Entrepreneurs today are routinely told to avoid the MBA, and in some cases, to avoid college altogether.

I have a different take. If you can afford it, if you plan to work internationally, and if you ever plan to sell to enterprise companies, an MBA can be a worthwhile investment because of the credibility and network that comes with it.

It takes a full decade for the network to achieve its value. After 10 years, former classmates find their way into C-level and executive jobs, have international experience, and are far more interesting than they were shortly after graduation. Being able to text message friends in high places is a valuable advantage that can lead to real business. At my recent Tepper (Carnegie Mellon) MBA reunion, a classmate who runs a $10 million translation company told me his Tepper connections landed three major clients.levitra pilules

In my experience, business people in Asia and Europe value advanced degrees. The wealthiest families in Asia send their kids to study in the US and Europe, so having an expensive US or European degree signals prestige and trustworthiness. It lubricates business.

Importantly, getting an MBA is not a wise decision if you’ll have to take on much debt. Unless you attend one of 5 top-tier schools, there is little assurance that you’ll be able to escape from that debt for many years, and that will curtail your entrepreneurial efforts.

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  • http://www.facebook.com/reid.steadman Reid Steadman

    Good post. It’s been interesting to see all the new, unique company names showing up on my friends’ LinkedIn profiles. Many of them used to work for big, established companies, but have decided now to strike out on their own and to do something entrepreneurial. This is a pretty common track in finance. You earn your street cred with a big company, get to know the industry, identify a need, and then break off to address that need on your own. An MBA facilitates this type of trajectory. Allows you to break into the conventional business world and find hidden opportunities world before going unconventional. (Example: Friend of mine who worked in the finance industry recently started an online funding platform for higher education institutions.)

  • Anonymous

    You’re right, Reid. And actually, the best businesses are sometimes created by people with very specific industry insight that comes from working in an area and seeing opportunity. These seasoned entrepreneurs face better odds of success than the 22 year old dreaming up ideas.

  • Aliguma

    Having those letters after your name DEFINITELY adds credibility but I would really add the caveat that if you’re going to go to business school you should have a clear understanding of what it is that you want to do with it at least in the short term. After counseling MBA’s for several months I’ve learned that which school you choose is as important as why you chose it. Some programs that may not be ranked as high often offer graduate assistantships that can pay for your education. it’s so important to do your homework before you choose a program. Great read Arshad.

  • ArshadGC

    Wise observation, Aliguma. I always assumed that people in business school had more focus than, say, folks in law school, but I quickly learned otherwise. Many enter business school without a vision for the future, and that can make business school a waste of money. Without a vision, it’s hard to know which classes to take, which fields to hone in on, and what kind of expertise to cultivate.

    The second point you make is also really important. There are indeed many resources students can take advantage of in b school. For example, I would probably have never become an entrepreneur if it weren’t for the Donald Jones Center for Entrepreneurship at CMU. Winning a business plan competition put me on this trajectory.