Pato Bichara
Founder & CEO
Collective Academy
/
Startup Contributor

Will Tech Companies Replace the MBA?

By Pato Bichara | Fri, 08/12/2022 - 13:00

When people decide to study a masters or MBA, they are usually motivated by three things: learn from people with more experience than they have, grow their network; and gain the credibility and reputation that the institution offers. Ideally, each of these will open new career paths and opportunities for their future.

Over the past few years, I have continued to think about one question: Can working for a startup or technology company drive the same results as an MBA?

If someone were to ask me if I would study an MBA all over again, my answer would be that it depends. On one hand, if I hadn’t studied my MBA at Harvard Business School, our university, Collective Academy, probably wouldn’t exist. We wouldn’t be trying to shake up the educational system of Latin America. But on the other hand, I can see that within tech companies, the opportunities for learning, mentoring and networking increasingly compare with – and in some places are superior to – the experiences offered at traditional MBA programs. (However, when I decided to study for an MBA at Harvard in 2012, many of these tech companies either didn’t exist or had not yet entered Mexico.)

Let’s dive a little deeper into how a business school compares to what a tech company offers team members:

1. Content, training and support

YouTube is the largest university in the world: it has the content, it’s free and it’s accessible.

But then what is the value of a university? It’s an institution that helps you to curate this content and guide you through it while providing a great experience. The challenge, however, for traditional universities, is that despite deep expertise, many professors have more academic than real-world experience.

In tech companies, it’s the opposite: most leaders have deep experience in their industry. The leadership model has evolved from directive leadership to leadership through mentoring and coaching, allowing employees to learn through experiences and achieve their professional goals.

Furthermore, in the executive education programs of our university, Collective, we’ve increasingly seen Latin American companies that want to invest in the development of their people. Our personalized programs are helping many of the unicorns as well as traditional companies teach strategic skills that the organizations and industries require.

2. Networks

I would estimate that 50 percent of the value of an MBA is the network. An MBA can allow you to connect to people who can advance your career to the next level, in which lies the return on investment for the degree. Oftentimes, these networks are powerful at a global level but lack depth at a regional level.

The technology industry in Mexico is becoming increasingly powerful as the number of people and money in the sector grow. There are “mafias” – current and former employees of outstanding companies – that have emerged that help people develop their careers as well as start their own businesses.

Being an “ex Rappi” or “ex Linio” in Latin America can open many doors, much like the name of a university does. Furthermore, the professional contacts you make working at one of these tech companies may help you identify a technical cofounder or another person with entrepreneurial experience, as well as teach you the pain points and trends in the market to start your own business.

3. Credentials and signaling

Graduating from a top business school can open many doors professionally. And today, because of these networks, being part of a top startup can generate the same results. Today, many companies want to hire (or invest in) “ex Bitso” or “ex Kavak” employees, and these experiences are synonymous with strategic leadership, ability to execute, and an unparalleled network.

What is the best credential – university or corporate? Again, the answer is that it depends. In order for a diploma to be enough, it typically needs to come from a top university abroad (including from the Ivy League), but we know the cost of time and investment that this implies and the challenges of the admissions process. And to be objective, being “accepted” says nothing about the academic rigor or the skills that one develops within the program, as most universities want their students to graduate, while spending two to four years in a scale-up or unicorn provides a greater demonstration of professional abilities.

The Future of Learning

Many companies are doing a phenomenal job of developing employees’ technical skills and I applaud that. However, there is still a gap with regard to teaching life skills, management and leadership.

This means that traditional education institutions and edtechs will continue to be necessary for training the leaders of tomorrow. However, no one organization can excel in all types of education, at all levels and in all types of learning. This is why education is such an attractive market: it can easily accommodate multiple winners.

Given this, whether business schools can survive will depend on their capacity to adapt. All business schools should be thinking about how to update their programs and curriculums constantly and quickly, how to attract mentors with noteworthy professional experience, and how they can be flexible and adapt to students who are working and studying at the same time. They should identify how to enable students to build personal and professional connections. 

This leads me to my final answer to this question. Neither the MBA nor tech companies can replace the other. Instead, it’s when education and professional experience mix, as in Collective and many other edtechs, that you will see the real results: professional and learning experiences that prepare the next generation of leaders in the region. This is the future of education.

Photo by:   Pato Bichara