MBA & consultant's guide to joining a startup

As a recovering MBA and management consultant (for this article, we'll collectively call us MMC), often I get asked about my transition to working in tech and startups. On one hand, my MBA friends and management consultants I worked with were indeed some of the smartest and most driven people I have ever met. On the other hand, some of the most iconic founders had some pretty harsh quotes for us:

"Never ever hire an MBA; they will ruin your company." 
- Peter Thiel
"As much as possible, avoid hiring MBAs. MBA programs don’t teach people how to create companies … our position is that we hire someone in spite of an MBA, not because of one." 
- Elon Musk

What gives? This article did a pretty good job in describing the type of education and experience mismatch between MMC and startup life. Let me add some perspectives that are more on the personal level.

Roles at Startups

Working at early stage startups is simple. You either build things or you sell things. The extremely limited amount of resources dictates this.

Build Things

Some MMCs (like myself) come from a technical background with hard skills like design or programming. Though if one chose the path of MMC, that person was likely not looking to be a designer or developer. Else they would/should have skipped the MMC path and joined/started a startup as a designer/developer. The closest "build things" role is Product Management. Product Management is a good fit for MMC though when you dive into the details, MMCs often lack the actual relevant experience to be product managers in a company with limited structure and resources. Experiences such as instrumenting analytics tools, participating in agile development, conducting user interviews and gathering user insights are not often part of the MMCs' background.

Sell Things

Some MMC become extremely successful in early stage sales. Though the majority of MMCs I talked to were not interested in sales. They were interested in Business Development (BD). BD sounds cool. Also, it doesn't carry a quota. The 2 major mismatches are that:

1) Early stage startups don't need (don't deserve, really) major partnerships. It needs revenue from customers.

2) What true relationships does the MMC bring to a BD deal in the startup's specific industry? Finally, if there's really a deal to be done, why isn't the CEO doing it?

Value Mismatch

MBA education is expensive. Strong ROIs from high paying jobs upon graduation usually are the justifications for such high prices. This need for a high salary goes directly against the resource constrained startup, regardless of the MCC's talent and experience. To make matters worse, the MBA is surrounded by friends who are entering investment banks, management consulting firms and big tech who are paying top dollars. In a world where money often equates to self worth, it is not easy to take that startup role even if one qualifies. This is worse for a management consultant since the up or out policy is designed to get one promoted and make more money every year, making it harder every year to "downgrade" to a startup job.

Now What?

In the past, I often got into similar situations when I would meet a talented, driven and smart MCC candidate who doesn't have the right day-to-day skillset I need for the immediate job but demands a significant amount of compensation. We would try but ultimately not be able to close the gap. To minimize frustrating experiences like these, here are my recommendations:

Series C+

For MCC who are looking for roles in strategy, marketing, operation and BD, look for later stage startups. As companies reach 100+ employees and/or have raised significant venture funding at series C round and beyond, they'll likely have the need to bring on MCCs in these key roles. There will likely be ongoing concerns that crave a MCC's talent and experience to optimize and capture values. In return, they are more capable in compensating the MCCs' near their expectations.

Big tech PMs

For MCCs with technical background, another viable path is to spend a couple of years as product managers at one of the big tech companies first. I know many who have successfully taken this path. Big tech companies are the breeding ground for some of the best product management talents in my opinion. With this experience under one's belt, it becomes a much easier transition to product management roles in smaller startups.

Start your own

And of course, one can always do what I did - start your own company. No one can tell you what role you are qualified to do or not do in your own company. You just need to perform.


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