The big trend in the MBA today is NOT to follow the flocks of graduates rushing to the corner office in the traditional corporate jobs in finance and management. Today, newly minted MBAs seek to become their own boss by becoming an entrepreneur or joining a startup. In a study by the Wharton School of Business, 7% of their MBA graduates were bitten by the entrepreneurial bug at graduation, while historically about 25% of their graduates had dabbled in entrepreneurship since 1990. The first thing these go-getters learn after graduation is that business school taught them a few things that aren’t really true when you own your own business.
- Plan. Plan. Plan. Business schools like to focus on building plans for everything. That’s great if you don’t have any time pressure, like when you’re in a classroom. However, when you’re in the thick of running a business and dealing with rapid change, planning is a task that requires significant resources and time. These are luxuries that new entrepreneurs and startups don’t have. Business is messy, unpredictable, amorphous and always changing. Even the big companies use the most common method of business planning; that is, trial and error.
- Hard work is the key to success. This was echoed to me so many times in grad school. I know I’ll have to work hard and in the corporate world, this exacerbated by competition for bonuses, promotions and fun work. However, the new MBAs coming directly from business school aren’t seeing the benefits being hailed by professors. Organizations aren’t giving away those perqs like in years past. So, if you’re going to work your butt off, you might as well do it for yourself, rather than some organizational leaders who won’t appreciate what you have to offer. There is a small caution to this tale. Entrepreneurs will be pushed and pulled from all angles, so rest and release are critical to maintaining sufficient motivation.
- Learn what others do first. “Play it safe” sentiments are echoed through the hallways of business schools. “Get a corporate job and learn how companies are running their business before tackling your own company” a professor always told. Isn’t that what business school is for? Besides, if there is ever a time for taking risk, it’s when you are young and full of energy. Young MBAs have to chase their dreams while they can afford failures. Diving into the corporate job can quickly lead to domestication, which comes with a family, mortgage and lots of activities that eat up time you don’t have. There’s nothing wrong with these things, as I have them all. But you can always fall back on your MBA to get you a decent job if the entrepreneurial thing doesn’t pan out.
- You need to acquire funding. The big MBA programs give out badges for raising a lot of capital to start a business. Money is important but not necessarily when you’re starting out. The biggest focus for you as a new entrepreneur is to figure out what the heck you’re doing. Learning business in school is not the same as putting it into practice. You aren’t solving problems that are easily defined and have easy solutions. Learn the business first. If you’ve seen the hit TV show, Shark Tank, you already know that investors don’t like investing in an unproven concept. They want to see that you can make money with the idea, not risk their money trying to figure it out.
One of the big criticisms of business schools is that they don’t employ professors who’ve actually started and run businesses. Of course, you will also find that the corporate world is full of those types too. As an entrepreneur, learning is critical and has real value in all you do. It’s psychotic to think that business school will give you all the tools you need. That’s why we’ve brought a great resource for you here on our blog….Ask Dr. Business. Send us your questions and we’ll get you answers from a tried and true entrepreneur.