What It Now Costs To Get A Top MBA Degree
Maria |
December 7, 2021

It’s no secret that getting an MBA is expensive, but how much money do you actually need for an MBA degree?

 In this episode of Business Casual, Maria, John, and Caroline will not only give you an estimate of how much money you’ll need to have a degree, but they’ll also explain why an MBA is a good investment for your career in the long run.

Episode Transcript

[00:00:07.210] – John

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. Caroline, of course, is I cofounder of Fortuna Admissions, the MBA admissions consulting firm and a former director of admissions chief of admissions at INSEAD. And Maria, of course, is the founder of Applicant Lab, which is sort of a do it yourself tool software program to help applicants guide them through the process of applying to a top school. We are going to talk today about something that we do every year at Points and Watch, which is to assess the cost of a top MBA program. Every year we look at the top 25 and see what it costs to attend, not only in tuition, but the estimates that schools provide on room and board and the additional fees that they tack on to tuition. You’ll be not surprised to learn that obviously an MBA for a top 25 school is a major investment. I’ve always said that once you toss in the opportunity costs of forgoing your earnings, you’re looking at larger than any other purchase in your life outside of a home.

 

[00:01:28.370] – John

And this year I would say the top school is in New York City. It’s actually NYU Stern. The two year cost in tuition, room and boarding fees is $243,000. Stanford is next because we know how expensive it is to live in California. The total cost there is about $240,000. Dartmouth Tuck, 238,000. Same at Columbia, MIT 236. Interestingly enough, there are nine schools where the costs are higher than Harvard Business School. Harvard right now is priced at $223,000. I always think that one of the interesting things about these numbers is that when you look at the estimated room and board and fee costs in addition to the tuition, you can make the argument that, well, look, for two years, you’re going to have to pay room and board somewhere anyway. So what doesn’t matter. But most of these estimates that are provided by the school are for let me call it a conservative lifestyle. At many of these elite schools, MBAs live a very rich life going out for drinks and expensive restaurant meals. And maybe many people don’t want to live in a graduate dormitory. They would prefer to share an apartment or have their own apartment, which really significantly increases all of these price Tags on a degree.

 

[00:02:59.450] – John

So let’s start with Maria. How do you make sense of this? I want to kind of put these numbers into some sort of context. If I’m looking at $243,000 to get an MBA from NYU Stern, and I’m not even thinking about the loss of my earnings for two years, how do I get my head around that and say, yeah, this is worth it?

 

[00:03:24.740] – Maria

I think you look at it the same way you would look at any long term investment where there’s an enormous capital outlay up front and the expectation or hope is that you will recoup that in the decades that follow. So I think most people who get MBAs ultimately do acknowledge, even if they didn’t love the experience as much as they were hoping, even the most sort of disgruntled and grumpy graduates will acknowledge that their earnings potential has been pretty significantly increased as a result of doing the program. So my quick answer is look at it as you would you compared it to a house, right. If you buy a house and you live in it for 30 years. Yeah. It’s going to cost a lot upfront. But think about how long you will be benefiting from that purchase.

 

[00:04:12.410] – John

Yeah, that’s really true. And you think about the appreciation that you’re going to get from it. And in this sense, the appreciation is not merely the bump you get when you graduate, but really the bump you get throughout your career because every percentage increase on a bigger basis is very significant. The other big thing is there are opportunities that you will have with the MBA that are otherwise not available to you. A good example, frankly, would be firms that really rely on business schools for their talent pool. So McKinsey Bain, BCG, right off the start, where the starting salary is $165,000 with a $35,000 sign on bonus. If you’re an engineer or you’re into marketing or you’re into any field and you want to get into consulting, you don’t have a choice. You have to go to a top MBA program really to get those jobs. So that justify the expense because those jobs are incredibly lucrative. And while you have to work really hard at them, there is an immediate bump that is sustained over the period that you’re working at A, McKinsey, Bay and BCG or Deloitte or any other major consulting firms, for one thing.

 

[00:05:37.840] – John

Caroline, how do you make sense of this?

 

[00:05:40.790] – Caroline

I think, as you said, you have to take a long term perspective on this. And it’s interesting to look at some of the data on return on investment. And the Forbes ranking is based on purely financial data. Right. Return on investment, payback time and so on. And it’s very impressive, right. The payback time on these top MBAs is just a few years. We’re not even talking decades. Right. We’re talking single finger years. And so when you think about the return on investment that you will actually generate over an entire career, it’s very impressive. So despite the huge ticket price and that entry to a whole new world looks very intimidating, and it looks like you’re taking a big risk. And I often talk to candidates who are thinking about applying, not even sure about applying because they’re so concerned about taking on that financial risk that is unsecured. Right. And if you buy a house, you can sell the house and you’ve got an asset, but you’re investing in yourself. And so it’s much more intangible and can feel much more risky. But as Maria said, it’s very rare that anyone regrets going to business school.

 

[00:06:59.070] – Caroline

And if they do have some regrets, it’s often about the choice of community or the place that they were and not about the whole idea of doing an MBA and whether that had a payback for them in their career. So I do think it’s still important to find the right fit for you and to get into the best school that you can, where you feel you will be able to achieve your goals. And sometimes I speak with people who get into multiple programs, and then they’re lured to a program that was not their top choice because of scholarship offers. And it can be very difficult to turn down a generous scholarship and to then take on the financial risk yourself of going to the program that was the one that you actually had your heart set on. But I always advise candidates to take, if possible, to take some of those financial elements out of the decision and think about really which school is the best fit for you, where you feel most comfortable, where you think which environment is best suited to enabling you to achieve your goals, because at the end of the day, you will pay those loans back, you’ll get the return on investment, and that’s something that will stay with you about that experience and the alumni network and so on will stay with you for the rest of your life.

 

[00:08:21.880] – Caroline

And so I think sometimes candidates are too focused on the short term of the calculations and how much it’s going to cost them, the size of the loan they have to take out and scholarship offers and so on. And I wish often that they were less influenced by those. And I know how difficult it is when it’s such a huge amount of money. But I always encourage them to take a long term perspective, and it’s possible not give too much weight to the financial considerations.

 

[00:08:49.850] – John

Yes. And as you mentioned, the other aspect of putting this into context is scholarship or fellowship aid. The schools are in literally an arms race to offer discounts on these numbers. So you can consider these numbers sticker prices. And if you look at what kind of fellowship or scholarship is available to people at most schools, it’s considerable. And there are MBA programs, to be totally honest about this, where almost every person gets a scholarship and many people get a free ride, and those tend to be not the best program. Sure. Those tend to be smaller programs where schools want to maintain a certain leadership position on a ranking, and they’re literally paying for their students better students to come than they would otherwise get. But you can get a really good deal at some of these schools. And then even at the best schools, they’re quite generous. So let’s look at Stanford. The average fellowship at Stanford is $42,000, a year or $84,000 in total rewards over a two year period. At Harvard, the average fellowship is just under 40 grand a year, or roughly $80,000 total, and half the class gets it. So that’s an extraordinarily large amount of discounting that’s going on at Stanford and Harvard.

 

[00:10:19.910] – John

And yes, these schools have large endowments, and yes, these schools tend to be among the most generous. But a lot of the other schools then have to basically anti up to be in the competition for the best applicants. And there are a lot of schools that have hundreds of scholarships, grants, fellowships, and awards. Ucla is one. Berkeley annually spends millions around it’s relatively small MBA cohort. And when you look at this many times, you can apply for aid, and it doesn’t take a lot of extra effort either. So it’s not like this is something that should be all that time consuming. I think what Caroline mentioned about people taking offers that they might not otherwise accept because of the scholarship award that’s dangled in front of them so that they don’t have to borrow as much money. Ultimately, you’re right, Caroline. You’ve got to know you want that degree from that school, and you’ve got to be pretty darn certain about it to pass up a Wharton or a Columbia or Harvard or Stanford and go somewhere else because you don’t want to get heavily into debt. Don’t be accepting an offer. No matter how generous it is, it’s going to turn you away from the dream school, the best possible education outcome that you could get from it.

 

[00:11:54.570] – John

What’s another way to actually weigh these offers? Because I bet both of you in counseling applicants to top schools get involved not only in the upfront process of here’s how you apply, here’s how you increase your odds of getting in, but just as importantly, on the choice issue, because if you have multiple offers and you’re thinking about this and cost is an issue for you, how do you think about it? Is there a framework for this? Maria, what do you advise people?

 

[00:12:24.870] – Maria

There’s a framework, but I would say it’s more of an art than a science. I think that there are so many qualitative elements that should go into your decision. So on the quantitative side, yes, I think you should look at the career outcomes for your desired career from the career placement reports, how many people go into your desired career, talk to the students. How easy is it to get that job that you’re dreaming of? But I also think that there’s a cultural component to each one of these top schools has a slightly different cultural vibe. And I think there’s something to be said for being near your tribe, so to speak, finding people that are more aligned with you. And so I think there’s the quantitative aspect or the quantifiable aspect, like the more hard, tangible aspect of do they offer the classes I want? Do they have the career outcomes I want. But then I think there are also the other things, like the culture, even the location. For example, if you really want to live on the West Coast, it won’t hurt to go to a school on the West Coast because people tend to stay.

 

[00:13:25.650] – Maria

Even if a large percentage of a class does disperse geographically, there is usually also a pretty big chunk that stays in the area. So if you want to live in the Midwest, maybe you do value an offer from a booth or a Northwestern a little bit more than you might an offer from an East Coast school, for example, right?

 

[00:13:46.720] – John

Yeah, totally. And often geography is destiny. There tends to be more of an alumni network around the schools, whether East, West, Midwest, and that helps. It also tends to be certain different sets of companies that may be recruiting at these different schools. So geography is also a real key component of where you decide to go. Are you surprised that the most expensive school just in terms of tuition? Forget room and board, forget the additional fees that schools tack on and expense their students. But the most expensive MBA program in the world today is MIT Sloan $79,000 a year in tuition. Are either of you surprised that MIT would be that high and be number one over Harvard, Stanford, Wharton, Kellogg, Chicago?

 

[00:14:46.850] – Caroline

There’s not a huge amount to choose between them, is it? I don’t know exactly how the schools calculate this, but it also depends what it is included. Sometimes there are different things that are included in the tuition, different additional cost. So I don’t think those small differences are going to make a big difference at the end of the day to the total cost of the overall experience. And I think that location plays in more to the calculation of cost because there can be a big difference in paying rent in Palo Alto versus some other Metropolitan areas.

 

[00:15:26.130] – John

Right.

 

[00:15:28.290] – Caroline

There’s a cluster of tuition fees, and they’re all fairly close together.

 

[00:15:33.450] – John

Yeah. And the exception would be among the top 25 schools. It’s probably not a surprise. The least expensive opportunities are all at public universities, right. So if you look at Indiana, Kelly, it’s 52,000, University of Washington, the Foster School, 54,000 a year. Ut Austin, MCCOM is $58,000 a year compared with at the top, MIT at 79, NYU at 79, Dartmouth at $78,000, Columbia at $77,000. So you’re looking in that case at a $20,000 a year difference or $40,000 over the two year period. But obviously it’s a reputational, image or prestige game. The brands like MIT, Stern, Dartmouth, Columbia, Kellogg, Wharton, Chicago, Stanford, Yale obviously have more pricing power than Indiana, Washington, UT, Georgetown, or Rice, all of whom have among the top 25 MBA programs. The more affordable price Tags. Is the premium worth it? Do you remember how much you paid for your MBA, Maria?

 

[00:17:00.270] – Maria

I don’t. I think I blanked it out of my head. But to Caroline’s earlier point, even I who went into the startup world right after business school. And so my monetary compensation was not as high as it was for some of my classmates. Even I was able to pay off my debt fully, I think, within ten years. And so you really are able to pay it off. It’s not as daunting once you actually graduate. I think the premium is worth it. A difference between, say, in Indiana versus a Sloan. I would pay that difference.

 

[00:17:37.530] – John

Yeah. Now, I do know that you remember how much your room and board was at Harvard Business School.

 

[00:17:43.330] – Maria

Yes, that’s the room because I was in a dorm, a teeny dorm room that was only slightly wider than the twin bed that was in it cost, I think it was $700 a month, but that did not include food. So there was a cafeteria on campus where I ate most of my meals. And so obviously that would just add up depending on what I chose to eat in a given day.

 

[00:18:10.350] – Caroline

But yeah, I do believe that Maria was on bread and water.

 

[00:18:16.230] – Maria

It was more like Mountain Dew and coffee.

 

[00:18:21.080] – John

This is before the Raymond noodle, phenomena, right?

 

[00:18:24.930] – Caroline

Energy bars.

 

[00:18:26.020] – John

Ramen.

 

[00:18:26.690] – Maria

Exactly. Oh, man, I could have really used some energy bars back then. Would have been pretty transformative.

 

[00:18:33.190] – John

As a point of contrast, the rooming board at Harvard Business School is $30,270 a year and the highest rumor board is at Stanford, where it’s $34,806 a year. Now, the argument on this, like I mentioned earlier, is that, look, you’re going to have to pay room aboard somewhere. So that’s an expense that you’re already incurring to incur at a business school. The only difference is that you’re not having income to help pay for it, but you obviously have to have that expense no matter what you do. Caroline, you’re going to make a point.

 

[00:19:10.550] – Caroline

Yeah. So I wanted to put in a plug, if I may rather shamelessly for the one year program. Absolutely.

 

[00:19:19.930] – John

I was going to ask you, Caroline, how much you paid for your one year MBA at INSEAD.

 

[00:19:26.430] – Caroline

God, I mean, like Maria, I can barely remember. I think it was something in the €40,000 and now it’s about €90,000. So it has gone up considerably. So that’s about $100,000. But the payback is fantastic at this one year program. So we mentioned the Forbes ranking, which is based on financial data, and Stanford and Chicago at the top there with a four year payback and IMD, which are at the top of IMD and Insured at the top of the Forbes ranking. It’s about two and a half years to pay back. So it’s difficult to argue with a financial proposition of these top one year programs because it does make a tremendous difference if you are incurring living costs and paying tuition and foregoing your salary for one year rather than two. It’s very powerful formula and I know that a lot of people apply to these programs with the intention of being able to leverage that more efficient format and therefore benefit from those cost savings. And that’s a huge part of the value proposition of these programs. And it’s great for attracting candidates from around the world because a lot of the students of these programs have not been earning US style salaries before they go off to business school.

 

[00:20:59.310] – Caroline

And so you’re working in India or you’re working in some other parts of the world emerging economies where salaries are much lower, regardless of how prestigious your job is, you just don’t have the same savings.

 

[00:21:16.430]

Right.

 

[00:21:16.830] – Caroline

So it makes a tremendous difference for those candidates to be able to get the full MBA experience and achieve their career goals in one year rather than two. It’s a very powerful value proposition.

 

[00:21:30.690] – John

Yeah, that’s really true. And as you pointed out, the ROI on those degrees, based on the calculations, reports does is exceptional. So you were saying the latest data shows it takes four years to get the payback on a Harvard or Stanford degree, how long you get on INSEAD.

 

[00:21:52.630] – Caroline

So it’s 2.7 years for IMD, and it’s 2.6 years for 2.4 years for Cambridge Judge. So, I mean, that’s very fast.

 

[00:22:02.120] – John

Exactly. That’s really a good point. The other thing you should know, though, is that generally one year programs in terms of scholarship aid tend not to be as generous as some two year programs because they don’t need to be because they’re more affordable to begin with. So that’s also a thing. I think it’s so hard for someone to make decisions on the basis of cost because the sticker prices are not the real prices. And it’s not about your negotiating power, really, because there’s a bit of a black box when it comes to how much aid you can get from a school. So you apply and you kind of don’t know what it’s really going to cost you until you get that offer back. And while some people have some negotiating power, it’s pretty limited, really, because the schools don’t want to get into a fight for you with another school bidding against each other. That is rare when that happens, if it happens at all at some schools, because most schools refuse to do it at all. But it is hard to make this decision totally unclosted. You just don’t know what the final price is going to be.

 

[00:23:16.980] – John

The other thing is with the two year program, you’re going to have that summer internship, so you’re going to be earning some cash. And those numbers are on our side as well. What insurance are paid at different firms in different industries, and that takes down some of the sting of the price tag as well. I think all three of us come down on one point here. We totally agree that it is worth it. The numbers are shocking. Yes, the costs are significant, but all three of us believe this is a top school, a no brainer investment. Still. And if you look at the outgoing data right now, today the Wall Street Journal finally caught up with stories that we’ve been running for three months, that salaries for MBAs are record levels, jobs are plentiful, sign on. Bonuses are pretty nice. So it’s clear the rewards are there once you get the degree, go out and apply. All right. Maria and Caroline, thank you so much for this discussion and for all of you out there. Yeah, the price is high, but it’s worth it. All three of us agree that the top MBA from a great school is a no brainer investment.

 

[00:24:41.630] – John

Sure. When you go and you look on the websites and you look at this article that we’ve just published on the cost of an MBA, you might be shocked, but that is the price tag cost. You can probably get a discount through fellowships and scholarships. You’re going to have an internship and a two year program. The payback is going to be four years or even two and a half in a one year program. So we think it’s worth it. We hope you’ll you think it is too. Maria and Caroline, thanks for the discussion. This is John Byrne with Poets and Quants. Thanks for listening to Business Casual our weekly podcast.

 

The Economist Dis on MBAs: Is the Degree Still Worth It?
Business School News | General | P&Q Podcast "Business Casual"
What It Now Costs To Get A Top MBA Degree
Maria |
December 7, 2021

Episode Transcript

[00:00:00] John Byrne: Hello, everyone. This is John Byrne with Poets& Quants. We have a really cool story to relate to you today. Me and my co host, Maria Wich-Vila and Caroline Diarte Edwards, are going to talk about the most disruptive MBA startups of the year. Every year, Poets& Quants invites the top schools all over the world.

To submit nominations for ventures with what we call the greatest potential for lasting beyond business school. So what we want to do is acknowledge MBAs who have launched really cool companies that are paving the way for the future. And this year, we have 41 student startups that we have honored in what is the sixth annual list of the most disruptive MBA startups.

And they come from all over. We got nominations from Stanford, Wharton, Kellogg, MIT, INSEAD, London Business School and others. And, uh, I think what the basic list shows is that entrepreneurship is alive and well in business schools are a lot of great ideas. A lot of them are powered by AI. No surprise there.

They involve every imaginable industry. There’s a good number of these in the business of health as well as in beverages, consumer products and things like that. And I wonder, Caroline, if you have a favorite among this group, and I bet you it’s going to be an INSEAD startup.

[00:01:30] Caroline Diarte Edwards: Yeah, I have a few favorites, and definitely INSEAD is on my list, although I’m going to start with a London Business School one.

Um, and there were a few international ones that I thought were really interesting. I like the story from kiro, which is a fintech startup, coming out of London Business School, founded by LBS student Alicia Chowdhury. she secured 200, 000 in funding, and it’s the first AI powered financial coach, which is designed to help,

Gen Zed, as I would say, or Gen Z, as you would say. and young adults, get personalized financial guidance. So that’s something that jumped out to me, given that I now have a young adult among my children and trying to teach her financial literacy is somewhat challenging, so I can definitely see the need for that. And she tells a really interesting story about how financial literacy was something that she had struggled with and realized that there was a gap in the market, right? There’s a lot of great financial information out there, but it’s not necessarily tailored and communicated well to young people. And she ended up working in finance before business school.

she doesn’t have a tech background, but she did. Teach herself the fundamentals of AI and machine learning, and she assembled a technical team to work with her. And I thought it was really interesting as well, how she leveraged the LBS resources. And I think a lot of the stories that you have in this article really tell a great deal about the power of business school experience in helping people launch a company. And of course, there’s often a lot of criticism about the value of going to business school. And if you want to be an entrepreneur, there’s no point going to business school. And I think that this article really debunks that. so for example, this is how she benefited from LBS.

She was a finalist in the LBS Launchpad. She completed the LBS Entrepreneurship Summer School. She joined the LBS Incubator. She led the LBS Entrepreneurship Club. And then, of course, she benefited greatly from a lot of the courses that she took at LBS. I got a lot of great advice from LBS faculty, as well as the Institute of Entrepreneurship and Private Capital.

I think a wonderful story about how a student had a vision of something that she wanted to do and saw a gap in the market and really went after it, leveraging that wonderful ecosystem that you get at business school and she’s got a VC group backing her. So that’s one of her investors and Aviva Group is a huge financial company.

I think it sounds very promising. So congratulations to Alicia.

[00:04:11] John Byrne: Yeah, you’re right. One of the things that comes through here is the support that students get from the schools. And their classmates and their professors, it’s a real terrific thing.

As you said before, a lot of people say, hey, if you want to start a company, instead of paying a school tuition, just use that as your seed capital and you’re going to be better off, but the truth is that a business school you’re surrounded by really smart colleagues and people who’ve been through this before and mentorship from professors and seed money from the many venture challenges that occur at different schools can make a very big difference and shift the odds in your favor of success. Maria, do you have a favorite?

[00:04:53] Maria Wich-Vila: Yeah, my favorite.

startup was Cell Mind, which is out of the Johns Hopkins business school. This one really hit home for me personally. What they are trying to do is they are trying to maximize access to a type of cancer therapy called “Car T”. And I have indirectly lived this. We have a good friend from business school who has been battling cancer for several years, and last year there was a complete rollercoaster around  this car T therapy. And I apologize to any doctors if I’m butchering this. But basically, my understanding is that if it works for you, it essentially can cure your cancer or cause it to go into remission. But, if for whatever reason, if your body is too weak at the time that you receive it, it can actually kill you. Unfortunately, it can cause something called a cytokine storm, I think.

And so, the decision of whether to go or no go is obviously one that is very fraught with a lot of, emotion and risk. And so, we actually had a friend who last year was approved for CAR T. But then in the weeks right before they were going to give it to her, they then disapproved her because she had gotten weaker … it was this whole roller coaster.

And so any sort of startup that is doing something to figure out, which patients actually are likely to do well with this therapy? Can we expand our doctors being perhaps understandably a little too cautious because they’re concerned about the negative side effects, perhaps being worse than the.than the cancer itself.

Anything that can help expand access to this is why they were number one in my book. And as you guys were just talking about. Because Johns Hopkins is one of the best, if not the best medical school in the world, this is a great example of a business school student or group of business school students leveraging the resources and the expertise at that overarching institution, trying to find ways to commercialize it, and just make the most of those resources.

I really loved that story.

[00:06:40] John Byrne: Yeah, and that’s what you increasingly find. it’s not a bunch of MBA students doing their thing. It’s reaching out and having these really entrepreneurial collisions with students from other departments, other schools where they have deep expertise in computer science or engineering or medicine or law or public policy or environmental sciences teaming up with MBAs to launch things. which really give them extra power.

One of my favorites comes out of, uh, Chicago Booth. And, it’s sort

a really interesting idea where, first off, it’s called Encore, and it’s a marketplace for high end collectibles. Now, you think, how could that really be a cool thing? What they’ve done is they’ve combined TikTok style videos. With the traditional eBay auction format, to create a really engaging experience for people who want to shop for these collectibles. But what’scool is the MBA who’s behind this. His name is Will Enema, at first thought he shouldn’t apply to Chicago Booth, new venture challenge, because he had already raised a pre seed round and thought that Encore might not be good for that traditional, giving money out kind of program. But, he entered it after he was urged to by a number of professors at Booth. The idea placed second in the competition. He won $350, 000 to help launch his company, but here’s the real kicker:

Within two weeks of that competition, a venture capitalist who participated in the judging agreed to lead their seed round. So it just shows you how, incredible things can happen, in the environment of a business school.

Now, Caroline, I’m sure you have others that you really thought were really cool. Name another one.

[00:08:29] Caroline Diarte Edwards: Yeah. So my second one is of course, an INSEAD startup and it’s called faceflow. ai. And I really liked this one because it’s an AI powered skincare platform. So again, relating it to my personal experience of having four daughters who are constantly clamoring for the. latest ridiculous beauty product that they’ve seen on Instagram.

I think this is a fantastic idea.

What it does is it actually gives you scientifically based product recommendations, right? So they have for the two founders, Daniel Patel and Simon Zhang, Patel had previously founded a marketplace for international skincare brands. So he knew the skin, the beauty industry, skincare products.

And then his partner, Simon, is an experienced AI engineer, and so they’ve combined their expertise to bring AI to skincare recommendations. And it’s underway. I checked out their website. I have signed up already. The product is not yet available, but I’m looking forward to when it comes through.

And they won the INSEAD French competition and, talk about how they’ve benefited from the very entrepreneurial environment at INSEAD,

I really enjoyed reading about their experience and I’m excited to learn more about their products.

[00:09:49] John Byrne: Yeah, absolutely. And now

Maria, I know there are 2 Harvard startups on the list from your alma mater. did you pick 1 of them as your 2nd choice?

[00:10:00] Maria Wich-Vila: It was not necessarily my 2nd choice, but there was 1 called Vulcan Investments. This is a little bit out of my, Wheelhouse. So I think we all tend to gravitate towards something we know or something we have experience with, but it’s trying to figure out how to solve the rare earth magnet problem. Right now. A lot of these rare earth materials that are powering modern technologies are coming from China, which poses several challenges, especially should relations with that country not go well in the future. So this is trying to solve for that issue. I think that was a really interesting one.

But actually, my second choice was one that again, I have indirect personal experience with, albeit in a different way. It was called Yogger. What they’re trying to do is, I believe it’s taking your phone to watch you as you perform exercise then give you feedback on, your gait, your form, et cetera.

And this was really interesting to me, not so much because of exercise, although I wish it were (ha ha) (though: side note, my dad was a track and cross country coach for decades and I totally forgot about that in the moment, but I should have mentioned that!!! D’oh!!!), but who knows, maybe this will motivate me to jog more (har har har).

In the interview with the entrepreneur. he talked about how you can do things like a gait analysis right now, in other words, tracking how your legs move when you are running or jogging, and then providing an analysis, but these sorts of things are very difficult to get to. It’s expensive. You need to be set up with, they put a whole bunch of sensors on all of your joints. and I have a friend who has a child with cerebral palsy and they’ve had to do these, go to actually Hopkins (this is not a Hopkins based startup, it’s from Tuck, Dartmouth Tuck), but they’ve (my friends, I mean) had to go to Hopkins and actually have these, it’s a day long thing to set up your child with the different sensors. And so the thought of using something as simple as an iPhone app, perhaps, machine learning, et cetera. all that good stuff to analyze your gait and make this accessible. It’s not only I think useful for casual exercise enthusiasts, but I think it could also have ramifications and uses even in other areas. For example, kids with special needs. So I was really excited about this one.

John Byrne:

MIT Sloan has three startups on our list this year.

That’s more than any other school. And one of the really cool ones is called Vertical Horizons. This is an incredibly ambitious startup. It’s all about commercializing high density, high efficiency power supplies for AI computing. Essentially, it’s a semiconductor company. and you might not think that an MBA would be involved in actually creating a semiconductor company.

But it’s founded by Cynthia Allen, an MBA in the class of 2024 at Sloan and one of her professors. So it’s a good example of where university develop some sort of new technology or new insights. And then needs to commercialize it. And in this case, you have an MBA coming along, who has a great interest in this, and is helping to commercialize it. The actual idea of it has 4 million in research grant funding to develop the technology. So there’s a good amount of money behind this very ambitious idea.

I think, stepping away from the individual startups, what I think this says about, the ability of people who want to go to business school and use that experience as an incubator to launch a startup, it’s alive and well, it’s a great way to launch a company because it does take a lot of risk off the table and these startups, these 41 startups that these different business schools really give you a great insight into what different people are doing.

Caroline, I’m sure, and Maria as well, you probably meet a number of people in your practices, that want to use an MBA to do a startup. Do you think they’re ready to take full advantage of these experiences?

Caroline Diarte Edwards:

Yeah, I certainly hear from a lot of candidates who are hoping to launch a venture. Some of them want to do it as soon as they graduate and for some of them it’s more of a longer term ambition because of course financing can be a challenge.

Especially if you’ve invested a lot in taking on a lot of debt with your MBA and a lot of the themes that I hear, candidates are interested in come through in your article as well. So it’s noticeable that there are quite a few startups in your list that address, healthcare issues as Maria highlighted, also education, environmental challenges. And I think those are three areas that I hear a lot about from candidates in terms of where they would really like to have an impact.

And I think, something else that is noticeable is that a lot of them are really trying to have a positive impact on the world as well. They’re really trying to address,  fundamental societal challenges, many of them, which I think is wonderful from health care, mental health issues, pollution. et cetera. There’s a lot of really interesting, and important issues that are being addressed by some of these startups. and, I think it’s wonderful that we have this young generation, going through business school who are ready tackle these challenges that that they have inherited from our generation.

John Byrne:

Yeah. And these ideas are going way beyond, some of the earlier ideas of five, 10 years ago, hookup apps and match.com, uh, wannabes and things like that. some of these ideas are remarkably sophisticated and elegant as well.

Maria, last words.

Maria Wich-Vila:

I think that this article not only is very optimistic in terms of these amazing ideas that are out there, but I also like that it shows that there are so many different paths to entrepreneurship through the MBA that first of all, number one, the NBA is valuable for entrepreneurship, which, as you noted a second ago, is often a stereotype that that exists that, oh, I don’t need this. but also there are so many different MBA programs out there. Look at the range of schools that are creating these amazing startups. Look at the fact, one of the, Stanford ones, the student was not an MBA student. They were an MSx student.

Sometimes I’ll meet people who are a little bit on the older side who are applying and they’re like, I have to do the two year program and I’m like, no, you can… you just need to get your foot in the door and even if it’s that MSxs program, it’s one year versus two years. For example, you can, you just need to get to a university that’s going to teach you the things you need and give you the resources and then you can take it from there.

So I, the other thing I really appreciate about this article is showing the breadth of programs and the breadth of students and the breadth of backgrounds of these students who are creating incredible new companies.

[00:16:37] John Byrne: Yeah, check it out. It’s called most disruptive MBA startups of 2025, and it’s on the Poets& Quants website.

If you are interested in doing a startup, I think you’ll learn a lot about how business school can help you make it a reality. This is John Byrne with Poets& Quants. You’ve been listening to Business Casual, our weekly podcast.

Maria

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