MBA - good or bad for a tech start-up?
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That being said, many engineers tend to alienate customers and make bad business decisions. I know quite a few, and the idea of them interacting with our clients scares the crap out of me.
The key is balance, I think. Here's a tell: if your CTO can't code and only has a educational background in business, be worried.
I worked at a startup exactly like that. It was a hard-core Douchepocalypse.
So I know exactly what you are talking about. You win the thread.
I grant you an Honorary Indignation for your work, sir: http://www.youtube.com/watch?v=EtCiP8B2xpc#t=7s
It's almost like MBA programs aren't the problem, but the people who apply/selected are.
Also, might help to understand that MBAs come in all shapes and sizes. It's like saying you have an EE degree. Is that computer architecture? digital or analog communications? solid state?
Not all engineers are the same, so why do you seem to put all MBAs in the same bucket?
My point is, is that companies with top-heavy business-grad management tend to be crappier companies as opposed to companies with a balance between business and technology. Don't try to change my argument into, "Hey! My cousin Larry has an MBA and he's a great guy!"
I'm challenging the basis of your analysis, which uses a flawed example (look at Wall Street!) and seemingly anecdotal evidence to come to your conclusion.
I'm clearly not changing your argument. I'm challenging your analysis.
Sure, not every round peg fits into a square hole, and you can always find exceptions. But there's still a general consensus that can be built through common experience, and I think the truth of that is shown in all the votes my original comment is getting. Agree with it or don't, but please don't internet-argument-guy because someone on the Internet shared an opinion.
I also find it funny that you want to voice such a negative opinion of a group of people and not expect it to be picked apart from the obvious flaws in logic.
Anytime there's an MBA article posted, the overwhelming number of comments are about how terrible MBA managers are and how many organizations suffer from their money-grubbing ways.
Then you get stories like the Ecomom debacle where the comments basically repeated the "Founders need to understand business and financials." platitude about 200 times.
Many commenters don't seem to realize that a huge number of MBAs (especially from good schools) have technical backgrounds and are doing the MBA to gain better organizational and financial knowledge. Granted it's less common in software, but most companies in the sciences and physical engineering domains have tons of engineer-MBAs.
As for startups, would an EE/MBA not be a huge asset for a newly formed company? Even forget the EE for a second, would a former sales guy with an MBA not be valuable? A good MBA teaches accounting, finance, marketing / advertising, market-research, supply chain / logistics, as well as the more recognized organizational structure, management, and conflict resolution pieces. Obviously, after only two years, students won't be experts in those fields, but they'll be much better off from anyone trying to learn accounting on wikipedia.
Now you seen people getting an MBA with no or little real word experience not sure this sort of MBA is much use to a start up - though I am sure the big 4 consultancy can rent then out at a huge day rate to tell you the time using your watch.
And having worked on the campus at CIT the Business school was not regarded by at least a proportion of the students as being quiet as good as a proper MSC /PHD
The content is beneficial but inconsequential - not much more than a broad survey of intro/mid level undergrad stuff - and certainly nothing that a mildly dedicated auto-didactic couldn't learn with a local library card.
The tech world is one in which there are many ways to signal competence, and I'd argue that an MBA is a highly inefficient way of doing that. And even if you do find a tech company that does value MBAs, do you really want to work for one that values inefficient mechanisms or academic pedigree highly over say, competent contribution to open source?
That said, I don't regret doing an MBA - it was the seed that lead me to where I am now - doing a PhD in Philosophy
I'll bet he also has a good idea if the ROI is going to be worth all the costs.
They will have a grounding in the real world; whether they have enough of one will of course depend on the individual.
For that matter, if they grew up helping run the family business(es) as I sort of did, they could potentially go straight to B school with little to no harm.
For me, it's a return-on-investment question, whether the 2 years and $100k+ in tuition would advance my ambitions more than 2 years of building and $100k that could go towards self-funding.
ROI: Most choices result in opportunity cost - expense and time were considerations, but the skills gained will stay with me for life.
This is not really accurate. The 100K for the MBA will likely come from financial aid which can be paid over time, maybe 6-10 years. Thus it is generally not paid with cash on hand.
At the same time there is no $100k financial aid to start a company. Sometimes you can find family money or smaller personal loans, but 100K for a biz is much harder to come by and not the same as 100K of Gov backed financial aid.
This is apples and oranges here...
That being said, your main point re ROI stands..
A couple years ago, I worked for a UMich MBA in a product marketing role. I remember hearing about how MBA's weren't worth getting unless you got one from a top school. But that was years ago. In 2013, even if you can pick one up from Wharton, you're still probably going to end up worse-off unless you manage to parlay the degree into a role in finance.
Don't get an MBA.
-"I got an MBA at night school so I could be a more effective manager" vs.
-"I got an MBA as a ticket to the upper middle class"
Obviously you may want to hire the former, but not the latter.
I once got accepted to an MBA program but declined to attend because I realized I was the latter of the two types and it would be a waste of money if I didn't use it for social climbing purposes. So I decided to focus on my career and skills rather than my educational pedigree.
"In the consumer Internet world, [an MBA] is a major disadvantage because of the opportunity cost of 2 years during the prime of your career." –Keith Rabois
Shameless plug: [redacted]
Note: I took a bunch of business courses but do not have an MBA.
That being said, I don't drop the MBA because of the insights I'm getting from so many different industries. As a full time programmer, it's being really helpful to have this extra knowledge.
I started really getting into it, and now I've spent a ton of time over the intervening year learning and practicing. I think back and wonder where I might be now if I had started at 23 instead of going back to school.
It's not that what I learned wasn't worthwhile; it's that it took an amount of time and money disproportionate to its value.
On top of that, while I only (ha) paid about $58k for mine, having that amount of debt really hinders one's flexibility.
Life experience doesn't help you project free cash flow, consider the complexities of pricing strategy, understand accounting rules, or really, do anything else we did over the course of those two years.
Maybe it helps with management classes, but the only management class I took was a complete throwaway.
Edit- Got hung up on the life experience bit and didn't address work experience, but in many cases, much of the same applies. There was nothing conceptually difficult about any of the classes I took. At times, my work experience was relevant, but the only benefit was needing less time than some of my classmates to internalize some of the ideas.
Now, I realize that I can't just jump in to a position where someone with 10 years of experience in X + an MBA would be, but that was never my expectation. My expectation was to get good foundational knowledge in a variety of areas. And I got that, just not to the extent I expected. I was just disappointed in how easy a lot of it was.
Getting an MBA is not just about the mechanical absorption of how to do a free cash flow or doing a paper on organizational behavior.
Frankly, more insight and knowledge was gained from classmates than from the textbooks and case studies we had.
With rare exceptions, I wouldn't hire any recent MBA who references their degree more than once in an interview.
Get real-world experience, it counts for more. Especially when i'm the one doing the hiring.