I recently had the opportunity to talk to a smart, friendly guy who’s working at a well-known investment advisory firm. He wanted my advice on whether he should go to business school or take the risk of working for a start-up.
This person had recently been admitted to a top 10 business school in the Northeast. He’s already told his employer that he would be leaving this summer, but hasn’t made up his mind about what to do. Given his background, he eventually wants to work in venture capital and invest in start-ups. He felt that he was more of an investor than an operator.
Network vs Experience
Being part of an elite network could give you access to top executives. It could certainly help you close large deals. It could even help you find a job if you get laid off. MBA is a great networking tool. It will certainly help you build your LinkedIn connections. There’s a reason a lot of the partners at top venture capital firms have MBAs, although that’s not necessarily the case with some of the younger partners at newer VCs.
On the other hand, there’s nothing that can replace real life experience of working at a start-up. If you want to be able to relate to founders, you must either bring personal operating experience or have experience working with many entrepreneurs. You cannot learn venture capital by taking a class on entrepreneurship or venture capital investing. HBS cases, as good as they may be, do not reflect how difficult it is to fight for deals. They do not help you understand what it’s like to sit across the table from an entrepreneur who has poured every ounce of his energy and his entire life savings into the company and say “no.”
This person is a career switcher, sort of. An MBA is great for that. That’s why people take summer internships. However, if you have the opportunity to do something new now without an MBA, you should definitely take that opportunity. Salespeople says, “Always Be closing.” To those contemplating choosing between an MBA program and a start-up, I say, “Always Be Learning.” Remember that most of the learning in life occurs outside the classroom.
Getting an MBA is safer than working at a start-up
We get health insurance not because we want to get sick, but rather because we want to be able to pay for all medical expenses in case we do get sick. An MBA is a great career insurance, but it’s also an expensive one. Weigh the costs. What is your drag coefficient? Can your tolerate the start-up lifestyle? The chance of achieving monetary success is probably bigger for an MBA than it is for an entrepreneur. Most start-ups fail while most MBAs will steadily climb up the corporate ladder. There’s nothing wrong with climbing the ladder. It’s a good way to make money and your family will appreciate you for it.
However, you also have to consider the cost of missed opportunities. Let’s face it. Life is ridiculously short. One of the top five regrets of the dying is, “I wish I had the courage to live a life true to myself, not the life others expected of me.” Many people have unfilled dreams. Give yourself the freedom to pursue your passion. If everyone played it safe, our history books would be mind-numbing and boring. That said, it’s important to note that the second most cited regrets is “I wish I hadn’t worked so hard.” Starting a company or working at a start-up is a lot of work and most of that is not glamorous work. Honestly, a lot of it is pure grunt work. It’s a huge time investment.
What matters the most is you.
It’s not the degree and it’s not where you’ve worked, no matter how “hot” that start-up might have been. If you want to be a venture capital investor, or anything really, you have got to try your best to make the right connections and equip yourself with the right skills. I’ve seen both successful MBAs and entrepreneurs become venture capitalists. I’ve also seen the reverse where mediocre former entrepreneurs and MBAs, despite wanting desperately to become a VC never quite get there. As we’ve all been told byour parents and teachers, we are are responsible for our own actions.
Therefore, whatever path you choose, whether that’s getting MBA, MS in something cool, or joining a start-up, make sure you have the end goal in mind. Go do what you love. Don’t do something because you think it’s the right stepping stone to something else you want.
By: Jonathan Lee