Do MBAs Make Better Entrepreneurs?

Entrepreneurship MBA programs are all the rage these days, but do they really help? Forbes points out that only 15% of the wealthiest 400 Americans have them. I'm not sure that is a relevant statistic though. Henry Mintzberg makes a good point in the article:

When it comes to starting companies, the stumbling–not the studying–is what counts, argues Henry Mintzberg, author of Managers Not MBAs: A Hard Look at the Soft Practice of Managing and Management Development. Bona fide entrepreneurs such as Bill Gates and Apple's Steve Jobs typically shun M.B.A. programs because they're too anxious to work on their own ideas, says Mintzberg. (Both Gates and Jobs dropped out of college to start their companies.)

A valid insight, but one that still doesn't directly answer the question.

Jeff Cornwall has said repeatedly that entrepreneurship training can make a significant difference in success rates. On the flip side, a local angel investor once complained to me that he was tired of these 20-somethings coming out of school with their entrepreneurial MBAs thinking they were ready to start up a company. He thought that most of them weren't.

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It's probably somewhere in the middle, and equates well to an exercise analogy. Some physical training will make you better, regardless of where you are, but you need more than that to make it to the Olympics.

  • English economist, Ely Devons observed, “Let’s consider what an economist would do if he wanted to study horses. He’d go to his study and think, ‘What would I do if I were a horse?’ And he’d come up with the conclusion…” I think that is true of most academics. Mintzberg is right. It is the stumbling that counts. And what academic has tested his expertise at the coal face? How many have made cold calls, hired and trained customer service reps, bought merchandise (with their own money), run a factory floor?

  • I’ve always thought that an MBA prepared a person better for studying companies than it did for running them. That goes double for new companies.

    Most of the entrepreneurs I’ve known in my life gravitate toward trying things out. Most of us had “businesses” when we were kids. Most of us of had more than one as an adult.

  • pawnking

    15% of the wealthiest 400 are MBA grads? I’d say that speaks rather well of the MBA program, as a much, much lower % of the general population are MBA grads. In fact, I’d use that very statistic in proper context as a recruitment for MBA programs.

  • Matt Hedtwig

    Who knows what makes a good entrepreneur these days. Some kids come out with their MBA and already have a company they created themselves out of their dorm rooms and by the time they hit 40 they are self made millionairs, other people are older and have more expereince but just can’t seem to make anything happen. I have been the CEO of a small company I created in the midwest for some time now, and recently I was fortunate enough to come across a copy of a new book- The Enlightened CEO: How to Succeed at the Toughest Job in Business. This book is genius for people who are CEO’s or plan on making it that far in their career. The authors really focus on how to approach being a CEO and making decisions in all aspects of your business to truly succeed. If you are business savvy, I encourage you to read a copy of the Enlightened CEO; the book is a relaxed read and just flows the whole way through. I included the link below to the book; I read somewhere that it is only available online.