As a serial entrepreneur for nearly a decade and now as an MBA student attending Berkeley Haas, I am frequently asked whether an entrepreneur should get an MBA or spend the $100,000+ on a new startup. Well…
This is the default MBA response. A Masters in Business Administration is (hopefully) designed to train you to think critically, be challenged by your peers, and remind you to make management decisions with different perspectives in mind.
I never imagined I would set foot back in school let alone get an MBA. I abhorred school because I was more of a hands-on learner and found some of the subjects too abstract and not practical. I subsequently graduated university at the start of the Great Recession in 2007. In reality, the recession hit Michigan much before the rest of the country because the automotive industry faltered before the subprime mortgage crises. Either way, the stage was not set for me to have a clear career trajectory with a finance degree.
Even though I had an inclination towards entrepreneurship in my teens (launching a web design service and building my high school’s first website in 1999 to building a business plan for a coffee shop and art gallery in college), I never imagined I would be a business owner at such an early stage in my career.
However, life rarely turn out the way we expect it to so I picked up the few things that I had to my name, packed up my car, and promptly moved to Los Angeles. I started with a short stint as an investment advisor, getting my Series 7 and 66 which I ashamedly never fully utilized. I then proceeded to work at a boutique Investor Relations firm in Los Angeles while concurrently helping a start-up biotech firm with business development. I had two jobs at the time because I wanted additional income but more importantly exposure to different learning opportunities. I learned extensively about financial statements, financial reporting and legal frameworks around incorporation, patents and copyrights. I also toiled over one too many 10K filings, investor pitch decks and client presentations.
I cannot deny that my initial work experiences, on top of my undergraduate degree in finance and minor in accounting, set me up to launch and run my own businesses. However, I cannot entirely attribute those experiences to my successes either. There are plenty of individuals with finance/accounting backgrounds who are not successful entrepreneurs. So, I started exploring what factors increased my likelihood for success.
Never Work Alone
Some people have it in their head that entrepreneurship is a solo path. I can from say from many experiences and observations that you should not go solo. Steve Jobs had Steve Wozniak, Bill Gates had Paul Allen, Phil Knight had Bill Bowerman, and even Elon Musk had Peter Thiel (and others). At least, not if you want to build a business beyond a small mom and pop shop. I feel like there is too much of a lone-wolf mentality these days in our digital age even though technology promotes interconnectivity and collaboration. However, I have found that one of the biggest hurdles to collaboration is trust. The double-edged sword of an ever expansive digital world is that it may create less trust. So, we end up with a dilemma and an environment which encourages more collaboration but has yet to foster more trust.
This is where an MBA can come in handy. A top-tier, in-person MBA provides an environment where you are surrounded by like-minded, high achieving individuals and you are taught the skills to better lead and work within teams. I thought I had developed copious team collaboration skills building my start-ups. However, the MBA classroom and experience thus far has pointed out some shortcomings in my ability to work with and effectively communicate with people who are my peers and not my subordinates. Even more so, it has been a good learning experience and challenge to interact with people who are more experienced and more successful than me. As an entrepreneur, you are usually at the top of the totem pole in your own organization or bubble. This is critical to recognize if you aim to succeed beyond a small mom and pop shop.
You Don’t Know What You Don’t Know
This leads to my second discovery after entering my MBA. There is a world of knowledge and experiences that I am not even aware that I need to engage-in and learn from. As entrepreneurs, you are required to embody a student always mantra. I was always seeking new knowledge, new books, and new methods to improve myself. However, I have to accept that there is a limitation to what I can teach myself. More importantly, there is a limitation to my awareness of my knowledge gaps are and what else I need to be learning.
In our information age, there is more access to knowledge and education than we could consume in a lifetime. This predicament creates the curse of choice. What am I supposed to be learning now or next that will greatly improve my business or advance my leadership skills? The challenge sometimes with self-learning is a lack of structure. In school, we are guided to learn arithmetic before algebra. In the real world of self-learning, it’s not always clear the order of operations. Additionally, we are not and cannot be experts in every subject or area of interest. This creates the challenge of not knowing how to best approach a learning objective.
This is where an MBA can help. An MBA provides a structured approach to learning important business concepts from management to accounting to operations to strategy and beyond. For example, I’ve always approached marketing in a scrappy way; learning what I needed to know for my business at that point in time. However, having taken a marketing class for my MBA, I realized I could’ve approached marketing much more systematically and comprehensively versus haphazardly.
Granted, this difference did cause a dilemma for me; between thinking like an entrepreneur and thinking like an MBA student. I was caught between what felt like two opposing approaches to problem-solving. Most entrepreneurs abhor rigidity and formality in favor of speed and execution; a common “Shoot First and Ask Questions Later” mentality. Whereas, an MBA student is expected to perform comprehensive research and act when hypotehses are validated. What I learned at Berkeley Haas is to not advocate for either or but rather for both. There is a need for the entrepreneurial mindset and the MBA mindset because they compliment one another.
Lastly, an MBA creates a safe environment for people from the corporate world to break out and experiment. This is where an entrepreneur can bring value-add to the classroom and share our experiences and lean mindsets.
Lifestyle or Impact Entrepreneurship? You Decide
These are strictly my experiences and my opinion as of this writing in 2018. I am sharing this as an entrepreneur who wants to build ventures beyond my previous lifestyle, “4-Hour Workweek” businesses. If you want to build a lifestyle business then an MBA may not be as valuable. However, if you have the desire to build a business for large impact, then you may want to consider “investing” in a top 10 MBA and its alumni network. At the very least, the MBA will help you network with people who are smarter than you in different areas of expertise and help you breach new frontiers. One word of caution: nothing will spoon-fed to you, it will be a lot of work if you want to extract the most ROI.