MBAs train you to be junior officers in the armies of managerial capitalism. But there is almost zero overlap between that sort of work and what startups do.

davidw• 16 years ago

I don't think this debate will really be settled until we have actual data to deal with, which isn't likely to happen any time soon, because you'd have to observe the same people with, and without MBA's.

NyxWulf• 16 years ago

We actually do have some data, but a little thing like facts never hinders an uninformed opinion.

http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1127248

ericlavigne• 16 years ago

That's an interesting read. Some conclusions about US-born tech startup founders include: (1) they tend to be 30+ years old, (2) they tend to have advanced degrees, especially from ivy-league schools, and (3) those with advanced degrees tend to create bigger companies, especially if they went to ivy-league schools.

I didn't see any commentary on whether someone who is older or has a degree is more likely to succeed in their venture at all. This study couldn't address that question because the survey sample was composed entirely of people who had already reached a certain threshold of success. I find the study interesting mainly because it hints at the answer to this related question, and would love to see some data that addresses this issue more directly.

sachinag• 16 years ago

I'm a non-technical founder who's founded one startup, joined another, and am now an Advisor at TechStars - before I go back to B school to get an MBA. And that's after I did a business degree in undergrad.

To me, getting an MBA is all about option value. If I want to go to a big company, it's a prerequisite. If I want to do startups, it's not. If I want to jump back and forth, then it's a prerequisite again. I'm willing to pay $150,000 to have the option value of jumping back and forth for the thirty years after I graduate, not to mention the experience of the two years there, the network I'll have, and the other attendant benefits.

I wrote about this decision last week; maybe it'd be useful to some people here: http://www.sachinagarwal.com/why-this-startup-guy-is-going-b...

tullius• 16 years ago

Exactly the kind of the logic that people use to justify going into the corporate world instead of a startup. For people serious about building a successful startup the possibility of going back to a cushy corporate job if things don't work out should be the last thing on their mind.

mwerty• 16 years ago

So should health insurance by that logic.

Major_Grooves• 16 years ago

I think the actual education would be very beneficial. Most MBA schools now position themselves as very entrepreneurial. Oxford, for example, has a seed fund for startup ideas from MBA students.

The thing that puts me off doing an MBA is the time and the cost. One or two years is a long time to not act on an idea if you've already got some in your head. If you don't already have some startup ideas in your head and you're thinking of doing a MBA I would argue that you're not really a startup person. There are lots of people that want to be an "entrepreneur" but don't have any actual startup ideas.

The cost is my biggest worry though. Having a £50,000 dept with £700/month repayments really does put a dampener on the idea of bootstrapping a startup. Hence why so many MBA graduates end up doing investment banking or consulting.

Me - non-coder, lots of startup ideas, entrepreneur wanabee, business school interview in a week!

vishaldpatel• 16 years ago

Being in a start up is a game. We have an idea and we are playing the game to make that idea as successful as possible. We need tools in this game - engineers, lawyers, accountants etc.. are all tools. Some tools are more useful in the beginning than others. Some tools become more important as our startup matures.

Now MBA is this awesome general degree that teaches you a bit of everything - accounting, sales, some business law. This makes you a versatile tool! :D. The question is, do you know how to best serve a startup? What can you do? What do you want to do? How will you make up for your lack of experience in a certain area - can you learn quickly? Adapt?

Many startups these days start out with the core team being engineers - they're looking to build something, so it makes sense. That said, some startups may do well with a gritty MBA who can go out there and talk to tons of people to generate / prove ideas and report back to the engineering team; take care of accounting; HR stuff if need be; etc... basically it means being the CEO from day one without worrying about the title.

Is that what you're looking for or do you just want a cusy desk job as a junior manager? ;)

thewileyone• 16 years ago

I was a founder at consecutive startups years ago and I recently got my MBA. One thing I can attest, if I had my MBA in the past, it would have helped to run the startups more productively and efficiently.

pramit• 16 years ago

Related Reading Which You Will Find Useful: The Simple MBA Manifesto: Do We Really Need MBAs? A Presentation http://www.slideshare.net/pramitsingh/the-success-manual-do-... Presentation Transcript is Available Here http://bighow.com/news/the-simple-mba-manifesto-do-we-really... Do we need MBAs? A 5- part look http://bighow.com/tags/doweneedmbas

Is an MBA a Plus or a Minus in the Startup World?

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