Skip the MBA: 3 Reasons Why You Should Get Real-World Experience Instead

By Ryan Holmes | 1 year ago | No Comments

Bill Gates Reclining on Desk
Bill Gates, CEO of Microsoft, reclines on his desk in his office soon after the release of Windows 1.0. 1985 Bellevue, Washington, USA. Photo by Esparta.

By HootSuite CEO, Ryan Holmes

This post was originally published by HootSuite CEO Ryan Holmes on the LinkedIn Influencer blog.

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In 1999, I dropped out of business school. I think it was one of the best decisions I ever made.

Fast-forward to the present and I’m CEO of HootSuite, a quickly growing social media company with 300 (amazing) employees and more than 6 million customers. It was real-world experience in business that led me every step of the way—not an expensive college degree.

Higher education is pricier than ever, but in today’s job climate, it doesn’t always guarantee a return on investment. This especially applies to the once-coveted Master in Business Administration. Here’s why:

1. MBAs no longer make sense financially.

Many people say they want an MBA for the money. But decreasing salaries for MBA graduates combined with skyrocketing tuition costs mean they aren’t experiencing the kind of financial rewards they once did. While students coming out of top U.S. MBA programmes in the mid-1990s saw their salaries triple in just five years, graduates leaving the exact same programs in 2008 and 2009 saw that pay cut spike in half. Meanwhile, MBA students in 2012 paid 62 percent more in fees compared to those in 2005. A two-year MBA at an established school like Harvard or Columbia may well cost you around $150,000. That’s just staggering.

2. MBAs are no longer the best way to network.

A lot of people get an MBA for the networking opportunities. But the Internet and social media have changed the way we network. Now, anyone can connect with people all over the world using professional social networking sites like LinkedIn. Even Facebook and Twitter are proving to be tools for connecting with valuable allies and business partners. Take for example the story of Stacey Ferreira, a 19-year-old who landed a million-dollar investment from Richard Branson with a tweet. (She’s since dropped out of college.) Technology has leveled the playing field—no longer do you need an Ivy League pedigree to mingle with the decision makers.

MBA programs themselves tend to be highly competitive as well, so there’s no guarantee that your classmates are going to become trusted allies. As for the professors, they may not make the best contacts either, since many are smart theorists but untested business people.

3. MBAs are not as exclusive or prestigious anymore.

MBAs used to be something that really helped you stand out. Now that elite clique is more like a crowd. In 2010, schools in the US gave out 126,214 MBAs, a whopping 74 percent increase from the 2000-2001 school year. Before the early ‘90s, you had to be enrolled in a full-time program to attain an MBA. These days, you can get one part-time or online from schools that are hardly household names.

Don’t get me wrong. I’m not saying that an MBA is worthless. It still boosts your chances for employment. It’s just that the degree no longer offers the same value it once did. The new business landscape—thanks in part to the Internet and social media—grants innovative, entrepreneurial and ambitious people all sorts of new opportunities, without the degrees.

So instead of burdening yourself with a $100,000 debt, why not try an internship or start your own business? Instead of pursuing purely financial goals, why not pursue a passion instead? Find that activity you get lost in, the thing you love to do, and do it. After dropping out of business school, I followed two of my greatest passions, programming and entrepreneurship. Safe to say, I don’t regret my decision.

But don’t take it from me. Ask Harvard first-year dropout Bill Gates. Or Ted Turner, billionaire founder of CNN and TBS. Or Sir Richard Branson, who skipped college and started his own magazine company at the age of 16. And let’s not forget the late and great Steve Jobs, who dropped out of Reed College after just six months and instead spent the next year and a half dropping in on a variety of classes…including a calligraphy course.

For more social media insight and to learn more about my company, follow HootSuite on LinkedIn.

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16 comments
bgza
bgza

Im with kennethchen on this one, you're looking at the situation from a very unique point of view that almost nobody experiences. People that work hard and then get an MBA degree at a prestigious school are mo´re likely to succeed than those who don't, that´s just how it is. 

kennethlchen
kennethlchen

Ryan, 

What an American post. This is the problem with America. People tell everyone to dream big when everyone shouldn't dream big and go with the odds. Why does everyone want to be the 1 in a million. why can't you just be 1 in 12? I say 1 in 8 because as of last year, in the US, top 8% of america made 150k or more.  Being 1 in 12 should be good enough for people. 

People get MBAs to accelerate and career shift. 90% of instances. 

I agree, if you're gonna start up, you don't need an MBA. take that money and get funding - go boot strapping, find a developer in Jakarta. 

If you want to work for a brand and you're in a different industry, then you should get an MBA. 

Look if you work 5 years for hootsuite doing social media marketing, then you try to get a job at Exxon trying to be the Director of Finance at Exxon, Oil Procurement - YOU WILL NEVER GET THAT JOB. If you get an MBA from a top 15 school, then you might get that job. Even if you did finance at Hootsuite, no one in procurement has probably heard of Hootsuite. 

You make it sound like all work experience is the same work experience. I've seen your resume and while its impressive, its all start up. You're a serial entrepreneur. 9/10 Entrepreneurs fail, so if you're in the 10%, and want to play it conservative, then getting an MBA from a good university is conservative. You'll make 125k and probably make 175k+ for the rest of your life 7 years after graduation. 

5 years of work experience at a nobody start up is worthless experience to most brands. They would prefer 2 years at a fortune 500 company. It's difficult to get into a fortune 500 company unless you've got other fortune 500 experience. You can get Fortune 500 experience if you get an MBA. You won't get there even if you've got 20 years of work experience at a Start up that nobody has heard of. 

CONSERVATIVE EXPECTED UTILITY NUMBERS 

If I want a 90% probability to make 150k for the rest of my life then go to MBA. If I want a 1% probability to make 10 million, do Start up. But realistically, its more like 0.1% will make that 10 million. If you're at a top 15 MBA - in 5 years, making 150k is not hard so 90% is probably really conservative. 

I like 90% odds better than 1% odds. 

In terms of expected utility. My Expected Utility of 90% of 150k is 135k. My expected utility of 1% of 10 million (probably less than 1%) is 100k. 

Go with 90% odds. Be the 1 in 12.  


Prashasti
Prashasti

I agree with the fact that a true talent doesn't need any degree or academic requirements but still most of the companies have set the management degree requirement in job eligibility criteria, id one has not the same degree then he can not even apply for that job position. 

Cedric Bianchi
Cedric Bianchi

Sounds interesting. I totally agree with you regarding the fact a top US MBA is not providing you a significant ROI. Somehow it depends on the countries first (before I left France 2 years ago, MBA was a great value). Secondly it may be a good investment when you attend it after a few years of work experience.

I have attended a full time Executive MBA (minimum of 10 years of work experience to join the program). In this case, I knew what I was looking for and it was worth spending time and money. I now have the tools I missed when I ran my businesses and I'm more at ease when coming to understand the Company with a global vision.

To conclude, if I had money to attend an MBA at Harvard, I will sign up. I will never make a loan to attend such a program. This is why I preferred to attend a Top 50 MBA recognized in North-America :)

Ron1007
Ron1007

Most peole do not get an MBA right after their bachelors degree. The average age and the number of years of work experience is significant for the average Harvard MBA as well as other colleges. The best plan is to graduate, get a job, work for about 5 years and then get an MBA. Often time, one can get the company to pay for it as well, so the cost is nothing. I did this while working for one of the Big 3 in Detroit. But, I had to get my MBA at night. Took me 3 years, both worth it.

Sandi
Sandi

My feelings are having an MBA might differentiate you from other candidates when applying for a certain job. In a tough job market when so many people are applying for the same position, it comes down to the best qualified, and if all other areas are equal having an MBA just might put you on top, and land you the job. Then it would be worth the money!

Byron Wolt
Byron Wolt

i agree with your article 100%.  Although, My degree is not in business, when i hire people i ALWAYS place experience above education.  However, someone with both the actual work experience and the theoretical educational experience is tough to beat. 

Jules
Jules

Now, we just have to get the employers/corporations to think differently about hiring requirements. I can name more companies who require at least a Bachelors degree then I can name companies who hire based on experience alone. 

RogerTheriault
RogerTheriault

If you're talking solely about getting an MBA before entering the workforce, I agree. But an Executive MBA after a decade or more of work experience provides a tremendous education and can open more doors and offers more education than  what anyone can get on the job.

In fact, if someone is not getting an MBA primarily for what they can learn, but instead for who they can network with or what salary they can earn, I think they ought to skip it.

Aderounmu Babafemi
Aderounmu Babafemi

With the increasingly tougher job market, I think what we all need to do is get our hands dirty, Work with established firms, start-ups or even float our own ideas. 

RealCheapReader
RealCheapReader

Basically. In 50 years, traditional employment will begin to be extinct.

mohdrafie
mohdrafie

Everybody has to start somewhere.

RickdeVries
RickdeVries

Everybody hears and talks about the success stories. Now, I don't totally disagree with the arguments that are made, but getting a degree shows a certain will to succeed. I know a lot of dropouts, who don't succeed in real life and end up working in shops and places that barely reach a certain monetary number, because there are no people who want to hire them.

KRZ
KRZ

I don't think people shouldn't further their education because of the highly-unlikely probability that  they will chance on a one-in-a-million idea and become billionaires like the few people you mentioned.  Most people out there are trying to make enough money to start a family, buy a house one day, live comfortably and they need more education just to keep their neck above water.  Not everyone can be business owners or entrepreneurs and limiting your education limits your opportunities and your ability to bust through promotion ceilings.  Glad you became a CEO for an internet start-up, it is nice to hear of people succeeding when there are so many articles describing the dim future for millennials. 

HootMatt
HootMatt moderator

@Lydia F Thanks for sharing this, Lydia. David Frasier gave a really substantive response to Ryan's article and it's worth a read. I'm also happy to see that the Tippie MBA program uses HootSuite!