Are MBAs Necessary for Start-ups or VC? | Hacker News Reader

Are MBAs Necessary for Start-ups or VC?

bothsidesofthetable.com

22 pointsvibhavs17 comments

A guy I really look up to (A VP of Engineering type of guy with a lot of startup experience) said once:

"At a startup, you need people who build shit and you need people who sell shit. IF you succeed on those fronts, eventually you might need people to manage/organize shit."

Time and again I see startups with technology that's inferior to their competition kick ass because they have a salesgod out there getting early customers or bizdev relationships. But I don't think an MBA is ideally suited for this role-- in fact, I think they've probably been well trained to manage/organize shit and wouldn't lower themselves to a cold call/email.

I'd even say MBA's are often detrimental to those entering startups.

1. It's expensive, increases the need for a low-risk/ high-pay job (i.e. consulting) once you graduate

2. As the article says, it increases expectations wrt. compensation, but also authority (most MBA's wouldnt want to start out as entry-level biz dev as a startup).

3. You don't learn enough about technology businesses.

Overall, an MBA doesn't help you "get" startups, but often convinces you that you do.

Really, an MBA is only "necessary" for a middle-management position at a large corporation, where it's the standard entrance ticket. Everywhere else, you can get by without it. Clearly in technical circles, people see little value in the degree.

That's not quite the same thing as saying the the degree has no value though. I think the jury is still out on that one. I think it can be easily argued that "stupid business tricks" are an important area of specialty, with lots of subtlety. Not knowing those tricks is going to put your startup at a disadvantage in some situations (as other point out though, that probably doesn't include early stage development). And there's probably a lot you can learn in a classroom about that stuff. So I'm not going to condemn the MBA without evidence.

Start ups require balls, time, money, and a good idea.

Everything else can be hired.

Even the MBAs I know say not to bother with the MBA.

No.

probably learn more and network more from starting up than you would from an mba.

You can be the greatest web programmer in the world, but if you cannot develop and articulate the ideas that are in your head, you have nothing. Thats what I learned among other things when getting my MBA. I learned how to think in the terms of taking a new idea from idea to reality, and making it a success.

I greatly appreciate the value that programmers bring. As it is, I cannot use my MBA to program my ideas into a working and successful web startup. I do not think that an MBA is absolutely necesssary. Mark Zuckerberg, Bill Gates and many other successful tech moguls have proven that. But, MBAs could can definately help in lowering the failure rates of startups by using their experience in finance, management and accounting. The best formula of all is to have both on hand. The MBA and the programmer. With the two, you cant go wrong.

Why do you think Ebay founder Pierre Omidyar hired Harvard MBA Meg Whitman as CEO?

Why do you think Ebay founder Pierre Omidyar hired Harvard MBA Meg Whitman as CEO?

Yes but who would you rather be in that example?

Omidyar himself during the 2008 "Bubble" tv episode of "Download, The True Story of the Internet" on The Science Channel hosted by John Heilemann, stated that he hired Meg Whitman as CEO because he is not a business person and did not do any resarch to begin with, before he began writing the code to develop Ebay. He started with no business plan,and at first the site has very slim pickings of things to auction. In 1998 they hired Whitman because they he realized he need an "A List" business person on their team in order to define the company, direct it, and get it to be taken seriously. Whitman led Ebay to its IPO.

I am not a greedy person at all, and though I enjoy being a founder myself as I currently am one, I have both an MBA and am a founder. So I represent both sides and the best of both worlds. Whitman my not be the founder, but her efforts and that Harvard MBA has led her to the tune of of starting salary of $175k per year with an annual bonus of $100k. in 2008 this had grown a salary of $11 million per year,and today she still owns 3.9 million shares of Ebay stock. Not too shabby I'd say.

Meg Whitman's Ebay Employment Letter http://www.allbusiness.com/human-resources/workforce-managem...

Conversely, you can be great at developing and articulating the ideas in your head, but if you can't implement them well, someone else will.

I remember reading Robert Zubrin's thoughts on Mars expeditions. He argues that the ideal initial team to Mars would be four people: two engineers, two scientists. His rationale is that you need engineering and science, and that it's easier to crosstrain an engineer or scientist as a pilot and mission commander than it is to crosstrain a pilot to become an engineer or scientist.

Startups are a lot like going to Mars: to do one well, you need people who know how to do the real work, since you have limited cabin space. You can call Mission Control to do a lot of stuff, but the most important work requires the people there in the capsule with you. From that perspective, you can cross-train a programmer to do business easier than you can cross-train a pure business person to do programming.

Agreed. Here's the data to back you up: http://www.aomonline.org/Publications/Articles/BSchools.asp

There's nothing you need to know about business you can't teach yourself via reading or mentorship. Here's the list of books I used to teach myself: http://personalmba.com/best-business-books/

Relatedly, and I mean this question with the utmost sincerity, what is an MBA exactly good for?

Far too many people I know are dismissive of MBAs and their degree ("Master in Bullshit Administration! Hur hur hur"), but this same crowd tends to think Ph.D's are always useless ("Piled High and Deep! Hur hur hur").

I will try to tackle this one.

Imagine you finished college and 4 years of working at hypermegacorp as a sr. software developer or a product marketing manager.

Now around you, you see some of your superiors have MBA's (certainly not all), you are single, you have been working very hard, and you have saved up $100k.

MBA = up the ladder + meeting other career driven, socially not awkward people + free time + you have the money.

4 years later, you're a "director of...", married, well-read, and went to europe, australia, japan, and hawaii twice.

It's not for me, but that's my impression of an MBA.

The money an MBA costs would be better spent as seed capital to get something released! Even if your start up fails, it still could be cheaper than what you'd spend on the MBA and you'd have REAL experience.

Empiricism says: no. Neither necessary nor sufficient.

No.

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