With grad school admission responses being received around the country, and having attended an event recently where many people my age were in graduate school pursuing an MBA, I’ve been forced to reflect on my choice to forgo an MBA in pursuit of entrepreneurship.
Three years ago, at age 24 I quit my job. At the time, nationwide unemployment was over 9% nationwide, and pundits were talking about a prolonged recession. This is roughly still the case, but my life has dramatically changed for the better. And, I’d argue that I’m further along than most people who would have went through a full-time MBA program, because I have my own clients now, a professional reputation that’s been built over time, a stronger resume and the added savings vs. added debt ratio is in my favor.
Entrepreneurship instead of a MBA
Everything in life has Pros and Cons. The real internal debate should be whether or not you will enjoy the Pros and can form a solid plan to deal with the Cons.
- Make your Schedule
- Flexibility – Potential to work when you want, where you want and with whom you want
- The potential to determine your own income and monetary worth
- Momentum – You own the accounts and the business. Each year things can get easier.
- Learn the skills you need to succeed (or fail)
- Risking your own capital
- No steady paycheck
- Worse job benefits (no paid vacation, no dental plan, etc.)
- No 401K match (You have alternatives here, but they take some setup work)
- No “job security”
Before You Take the GMAT
I think people seriously need to ask themselves the following questions before pursuing an MBA.
- Am I doing this out of fear or a lack of direction?
- How much is the opportunity cost of pursuing an MBA?
- Debt accrued + Cost of financing the debt + salary lost vs. potential income gain in the future.
- Who do I plan to meet that can open new doors for me, and can I meet them without having to do it at business school?
- What will I do that can make me less dependent on others for my future income?
- Have I talked to professionals that are in positions I would like to hold some day? Do they recommend I get a MBA?
Don’t get me wrong, I think higher education is a good thing overall. But, in the case of business, I think that if you’re truly interested in business you should start freelancing or bootstrapping a business long before investing in more education. I think investing in infrastructure, inventory and marketing for a small business you run on nights and weekends can provide both ancillary income but also an invaluable learning opportunity that doesn’t necessarily need to be adding debt to your personal finances.
Disclaimer: I’m not totally against getting an MBA. I think it makes sense when you haven’t gone to business school and you plan to pair it with other professional skills (medicine, engineering, design, law, etc.) to make you a unique asset. I also think that if you want to work as an executive for a large corporation, it will help you get in the door.
With that being said, I wouldn’t recommend that anyone attend a business school that isn’t ranked in the Top 25 in the country or that doesn’t have a highly recognizable brand.
This year, I’m planning a series of blog posts relating to entrepreneurship. Some of the posts I have planned include:
- The keys to entrepreneurial success
- How to write a marketing plan
- How to think about and invest in advertising effectively
- How to promote yourself without being an jackass