I’m getting REALLY sick of the assertions that MBAs are worthless to start-up organizations. While I’ve seen a few folks lend nice support to the MBA skill set and perspective, that school of thought is certainly the exception and not the rule. As someone who had the opportunity to work at a a bulge bracket bank, to get three years of heavy operating experience in marketing/analytics at a high-growth start-up, and to know for damn sure I was anything but a career-switcher before I matriculated to b-school, I was probably #1 on the list of people whom our community would tell to skip the two-year “vacation.” Well, I ignored the advice. Today I wish to debunk the myth of the worthless MBA, while still under-the-busing my lazy and entitled MBA peers.
Part I: Functional Expertise vs. “Renaissance” Operators
One of the big arguments against the MBA is that it’s a two-year opportunity cost on relevant functional experience; I’ll address the opportunity cost piece in the back half of this rant, but let’s first dissect the idea of functional expertise. Tim Brown of IDEO has been a fantastic proponent of the “T-shaped skill set” and I’m right there with him. You will not get a fruitful start-up role with run of the mill MBA breadth, but you will get it with depth of knowledge in one particular arena complemented with that generalist MBA insight. I’m a direct marketer/anlaytics freak (“data whore” as my colleagues have called me in the past) by trade, but I also understand throughput, can reconcile a balance sheet, and perhaps most importantly, can shoot the shit with my engineers about APIs, POSTs, postbacks and Python. And I can communicate with conviction.
I love Fred Wilson more than the next person, but “MBA Mondays” do not an MBA make, my friends. Yes, despite what you all might like to believe, the core classes in a general management curriculum actually go very far where operational pragmatism is concerned – here are a few highlights:
- Economics – willingness to pay is at the core of every business that’s generating revenue. When you think about marketing and customer activation, you always need to have the WTP curve in the back of your mind and understand how to maximize profit. Yes, you will get a sneak preview of the mechanics here in any decent undergraduate microeconomics program (thanks, Duke!), but the MBA classroom is a chance to really take this to the next level and apply theory to real business problems/cases vs. hypothetical problem sets. For me personally, this course in particular also proved to be a great reflection forum – thinking about what all of the pricing testing we had done for three years at TheLadders really meant.
- Accounting – um, hello, working capital! Owning your marketing P&L? You had best be able to reconcile cash vs. accruals. Running a subscription business? You had best really understand the difference between cash and deferred revenue.
- Statistics – newsflash: business/optimization decisions are not about shooting from the hip. Those decisions need to be data-driven, and they need to be statistically valid. Multi-variate test? Sorry, the blog posts seem to largely leave those out.
- Marketing – I have to admit, I am a marketing professional and I went into MBA marketing thinking this class was going to be a fluffy waste of time. False. First off, I had the opportunity to learn from Kevin Keller, one of the most respected names in the game, and secondly, holy crap did I learn a ton! You can be awesome at user acquisition and conversion online, but the halo effect of real brand-building is a true game-changer when growing a business. Thinking through influence pyramids, etc. actually took me very far in my time at Savored. I am two weeks into a new job right now, and segmentation strategies are running deep!
- Operations – is your company on the selling block? For valuation’s sake, you had best know how scalable your operations are! What is the customer service throughput? What do your processes look like?
- Management Communications – don’t even get me started. Nothing kills me more than watching people fumble through ugly clip art slides or senseless talking parts.
- Strategy – if you think 2x2s only live in consulting firms, something’s awry at home. Our whiteboards at Savored were chock full of them.
- STUDY GROUPS – could I ever leave this one out? I actually had a pretty unique experience on this front because my team – the “Brazilian Hot Dogs” – genuinely had very little conflict – probably because we employed a “Beer Wench of the Week” in lieu of a “Chief of the Week,” but the fact of the matter is that the real world is chock full of assholes, and your study group will probably have one (or at least someone who behaves like one on a fairly regularly basis). The study group experience in b-school is an incredibly rigorous one, and is an unrivaled opportunity to learn to work with different personalities. Moreover, for me personally, it was an incredible lesson in how different backgrounds can be leveraged to manage teams. In particular, one of my teammates/friends was a former NCAA basketball coach; though he probably didn’t even realize it at the time, his approach to problem-solving was something that inspired me and many of the human capital techniques I employ today draw on that inspiration.
- Capital Markets – okay, fine, – we start-up folks probably could have checked that option at the door. If anyone needs to price a bond, do me a favor and don’t call me.
That all said, while the core builds the breadth, the MBA electives can help you refine your expertise at your “thing.” For me, the three most valuable MBA electives were marketing research, database marketing and sales promotion. I did database marketing for a living before Tuck (and believed myself to be pretty good at it), but that class helped me to consider things I had never even thought about previously and introduced me to models of thinking that I now use literally every day. Same goes for the others. If you want to take things one step further, work with your professors to apply your classroom studies to real businesses. While at Tuck, I did an independent study on the daily deal industry and published a case study on Groupon’s business model/sustainability. I also leveraged my experience at Savored to author a white paper on leveraging sales promotion and database marketing to balance acquisition and retention priorities (Tuck, give Scott Neslin a big raise!). These types of projects are the closest you will get to real-world experience without actually working (still a weak substitute – read further…).
The best compliment I’ve received in my professional dealings thus far was from my manager at TheLadders, who used to call me “Santa’s Little Workshop,” because I felt comfortable handling most things thrown my way, even if I wasn’t awesome at all of them. I encourage all CEOs to look for their own renaissance operators, and if I were a betting woman, I’d say the nation’s top MBA programs would be a great place to find them – but leave the lazy ones behind…
Part II: The Lazy MBA
I consider myself fortunate that my first foray into the start-up world (my tenure at TheLadders) was chock full of MBAs; Marc Cenedella had a penchant to hire top MBAs to lead the company, and I can’t thank him enough for it, because I realized the value of an MBA very early on in my time there and set my eyes on the degree years in advance. That said, in that same job I also learned that only the hungry go far in our world (namely via hanging out with my CMO in the office every Saturday morning), and knew that my MBA experience needed to be anything but a two-year vacation. As such (and Tuck administration, I really hope you stop reading here), despite the fact that I was enrolled in an intensive full-time MBA program in bucolic New Hampshire, I worked full-time during the entirety of my stay. During my first year, I started consulting for an old boss of mine who had moved on to advisory role at SapientNitro, and from there I set up an LLC and lent consulting support to a host of other companies. All too often I would be in the middle of a game of beer pong and a Blackberry alert would force me to return to my abode to crank out models. When I’d go away for the weekend, my friends would often hide my phone to make sure I stayed socially focused. Not going to lie, it sucked at times. A lot.
Early in my second year, I began doing some consulting work for a NYC start-up which was then called VillageVines (now Savored); I Tristan Walker-ed their ass and submitted a note about my passions for consumer Internet, Excel, and business analytics via the website’s “Contact Us” page, and connected with founder and CEO Ben McKean the next day; we instantly hit it off. When my classmates all traveled to India and the depths of Southeast Asia during our 7-week winter break that year, I sat elbow-to-elbow in a 10×10 room at 99 Madison Ave. with 6 other people cranking out data and establishing a CRM strategy for Savored (oh, and also watching our plumbing break, our heat not work, etc.). Following the company’s Series A raise that December, I committed to joining full-time - then. For the next 5 months, I telecommuted between Hanover, NH and New York and ran marketing for Savored from Byrne 209 (study room above the Tuck dining hall) and my dining room table. Every other Wednesday (and closer to the end of school, every week) I would wake up at 4:30 am, fly from Lebanon, NH to White Plains, NY on a 9-person Cape Air “jet,” drop my stuff off at whichever friend’s place I was crashing at that week (God bless you people), and crank out 3.5 days of work before returning to NH the following Saturday. My flight would regularly be delayed 2-3 hours for no apparent reason, and I enjoyed two different emergency landings in freaking Poughkeepsie. I graduated from Dartmouth on Sunday, June 12, “moved” to NYC that evening, and was in the Savored office at 9am the next morning to prepare for a re-launch 3 months in the making later that week. IT REALLY FREAKING SUCKED, but I loved every minute of it! Late in my second year, I met Matt Rightmire, an MD at Borealis Ventures and fellow Tuck alum who had pursued a similar path to me back in the 90s when he joined Yahoo! as one of its first 10 employees while finishing at Tuck; our conversations were inspiring and only reaffirmed my decisions – to win, you had to be in it to win it all along - no vacation. After reading this, many people might say, “it sounds like you wasted $160K on an MBA” – nope, I didn’t. I met some amazing lifelong friends at Tuck, rediscovered “power hours,” and even made it to Killington a few times – I just didn’t sleep while I was at it.
While in business school, I encountered countless peers at MBA institutions around the world who were looking to break into the start-up scene through a summer internship at Amazon (turning that one down was literally one of the most gratifying experiences of my life – story for another time…) or through self-centered last-minute networking. People in our world can spot their bullshit from a mile away, and these are the people tarnishing the name of the “good” MBA in the space. It is not your God-given right to work at a start-up because you did 3 years in TMT at Morgan Stanley, nor because you were president of the XBS Entrepreneurship Club. Your school may get you a job at BCG, but it’s not going to get you this job. (This is a phenomenon I like to call the “attitudinal gap” – and I’ve traded notes on this with several leaders at NYC start-ups and they all agree.) Oh and also, a group consulting project on “social media strategies” will also do nothing for getting you your dream job. If you’re hungry, be hungry damnit, and satiate that appetite from day 1 - on your own. The best way to get the job (and pay!) that you deserve is to demonstrate that you’re worth it. If I were a betting woman, I’d tell MBAs looking to break into our world to take on some intensive consulting hours (I repeat: no absurdly esoteric projects on social media), to meet interesting people for the sake of meeting them/learning vs. job-grubbing, and assure them that things will take shape from there. A lot of times graduating MBAs ask me where they should “look” for job postings – ummm? Decide what you job want and show/tell your dream company why they need that role and why you are going to crush it in that capacity. And don’t forget what you learned in the core!
All right, my first diatribe is complete; go ahead, start ripping me apart… and as a final disclaimer, let me say that I told my story here because I know it best, but I’ll tell you with confidence that the most highly-regarded MBA new hires at start-ups these days took very similar paths. Remember, no MBA >>> lazy MBA.
Let the scornful comments commence!