In the latest episode of Business Casual, the hosts dive into the recent appointment of Erin Nixon as the new head of admissions at Stanford Graduate School of Business. They discuss Nixon’s unique background, which combines her experience as a wine bar entrepreneur in Barcelona with strategic roles at BCG and LinkedIn. This eclectic mix might signal a new openness to non-traditional candidates at Stanford.

The hosts explore how Nixon’s diverse experiences and her status as a Stanford alum could influence the admissions strategy at one of the world’s most selective MBA programs. They speculate on the potential changes and innovations she might bring, emphasizing her deep understanding of the global business landscape. Tune in for an engaging discussion on how leadership changes can impact MBA admissions and what future students might expect under Nixon’s guidance.

Episode Transcript

John (00:04)

Well, hello, everyone. This is John Byrne with Poets and Quants. Welcome to Business Casual, our weekly podcast with my co-host, Maria Wich Vila and Caroline Diarte Edwards. Big news at Stanford Graduate School of Business. They finally named, and this is after many months, and a big international search. They finally named a successor to Kirsten Moss, who stepped down from her job as the head of admissions at Stanford back at the end of 2022. So here we are, nearly a year and a half later, and Stanford has a new person. Sort of unusual because this new person, her name is Erin Nixon, had actually founded and ran a popular wine bar and restaurant in Barcelona. Now, you might not think that that would be the ideal background for the chief of the most highly selective MBA program in the world at Stanford. But Nixon also brings a compelling mix of work experience to the job. She did Stints at the Boston Consulting Group and at LinkedIn. She’s also worked as an advisor to startups, and she will begin her new duties on July 1. Obviously, she is an alum. She earned both her undergraduate degree in economics and an MBA at Stanford in 2010.

John (01:41)

She’s returning to campus for a role that she clearly wants. Now, Caroline, having been in this role at INSEAD, what do you make of her background? I’m trying to think, will she be even more embracing of non-traditional candidates, giving her own detour out of the more typical MBA jobs and basically fulfilling a lifetime dream to open up a wine bar and become a wine entrepreneur.

Caroline (02:14)

Yeah, absolutely. I think she’s got a really interesting mix of experience. So she has, as you said, she’s been an entrepreneur. Launching a wine bar sounds like great fun. I’m sure she’s got some wonderful stories to tell about that. She’s also been a consultant, which is a great training ground. She would have got a fantastic breadth of experience during her time at BCG, and she’s got some interesting experience from LinkedIn as well, which I think would have appealed to the school. I also like the fact that she has worked internationally as well. So she’s worked in London, she’s worked in Amsterdam, of course, in Spain with her wine bar. I like that international diversity as well, and I think that’s a great addition to her profile, given the global appeal of Stanford GSP. So I think that she’s got a really interesting background. And it’s obviously taken them a long time to find her, right?

John (03:12)

It’s like two years, right?

Caroline (03:14)

I think, roughly, since Kirsten Moss left or announced her departure. And I know they spread a very wide net. I can hardly move in Silicon Valley without bumping into someone who they asked if they’d be interested. But they had signaled that they wanted an alum. And so she’s got a fantastic Stanford pedigree with her undergraduate degree as well as the business school degree. So they’ve got that. And it’s difficult for them to recruit a Stanford alum, right? Because they are victims of their own success. Their alumni are command often quite extraordinary salaries here in Silicon Valley. So quite difficult for an educational institution to compete with that and to attract someone. So I think she looks great. I’m excited to see how things go. I hope she doesn’t make any dramatic changes or do anything too quickly because I think she’s joining this summer. So I doubt it would have much of an impact on this coming season in terms of any big policy changes or changes to the application. But it will be interesting to see how this plays out in 2025. I would imagine after she’s got her fee under the table and got to grips with things then she might look to make some changes.

Caroline (04:32)

So I’m looking forward to seeing how things evolve.

John (04:35)

And I should note that she didn’t just create any old wine bar, the wine bar that she created in Barcelona in the El Born neighborhood. This was in 2018 and ran it until 2022. Within six months of opening, her wine bar was named Best Restaurant in Barcelona by Conde Nass Traveler, Time Out, and a Barcelona newspaper. So who knows? Maybe she’ll be serving a wine at the Stanford Admit events forthcoming. I mean, certainly, the wine country isn’t all that far from Silicon Valley, and she could get some pretty darn good wine to serve to Admit to close them for Stanford. Maria, what are you making of this?

Maria (05:24)

Yes, because the big thing that Stanford has a problem with is getting people to accept their offers. Time to get that yield rate up to 99%. Yes. No, look, I think it’s wonderful. I think it’s interesting the talk of whether or not she’s qualified. I’m like, I don’t know if she’s qualified, but I want to be friends with her.

John (05:44)

Yes, she sounds like a really interesting person.

Maria (05:47)

I know, Erin, if you’re ever in LA, I’ll look you up. No, but seriously, I think the wine… The feeling that I get is that she was very hard driving and hard charging. BCG before business school, sponsored to go back to business school, buy BCG, then return to BCG. This one little line jumped out at me on her LinkedIn profile. She said that she overhauled BCG’s recruiting efforts at Stanford. That, to me, says a lot because, first of all, I think it must It’s very difficult for any of the consulting firms to get people to join from Stanford who were not already being sponsored. This idea of putting on her recruiter’s hat and also putting on the hat of, I’m a Stanford student looking to find my post-graduation job, having that perspective of both being a student looking for a job and a recruiter looking to hire people from the school. I think both of those lenses are really valuable. Then at LinkedIn, it looks like she may have been working with the aspect that is trying to get recruiters, for example, perhaps, to purchase the LinkedIn premium. All these companies have such an opaque name sometimes for their different divisions.

Maria (06:59)

But to the extent that LinkedIn is the world’s largest job recruiting platform, I would assume that even by osmosis spending so many years there that she would really start to also get a sense of, Okay, what are people looking for? What makes for good careers? What makes for people who are successful in the workplace? Even just tangentially by even looking at trends at LinkedIn. I think that that’s really interesting. I also like that she… I would guess she left LinkedIn in 2017, which would have been I think Microsoft acquired LinkedIn in 2016. It was a pretty big acquisition. I have no idea if she made a nice little bit of money on her stock at that point. But it would certainly fit this narrative of, Okay, I’ve worked so hard. I’ve been super hard charging, and now I’m ready to do something completely different and move to Barcelona and open a wine bar. It’s almost like she’s had three different careers in one career. She’s already had the hard-driving consulting and then the tech, fast-growing tech thing, but just so happens to be in the job-searching space, which, again, that’s what I think it makes it different from, say, if she would have worked at a Netflix or an Uber.

Maria (08:18)

To the extent that business school is a people business and they’re in the business of trying to identify future leaders, any exposure to what are corporations looking for in future leaders or what do people who graduate business school and then go out into the world and become leaders? What do those people look like? I think that that’s a really interesting background, almost like an informal PhD in human resources in a sense.

John (08:42)

True. I mean, you don’t really have to be in admissions at another school or even at Stanford to do this position. It’s largely a management and an ambassador position for the school. Of course, she’s not joining as admissions chief of any school. She’s joining a school that has far more applicants than it knows what to do with. I mean, truth is, Stanford has long had the lowest acceptance rate of all the prestigious MBA programs in the world. She’s joining at a time when last year, the acceptance rate at Stanford was 8.4%, even though that’s a third higher than the 6.2% two years earlier, that’s still pretty low because you got to know that people who apply to these elite schools, they are pretty much a self-selecting group. I don’t know what you would find, Maria and Caroline, because I think the general rule of thumb is that anywhere between 60 to 80% of the applicants are actually fully qualified to attend a school that they apply to and probably would do just fine getting through the curriculum and getting a great job. But obviously, very few of them actually are picked. So, Stanford has pretty much held its own, more or less, during a significant application slump.

John (10:24)

We just took a look at acceptance rates yield, which for those who I don’t know, yield is the percentage of applicants who actually enroll at a school after being accepted by a school, and application volume in a story that looked at not only last year, but the last five year trend And the story is one that we’ve talked about a lot on our podcast over the last couple of years, which is a story of generally declining apps and diminished interest in full-time residential MBA programs. And what you see in the data is pretty surprising. Like, Dartmouth Tuck last year accepted over 40% of its applicants. Back in 2021, that was 29%. Columbia Business School, over 22% of applicants accepted, which is still incredibly selective. But two years before, 16%. Yale was up to a third from 24 two years ago. It’s pretty much like that in a lot of other places. Uva Darden, 39%, up 10 points from two years ago. Nyu Stern, 31%, up from 19 two years ago. Chicago Booth up to 33%, and it was 22% two years ago. Now, I will put this into some context because I’ve been in the market quite a bit in the last couple of weeks, and I can tell you that a lot of these schools are telling me that applications have made a real snap back.

John (12:07)

Darden is up 25% through their second round. Yale School of Management is up about 20, 21%. There are other schools that are up around 10, double digit increases. This is data that’s a little bit a year old, but of course, it does take a while for schools to report this information. The numbers that I’m giving you are basically straight from interviews that I’ve done with admission directors. What do you make of the decline in apps here reflected in these higher acceptance rates? Maria?

Maria (12:48)

Well, it’s interesting. It almost goes back to, we were just speaking about the new head of admissions at Stanford. It almost goes back to, I think the schools have a marketing issue on some level that they perhaps have not needed in the past. The alternatives to getting the MBA, whether that’s staying at your job and accepting a higher promotion or pursuing a different type of master’s program. I do think that the MBA, the traditional value proposition of the standard two-year MBA is hurting. I do think that making that ROI calculation, I think students are being much more savvy or much more methodical about thinking through, Am I willing to take out this $200,000 loan? How am I going to pay that back? The costs are so expensive. I do think that on some level, the business schools themselves need to start practicing what they preach in terms of their own marketing and strategic positioning and convincing applicants that this really is a worthwhile suit, a worthwhile use of their time and their money. It just did tie together with our previous topic of conversation. I was like, Wow, if you can launch Barcelona’s most popular wine bar in six months, what can you do then to start?

Maria (14:04)

In addition to serving wine and admin weekend, what else can you do to start to show people like, Look, this degree really is worth it, and you should totally apply because if you get it, it’s going to be great.

John (14:15)

Yeah, exactly. Caroline, your thoughts?

Caroline (14:19)

Yeah. Well, it’s also coming down off a pandemic high, right? So there was a spike of applications triggered by the pandemic. So the numbers that you’re looking at where over the last four years, the acceptance rates were lowest in 2021. So that was triggered by people throwing their head into the ring when everything went crazy during the pandemic and people had time to work on applications. They were getting laid off and so on. So there was a huge surge then, and we knew that that was going to be a short-lived effect, right? And I think also at that time, time, some of those additional applications were from candidates who were not of the same quality as the… These top schools have a steady flow of really good candidates. And when there’s a surge in applications, especially as we saw during the pandemic, the average quality goes down a bit because some of those additional applications are from people who are applying, not because it’s a well-thought-out plan that they’ve had in mind that they’ve been working towards for several years, but suddenly, their circumstances have changed, and they wake up one morning and think, Well, perhaps I should try something else.

Caroline (15:33)

I could apply to Harvard or Stanford or Wharton or wherever. And so it’s more of a spontaneous decision, and they are not necessarily the best-prepared candidates. So when you get that surge, the average quality goes down a bit. So I think that we’re coming down off that pandemic peak.

John (15:53)

Yeah, a really good point.

Caroline (15:56)

For the top schools, they have this very loyal pipeline of really strong candidates. So I don’t think that they worry too much about these fluctuations, although it can be harder for schools that are further down the pecking order.

John (16:14)

Yeah, I mean, the second-tier schools in particular, or those, frankly, outside the top 20 are finding they’re really fighting for their candidates, to be honest, because they’re surprised at the scholarship offers that that some of these applicants are getting from schools. It’s a real fight, particularly down after the top 20 or so full-time MBA programs. Now, Caroline, I wonder, when you were Head of Admissions at INSEAD, if you were to say what percentage of the applicant pool would you really think would be fully qualified to attend and do well in the MBA program versus the % that you were actually accepting, would it be like 60 to 80%? Could probably just go in, do very well, and have great careers, or is it less than that?

Caroline (17:07)

Yeah, it’s around that. At any of these schools, you could throw in a student from that 60-80% range. You could throw them into the classroom and no one would notice, right? No one would think, What is this person doing here? They would fit right in.

John (17:26)

Yeah, because people look at those class profiles, and a lot of opt out when they’re far off the profile. Sure, you get some people are throwing Hilmary passes, and that’s the 20% who probably don’t really have a chance. But most people look at those stats, they do their research, And they’re really good candidates, right?

Caroline (17:49)

Yeah, they are. And that’s one reason why in some ways I don’t envy Erin her job, because it’s horrible to have to turn away so many great people, right? I mean, that was definitely a downside of my job at INSEAD is saying no to people who you knew would be great students and you knew would be very successful. And it’s much worse. That’s 10 times, well, not 10 times worse, but many times worse for her, given the the eye-watering exceptions rate. What is it? 8% right now. So they have to turn away some quite extraordinary young people. And that’s It’s not fun, right? That’s not a fun part of the job. So yes, it’s great to be able to play a role in crafting the class, but it’s also painful to have to say no to people who you know are fantastic and very, very deserving. So she’s got her work cut out for her.

John (18:49)

Now, we also published in this application and acceptance rate story, the yield numbers. And I’ll bring this up because US news, of course, just recently came out with the newest ranking. But as you have heard from us before, I know Maria believes this in particular, that yield rates are more telling than almost any other stat in terms of the quality of the school, because basically, you’re really getting the wisdom of an informed crowd here in the decisions that they make of whether or not to attend the school if they’re admitted. On yield, Harvard is back up to number one. It had lost that position to Stanford in 2020 and 2021. And in fact, in 2021, it lost a position by over 10 points. 83% of the applicants accepted to Harvard in 2021 actually enrolled. At Stanford, it was 94% in that year. Now it’s a bit closer, but Harvard is ahead. 87% of people who are accepted actually went and enrolled. At Stanford, it’s 83%. Those are extraordinarily high numbers in relationship to everybody else. I mean, Duke is at 53%, which is pretty darn good. Columbia is at 56%. Wharton is over 50% as well.

John (20:25)

It’s actually 57%. But some great schools, you’d be surprised at how many people get turned down, rather how many are turning down the school. I think it’s primarily the function of, Yeah, we got into Harvard, Stanford, or Wharton, or another program that we really preferred, and we’re going to go there. Yale, which I think A lot of elite candidates might consider to be something of a safe school if they’re applying in the neighborhood of Harvard, Stanford, Wharton. Only 33.5% of the applicants who are accepted actually enrolled. Dartmouth, Tuck, 37% actually enrolled. Maria, I know you’ve said before, and I mentioned that you like yield numbers because it tells you a lot about the wisdom of that informed crowd that is applying to these schools. After all, these numbers show which programs are most in demand by very highly qualified candidates, right?

Maria (21:27)

Yeah. I mean, to the extent that one even try to rank business schools, which seems like a folly in itself. If you had to choose one metric, it’s an impossible task. But if one had to choose one metric, for me, that metric would be yield, right? Because Because that is where the rubber hits the road. That is where you have to pull out your proverbial checkbook and pay that tuition deposit or move across the country and move into a dorm room, some other country or some other state. So Who actually shows up when you give them the offer? I think that that is a really… Any one of these metrics can be gamed, which is one of the things I dislike about using metrics in general. But I do think if you ask people, if you say to people like, Okay, well, Harvard is now, whatever, sixth in the US news world report. Isn’t that terrible? I don’t know. I don’t have people contacting me and saying things like, Oh, I got into the school that was ranked second or third or fourth in the US news. But, Oh, Thank goodness, I didn’t get into Harvard, my safety school.

Maria (22:33)

It’s such a weird… You can say that this school is first or sixth or eighth or twelfth, but at the end of the day, if someone gets into Harvard, they’re probably going to go. If they get into Stanford, they’re probably going to I don’t know. It doesn’t really have anything to do. You can slice and dice all these other metrics and have them say whatever you want them to say. But I just think, I don’t know. If I had to choose one metric, I stand by that. If In an imperfect world, that’s my one that I stand by.

John (23:03)

Okay, let’s see if I can shake your confidence.

Maria (23:05)

Uh-oh. I’m sure you can.

John (23:08)

Because whenever you’re dealing with numbers, you’re going to find anomalies, right? You always find some quirky results. If you look at yield, would you believe that Alabama’s full-time MBA program has a higher yield than Stanford? Or would you believe that right behind Stanford is Brigham Young University? There are some quirky- Well, but when I think about…

Maria (23:34)

So Brigham Young probably appeals to people who are of the Norman faith, I would assume. That’s true. And so in terms of self-selection, I’m not surprised they have a very high yield because I’m sure that they attract a very specific type of candidate. The same thing with Alabama, presumably that is a school that draws regionally from people who are either currently living in Alabama or want to set up their roots and build their careers within Alabama. If I’m currently living in a certain geography and I want to stay in that geography and build my career in that geography, of course, I would go to the business school that is nearby. I think it would be, yes. I would caveat and asterisk my yield comment considerably. But in terms of the top schools that draw international candidates from all over the world, I still stick with yield.

John (24:25)

Caroline, yield is an important number to an admissions official, right? Because After all, it does suggest, well, who you can land. I mean, it’s almost like if your yield number is really low, you got to be asking yourself as an admissions official, I can’t close these candidates. How come? Maybe I don’t have enough scholarship money. Maybe on our admit events, we’re not doing a good enough job. Sure, you can’t. It’s hard to beat a Harvard or a Stanford, but very few people are getting to accept to Harvard and Stanford in the elite applicant pool, right?

Caroline (25:04)

Yeah, it is very important because you want to make sure that the best people that you’ve admitted are coming to your school. And if your yield is low, then that means that you’re probably losing a bunch of those great candidates. So it makes my eyes water seeing some of these numbers. I was very fortunate. In Seattle, we had very high yield, so typically around 75 % during my years there. That’s excellent. And the idea of having 20 to 30 % yield, you have to be admitting so many more people than you know are going to come to the program. And it must be very difficult to know. Of course, they have the historic numbers and they can predict and forecast and so on based on their experience. But it must be quite demoralizing to be admitting so many people who you know are not going to attend. I think they have quite a tricky job because, of course, you’re trying to craft a class with a certain diversity. And how do you do that if two-thirds of the people that you’re admitting are not coming? What if all of your management consultants drop out or all of your Asian candidates?

Caroline (26:19)

You could end up with quite a skewed diversity because it all depends on who comes and who doesn’t come. And if such a big block of candidates are dropping out, then you have much less control over the mix of people that end up in your classroom. I think managing, crafting the class must be much trickier when you have such low yield.

John (26:40)

Yeah, very true.

Maria (26:42)

I will say that the emphasis on yield, the unintended side effect of that is that I think it leads to waitlist shenanigans, where if I know that, Oh, my gosh, this yield number is going to be scrutinized, then I’m going to put everyone on the waitlist and just reach out to them one by one and say, Okay, hey, if I let you in, will you sign the deposit? Will you come? I’m not going to name schools, but I do think there are some schools out there who are very aggressive with the waitlist and put a lot of people on that waitlist and then quietly come around to them and say, Hey, can we set up a call to answer any questions you might have about being on the waitlist? Then it just so happens that on that informational call, they’ll say something like, If you were to get off the waitlist, what are they accepting What insist do you have in hand? I do think that’s the one downside of the… Again, I said any metric can be manipulated, and that is the one downside of looking at yield. But I do think that it does.

Maria (27:43)

To Caroline’s point, if you’re trying to craft a class and you’re not entirely sure who’s going to show up and who isn’t, just put them all on the waitlist. Then if all of your consultants drop out or all of your candidates from a certain geography drop out, great. Just go to that waitlist and you can manually try to craft it after the fact. But yeah, I don’t end any of these folks in their jobs.

John (28:03)

Indeed. They’re absolutely so, Erin, good luck to you. You were in the cat bird seat there with the lowest acceptance rate on Earth for an MBA program. One of the revealing pieces of the analysis of acceptance rates that we do is we look at the top 10, and we look at the top 10 over a number of years. It It’s revealing because if you look at 2016, so that’s well before the pandemic, the acceptance rate for a top 10 school, this is the total average for top 10, was 14.5%. Last year, it was 27.8%. In 2016, 55,000 people submitted applications to the top 10. That wasn’t even a record. The record in this period was 58,000, which was year 2021 due to the pandemic. But it’s now down to 39,500. Enrollment numbers are down in the top 10 as well. Back in 2016, it was 5,100. There was a peak also during the pandemic era of 5,500, but now we’re down to 4,411 in the top 10. You definitely see that whether you look at it from a pre pandemic level on a top 10 basis, or certainly from the pandemic when there were peaks, there’s been a fairly significant decline, which means for all of you out there, hey, again, it’s another good time to be applying to a fantastic MBA program.

John (29:49)

While this application volume has declined, I’ll tell you what has not declined, the compensation that newly minted MBAs which is at record levels, both in sign on bonus and both in starting salary. It’s still a great degree. It’s a no-brainer degree. It’s a fantastic opportunity for young people who are smart and ambitious and want a meaningful and fulfilled career. Maria, Caroline, and I are just total ambassadors and boosters for the great MBA programs We’ve said it before, we’ll say it again, go for it, go for it, go for it. It’s really worth it. Anyway, check it out, Acceptance, Rates, and Yield at the top 100 US MBA programs, and check out our profile on Erin Nixon, the new admissions chief at the Stanford Graduate School of Business. She will be getting her new job on July 1 as she moves from Barcelona to Silicon Valley. We wish her great luck, and hopefully, you know what I think we’re going to do? We’re going to try to have her on a future podcast so we can get some tips on which wine we should be serving at dinner or while we’re completing our MBA application. Hey, thanks for listening.

John (31:17)

This is John Byrne with Poets and Quants.