Industry players debate the pros and cons of that sheepskin.
Look, Mom, No MBA

Does an MBA make sense for an aspiring entrepreneur? It depends. Aspiring entrepreneurs fall into two categories: Type I and Type II. The first is fascinated with the abstract idea of business, and looking for a perfect seam in the market to attack. Justin Kitch is founder and CEO of Homestead.com This person should get an MBA, and almost always does, because a business degree is as much about contacts, business plans, and fundraising as it is about academic study. Two years of case studies, cocktail parties, and business plan competitions is a perfect catalytic state for the "great idea" and/or a naive investor. If you are this type of entrepreneur, you should stop reading this article immediately and apply to business school.

The Type II entrepreneur is fanatical about a specific revolutionary technology, product, or idea. This person usually doesn't have the foggiest idea about business and has little interest in generic business principles. They are often suffering under the delusion that they can "change the world" and, as one might suspect when embarking on such a task, time is the scarce commodity-especially in the Internet world.

Who's got the time?

It has been said that Internet time is roughly the equivalent of dog years: Seven Internet years equal one normal year. This means that while you are squandering two years in business school, someone else is already out in the Internet world implementing your big ideas.

No matter which type of entrepreneur you are, there are two major skills required to get your idea off the ground: vision and communication. Business school doesn't focus on either of these things. It doesn't matter how many business principles or well connected people you know; if you can't inspire other people to believe in your vision-or you don't have one in the first place-someone else will get there first.

Type I entrepreneurs are often great at communication-luckily for them it is one of the major screening criteria for MBA programs-but they usually lack in vision. It is common for Type I people to go to business school in search of this vision. While you may get inspired with a vision while attending business school, you won't learn to be visionary there. That visionary inspiration is impossible to teach or force-it just has to come-and it is tough to succeed as an entrepreneur without it. Other, more basic, human needs usually take over long before success, such as rational thought and sleep.

In contrast, Type II entrepreneurs are visionary by definition but often are short on communication skills. They work day and night on the prototype of their collapsible Internet defibrillator, or whatever it is, until they suddenly realize that they need to raise money-the ultimate test of communication skills. Alas, having a vision is not the same as pitching one, and many great visions get lost in the chasm between the two.

Don't talk, do.

Unfortunately, business school is rarely an answer for Type IIs who lack the necessary communication skills, even if they realize their deficiency in time. First, they have to decide to go to business school, which means putting their vision on hold. Nothing is more blasphemous to Type IIs than postponing their vision. Two years is equivalent to four complete re-designs, 18 product releases, 200 all-nighters, and more than 1,000 bowls of ramen. Secondly, even if they decide to go, they have to get in, which is quite hard to do without the aforementioned communication skills. Finally, business school is less about teaching communication skills than it is about using them.

If you are an aspiring entrepreneur mostly interested in business for the sake of business, an MBA might be a great way to set the stage for your success. You might even discover your vision-or a visionary-while you are there. However, if you are an entrepreneur already feeling the visionary juices bubbling to the surface, then an MBA is a waste of precious time. With a lot of hard work and a little luck, you will soon realize the ultimate irony that comes with being a hard-charging entrepreneur lacking an MBA: You spend a lot of time recruiting, pitching to, raising money from, and pleasantly ignoring the advice of people who have one.

I Want My MBA

There comes a time when you look back on your life and realize that of all the myriad potentials you envisioned as a child, your life has tracked a path of progressive narrowing. In many ways, business school reopens that field of view. Rather than trundle along a path that may look like a rut in retrospect, there is a child-like rush of myriad horizons open anew.

Brain food

It is an academic program after all. Many applicants have gone through academic withdrawal, and they yearn for a revival of that undergraduate spirit. Steve Jurvetson is a managing director at venture capital firm Draper Fisher Jurvetson. In any academic curriculum there is a balance of short-term tactics and long-term frameworks, between depth and breadth. Most of the value is in the higher-level analytical frameworks and self-awareness rather than in the details of corporate finance or accounting. The MBA coursework is like a Chinese menu of delights: Interpersonal Dynamics, Business Strategy, High-Tech Entrepreneurship, and Brand Marketing. Most business schools teach with the case method. Most of the lessons are learned by reading a summary of a real business situation and hashing out the implications and strategic counter-moves in class. The classes are highly participatory. Often the CEO or protagonist from the case would jump in to debrief the class in the last 10 minutes of an hour-long debate.

Business judgment, especially in evaluating new business ventures, is fundamentally an exercise in pattern recognition-what elements of the market, team, and strategy were correlated with success. Rarely would a direct comparison suffice; rather, a new business is often the complex composite of several successful business elements. The corpus of MBA cases is like a highlight reel of a lifetime of business experience. Although no substitute for direct experience, they nevertheless provide a stable of mental triggers, analogies, and frameworks for learning quickly in future business contexts.

And then there are the classes that go on across the street at the university. You can catch up on that engineering seminar. Or take an introduction to computer programming. The amazing variety of the undergraduate and graduate schools is open once again.

Network of contacts

Business school is unique in that it is one of the few academic programs where you are likely to get a job from one of your classmates. Unlike engineering grad school, medical school, or law school, MBA students have made a three- to five-year run at a career before coming to business school. It is a fundamental difference; you are more likely to find your career by getting to know your classmates than by anything the Career Placement Center can do. It is the background for the "Great Job Swap"-most of the bankers want to leave banking and most of the consultants want to get out of consulting. Many of them end up swapping jobs. Whether it is from this subtle realization, or the prior predilection of a bunch of gung-ho business types, "networking" is on the brain. There are more parties and networking events per year than many of us have had in our entire lives. Welcome to the blurring of work and play, endemic to the Information Age.

The network of contacts are the students, faculty, and guest speakers from Silicon Valley. Each is learning from the others. The case method requires teams of students to band together; almost everything is a group project.

And then there are the clubs. I spent as much time working on the "High-Tech Club" as I did on academics. Under the Stanford brand, I emailed invitations to technology executives to speak to the school, and it proved to be very effective. Jim Clark spoke to us back before Netscape Communications was even a company. Steve Jobs gave a fireside chat at my house. The High Tech Club had at least one great speaker every week, for two years.

Long after graduation, the classmates constitute a business development and partnership network, as well as a security-blanket employment network. A couple of years after graduation, when several of them are looking for new jobs, they often turn to their classmates for leads and introductions. One of the most important jobs of the venture capitalist is to serve as matchmaker-for corporate partnerships, team building, customer contacts, and follow-on financing. Business school contacts prove invaluable.

A time to dream

School is refreshing; it provides a time to think, a time to reflect, and a time to interview. For me, the transition into venture capital took 60 interviews across 15 firms, and countless informational interviews and background research. It was a process I might not have undertaken while employed elsewhere. Business school provides a spectacular opportunity to pursue the career of your dreams.

If you are an Internet executive or an entrepreneur with a great idea, I would not advise stepping out of the market for two years to get an MBA. The opportunity cost is too great. But if you are looking to break into the industry or explore new careers, business school can open doors and accelerate the process. To find your calling in life is priceless.