How to account for Harvard’s exceptional track record in startups? After all, when most people think of Harvard Business School, they think it’s the training ground for big time CEOs. But Tom Eisenmann, the faculty co-chair at Harvard’s Rock Center for Entrepreneurship, credits HBS’ dominance to curricular and extracurricular offerings. Every Harvard MBA gets trained in entrepreneurship in their first year, no matter what they actually plan on doing. “Everybody learns about entrepreneurship,” Eisenmann explains. “And it’s not just startups. We view entrepreneurship as a way of managing, where you’re starting and building something new and facing a lot of uncertainty, and facing resource constraints. That’s true in all sorts of organizations.”
B-SCHOOL CONTINUES TO BE A ‘SAFE-SPACE’ FOR IDEATION AND EARLY STAGE TESTING
Still, the two entrepreneurial Goliaths showed some vulnerability, dropping to a combined 65 ventures on the list, compared to 71 last year. Schools such as Columbia Business School, which leapt from two ventures on last year’s list to seven this year for the third most of any school, have shown some recent entrepreneurial prowess. Meanwhile, MIT’s Sloan School of Management fell from 10 startups last year to a half dozen this year. Pennsylvania’s Wharton School held steady with five ventures.
School rivalries aside, business school has become an ideal habitat to incubate and test new business ideas. “The MBA is a safe environment to experiment,” Ponzo insists. “You can spend a year-and-a-half or two years trying to start a business, meeting people, finding engineers, testing your hypotheses, trying your products online. If things don’t work out, what’s the worst case scenario? You’ve got this amazing degree that’s going to allow you to get a job. You’re imminently employable. You’re 27, 28, 29, you’ve still got a long way to go.”
Not only are more students entering MBA programs to start businesses, they are more frequently partnering with students in other schools and departments from computer science and engineering to medicine to create their startup teams. “That helps not only with the viability of the business but also with the creativity,” says Ponzo.
SCHOOLS ALSO PUMPING SEED MONEY AND CAPITAL INTO THESE VENTURES
Besides providing the training and space for early stage entrepreneurship, schools are increasingly pumping resources into helping students get their ventures off the ground. At the Wharton School, it’s not uncommon for students to receive a little seed moola for their ventures. Karl Ulrich, Wharton’s vice dean of entrepreneurship and innovation, says “virtually anyone” at the school can receive anywhere between $25,000 and $100,000 and sometimes up to $350,000 in equity-free university funds to fuel their startups. At Wharton, the funds largely come from alums.
At Harvard, Eisenmann sees students gaining valuable entrepreneurial skills and business fundamentals in an accelerated way. “You can learn this stuff over time with great mentors and teaching yourself, but I don’t think there’s any question an MBA can accelerate all of that learning,” Eisenmann believes.
Still, many early stage founders and leaders would argue that entrepreneurial success and impact goes well beyond how much dough a team of entrepreneurs can convince investors to dish out. The University of California-Berkeley Haas School of Business stands firmly in this camp. Despite sitting across the San Francisco Bay from the epicenter of the venture capital world, none of the school’s MBA startups cracked the list. That’s largely because the vast majority them are the result of bootstrapping, not substantial venture funding.