Is An MBA Worth It?
MBA: Useless? Worth it? How to decide if business school is for you
I’ve been asked 27 times if getting an MBA is worth it.
I started counting after two close friends texted me essentially the same question:
‘Considering going back to school... do you think I should get an MBA?’
I love helping out. But there comes a point when answering the same question 27 times is a little absurd. This essay is my no-bullshit attempt to help people answer that question.
Disclaimer: I have an MBA. It was worth it. I doubled my salary, made life-long friends, and learned a hell of a lot. But it’s not worth it for most people.
There are other personal investments I’ve made since getting an MBA that I believe are more valuable than my full-time, two year degree... and at a fraction of the cost. One is writing a bestselling book on luck - which has opened an insane amount of doors - and the other are investments in online courses & communities like Visualize Value, Small Bets, Starter Story, and Creator MBA.
Now on to the fun stuff!
TL;DR - there are only two good reasons to get an MBA
If you stumbled across this essay because you’re considering an MBA I want you to have a definitive answer by the time you’re finished reading.
Not some wishy-washy ‘well it depends on these 13 factors and if you have kids and if you can ace the GMAT and if you can get into a top school and if if if.’
Here’s your answer - there are only two GOOD reasons to get an MBA:
- You want to pivot your career, fast.
- Your company requires an MBA for promotion - a.k.a. you need to ‘check the box.’
That’s it. All other reasons aren’t good enough. There’s the ‘TL;DR’ version of this essay.
Table of Contents
This essay is structured so that you can skip directly to the parts most relevant for you and forget the rest. You won’t hurt my feelings skipping around - I encourage you to be efficient!
1. My personal MBA journey
2. The most commonly used BAD reasons to get an MBA
3. The only two GOOD reasons why you should get an MBA
4. The decision point
1. My personal MBA journey
I started my career as a microbiologist and quality engineer for a large food manufacturing company. It didn’t take long to realize I hated my work.
About a year and a half into my first job a senior sales executive opened my eyes to business, and specifically, the importance of concepts like branding, value propositions, supply chain, and other terms I hadn’t ever heard of or thought about.
I knew I needed to make a career change and started to look for ways to switch roles inside of the company. I was especially interested in sales and marketing roles because when I interacted with those types of employees I felt my strengths, namely public speaking and presentation skills, were more closely aligned with what they did day-to-day.
After attempting to navigate the internal political structure I came to the realization I wouldn’t be able to switch roles (engineer -> sales) without it taking multiple years and a ton of headaches. Big companies aren’t set up for employees to readily explore their career interests, much less make job function changes in a short amount of time.
I started looking externally for opportunities that would expose me to other functions and divisions of a business, in addition to the possibility of living and working abroad. I settled on a small food manufacturing company in Rio de Janeiro, Brazil with the goal of getting their processes up to international export certification standards.
After a year or so living and working in Rio (and also having to embarrassingly learn Portuguese), I came back to the U.S. to help them sell their products. I loved sales and decided to solidify my interest in becoming a full-blown sales & marketing person by getting an MBA. I felt, and still feel, that it was the quickest path to redefine myself in the eyes of future employers as a business person and not just a quality/manufacturing engineer.
I studied for and took the GMAT twice, researched potential schools, and applied to a half dozen. I settled on the University of Arizona because of their highly ranked entrepreneurship program and the affordability (free with my GMAT score of 690 - above average but nothing too spectacular).
My two year, full-time experience was definitely worth it. I doubled my salary, made life-long friends, and learned a hell of a lot.
But it’s not worth it for most people.
2. The most commonly used BAD reasons to get an MBA
This section lists the top five reasons I’ve heard from friends considering an MBA. The list is not complete and a quick google search will bring up dozens of others. But none of these are good enough to justify spending two years of your life and hundreds of thousands of dollars on a business degree.
- “I want the network”
Although you can develop a great network in business school it should only be a consideration for what full-time school you choose (discussed below), but not a reason to go in the first place.
This was a good reason before the internet really took off. You can meet, interact, and network with anyone using the power of the internet and social media… specifically online communities like Visualize Value, Write of Passage, or on social platforms like Twitter.
Elite individuals including business professionals and entrepreneurs all congregate in like-minded groups around the internet. You have to do some digging to find them. But that digging will cost you far less in both time and money than an MBA.
Take, for instance, one of Travis Kalanick’s first employees at Uber who became CEO… all because he responded to one of Travis’ tweets.
I’ve built a broader AND deeper network than I ever did in grad school by having an active Twitter presence, taking online courses, and a contact me form on this blog.
If network is the primary reason you’re considering business school think about who you want to network with and why. Create ‘personas’ of those people you imagine surrounding yourself with and then go and find them on the internet. Engage. And see what happens.
- “I want to learn more about business”
That’s what YouTube and Wikipedia are for. That’s also what colleagues in other departments of your workplace are for. You could also try a career in a small business or work for an entrepreneur as a ‘side hustle.’
There’s also the option of free or heavily discounted online courses through Udemy, Coursera, or something like Seth Godin’s altMBA.
If you really feel motivated try starting your own company. The best way to learn about business is to do it, not study it.
- “I want to increase my salary”
Getting an MBA doesn’t guarantee you anything, much less a salary increase, just like getting an undergrad degree doesn’t guarantee you a job.
MBA students who work hard, go to top schools, and enter highly-paid industries like consulting (despite what they really want out of life) typically see salary increases… but if getting an MBA guaranteed a salary increase there’d be a hell of a lot more people getting MBAs.
Pepperdine’s blog sums it up well:
“A survey of over 100,000 respondents indicates the average MBA salary is $86,000. According to the U.S. News & World Report article Find MBAs That Lead to Employment, High Salaries, among the 130 ranked full-time MBA programs that reported data, the highest average MBA salary and bonus paid to 2018 graduates was $102,495...”
Keep in mind that the highest AVERAGE MBA salary and bonus in 2018 was $102k. So half of the graduates fell below that… and the upper half likely already had lucrative careers lined up with a former employer before they even started their graduate program.
Pepperdine then says, “While there is no guarantee your MBA salary will fall within or beyond this range, data does show that MBA graduates tend to make good money.”
What is ‘good money’ anyway? Studies have shown that happiness levels start to fall off after an individual makes more than ~105k/yr. - or right about the highest average starting salary + bonus of an MBA graduate (how ironic…).
As Biggie says… mo’ money, mo’ problems.
- “It will help me figure out what to do with my life”
If this is a top reason you’re likely a recent college grad, <5 yrs into your career, or recently unemployed.
Using an MBA to switch careers is great (discussed below). Using an MBA to find a new career is not. Ask yourself if you’re truly using business school to explore an alternate career path (unlikely) or just using it to kill time until you find your next job (likely).
Grad school will not help you figure out your path in life. Only you can do that.
And spending $100k and two years trying to do that is a waste of time and money. An MBA is a safe choice, not a life-changing choice. Don’t conflate the two.
As John Shedd says, “A ship in harbor is safe, but that is not what ships are built for.”
- “An MBA will impress employers and people in my network”
Publicly posting the ‘alphabet soup’ of credentials makes you look like an ass and nobody cares. Here’s a real example on a LinkedIn profile:
MBA, PMP®, CSM®, PMI-ACP®, ITIL®
If an employer requires those credentials that’s fine… but they belong on your resume, not as a publicly visible badge of honor.
As fellow MBA and Write of Passage friend Cam Houser says, “MBA is particularly useless here. PhD actually (sometimes) carry weight. MBA on your list looks weak.”
The problem with MBA-types - myself included - is that we overanalyze decisions. Paralysis by analysis. I’m trying to help you avoid that. The intent of this section is to help you think critically about a big life decision and come to a definitive answer on what you should do.
The question you’re asking - should I get an MBA? - is the wrong question. Instead, you should be brutally honest with yourself and answer this question: What am I trying to accomplish by getting an MBA?
Unlike medicine or law there’s not an MBA requirement (or any degree, for that matter) to have a career in business. You can be wildly successful without any credentials.
Want proof? If money is your measurement, 30% of billionaires in 2015 didn’t even have a bachelor’s degree.
3. The only two GOOD reasons to get an MBA
This leads me to the only two good reasons to get an MBA.
- You want to pivot your career, fast
What I mean by pivot is someone going from an engineer to a finance professional, or a non-profit employee to a marketer. Without an MBA this process can take YEARS and come with a lot of headaches, salary reductions, and overall misery.
The beauty of an MBA is that the first day you set foot on campus you get to choose your ‘new persona.’ And it’s totally acceptable in the eyes of employers!
As an example, I was a quality and manufacturing engineer that in the first week on campus applied for sales and marketing internships. Many of my classmates were non-profit employees their entire career and immediately ‘became’ finance professionals… before they had even completed a semester’s worth of finance classes.
If this sounds like you, you should get an MBA.
- Your company requires an MBA for promotion - a.k.a. you need to ‘check the box.’
Take a look at the VP-level and C-suite executives at your company. If the majority have MBA’s or your next promotion ‘requires’ a graduate degree you should get an MBA.
Even better if your employer will pay for your graduate degree. Don’t let them get away with not providing some kind of financial assistance.
4. At this point in the essay you should’ve made your decision.
If you’ve chosen not to go - great! Make the best of two years and tens (or hundreds) of thousands of dollars you’ve saved not getting an MBA.
If you’ve chosen to go - great! Now you have some hard decisions to make… like where you’re going to go.
Part 2 of this essay - how to choose the best b-school for you - aims to help you answer exactly that question.
Lastly, if this helped you in any way please share it. Even better if you’d send me a note to connect - I’d love to hear about your journey and if there’s anything you disagreed with or think I should add.
Big thanks to Charlie, Ayomide, Miriam, Cam, Juan David, Salman, Dipan, and Jen for reviewing early drafts of this piece.