4 reasons a fresh MBA grad should not eye a start-up

Arundhati Bakshi Dighe

A start-up can be a funny thing. While most people stepping into a job interview obsess about qualifications and an impressive resume, a start-up calls for skills they don’t teach you in B-School. So, if you’ve just acquired an MBA degree and are eyeing a position in a start-up, think again.

Some industry experts go so far as to say that an MBA degree may even be a liability in a start-up, which often has little place for classroom learning. You see, a start-up is not your typical mini-organisation. It is a small business that requires experimentation and execution skills rather than research, planning and administrative skills typically taught in business schools. Here’s why experts feel a fresh MBA grad may be the wrong fit for a start-up.

1. Theory Could Be A Liability

Unlike a fancy corporate job, in a start-up, you need to roll up your sleeves and get down and dirty, what a mountain of mundane problems waiting to be tackled. Start-ups typically need people who can identify and prioritise problems on the go, not just solve problems that are defined, opines Tarun Mitra, CEO & co-founder, LurnQ.

“Sometimes, textbooks need to be thrown out the window in a start-up that is yet to find its footing. As a result, the benefits derived from the case study methodology followed by most B- Schools are inappropriate for a start-up, where the emphasis is on execution rather than analysis,” Mitra explains.

He points out that a start-up is not a smaller version of a large company. “It is a temporary organisation designed to look for a repeatable and saleable business model. In other words, a start-up is all about experimenting, and market research is no substitute for prototype and user-testing.”

2. Domain Knowledge Scores Over Versatility

Kartik Sapra of www.begin101.com, an online fashion portal, feels an entrepreneur must have core or domain knowledge of the business he is investing in. “This is not the case with an MBA grad because during the MBA course, students intern in various organisations rather focus on only one area,” reasons Sapra, who does not hire fresh MBA grads for his business.

3. Start-up Environment Could Be Overwhelming

Start-ups can be overwhelming, even chaotic at times. Most MBA grads have a pre-defined business hypothesis and start-ups usually do not work to this plan. New developments, discoveries and challenges crop up almost every day and dealing with each one may call for improvisation. “This could be an overwhelming experience for a MBA student as he would have to unlearn everything he has learnt in college,” points out LurnQ’s Mitra.

In fact, most entrepreneurs will admit that launching a new business calls for unlearning and learning new things. “You require plenty of patience and the ability to multi-task. It is therefore always better for an MBA grad to work in an organisation for a few years before they launch or join a start-up,” says Sapra.

4. No Fat Paychecks

This will probably clinch the case against an MBA grad choosing a start-up! Unlike a well-established organisation, start-ups usually don’t hand out fat paychecks. MBA grads usually look forward to handsome remuneration as soon as they start working. And most corporate organisations will oblige. But, as mentioned earlier, a start-up is not a mini-corporate. “In a start-up, you will get a barely-liveable wage, and the company could go out of business at any point,” cautions Mitra. This is not exactly what most MBA grads have in mind as their first work experience!

A Case For The Degree

However there are a few entrepreneurs who are prepared to bet on a fresh MBA graduate. “Why not hire a fresh MBA student?” argues Gaurav Mendiratta, CEO, SocioSquare. “After all, while at a B-school, you are learning to master the art of business, and in a start-up, what we’re trying to do is business.”

But Mendiratta agrees that a fresh MBA graduate is an expensive proposition and a simple graduate would have lower monetary expectations. “But you never know. Someone fresh out of B-School could be an extremely good client servicing/market/advertising person that the start-up could benefit from these skills,” he argues.

Did he ever cross that bridge? Yes, says Mendiratta. “We did hire a fresh MBA grad from a reputed Mumbai-based B-School. He did very well but that story lasted only 12 months!”

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