Why You Might Just Need An MBA To Become A Successful Entrepreneur
Bill Gates, Steve Jobs and Mark Zuckerberg did fine without one, but MBA programs are becoming increasingly important launch-pads for ambitious entrepreneurs
For the last two years, the Financial Times has ranked the best MBA programs for entrepreneurship. Stanford, Babson and Darden round out the top three, and the list is largely an American affair, punctuated by European and Asian heavy-hitters like IE, IESE, ESADE, HKUST and Birmingham Business School.
So, is getting an MBA a prerequisite to starting a business? “No way,” say Ben Young and Frederick Kukelhaus of Hugo & Hoby, a sustainable furniture brand they founded while at Yale School of Management.
“But the tools are certainly powerful and give one a deeper understanding about what to focus on as an entrepreneur,” they continue.
An MBA then, teaches you every aspect of how a business works. While knowledge of finance, marketing, analytics and so on are not necessarily essential to successful entrepreneurship, they are undeniably useful.
And an MBA tests every aspect of your professional competence in the same way that running a business would. Being a polymath, therefore, is a prerequisite both to succeeding as an entrepreneur and to succeeding as an MBA.
Moreover, an MBA is effectively a sandbox for entrepreneurship, in that students have far more room to recover quickly from errors, and are surrounded by people capable of providing feedback.
“I was able to spend a large portion of my time working on [my business] in a structured format with plenty of support from teachers and students,” says Nell Diamond, a Yale MBA whose incubation of her luxury bed linen and nightwear brand Hill House Home gave her course credits and enabled her to spend more time on her venture.
Though most MBA programs do offer entrepreneurship and innovation as a specialized track or elective, there are some that integrate it into their core curriculum.
“In the first year at Babson, everyone has to take the ‘Entrepreneurial Thought In Action’ class, where you literally create a business,” says Courtney Wilson, an MBA student and founder of DropZone, a mobile app connecting US veterans with resources that help them adjust to life after the army.
France’s EMLYON Business School requires its students to undertake a nine-month Entrepreneurial Leadership Project in which they attempt to solve an urgent business issue. And Yale, IESE, IE, ESADE and Chicago Booth all provide a core entrepreneurship module in their MBA curriculum.
Some schools even have dedicated centers for entrepreneurship, which coordinate activities from inside and outside the school and establish a point of contact for entrepreneurial activities. At Chicago Booth, the Polsky Center for Entrepreneurship provides students with programming lessons, access to mentors, meetings with investors and individualized recommendations based on their goals. And at IESE, FINAVES provides a similar platform.
It can take years to build up the network that an entrepreneurship center can provide, and a mixture of traditional academics and teachers with proper hands-on experience provides the best environment for boosting one’s entrepreneurial skills.
“Babson has a year-long incubator, trained actors that help you revise your pitch, and I’m also part of a summer accelerator,” says Courtney. “I’ve met with five teachers about Dropzone this week alone.”
A good MBA program will assist students who come with pre-defined ideas for products and services they’d like to launch, and support them long after graduation: “We’ve hugely benefited from Yale’s Center for Engineering Innovation and Design, which helped us prototype furniture by using their machinery, laser cutters, and 3D printers,” say Young and Kukelhaus.
Most importantly though, the best schools will boast a diverse cohort with a raft of entrepreneurial experiences, and talking to one’s classmates can prove just as illuminating as any lecture.
“It’s crucial to have a community from which you can draw strength and gain real insight,” says Nell. “My classmates and mentors were many things to me - a sounding board, a therapy session, a board of advisors - and I couldn’t have gotten here without their help.”
Of course, there are many notable entrepreneurs that never completed a postgraduate business degree – Steve Jobs, Bill Gates and Mark Zuckerberg all spring to mind. While an MBA provides entrepreneurs with a solid foundation upon which to achieve success, entrepreneurs are, by their very definition, risk-takers.
It’s something that Jonas Clark and Amanda Rinderle – Yale MBAs and founders of organic office wear brand Tuckerman & Co. - think can’t be covered in an MBA syllabus.
“An MBA gives you a holistic view of business, but doesn’t necessarily teach you how to hustle, or how to deal with the tremendous uncertainty that you encounter as an entrepreneur,” they say. “Ideally, you want to have a mix of both of those sides. The first can be taught, the second probably comes more with experience.”