The nature of education is rapidly evolving, and with global commerce more accessible than ever, many people are wondering what is the role of education, especially as it relates to entrepreneurship. More and more, colleges and universities trying to adapt to a changing educational landscape which includes MOOC (massive online open courses), bootcamps, and other online learning channels.
You may also consider the rapid increase of entrepreneurship as an M.B.A. focus. According to Poets & Quants:
“From a survey of self-employed alumni who graduated from 1959 to 2013, GMAC has found that 45% of 2010-2013 grads started businesses directly after finishing b-school, while 80% of self-employed alumni from years past worked several years for an employer before embarking on entrepreneurial ventures.”
Can colleges and business school programs teach not just the theory, but the harsh reality that comes with being an #entrepreneur? But further, should academic institutions feel a responsibility to take on that topic?
What is Education?
To begin answering the question of education in the realm of entrepreneurship, we first must consider what post-secondary education is even designed to do. Historically, and can be considered a baseline assumption, colleges and universities were designed to prepare students for higher-earning careers.
Depending on the institution type (community college, four-year university, post graduate), students can earn technical, incremental growth opportunities (certificates or credentials), or degrees that prepare students for bigger, more competitive, and assumed safer career paths.
I mention this because historically, the role of post-secondary education was never designed to create business people. While many colleges offer business coursework (accounting, business law, etc.), the knowledge of what it takes to run a successful business has not been adopted at the foundational level.
Why Academic Institutions Are Not Ideal to Fuel Entrepreneurship
On the surface, academic institutions might seem a good venue to fuel innovative entrepreneurs. They have a ready, engaged user base. They come with respect and laurels. They already offer some existing framework courses. It seems like the infrastructure is in place to make this a success!
And that’s the problem. Anybody who has ever worked in the education realm knows there to be a few universal truths:
- Education is slow to adopt. Most students attend colleges that receive state or federal subsidies. That amounts to an organizational hierarchy that looks like a plate of spaghetti. That amounts to loads of bureaucratic red tape. That amounts to slow, incremental change.
- Don’t have the experience. Professors receive MBAs or PhDs in their respective fields. This provides a level of domain expertise in any given area. There is no PhD in entrepreneurship. There’s only experience and academic theory, which sometimes overlap, and many times conflict. Educators who have no business experience can’t possibly teach what it takes to be an entrepreneur, at least not in any meaningful way.
- Sovereign nations. Each department in a school is run somewhat autonomously. Deans or chairs ensure their faculty is abiding by and adhering to their respective vision for the department. Further, most every school wants to “own” a piece of the pie, making inter-school collaborations particularly troublesome. And further, educators tend to be territorial, meaning truly collaborative partnerships with private-industry organizations rarely happen.
Education is always a good thing. Continuing to learn, to see things in a new light, to conquer something you have long feared will help any business owner. But at this point, education institutions are not positioned to effectively lead the entrepreneurial charge.
Looking through this perspective, it seems more appropriate to question what’s important to teach in something that’s relatively unteachable. For example, many businesses actually use games to help change the way they approach their business. Online games or even board games for entrepreneurs help not to teach everything about a subject, but instead help you think more like an entrepreneur.
Right? Doesn’t it seem reasonable that entrepreneurial thinking (persuasive speech, collaboration, trust building, sales pitches, contract negotiations, etc.) can be applied to every area of your life, even if you never start a business? Example: You are a high school student and you want to ask a girl out on a date. This is your first introduction to persuasive speech and competitive analysis. You know other guys want to ask her to the dance. You know those other guys are idiots and she should go with you. So you have to find your points of differentiation from the other guys, and tailor those to how you interact with the girl. You’re selling yourself as the best option.
So can playing a business board game help you be a successful entrepreneur? That all depends, but the reality is that by learning to think like an entrepreneur, you’ll be better positioned to see more opportunities and understand how to capitalize on them.
Let’s look at a few ways more modernized education is addressing entrepreneurship.
The Bootcamp Effect
More and more you see “entrepreneur bootcamps” pop up, blasting you in your social media feeds, email inboxes, and mobile devices.
Let’s look at some of the pros and cons to this type of learning:
- There’s no standard for instructing. If common advice is to find a mentor to help you grow your business, wouldn’t you want somebody teaching you who’s already practiced the concepts they’re teaching? In most cases, this is a more effective method than theory-based teaching.
- Open market allows the effective courses to thrive, and the scammy type courses to be jeopardized
- More accessible pricing options
- Learn at your own pace
- Flexible scheduling
- There’s no standard for instructing. Courses can be designed as video only, may or may not follow an effective curriculum method, and the instructor may not be available to adequately answer your questions or provide clarification.
- How do you know if these are effective?
- Will the information they provide be useful and applicable to you?
- How valuable is this training in the real world?
- Has this person actually, and successfully, used the principles they’re teaching you?
The MBA Effect
M.B.A. programs are known primarily for their prevalence in finance and corporate marketing. Try getting a job on Wall Street, or even growing into a VP role at a large organization, without one. The likelihood just isn’t in your favor.
While MBAs provide good information and training for large corporate environments, there hasn’t been a lot of application to small businesses. Ask any budding entrepreneur if they’ve talked to an MBA about their marketing plan. Chances are, the suggestions weren’t really applicable because new, small businesses don’t have the capital, resources, or market intelligence that large corporations have. It’s a world most MBAs simply aren’t taught about.
Of course, over the past 10 years we’ve seen a huge influx of entrepreneurship as an MBA focus. That’s all well and good, but I have to question if the traditional approach is also applied to entrepreneurship. Look at some of the more popular MBA entrepreneur programs.
The curriculum of these well-regarded schools, seems to focus on the unicorn entrepreneurs. The $19 Billion acquisitions. The already-profitable, VC-funded elite. So the question of “Should I get an MBA?” comes down to a simple question of value: Is the $100,000 in MBA tuition ultimately going to yield a significant return on my business?
In many cases, the answer is no. It’s not because these are bad schools, or anything of the sort. It’s because most entrepreneurs are so focused on, and have invested so much energy in, their businesses that they’ve effectively learned many of the basic concepts of the MBA program. Contract negotiations, product pricing, competitive analysis…while there is always room for improvement in these areas, investing time, money, and effort into the academic approach doesn’t seem to yield the right returns.
Again, the right education is absolutely useful…in the right situations. The truth is, many of the people on the fence might actually be better served by taking a few community college or online classes about the specific areas they want to improve.
The Industry-Specific Effect
Like technology, there’s no entrepreneur industry. Think about it: tech spans any industry – Bio tech, financial tech, education tech. Same thing with entrepreneurship. You’ll see a lot of Instagram or Facebook pages promoting their entrepreneurship course. Once you dig in, you’ll see a lot of similarity in the specific industries they’re promoting.
A common theme, at least in my experience, is real estate. There are hundreds of courses and webinars and subscriptions to teach you how to flip real estate with no money down and make an extra $10k each month. You’ll also find a lot of courses around drop shipping, specifically with Amazon FBA.
- Easy to learn specific information about a niche area
- Usually lots of success stories to validate the effectiveness
- Easily cross reference and compare to similar courses via community boards or forum threads
- The process might have been a fluke that only worked in one industry
- One-on-one consultation and questions may not get the attention they deserve
- These courses are businesses, so you’ll be subjected to their biases and slants
Conclusion: What Is The Role of Education in Entrepreneurship?
We are fans of learning. Every person on my team tends to read at least a book each month. Not because we’re looking for something brand new, but because when you read the essentially same information from a variety of sources, experiences, and points of view, you are better able to formulate how to apply that information to your business.
If I had it my way, we’d restructure education from high school on. If schools are truly interested in helping students become better entrepreneurs, the foundation needs to shift. Financial literacy should be required each year of high school. Most graduates can’t balance a checkbook, and then we wonder why people get over leveraged and fall victim to changing economic environments.
As for colleges and universities, faculty should teach the technical aspects (accounting and bookkeeping, human resources, etc.) but the majority of information should come from experienced professionals, and should include interactive lessons (every team has the same challenge and at the end, the instructor reviews the wins and losses from each).
But until that changes, until schools are able and willing to utilize private industry relationships, bring in experienced (even if not credentialed) leaders, and operate more like a business, then they should just stick to providing supplemental information for entrepreneurs and small business owners. The Entrepreneurial Revolution is already decades deep. Schools have a lot of ground to cover if they want to catch up.