Item — HN Reader

> They’ve done studies at Harvard Business School where they’ve found that the largest cohort always went into the wrong field. So in 1989, they all went to work for Michael Milken, a year or two before he went to jail. They were never interested in Silicon Valley except for 1999, 2000.

They're interested in Silicon Valley now. Here's an actual conversation I had recently with a business school student (not verbatim obviously, but accurate as far as content):

Me: What are you doing after you graduate from HBS this spring?

MBA: I want to do startups.

Me: Oh cool, do you know which one you're going to work for?

MBA: Oh no, I want to start a startup.

Me: Oh okay, what's it going to do?

MBA: Don't know yet!

Me: Oh...

3 comments

What's wrong with that? IMO wanting to be an entrepreneur is one of the best reasons to start a company :)

The problem comes when MBAs, generally without technical background, build companies without real value and expand an already existing bubble.

I don't think I would join a startup that wasn't founded by people with some kind of technical degree.

Same here. But it seems to be a thing.

Best email I got from a start-up that wanted to hire me went something like this: "We are a team of 5 MBAs with an idea and need you to be our employee #1 to build it!"

I mean 5 founders seems rather excessive to me but all of them MBAs and the only technical person will be an employee and not a co founder.

Maybe it's not such a bad idea. Someone has to do the no-fun work of sales, promotion, taxes, etc., might be nice to have a bunch of MBAs around to do that. Could also ask for 40% equity or so.

For some companies the core value is the tech they produce, and thus having non-tech people at the helm makes little sense.

Others, usually also dubbed "tech startups" due to their Silicon Valley location, use generic pieces of technology to achieve their purpose. There are entire sectors (ad tech, Uber for X), where basic building blocks have been built and now it's sell, sell, sell.

Indeed http://en.wikipedia.org/wiki/List_of_Wharton_School_alumni with all due respect it's a bit tiring to hear about all those 'uselss MBA' stereotypes. There's a substance to it but I start to feel that 9 out of 10 comments like this one reflect the insecurity of the author rather than anything else.

One of the people not mentioned on the list is founder of Warby Parker - surely he contributed to the bubble by building the 2nd most profitable retail stores and one of the few startups that are actually profitable.

With all due respect, if you're a MBA, you've just followed such stereotype.

So what I didn't even graduate college? I'm proud to have built a company whose employees are happy and treated with dignity. Diligence, respect and passion drove people like me to success, not a HBS MBA.

From experience, that's not what usually happens with MBAs. Because of an 'alumni list' or a privileged network, many feel entitled to success and will do anything to reach their goals(often unethically).

What about MBAs WITH technical backgrounds? Are they allowed to build companies?

MBAs with technical background usually have a BS in STEM and go work to a bank/corporation in finance/management positions.

Hence, they are not actual engineers actively building a product.

Please do build a company, but not a money-making scheme treating developers like dispensable tools.

I get the impression from HN commentary that the minute you receive your MBA you become a sociopath whose IQ drops 40 points.

And plenty of devs go and work for such companies and individuals…

One would think we'd come up with better ways by now to lessen the allocation of resources for things in the present that are of marginal utility for most people, but somehow, humans have a knack of creating/engaging red queens races relative to other things that are theoretically possible and feasible.

Becomes hard to turn down a compensation that could be 1.5-2x larger than others.

More likely: 0.8 times what you'd make elsewhere but a significant chunk of equity (0.0001% or so, vesting over 5 years...).

Most start ups (and large co's) are offering devs to work on pretty much the same thing, which in my opinion is very easy to turn down and actively avoid… 1.5x, 2x (at best for most) to ship marginally interesting projects that will probably provide not much more than marginal utility for most people while being around people who will pretend (or believe) otherwise… yeah…

Most of these people (not all of whom are MBAs) just want to be bosses, not entrepreneurs. Their goal is to be executives ("big picture guys") shouting orders, not worker bees, but they don't have the social resources to make it happen in an existing company so they drum up some seed funding and hire some engineers (usually, scraping the bottom) and try to kick something together. It doesn't work very often.

"I want to be an executive" is a pretty fucking lame vision, as it were. I'd rather be around people who have concrete ideas of what they want to build, and who'll lead when appropriate and follow when appropriate. People who say, "I'm a leader" but don't have a good sense of where they want to lead, are annoying. What they're really saying is, "I think that, based on some linear combination of pre-existing socioeconomic resources and inflated self-image, I have the right to a job where I tell other people what to do."

I don't think that all MBAs are douchebags. I know plenty whom I like a lot. Unfortunately, the culture of business school and especially the elite business schools is one of entitlement and position-seeking. When that type of person founds a startup, you get a lot of the same toxic big-company behaviors and formalities and political structures, but in a small company that can't afford the inefficiencies. Now you have the worst of both worlds between small companies and big ones, and a high likelihood of failure or, if the connections are there, Knewton-esque mediocrity.

Oddly enough, if I had a child I'd recommend that he go to the highest-ranking business school out there. Harvard is going to open doors that are just ridiculous, whereas the #20 school is probably educationally equivalent, but isn't going to make you a CEO at 30. On the other hand, if I were hiring, I'd be extremely skeptical of the Harvard MBA and less skeptical of the Booth MBA and even less skeptical of the UWash MBA. In most educational divisions, the correlation between prestige and douchebaggery is nonexistent, i.e. Yale law students aren't noticeably douchier, or less douchey, than students at middling schools; in MBA school, it's clearly a positive correlation (although Stanford is probably worse than Harvard, though less prestigious, for obvious reasons).

"linear combination of pre-existing socioeconomic resources and inflated self-image"

What do you mean here by linear combination? If you wrote the same thing and said nonlinear combination would we have come away with a different interpretation? Is this just injecting random math terms to raise the status and credibility of the speaker?

It's a problem I see in a certain non-MBA culture (and am guilty of myself all the time too).

Or maybe I'm just missing something about what you meant.

> "linear combination of pre-existing socioeconomic resources and inflated self-image"

> What do you mean here by linear combination?

I suspect that Michael means that the people who claim on leadership position without having proved themselves will justify their self entitlement x % by their pre-existing social resources and (1-x) % by what they think of themselves.

Yes, you don't have to hold an MBA to think like that, but a diploma from a prestigious institution sure helps boost your ego, and being born from wealthy parents helps as well.

You're reading too much into it. I could have taken out the word "linear" and it would have been fine, but it wasn't exactly a random math term.

A linear model is the simplest model, which is sometimes an asset (in some cases, linear regression is the best statistical model for its simplicity) and sometimes makes it crude and underfit to the problem. I was focusing on the latter.

> Most of these people (not all of whom are MBAs) just want to be bosses, not entrepreneurs. Their goal is to be executives ("big picture guys") shouting orders, not worker bees, but they don't have the social resources to make it happen in an existing company so they drum up some seed funding and hire some engineers (usually, scraping the bottom) and try to kick something together.

That seems like a very mean way to say they don't want to be a cog in a machine.

> "I want to be an executive" is a pretty fucking lame vision, as it were.

By "I want to be an executive" do you mean "I'd rather not work for a boss"? Is there a difference in those two desires? How is that fucking [sic] lame?

> What they're really saying is, "I think that, based on some linear combination of pre-existing socioeconomic resources and inflated self-image, I have the right to a job where I tell other people what to do."

Actually, "I have the right" is your words, not theirs.

> I don't think that all MBAs are douchebags.

Whoa, whoa. Nobody said they were douchebags.

> I know plenty whom I like a lot.

And I have a lot of gay friends (but I wouldn't say I like them "a lot").

> Unfortunately, the culture of business school and especially the elite business schools is one of entitlement and position-seeking.

What is a culture of entitlement? People just go to business school and... sit there and be entitled? What is a culture of position-seeking? Do they seek positions in companies? Does engineering school also have a culture of position-seeking, or is that different somehow?

> When that type of person founds a startup, you get a lot of the same toxic big-company behaviors and formalities and political structures, but in a small company that can't afford the inefficiencies.

So some MBA's aren't that good. I think we all already know that some startup founders suck. But others must be good, or turn out to run successful companies, or investors would just unilaterally cease funding any MBA's. The phenomenom of bad founders is not limited in any special way to people that got MBA's, either. So in what way is the problem with business schools, or the people that go to them? (Aside from the usual complaint you hear from a lot of people, that you're repeating, about MBA's that don't really know what they're doing because they don't have experience, which we get when people make stereotypical complaints about management consultants too.)

> In most educational divisions, the correlation between prestige and douchebaggery is nonexistent, i.e. Yale law students aren't noticeably douchier, or less douchey, than students at middling schools; in MBA school, it's clearly a positive correlation (although Stanford is probably worse than Harvard, though less prestigious, for obvious reasons).

It would be helpful if you could point us to an academic study that makes these measurements of douchiness. I don't hang out with enough law school graduates and business school graduates from these respective schools to be able to tell if what you are saying is true, but I guess you hang out with enough of them from each major business school and law school to have figured this all out.

"douchebaggery"...Sweet. My new favorite word.

It starts even earlier than business school, with the kids who campaign to be president of ten different school clubs just for the sake of being in a leadership position and being able to put it on their resumes. American culture really encourages this shallow sort of leadership by entitlement, while truly great leaders almost always earn their authority through a medium to long period of hard work side by side with other people, not necessarily as a follower, but at least as an equal.

In what way is becoming president of school clubs a form of entitlement?

Becoming president of school clubs isn't entitlement. What I mean is that the culture around leadership positions in high school incubates the attitudes that Michael was complaining about. Some students do legitimately learn a lot being the president of a high school club and are able to do good stuff with it. Many students, though, just run for the resume item, to help themselves rather than really to serve the organization and help it do interesting things. And because of the way our culture treats leadership, as if it were something that can exist without context, that becomes part of their identity. They've been the "leaders" of organizations all their life (which in some cases involves little more than organizing social events), they've gone to these fancy schools, and now, as a result, they ought to be in charge later in life, because that's who they are and because Harvard doesn't train followers, it trains leaders. But just because someone is the president of a social club or an a capella group in college (not to say that this is not a worthwhile thing to do), it doesn't give them any more right or qualification to be the leader of a law firm, or an engineering firm, or an advocacy group, or a theatre troupe. Leadership isn't a single skill or quality; it exists entirely within a context.

I don't have any problem with club presidents in general. I do have a problem with some of the ideas U.S. culture (or at least middle class upward-aspiring culture) has about leadership, and I think those attitudes do lead to a destructive form of entitlement.

I don't think you're going to get an accurate view of people at Harvard, even people that were involved in student government or were club presidents, if you generalize them like that. If I were to generalize, I'd think that most people that were high school club presidents and leadership camp-goers were really cynical about it, not entitled. (That's just based on the people that went to my high school.)

I also don't think the cause-and-effect story is really there. The one startup founder that I know personally that I've heard be called a douchebag is somebody that started the company early on in high school, that bootstrapped it up with his brother from money made by selling bootleg CD's at soccer practice, and never went to college. And the other >bad person< I know that started a startup isn't your generic entitled club president type -- he is, far more specifically, your basic clinical psychopath.

Also, to the degree that these people do exist, or to which this attitude has been inculcated into a group of people, the sink-or-swim situation of running a startup seems like a great place for them.

Obviously, the person from your anecdote is representative of MBAs in general, right? If not, what's the point of the comment? I have a stupid conversation with someone from some occupation every day.

In a couple of years, your conversation will sound like this:

You: so, what are you doing these days?

MBA: well, I've been at McBainCitiGold for a couple years, but I'm getting bored, I'd like to start up!

You: oh really? Go for it! I really don't regret doing it myself.

MBA: yeah, but I'm just waiting for the right idea. And the salaries are too low. The kids, school, car, condo... By the way, do you have any ideas?

Wait a few more years and this time they'll tell you about how they'd like to invest in startups, but the entrepreneurs ask for too much, so they just had to invest it in property instead. Or are on their 17th meeting with a poor founder who for some reason (location, CV, lack of connections) is stuck raising from this type of amateur angel, unable to pull the trigger and "keeping options open".

This being said, I don't blame them. Startup life (outside the megafunded) is tough, has low expected value, requires sub-optimal life decisions (goodbye family) and, I think, only fits certain types of people who are very independent minded and enjoy that kind of challenge. The MBAs I know who did it with the express intent of getting on with a company fit that type, and one of them has hired his 100th employee last year.

When I hear a corporate type say "oh, I'd like to do startups" I think it's pretty similar to hearing many people say "I'd love to try the military". A passing thought, either being polite (admiring your life choices) or to be rapidly dismissed once encountering what those career paths entail.