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INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads | | DECEMBER 23, 1999 STAFF & BENEFITS Supposedly, MBAs Are Dying to Work for Startups So how come it's so hard for entrepreneurs to hire them?
The fact is there's still a big disconnect between B-schools and startups, starting with the university recruiting calendar, which parachutes students into jobs well before they graduate — leaving little room for the just-in-time recruiting practices of new companies. By the time startups come around, the pickings are slim. And for all the hype about entrepreneurship at B-schools, relatively few MBAs can resist the lure of high salaries, perks, and signing bonuses. In a recent survey of 18 of Business Week's top 25 business schools (the others didn't respond or complete the survey), 42% reported that the top career choice among second-year students continues to be management consulting. At 32% of the schools, finance jobs are the first choice. Columbia University's business school estimates that 50% of its current second-year students will go into financial services and 28% into consulting. Not that MBA students aren't genuinely interested in entrepreneurship — the explosion of business-plan competitions, university venture-capital funds, incubators, and other nurseries for creating companies is real. It's just that B-schools have only just realized that their traditional placement process actually hinders entrepreneurs from connecting with students. "LIKE A RIFLE SHOT." The problem begins in the fall, when big-company and consulting-firm recruiters sweep through campuses armed with glossy information packages. They fete students at receptions and interview them in a process that resembles an assembly line. By early December, most graduating students have jobs lined up for June. By contrast, startup executives can't promise a job a year in advance. Few can afford to tour universities to deliver presentations and interview students. Take Jeffrey Wei, president of San Jose-based uhere Corp., an online commodities and futures trading startup. He's preparing to launch his company and wants to hire some MBAs: "People who want to be rich and not work like dogs all of their lives." But Wei can't promise anyone a job until his next round of financing comes through. In the meantime, he relies on word of mouth and drops by occasional MBA career fairs to get his name out. "In Silicon Valley, it is very tough to get business talent," he says. "And recruiting is the most important task from this point forward." Kim Clark, dean of Harvard Business School, says that considering startups' recruiting handicaps, their relatively limited success is a testimony to the powerful interest in entrepreneurship. "Startups come like a rifle shot," says Clark, in an interview with Business Week Online. "They will [talk to students] about joining a company in April for June. And they don't recruit on campus." For all that — and meager compensation packages ranging from $30,000 to $50,000 plus options, he says, there have been enough success stories among startups that more students are attracted to them each year. FORGETTING THE RHYTHM. So what can business owners do to tap this pool? One approach is not to play the recruiting game at all, but to use the entrepreneurial programs themselves as a direct, year-round connection to the students. Impresse, an online printing company based in Sunnyvale, Calif., chose that route. It hooked up with student groups from Stanford and Harvard B-schools that acted as consultants and evaluated the prospects for two business areas the company wanted to pursue. When the projects were complete, one student stayed on as a summer intern. With many universities researching e-commerce, entrepreneurship, and the startup phenomenon, entrepreneurs who want to plug into schools should keep their eyes open for B-school faculty members seeking subjects to study. Others are taking advantage of alternate hiring paths now emerging. In Santa Clara, Calif., Elayna Berean, a 25-year-old co-founder of Monkey Rules.com, a startup that auctions discounted meals at top restaurants, will meet with a group of students making the rounds of California tech companies in early 2000. "I'm hosting 40 to 50 people to come by and chat," she says. "They should be able to feel comfortable because they're my peers." She adds that even since she left the Wharton School last August, schools seem to be making more of an effort to link students with entrepreneurs. Some entrepreneurs try networking through student clubs. Joshua Li, president of the High Tech Business Assn. (HTBA) at University of California at Los Angeles' Anderson School of Business, fields e-mails about jobs at startups and forwards them to HTBA's 230 members. Unfortunately, their messages may go unanswered. Entrepreneurs who haven't gone the B-school route themselves or have forgotten the recruiting rhythm, think "graduation" and send their messages out in the spring. "In April and increasing in May, the barrage of e-mails we send out about potential full-time and summer job opportunities may be overwhelming," Li says. Alas, that's long after the best of the class has been placed. WINDS OF CHANGE. MBA students themselves are pressuring business school placement offices to make it easier for them to network with startups. At Columbia University's School of Management, Regina Resnick, director of MBA career services, now meets with companies from New York City's Silicon Alley, and makes cold calls across the country to Silicon Valley startups with the message: if you're hiring, our students are interested. "We had to rethink our strategy," she admits. Yale University School of Management has a full-time counselor whose job it is to foster high-tech job opportunities. When more than 25% of Harvard's 1999 MBA class -- about 225 students -- signed on at companies with fewer than 50 employees, the school added a startup recruiting center to its Web page. But it's still left mainly up to students to find entrepreneurs. Even when the universities organize tours of startups, the students pay their own way. University of Chicago Graduate School of Business students recently shelled out about $500 each to fly to California for a weeklong tour of companies, followed by a career fair, organized with the Haas School of Business at the University of California at Berkeley. The winds of change are blowing through the MBA placement offices, though. And even the big recruiters feel the chill. Attendance at PricewaterhouseCoopers receptions was down last fall, says Janemarie Maselli, director of MBA recruiting for PWC's management consulting practice. So she stressed the firm's e-commerce specialty to lure those who were sitting on the fence. Business schools have been preaching the virtues of nimble management to entrepreneurs for years. Now entrepreneurs are pushing them to get with the program, too.  By Mica Schneider in New York  | | |
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