“How did a Harvard MBA help you to become a tech entrepreneur? What do you make of arguments that an MBA is not necessary, even distracting to spend 2 years in school (and in debt) rather than focusing entirely on a business? What suggestions could you make to someone who wants to become a tech entrepreneur/VC as regards pursuing an MBA or not?” –P
The Harvard MBA says:
Great questions P, and ironically enough, they have overlapping answers. Let’s tackle them one at a time:
1) At the time I was an MBA student (fall 1998 – spring 2000), it was a golden era for MBA students in tech entrepreneurship. The dot com bubble was in full swing, and the working theory was that MBA students were young enough to understand this brave new world, but had the business knowledge to monetize the Internet. For the most part, this theory was dead wrong, but it allowed me to do things like start a company over the summer and raise VC money even though I was in school.
At the time, I knew it was a bubble, and often told people who asked me why I had started a company, “We’re at the only time in history when venture capitalists will be dumb enough to give MBA students millions of dollars to start a company.” I believe that I’ve been proven correct.
That being said, there were rational benefits that still apply today. The school’s alumni network helped me reach out to investors; HBS alumni are wildly overrepresented at VC firms, and most are more willing to meet with alumni than strangers off the street. The school’s network helps with other relationships as well; for example, I actually got a return phone call from Jamie Dimon at one point–nothing came of it, but he never would have talked with a 24-year-old with an idea if it weren’t for that alumni connection.
The actual business school training also helps, especially if you’re a B2B entrepreneur. A lot of entrepreneurs without an MBA have no idea how companies actually function, how capital markets work, and how different industries look at the world. I’ve almost always served as the Super Sales Engineer at all my companies simply because I can go to any beta customer and understand how they work, be they the Gap, a billion-dollar ad agency, or UCSF’s cancer treatment team (all real examples).
Finally, after you’ve been out of school for a dozen years like I have, those old relationships become even more important. I now have classmates and old friends at numerous VC firms. Think they’d be more likely to take a meeting with an old friend than someone over the transom?
2) There are many cases in which an MBA is a distraction. The dirty secret is that very few great tech companies were started by MBAs. We usually come in later in the process. The best example I have of an MBA entrepreneur is Scott Cook of Intuit, and he started that company 30 years ago.
If you’re a great technologist and want to start a company, don’t bother with an MBA. On the other hand, an MBA can be very helpful for others. If you’re a “hustler,” an MBA will give you training and a powerful network. If you have no business background, an MBA will give you credibility.
3) If you want to become an entrepreneur or VC, an MBA can help, but how much it help depends on the stage of your career. If you’re a non-engineer who’s spent 2 years working in marketing at a company, it’s a great choice. If you’re already a successful entrepreneur, it probably isn’t. Know how the MBA can help, and assess whether or not it fits your situation.