Would an MBA better prepare me to start a business?
I have been debating about whether to go to business school or just start my own business. I am wondering if business school is worth the time and money. I know I would make great connections and probably learn a lot, but how much would it really help?
During my current 20-year journey of startups (both my own and helping others), I got my MBA in Entrepreneurship, so I can tell you my experience pre-MBA and post-MBA. I decided to pursue an MBA after about 10 years of startup experience. Why? - as someone with a pure technical background, I wanted to (1) learn the fundamentals of business, (2) be able to look at companies with both a technical and a business point-of-view (helpful when talking to investors), and (3) broaden my network (my contacts were almost exclusively in technical fields).
Should you get an MBA? - it really depends on your needs and your desire for learning. If networking is your goal, then there are plenty of networking opportunities now to make contacts. These opportunities will be much more cost effective than an MBA. Depending on what you desire to learn, there are numerous online resources that may suit your needs rather than a full MBA program. The time and money spent on an MBA program could be spent on starting your company.
One advantage of pursuing an MBA while developing a startup are the numerous business plan competitions and other startup assistance programs available at universities. Depending on where you pursue your MBA, there could be many resources available to help you start your business. Also, through your MBA classes you may end up working with a potential co-founder. However, you can access many similar resources through accelerator programs (depending on your startup idea).
Back to my experience, I feel the most benefits I have received from getting my MBA are (1) the know-how to fully understand the financials behind a business, (2) the ability to analyze a business and it's products/services from different perspectives (i.e., marketing, accounting, operations), and (3) the introduction to business mentors.
As a general rule, there's nothing wrong with more knowledge.
It's been said a few times here in different ways here; an MBA does not correlate with being a successful Entrepreneur. An MBA will help you move up in a larger company (think McKinsey or Accenture), but it's not going to help you too much with a start-up.
My question to anyone contemplating starting a company is based on who you are. You must be completely self-aware, and you must be naturally wired for the role in addition to having specific knowledge for what you're doing. This is far more significant to your success at a small business than any amount of additional education you could receive.
I've profiled and interviewed dozens of small business owners over the years, and with few exceptions, there is a very distinct pattern that successful entrepreneurs have.
No. There are thousands of people out there who believe they deserve to be listened to in business because they have an MBA.
I have found that an MBA makes you no better qualified to conduct business, but can (and should) enhance any skills you have and allow you to develop some that sometimes only come with experience at a senior level.
It became the default, but I am not so sure it is as important in the UK/Europe these days, though that may still be different in the US. After all, it's a lucrative element of the education system, so if people will spend so much money on one, it has to mean something, right?
I don't have a MBA, nor would I study one. I can't think of anything more dispiriting. However, from those I have worked with, it probably improved a good candidate, but it cannot make a silk purse out of a sow's ear.
I have met far more of the latter who know their way around a spreadsheet, but have no concept of business beyond theory and in many cases don't even understand the business they are in. They simply wade in and start applying 'metrics' (a favourite word of the MBA candidate/graduate) as if they are axioms.
I'm with Robert. Invest in yourself, not the college peddling a course that may only make a difference – in a negative sense – to your overall wealth.
I have an MBA and I own my own business. I found an MBA very helpful to advance me in middle and upper management before opening my own business Not knowing the type of business or your background, I would suggest you network with others that have done what you intend to do and with those already are in other businesses that can offer you good advice. One of the greatest compliments you can offer to someone is to ask for their help. That demonstrates that you truly respect their opinion.
Today I have a half dozen mentors that have been of tremendous help to me and continue to offer me advice. I also take pride in helping others as a mentor. Being an entrepreneur has risks, but the freedom and rewards have been very good to me. Potentially they can be for you too, but you need to go into this with your eyes wide open. Networking with others, understanding those risks, developing an operating plan (check these out on the internet), being flexible and adjusting to what works and does not work will be of great value to you.
Having had the MBA and worked my way to executive level and now being on my own for over three years, I appreciate the education I had along the way If you have the passion, persistence and patience it takes to run your own business with your trusted network, don't be afraid.
In the next generation, I see many that have college degrees that are underemployed. I also MBA's that have punched that ticket, but do not necessarily have the drive and passion.
My son went to college for a year and then opted to go into the Army when things were hot in Iraq. He joined special forces. He is a disabled vet today. He still only has one year of college. Today he is the team lead of a high risk group at the fourth largest bank in the world. He is very smart analytically. The rest of his group have college degrees in accounting and finance and many have MBA's. Again he only has one year of college under his belt, but he has a passion to help and continually learn. He has taught me a lot about what you can overcome if you have the passion and persistence to make it happen.
Define what you need to do. Explore your alternatives. Determine the impacts of those alternatives. Evaluate those impacts. Then make the decision that is best for you.
Good luck with whatever choice you make.
Today is Thanksgiving day and I am truly grateful for so much. If you focus on what you have rather than what you would like to have, your happiness is guaranteed. When you find the job that you are truly passionate about it is no longer a job. My wife says I don't really work I just have fun. She is right.
An MBA is simply a foundation in information. Management, leadership and entreprenurship are arts that must ve practiced to build experience. I will often take experience over a degree and most smart people will. Given the choice of your mother using a recent graduate doctor who was top of his class, or one with 20 years experience doing that exact operation which would you choose? Even it the second doctor was a "C" student I would take him without a blink.
See you know this when it is important.
So getting an MBA does not hurt but I suspect you would learn a lot more and create more value in the real world too. I have Harvard MBAs and PhDs go through my CEO Boot Camp and often the question is: "Why did I not learn this in my six figure MBA program?" Unfortunately the answer is only experience teaches this and most professors are teaching, not getting real-world experience.
Read all these books over a year or two and understand them and you will be in the top 5-10% of entrepreneurs: http://clevelenterprises.com/Recommended_Reading.htm
When you have that foundation and are ready to start a company, then read The Startup Manual which is a step-by-step process and models for designing businesses, launching them and operating them for the first year or two. Here:
There is no shortcut to rewiring your brain, literally neuroplasticity, to do any complex art.
Start your business, hire an MBA
I've been advising owners of growing businesses for over 20 years, and I see no correlation between having an MBA and small business success.
It depends on what you know already, and what you want to do. I have an MBA and I value the education I received, but I feel it better prepared me for corporate America than it did for entrepreneurship. MBA programs and Entrepreneurship programs in academia teach theory...and nothing teaches you better than practical application! I'd need to know more to help you, but based solely on your question, as phrased above, I would have to say that for access to connections and learning you're better working for a company that does what you want to do, spending time at an organization like SCORE, networking with other business owners in your community, or finding a business consultant who can help you with voids, next steps, and accountability. To your SWEET Success!
Looking at my friends, I'll say - it doesn't help to start a business, but surely helps to run a business when it becomes more or less stable. You learn when to stop being overly aggressive and keep the right pace of growing and keeping the processes stable and good, without leaving out any important things. MBA is great when you have some amount of practical knowledge as a base, to put it together in one framework and enrich.
NO not at all...read the book Think and Grow Rich...that book will help answer your own question.
Hi Barbara, I thought the same thing. So I got that MBA. I started a business. Perhaps it was my graduating class, perhaps it was only one professor who ran an independent real estate firm, or the professor who opened a failed marketing agency, but I cannot say truthfully my MBA helped me start a
business. I can truthfully say the MBA helped me design an efficient business but only after figuring out the core requirements in Revenue generation. If your heart is set on a MBA find a university specializing in business ownership, development where you can pay your tuition out of that entity with a product/service the market will buy.
Hope this helps
As a person who has an MBA and who has had his own marginally-successful consulting businesses, I would say that the correct answer depends on your situation. There are thousands of people without MBAs who have started and run successful businesses, and there are lots of people with MBAs who have started and failed at running businesses. In addition, biz school costs a lot of money and there is the time value of money as a result of attending biz school. In other words, you not only pay many thousands in tuition and living expenses, but you also sacrifice the salary you gave up to attend, unless you go part-time.
So, the critical questions are:
1. Is your business idea one for which you feel passionate and which you have done the due diligence to make sure that it is commercially feasible? You don't need an MBA to do that. You can easily learn about market sizing and business planning on the Internet.
2. Do you have savings or some other source of money to finance your biz? Sure, you can start in your garage, but unless your product is your brain or brawn, you need money to buy supplies, a laptop PC, and raw materials.
3. Do you have money to pay for food and shelter during the time before your biz becomes self sustaining? You should plan for at least 18 months.
4. Is your spouse/partner supportive of your plan to start a business and does he/she understand the sacrifices involved?
If you can answer "Yes" to the above questions, use your money for your biz and forget about the MBA.
If your answer is no to any of the above is "No", you either need to work on turning them into "yes" or you can consider business school if you have the money or can borrow it. An MBA is no ticket to a successful business, though you will have access to faculty and colleagues who may be able to get through the start up hoops faster.
Probably not the answer you wanted, but it is my observations after earning my MBA at a top school while working full time, then transitioning into the biz world.
The smaller the business and the weaker the competition is, the less important the MBA is. Some businesses categories are dominated by very sophisticated players and I wouldn't even consider attempting without one, especially if your geo market is national or global. But for other niche or local businesses, the MBA may be overkill and you can do very well with common sense, effort and using your time and money to build, brand and market the newco.
You can get all the info you need on an MBA here: http://personalmba.com
Yes. MBA would help you better learn more about specific functions within your business - Marketing, Finances, etc. The program I went to was focused on MBAs for entrepreneurs. Further, some MBA programs can also help with growing your network which may be crucial for getting funding, securing team, etc.
However. You absolutely don't need to have an MBA to start a business. This really just depends on your own personal skill set, the type of venture you are looking to start, finances, and other factors.
My first business I started pre-MBA, my second post-MBA. I felt like my MBA helped me greatly in numerous different areas.
An MBA is good if you work for a company . If you would like to advance your career then, is worth the investment. I have to agree with Robert Donnelly; you are better off using the money to start and grow your own business. Although starting a business entails many long hours and sacrifices. It will depend on what you really love doing.
@Robert: Unless one goes to a top-tier school--Dartmouth, Harvard, Stanford, Chicago, etc.--the MBA is overrated. I have one, so I know whereof I speak. It is increasingly looked on w/disdain. One wag said MBA stood for 'Minimal Business Acumen'; another said it stood for 'Maximum Business Arrogance.'
@Barbara: As Robert noted, the MBA is unlikely to be much help in starting your own business. A quality MBA program costs an arm and a leg (and then some), and as he rightly noted, that money will earn a bigger return in growing or launching a business.
What you don't say is what your background is. On a scale of 1 (zilch) to 7 (expert), how much do you know about marketing? About economics? About finance? About IT? About accounting? About HR and management? And how much do you like selling? If you can provide some 'scaled' responses to those questions, I might have an inexpensive idea or two that you would find helpful. But I need to know more about your background first.
Also, are you an expert in something that people would want to buy? Have yu been successful in your career so far? What is that career, incidentally? Do you have real passion for a particular business idea? (Up to a point, passion trumps technical business know-how.)
Barbara, you've got lots of good answers, but here is my two cents from the perspective of someone with three degrees (PhD, MBA, BSEE) who spent a decade in academia but even more time working on my own and mentoring start-ups...there are a handful of truly exceptional MBA programs (e.g., Stanford, Babson, MIT) with an emphasis in entrepreneurship that are actually comparable to being admitted to an incubator -- very hands on with great access to local mentors and networks. Unfortunately the vast majority of entrepreneurship "programs" and "majors" are drive by in nature (lots of war story based lectures, inspirational or "how to" readings, and guest speakers) where your culminating experience will be an exercise in creative writing -- producing a business plan where no one expects that you actually tested / validated your business model and actually will execute the plan. If your goal is to get educated on how to develop / validate a business model and launch and grow a business, there are a lot of local economic development resources that might be available to you (depending on where you live). As some have noted, more formal education on business / management may be of value to you down the road as your business matures (especially if you lack experience in finance, acctg, mgmt., mktg, ops, etc.), but not so much in the early stages when you are trying to figure out if you actually have something worth launching. Here are a couple of books that might help you kick things off: Just Start by Schlesinger, Kifer, and Brown, and Business Model Generation by Osterwalder and Pigneur. Good Luck!
Knowledge is king here on this question, "whether it be knobler in the eyes of man", I should say as an MBA grad, makes no difference really, street smarts can be an overwhelming factor as well, as classroom intelligence. If you feel you are ready for the challenges, it is the knowledge the takes over. But it is always a good thing to get the schooling views, but you can do both, I did. I opened my first business entity and went back to school.
Continuing education is a marvelous thing, but I know many educators, and many CEOs and both will tell you, as I am. If you are up for the challenges, go for it.
Formal education can show you how to approach these challenges, give you insight as to where to look for answers, but only hands on experience will give you the means to offset the changes as you find them.
Lastly, as I climb down off this soap box, Cash is the grease that feeds you and your family, so make some grease..
Being skilled in all [or most] aspects of business management will benefit the entrepreneur, obtaining the knowledge can be achieved through practical experience and reading relevant books. I recommend "The 10-day MBA" by Steven Silbiger [ISBN 0 7499 2700 3]. Even though business perceptions are subject to continual change, the basic principles remain. Unfortunately most new business owners in South Africa today start a business with some capital and an idea; some only have scant experience in the particular industry and can seldom adapt to potential challenges such as poor economics, market competitiveness, and so forth. Professional training and experience is essential, as is lifelong learning, to grow a company.
Having an MBA would be useful to get the background and practice to know the concepts of market research, business planning, marketing, sales and forecasting, and through the work you would be doing in case studies you would learn best practices.
But, having the MBA is really not going to help you much in the day-to-day challenges of starting and running a business. Once you have created a well thought out plan for your business, get a good coach/mentor to guide you, especially if you have never run a business.
Your chances of failure in the first year are 85%, and that happens because business owners make too many mistakes. With a mentor, you can take the edge off making those mistakes and greatly improve your chances of success.