Should Entrepreneurs Seek an MBA Degree?
Entrepreneurs who want to switch gears or rapidly advance their careers sometimes look to graduate school. A master of business administration degree can provide some benefits for an entrepreneur wanting to learn more about business management — like a supportive learning environment, excellent networking opportunities and a highly valuable credential.
However, these programs can come at a cost, and even a no-frills MBA will require a significant investment of time and money.
These are the benefits you should expect from earning an MBA, plus some barriers and drawbacks you may encounter along the way.
Advantages of an MBA
1. Business Management Knowledge
Do you enjoy being in an academic environment and spending time debating, researching and discussing with other students? An MBA may be one of the best ways to acquire new knowledge and build relationships with other entrepreneurs.
What you learn in your MBA program can also be a major asset if you’re looking to change careers or pivot away from your current role.
However, if you’ve always preferred hands-on learning, you may find the surroundings a little stifling. In theory, you can learn any new information you acquire while earning an MBA on the job. MBAs are an excellent way to boost your business knowledge, but the environment may not be right for everyone.
2. Networking Opportunities
The connections you build while enrolled in an MBA program can be long-lasting. Most MBA programs will provide you with networking opportunities.
Some of these will be formal. Others will happen naturally as you attend lectures and collaborate with other students in your program.
3. A Valuable Credential
The right degree from an accredited institution can boost your credibility in employers’ and clients’ eyes.
For example, some MBA graduates saw salary increases of an average of 80% after finishing their programs. If you’re a solo entrepreneur, many clients may be impressed by an MBA from a prestigious institution.
However, MBAs aren’t the only way to demonstrate professional and business worth. Potential clients and employers may be looking for experience and connections more than educational level.
4. A Unique Learning Environment
MBA programs offer some advantages you can’t find anywhere else.
International programs, for example, provide you the opportunity to learn about various cultural communication styles and network with entrepreneurs from around the world.
On the other hand, spending time meeting with local small business owners at a regional program may give you a sense of how entrepreneurs manage common small business challenges in day-to-day operations.
This knowledge can be invaluable if you want to relocate, work for a multinational corporation or market goods and services to international customers. The relationships you build with international entrepreneurs can also be similarly valuable.
Why an MBA Might Not Be Worth It
1. Cost and Accessibility
MBAs can be pricey. Average programs can cost more than $70,000 — and the more prestigious the institution, the more they’ll charge you to pursue a degree. Some of the most expensive MBA programs can cost more than $150,000 in total.
All this is without considering the costs you’ll have to cover before you even begin your program — like paying for your GMAT. For example, in the U.S., taking the GMAT costs $275 right now. You may also have to pay for extra score reports, depending on how many programs you apply to.
Accessibility may also be an issue. Some programs require you to come to class in person, which may mean relocating temporarily to attend your dream school. Moving to another city or state isn’t always practical, or even possible, depending on your financial and personal circumstances.
You can avoid some of these barriers with the right program — though other fees, like those associated with taking the GMAT, may be unavoidable. For example, some MBA programs are 100% online. You might attend your classes without needing to relocate or even divert much of your daily focus from your work.
These programs can also be both cheaper and more accessible than in-person programs. However, they may offer fewer opportunities to network. Also, just like some people find the classroom isn’t their ideal learning environment, online courses aren’t a good fit for everyone. You might find it challenging to stay focused or communicate well if you’re not physically present with your instructors and classmates.
2. Time Spent
Any MBA program is also likely going to be a significant time investment. The average full-time MBA will take you two years. Some programs are shorter — accelerated MBAs, for example, may take 18 months or even a single year. Some are longer, like part-time MBA programs, which may take three years or more depending on how much coursework you take on.
Exact requirements will vary depending on which institution you attend and which degree program you pursue. However, it’s common for programs to require 60 credits for graduation, which means four full-time semesters spread over two years.
This commitment may not leave a lot of room on your schedule for personal projects. It will also likely be a significant challenge to juggle a full-time job while attending an MBA program full-time. If you want to keep working while pursuing your degree, you’ll likely need to find a part-time course of study.
These Entrepreneurs Should Consider an MBA
An MBA program is a valuable option for entrepreneurs wanting to get better at managing employees — but it’s only one of many steps you can take to further your career.
You can often can pick up the same lessons you’ll learn from a formal training program while on the job. The cost of an MBA may also be an issue for some. However, an MBA program can provide a unique learning environment — one with plenty of opportunities for networking or learning about different leadership styles.
