Are MBAs and Entrepreneurship Compatible?

Are MBAs and Entrepreneurship Compatible?
Tuesday, January 7, 2014

In a recent blog for the New York Times, Cliff Oxford of Atlanta’s Oxford Center for Entrepreneurs said that a traditional MBA is "pretty much like having athletes studying game film but never practicing on the field." 

While he sees value in programs that offer real-world experience, Oxford feels that traditional, classroom-centric MBA programs do little to help future entrepreneurs succeed after earning their degree. This is in spite of the fact that many MBA programs (and students) today are shifting towards an entrepreneurial focus, and that many more programs have changed their curricula within the past twenty years or so to reflect the changing business needs of today.

The Midland MBA is far from traditional in many ways, not the least of which because it allows students to apply theories and practical solutions in the real world while working on their degree. Programs like ours call into question Oxford's argument that skills taught in an MBA program have little to no value for entrepreneurs. 

With that in mind, we can follow Oxford's lead and ask: Are MBAs any good for entrepreneurs? We have a few reasons why we think MBAs are valuable for entrepreneurs, which you can see below:

  • In a hybrid MBA program, you have the opportunity to immediately test out ideas in the classroom and in the real world.
    To address one of Oxford’s biggest concerns directly, some programs do offer students the opportunity to immediately test out ideas. Oxford’s concerns with the classroom focus of most MBA program are valid for programs where students are removed from the workplace for a couple of years.  

    But with a program that lets students work alongside someone who is starting a business, or with a hybrid MBA program where you can test out classroom ideas in the real business world, this shouldn’t be a concern. In the latter cases, students are still very hands-on with real business, getting both the “game film” and the “game time.” These types of approaches give a strong educational foundation and practical business knowledge, both of which are important factors in entrepreneurial success. 
     
  • Traditional business skills are still essential to a successful business.
    Although this might seem like a given, it’s important to keep sight of the fact that traditional business skills are absolutely essential to starting up a successful company. It’s possible to stumble through the launch of your own business without any actual business know-how, but having those high-level business skills can help mitigate risk and increase the likelihood of your startup being successful.

    As commenter Jonathan Levi (himself a well-respected figure in the world of entrepreneurship) noted in his contribution to a discussion about entrepreneurship and MBAs, “During my MBA, I realized a lot of the mistakes I'd made as an entrepreneur, many of which could have resulted in hundreds of thousands of dollars in increased revenues, decreased taxes, or a better price when I sold the business.” The fact is, the business acumen and problem-solving skills you’ll learn during your MBA will be useful whether you want to work at a Fortune 500 company or a 5-person startup, and can only increase your likelihood of success.
     
  •  An MBA provides you with valuable networking opportunities. 
    Much of the value of an MBA comes from the networking opportunities you’ll have within the program. While you’re earning your MBA, you’ll have the opportunity to work with other business professionals (both students and professors), bouncing ideas off of one another and bringing in many different areas of expertise. For entrepreneurs, this is especially useful because the different perspectives you’ll encounter during your MBA program will parallel the many different perspectives you’ll encounter in the first few years of your startup. The more familiar you are with different points of view and different ways to solve problems, the better off you’ll be as an entrepreneur. 

    While there is networking to be done outside of an MBA program, the type of work and learning you’ll do with your peers during your graduate education is unparalleled elsewhere. After you’ve earned your degree, you’ll have lots of experience within this tight-knit network—and you may even find a future business partner while you get your MBA!
     
  • Your time in the classroom can give you something very important: a safe environment in which to fail.
    As many entrepreneurs know, failure is a real concern when starting a business. Startup failure rates after four years range from 63% to 42% depending on the industry, and those failures cost real money and time—part of the reason why starting your own business is so risky in the first place.

    When starting a business in the real world, these failures can mean a significant loss of money and time. While you’re working through your MBA education, however, you’ll address and solve the types of problems that many of these businesses face. In the classroom, failure to solve a problem the first time around won’t mean the loss of a real business—it will mean the chance to work with your peers to find a viable solution the second (or third) time around. This safe environment in which to fail has enormous value, and you won’t find that kind of entrepreneurial think-tank in many other places. 

As we mentioned in our post about teaching entrepreneurship, there are certain things that can’t be taught--raw talent, hard work, and good timing. While those factors are important to launching a successful business, training in the kinds of skills that entrepreneurs use to build their businesses is essential, too.

Attaining an MBA doesn’t guarantee entrepreneurial success, but the skills you’ll learn and the people you’ll meet while earning your degree will certainly help get you on the right track. As the Bloomberg Business Week article we just linked notes, there is no shortage of MBA graduates with bold ideas who have started and succeeded with their own businesses. 

Succeeding as an entrepreneur requires a lot of factors working in your favor, and earning an MBA is a great way to help give yourself the tools you need to get out into the real world and start your own successful business. Especially within Midland's hybrid MBA program, you’ll get a combination of in-the-classroom, online, and in-the-office education and insight, truly working towards the idea that entrepreneurs with MBAs need both business education and real-world training in order to succeed. 

If you’d like to learn more about Midland’s hybrid MBA program, let us know in the comments, on Twitter @MidlandMBA, or via our website here. We’re always here to answer your questions and would love to give you more information about the Midland MBA. 

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photo credit: Dell's Official Flickr Page via photopin cc

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