The Best B-Schools for StartUps?

Which business schools have produced the most entrepreneurs?

A new LinkedIn study, published today (Sept. 1), studied the backgrounds of members who identify themselves as startup founders and came up with the leading schools for entrepreneurs.

The results dramatically differ from the two most-cited yet deeply flawed rankings—Princeton Review and U.S. News & World Report–of leading entrepreneurial programs. In effect, by sifting through its more than 120 million member profiles, LinkedIn has produced the ideal “put up or shut up” analysis. It’s the kind of data that calls out schools that have made entrepreneurship a marketing or promotional vehicle vs. those that have produced actual startup entrepreneurs.

LinkedIn membership data shows that Stanford, Harvard, MIT Sloan, Berkeley’s Haas School, and Dartmouth College’s Tuck School are the five schools that have produced the most startup founders. The next five are Wharton, Columbia, Babson, Virginia Darden, and the Johnson School at Cornell University.

How surprising are these results? Babson, which has long been number one in both rankings, does no better than eighth place. Tuck, which fails to make the U.S. News list of 27 schools or the Princeton Review list of 25 schools, is firmly in the top five. Columbia Business School, which doesn’t make the Princeton Review list and comes in at 19^th on U.S. News, has the seventh largest number of startup founders in LinkedIn’s database. Chicago Booth, which is ranked second by Princeton Review, doesn’t make the LinkedIn list at all. Neither does Michigan, Brigham Young, or the University of Arizona, all schools in Princeton Review’s top five.

A side-by-side comparison (below) of the LinkedIn list with the two other rankings tells the story well. Seven of LinkedIn’s top ten schools don’t even warrant a mention in the Princeton Review ranking. LinkedIn’s number one school, Stanford, ranks a mere eighth on the Princeton Review list. Two of LinkedIn’s top ten schools don’t make the U.S. News list even though it rates 27 schools.

Source: LinkedIn study, U.S. News, and Princeton Review

Of course, not every entrepreneur may have a LinkedIn profile and even those that do may not fall within the parameters of the professional network site’s methodology. LinkedIn counted members who identified themselves as founders or co-founders of U.S. companies created after 2000, with a LinkedIn company profile, and that currently has between two and 200 employees. LinkedIn excluded small law, consulting and real estate firms, as well as LLCs. Using these guidelines, LinkedIn came up with a pool of more than 13,000 entrepreneurs for its survey.

The LinkedIn ranking is not based on raw numbers, but rather on “how ‘over-represented’ those schools are among entrepreneurs,” according to Monica Rogati, a senior data scientist at LinkedIn who did the analysis. “This levels the playing field for small schools, as you have noticed but it makes it less surprising, which is why I wanted to mention it.”

This compares with U.S. News, which simply asks b-school deans and MBA directors, to rank schools on the basis of their entrepreneurship programs—even though they have no direct knowledge of those programs. Princeton Review, meantime, may as well pull its results out of a hat. Its methodology is so unclear and unspecific that it is hard to say exactly how the ranking is put together. It supposedly attempts to measure “academics and requirements,” “students and faculty,” and “outside the classroom.” (Our critique of the ranking was published last year.)

That’s why the new LinkedIn list has more gravitas–because it is based on real results—not what a few deans think about programs for which they no knowledge or some voodoo methodology by an organization that refuses to properly disclose how it comes up with a ranking.