Why having an MBA is a negative hiring signal (for startups) | Hacker News Reader

Why having an MBA is a negative hiring signal (for startups)

daltoncaldwell.com

19 pointsdalton16 comments

Can't have this without quoting Kawasaki's Valuation Formula for startups: Value = (500K * Engineers) - (250K * MBAs)

I would have put that in the post, but it seemed too snarky.

I also considered linking to this: http://whartoniteseekscodemonkey.tumblr.com/

Even as an MBA I agree with his thesis that the degree is a negative signal... however that's only true for the early stage tech-based startups. And while that subsection might be 99% of the HN crowd, as a whole for the US it's a pretty small chunk (by count).

I love the notion that MBA's get the degree to get rich. In reality most folks at the top tier schools do the analysis of comparing opportunity costs and realize they may not recoup the investment for 10/15 years! The reason most people get the degree is to switch careers, learn new skills, and build their network.

I'm a bit biased here at UC Berkeley, but I'm actually inspired to see all the startups come out of our class!

I just feel like we should caution against stigmatizing large swaths of anyone, be them technical v non-technical, MBAs, Berkly CS v Standford CS, Vegetarians v meat eaters, or whatever the case may be. If there's one thing that's been proven by startups it's that it's all about finding exceptional individuals, in whatever shape or form they come in. I know there are qualifications at the beginning of the post, but I still feel like point number 2, "Entitlement" can be roughly translated to "MBAs are entitled, overvalued egotists". While I agree this happens to be the case sometimes, I do not have an MBA but did do business undergrad so I know the type, the best people will always rise to the top. So while I totally agree that hiring an MBA just to have an MBA is a terrible idea, there will be MBAs who provide startups with INVALUABLE help because of who they are as individuals. Just like hiring a Stanford CS major doesn't automatically mean you hired the best possible programmer, hiring the best possible programmer does that. Hiring based upon intelligence, perseverance, creativity, know how, how someone fits into the team, etc. etc. will put any startup in the best position to be successful. And those people come from everywhere. They may not have even finished college, maybe they worked in a completely unrelated field, maybe they traveled for a while, or decided to give professional archery a try. If they're smart, they're smart. If they fit in, they fit in. No need to limit where startups should be looking for people, its already tough enough to find amazing talent.

um did you read the first paragraph of the post?

Pretty straightforward, reasonable argument. Under opportunity cost (or another heading), I'd include the cash outlay for business school which can be $50-100k, plenty of money to fund 18 months of starting something up.

Being an MBA and having spent a lot of time with a large cohort of the same, the "Entitlement," "Misguided Thinking,"and "Selection Bias" critiques sound a lot more like the caricature that's made of MBAs by non-MBAs (or self-loathing MBAs trying to impress non-MBAs) than the vast majority of real people who have the degree. If this represents the majority of the MBAs you've met, then I fear you have an unrepresentative sample. We had those folks, for sure. But they were the dorks and the minority.

In my anecdotal experience (albeit typically in larger corporate environments), many of those possessing or actively pursuing MBA's are or present themselves as fairly sincere. Nonetheless, they often simply have a perspective and approach that is not very useful for the problems at hand. Or they go about solving the wrong problems. Things get all (re)organized for a year or two, and perhaps the activity looks progressive. Perhaps it somewhat masks underlying circumstances.

But... moving dollars and org around does not, of itself, motivate nor solve production problems.

And a lot of those same people seem to embrace typical "HR best practices" in a rather claustrophobia-inducing fashion.

Mine is just a rather narrowly informed anecdotal experience. But many of the MBA types around me have not/hardly inspired me.

I hope I can be the outlier. I'm doing an MBA but I'm also working and whenever I do have free time, I try to get some coding done for some project. I disagree that strategy > implementation - I believe they both go hand in hand but slightly more to implementation. I don't think I'm entitled to anything but I do think that I have learned some things of value in school.

However, I do agree that there is an oversupply of MBAs who do not actually add value. I won't be one of them though.

Maybe run an A/B test?

Suppose 1) you had 1,000 resumes of near identical startup-ready backgrounds (top tier CS, design, entrepreneurship experience etc.), and 2) of those resumes 10 also had top tier MBAs. Which resumes would you prioritize reading?

If you believe an MBA is a negative hiring signal, then you'd read 990 other resumes first--which doesn't make sense to me. I may be missing something...

Is it ethical to leave the MBA off of the resume? For some of us, it was simply a box to check in order not to stunt our future growth.

Then you'd have to explain the 2 year gap...

Interesting observations around strategy and implementation. I agree with the reasoning behind the idea that at a startup, implementation > strategy... but it does still keep these notions separate. Is it going to far to say that implementation = strategy = idea? Do successful startups actually draw a sharp distinction between these things?

IME, this isn't only applicable to start-ups. The same considerations need to be taken into account when filling a senior professional or mid-level management role within a large enterprise. Doers verus Thinkers.

Making > managing.

And/or, making precedes managing.

I've seen, as a small minority of my experience, some very good management. But, that good management always understood and respected its context.

I am reminded of an anecdote I read years ago in a book by an entrepreneur. He related a conversation he had with another entrepreneur who did happen to have an MBA. Mr. MBA had a lot of fancy numbers and analysis written up but no customers nor any real idea how to get them. The author had customers and revenue. While he envied the MBA his education and wished he had similar analytical ability/tools, he also took it as a "count your blessings" moment and did not expect the MBA's business to make it.

I am also reminded of all the business books I have read which did not result in a business being born. I have had a business bank account, registered business names, written business plans, etc. It was all style and no substance. It was all window dressing. I am still trying to figure out what spark turns into flame in this regard.

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