Those in the B-school entrepreneurial know will notice something slightly different about this year’s Poets&Quants’ Top 100 MBA Startups. The oddity? There is not a single startup founded by an MBA from UC-Berkeley’s Haas School of Business. Yes, Berkeley-Haas has a relatively smaller MBA program, with just 248 in the Class of 2015. But the school rests in the middle of Berkeley–arguably the epicenter of American liberal progress and out-of-the-box thinking and dreaming. Not to mention, it rests across the San Francisco Bay from oodles of startups and venture capital firms.
Just wait, says Rhonda Shrader, director of the Berkeley-Haas Entrepreneurship Program. “You may not have Haas companies in your top 100 this year, but I would definitely stay tuned,” Shrader says. “There’s a lot cooking in the background.” And Shrader’s absolutely right. The Class of 2015 boasted 31 graduates, or 12.5% of the entire class, who launched their own companies–a massive jump from the six graduates that did the same in the Class of 2014.
Shrader, who graduated with an MBA from Berkeley in 1996 and lived through the dot-com boom and bust, is no fan of the quick cash grab. “You can’t control that,” Shrader says of the amount of venture capital cash flying around at the moment. “So we tell the entrepreneurs to control the controllable. Focus on building a sustainable and scalable business, with the fundamentals in place. That’s going to serve you so much better than a quick hit of cash.”
DON’T EXPECT ANYMORE FOOD DELIVERY APPS OR SNAPCHATS FROM BERKELEY-HAAS
It’s certainly served quite a few Berkeley-Haas alums well. Consider, Kristin Richardson and Kirsten Tobey, who have delivered more than 150 million healthy meals in schools around the country since founding Revolution Foods in 2006. The duo developed the business plan and founded Revolution Foods while at Haas and scaled for four years before earning their first venture round of $20 million at the end of 2010. They’ve now raised nearly $100 million.
Shrader says that in addition to building a scalable and sustainable business, bootstrapping allows the owners to remain in control of the company. Shrader says she has a “hunch” that bootstrapped companies typically have a better longevity than those that have gone out for large amounts of funding.
In an interview with Poets&Quants, Shrader talks more about what Haas is doing to stay true to business fundamentals and create sustainable businesses. She speaks about what’s on the horizon for changes in the Berkeley-Haas Entrepreneurship Program and why you won’t see anymore food delivery apps or Snapchats coming out of Berkeley-Haas.
There were no Haas ventures to make our Top 100 MBA Startups list this year, but we have a feeling you think there have been some very successful recent startups to come out of the Haas MBA program. What are some other indicators and measures of success for an early stage startup you and your team look for besides VC funding?
Number one, sales. You can’t argue with that. I think in terms of the funding question, I definitely don’t see that as a validation of whether or not it’s a worthy idea. Some other methods I look at are sales and sale productivity per employee. How many customers you have. That’s an indicator of your base and your sales for the future. I think those are all very important. You may not have Haas companies in your top 100 this year, but I would definitely stay tuned. There’s a lot cooking in the background.