Washington University’s Olin Business School has ranked first for the second time in the Poets&Quants/Inc Magazine entrepreneurship ranking of full-time MBA programs. Washington University in St. Louis photo
When Charlie Olson stepped onto Stanford University’s campus to start the full-time MBA program in the fall of 2015, he didn’t consider himself an entrepreneur. Those were the “hyper-creative” types who had the ability to build something out of nothing — a mindset, and a skillset, he just didn’t have.
Or so he thought. Olson’s outlook began to change early in his second year at Stanford’s Graduate School of Business, when he met Eric Lax, who was studying for both an MBA and a master’s in data science. “He had the brightest, most creative, most innovative mind that I had ever met,” Olson says of their first meeting. “I thought, ‘Hey, you know what, I actually have a shot at entrepreneurship as long as I pay attention to Eric.’”
Pay attention he did. One coffee meeting turned into many, and less than a year later Olson and Lax launched Pando Pooling, a platform that allows groups of people to pool their future career earnings together. A little more than three years into the venture, San Francisco-based Pando has raised about $11.6 million in venture capital backing, has more than a dozen employees, and is currently looking to hire more.
Has Olson changed his mind about whether an MBA program is the right time for exploring entrepreneurship? Completely. “This is two years for you to explore,” he says. “This is two years to try things you’re not good at. That liberates a lot of competitive individuals. And then you have all of the clubs and professors and lecturers who have done extraordinary things in entrepreneurship.”
Charlie Olson (right) and Eric Lax, co-founders of Pando Pooling. Pando photo
50 BUSINESS SCHOOLS IN SECOND ANNUAL JOINT RANKING WITH INC. MAGAZINE
It’s that entrepreneurial climate at top business schools around the globe that Poets&Quants set out to measure when we created our annual entrepreneurship ranking with Inc. magazine last year. And while we expanded the ranking from 27 schools in 2019 to 50 this year, the winner held on to earn top honors again. For the second straight year, the full-time MBA program at Olin Business School at Washington University in St. Louis placed first in our joint ranking.
Following WashU is Babson College, which climbed one position from last year’s third-place finish. The University of Michigan’s Ross School of Business also moved up from fourth to third this year. Entrepreneurial stalwarts Stanford’s Graduate School of Business and Harvard Business School rounded out the top-five, respectively. Among the top 50 schools, the U.S. clearly dominates, accounting for 42 of the entries, including 16 of the top 20.
The study proves that entrepreneurship can indeed be taught in a classroom. Despite massive resources poured into entrepreneurship programming by business schools, of course, skeptics abound questioning whether a true entrepreneurial mindset can be cultivated by academics in a university environment. After all, so many successful founders never stepped foot on a college campus and most never got an MBA. Still, business schools are turning out thousands of graduate entrepreneurs who are the beneficiaries of millions of dollars in funding and who have created some of the most successful startups of the past ten years.
ONE IN FIVE MBAs AT WASHINGTON UNIVERSITY HAVE LAUNCHED BUSINESSES THE PAST THREE YEARS
The 4240 building in Cortex in St. Louis. Photo by James Byard/Washington University
The result of months of data collection and analysis, this year’s ranking attempts to measure what schools are providing ideal launching pads for entrepreneurial-minded MBAs. It is based on 10 core metrics that reflect the resources devoted to entrepreneurship as well as the results of those efforts. The methodology places the most weight on the average number of startups launched by full-time MBA graduates immediately after graduation and the percentage of full-time MBA elective courses that focus solely on entrepreneurship and innovation. Each of those two data points represents 20% of the ranking. Other metrics include the amount of on-campus accelerator space available for MBAs, the amount of startup award money available to students, the number of entrepreneurs-in-residence, and the percentage of MBA students in the school’s entrepreneurship club, among others.
Between 2017 and 2019, some 19.7% of Washington University MBA graduates elected to launch startups immediately after graduation — more than any other school. At the China Europe International Business School (CEIBS) in Shanghai, nearly half (47%) of elective courses available to full-time MBAs in the 2019-2020 academic year were focused on entrepreneurship and innovation. And such schools as the University of Chicago’s Booth School of Business and Rice University’s Jones Graduate School of Business both have set aside at least $1 million in startup competition money each year for budding MBA entrepreneurs.
ENTREPRENEURSHIP AND CREATING STARTUPS REMAINS STRONG AT TOP B-SCHOOLS
Recent startups coming out of B-schools have been some of the most influential across the globe. Harvard Business School-founded and Singapore-based Grab has changed the way people transport themselves and get food. Similarly, Stanford GSB-founded DoorDash has proven extra valuable for food deliveries since the coronavirus outbreak. Fellow GSB-founded financial technology startup SoFi has upended the loan market with its refinancing algorithms. Other recent MBA founded companies like Warby Parker, Rent the Runway, Harry’s, and Stitchfix have changed the consumer product goods game.
At many of the best business schools, entrepreneurship is not only alive and well, but it is also thriving. In the past five years, between 2014 and 2019, 421 Harvard MBAs decided to launch a company immediately after graduation. At Stanford, 384 MBAs started a venture immediately after graduation during the same timeframe. And the University of Pennsylvania’s Wharton School had 251 MBAs create startups.
Many of these startups have caught the watchful eyes of angel investors and venture capital firms. They have funneled more than $3 billion in support of the 100 MBA startups on Poets&Quants list of the best-funded new ventures created by MBAs over the past five years. MBA entrepreneurs at Stanford alone have raised more than $1.4 billion in support of their new companies.
The Best MBA Programs For Entrepreneurship & Innovation
A team at the B.E.T.A. Challenge at Babson College. Babson College photo
CREATING A VIBRANT AND SUPPORTIVE ENTREPRENEURIAL ECOSYSTEM
Of course, a healthy entrepreneurial climate within a business school is based on more than funding. Most new ventures created by MBAs are bootstrapped with funding in hundreds of thousands of dollars from friends and family. They are formed from the confluence of entrepreneurial-minded students, faculty, and staff on a business school campus and gain support and encouragement through curricular and co-curricular resources, along with physical space and initial seed funding.
Yet again, the Olin Business School at Washington University provided the best well-rounded entrepreneurial support system for full-time MBAs. Besides topping the list for the highest percentage of graduates to launch businesses, the school placed among the top 15 in eight out of ten other categories.
Olin, with an annual intake of just over 100 full-time MBA students, dished out $738,000 in startup award cash to MBAs during the 2019-2020 academic year. A third of its student-run MBA clubs are focused on entrepreneurship or innovation. It boasts more than 25,000-square-feet of accelerator space for just 221 enrolled full-time MBAs. What’s more, about a quarter of its full-time MBA faculty teach either entrepreneurship or innovation courses. That commitment to entrepreneurial thinking occurs in a metro environment that has encouraged new venture creation.
The T-Rex coworking space in St. Louis. Courtesy photo
12 YEARS OF RAPID ENTREPRENEURIAL GROWTH AT OLIN
Washington University’s entrepreneurial ecosystem has been building for the past 15 years or so and has not coincidently coincided with a renewed startup scene in St. Louis. The 203-acre Cortex district on the opposite side of Forest Park from Washington University was first created in 2002 but has seen a sizable growth spurt since 2008 when Hank Webber was hired as Washington University’s executive vice chancellor and chief administrative officer. Under his leadership, the Cortex district now houses hundreds of large and small businesses in thousands of square feet of coworking space, accelerators, and offices.
Around the same time, in 2002, the Olin School founded the Skandalaris Center for Interdisciplinary Innovation and Entrepreneurship, making its first real commitment to teaching entrepreneurship. But it wasn’t until 2008 when Olin hired its first full-time entrepreneurship faculty member in MBA alum and serial entrepreneur and venture capitalist Cliff Holekamp. Olin had just two entrepreneurship courses — Intro to Entrepreneurship and the Hatchery, the school’s incubator class within the Skandalaris Center — when Holekamp was hired.
Over the next 12 years, Holekamp oversaw the creation of 15 entrepreneurship-focused elective courses before leaving Olin to oversee T-REX, another incubator in downtown St. Louis.
‘WE’RE THE GO-TO PLACE FOR TALENT’
Nowadays, WashU’s Olin School has a smorgasbord of entrepreneurial resources for MBAs. Entrepreneurship is a concentration option for MBAs and includes more than 20 hours of electives and at least one experiential project. The school regularly facilitates connections between MBA students and early-stage startups in the St. Louis area for consulting projects. Last year, the CELect program matched 10 local early-stage startups with 40 MBAs for 14-week projects.
“More and more accelerators are opening here, where they bring in a cohort of young companies and invest in them,” says Doug Villhard, the academic director of for Entrepreneurship at the Olin School. Stadia Ventures, a sports-focused accelerator, is one of the local accelerators that matches its portfolio startups with teams of Olin MBAs. “Those accelerators are partnering with WashU and getting MBAs assigned to the portfolio companies,” says Villhard, who has been launching startups in St. Louis for the past two decades. “We’re the go-to place for talent. So our MBAs are getting partnered with these startups.”
Connecting with entrepreneurial alumni has also been a boon in developing entrepreneurs at WashU, says II (Two) Luscri, the managing director of the Skandalaris Center and vice provost for innovation and entrepreneurship at WashU. “We have so many entrepreneurial alumni out there,” Luscri continues, noting the school has made an extra push starting in January when it created the Skandalaris Startup Webinar Series. The Series, which virtually connects alumni with current students, has been super popular, especially recently in a coronavirus-forced virtual world.
BABSON DOUBLING DOWN ON ENTREPRENEURSHIP
Babson College’s F.W. Olin Graduate School of Business
Babson College, which climbed into second this year from third, has baked entrepreneurship into its DNA for half a century. Not many have been around that program and seen its growth more than Stephen Spinelli, who served as Vice Provost of the school between 1993 and 2007 and just took over as President of Babson in July 2019.
“We lead with it,” Spinelli says of teaching entrepreneurship to MBAs. “That’s our brand. When I say brand, that’s the promise we’ve made for 30 years. We will empower you, enable you to see the world in a different way. To solve the problems and create value.”
During the 12 years Spinelli was serving as president at another college, he says Babson made three main developments in its approach to entrepreneurship education. First, Spinelli says, has been the basic integration of its “thought and action” approach that emphasizes smart action, failing fast, and pivoting based on what you learned. “It is a purposeful strategy for the business model at Babson,” he explains. “And became much more purposeful over the 10 years I was gone.”
The upshot: the creation and development of eight institutes and centers at Babson focused on the marriage of thought and action, or the theory and practice to teach students an entrepreneurial mindset. “That has created this more direct connection between what happens in the classroom and a student’s ability to self-curate their interaction with the marketplace at the same time,” Spinelli says. “Those centers and institutes allow a student to do that with a greater degree of self-curation and freedom. You have to have finance, you have to have accounting, you have to have marketing. You have to have these integrated studies.” But then you can apply those in the different institutes and centers, he says. “That coordination and integration that is really led by the students is probably the single-most innovation that I’ve seen.”
Spinelli says the second major shift has been the blurring of lines between social and economic value when it comes to creating a company. “They’re intimately woven and you should measure both,” he says, noting schools better focus on both because the current crop of MBAs is looking to excel in both. Lastly, Babson has put more focus on interdisciplinary collaboration among its faculty, no matter what discipline they come from.
The Best MBA Programs For Entrepreneurship & Innovation
Students at ESADE. Courtesy photo
THE ENTREPRENEUR DRIVES THE PROCESS AT BABSON
Over the past three years, an average of about 15% of graduating MBAs at Babson have elected to launch a business within three months of graduation. That’s more than all schools ranked this year with the exception of Washington University, Michigan’s Ross School, and Stanford’s GSB. Babson also boasts that 26% of its core MBA courses features at least 50% of their content dedicated to entrepreneurship and innovation — more than all but one other school, Boston University. Some 45% of its student-run clubs are dedicated to entrepreneurship and innovation and about a fifth of its full-time faculty teach at least one entrepreneurship-focused course.
Spinelli says entrepreneurship is no longer a fringe competency within business schools, but that it should be taught just like finance, marketing, or operations.
“We’ve always believed the entrepreneur drove the process,” Spinelli maintains. “But now, with the technological changes and this generation, it is no longer a competitive advantage — it’s a required competency. And we hit them over the head with that.”
Davidson Winter Garden at the University of Michigan’s Ross School
ESADE LEADING EUROPE’S STARTUP CULTURE
Across the Atlantic, Barcelona-based ESADE Business School was the top-ranked school outside of the U.S. for the second year in a row. Like Babson, ESADE is steeped in entrepreneurial tradition. The ESADE Entrepreneurship Institute, which is the cornerstone of ESADE’s entrepreneurial community was founded in 1992. But Jan Brinckmann, an entrepreneurship professor and director of the ESADE master’s of science in innovation and entrepreneurship program, points out that the school’s founding was based around infusing entrepreneurship into the community. And then in the 2000s, when the school became more international, entrepreneurship surged again.
“It has become one of the dominant activities on campus,” Brinckmann explains. “And it makes more people want to get involved.”
At ESADE, about 7% of MBAs launched businesses immediately after graduation between 2017 and 2019. Some 15% of the school’s core MBA courses have a focus on entrepreneurship including a required course entirely focused on startups. “I think this is a differentiating example,” says Lisa Hehenberger, the director of the Esade Entrepreneurship Institute. “We’re providing coursework and classes, but also exposure in a lot of different ways.”
Overall, one of every four elective courses is focused entirely on entrepreneurship and innovation. Some 60% of ESADE’s MBAs were members of the school’s entrepreneurship club last academic year. And with a whopping 90 entrepreneurs in residence to a total MBA population of 186, there was basically an entrepreneur is residence for every two MBAs last year.
Hehenberger says social entrepreneurship, in particular, is highly popular among current MBAs. “There’s quite an interest in this subject among students,” she says, noting about 50 of the 186 total MBAs took the social entrepreneurship elective last year. “It’s an opportunity to combine an impact on society with business models,” Hehenberger adds. “If you’re in a business school, this is very appealing. I’m finding that business students are really fascinated by this and are looking for jobs to combine their passions with business. In the past, they might have volunteered o the side while working. Now they’re combining the two.”
LAUNCHING A STARTUP IN THE HEART OF SILICON VALLEY
Stanford GSB’s Startup Garage will be a key resource for the school’s new Stanford Rebuild initiative, an 8-week innovation sprint to ideal and accelerate plans for boosting the economy post-coronavirus. Stanford GSB photo
It’s the robust portfolio of resources that make launching a business during an MBA experience so appealing for many students. Soon after Pando Pooling’s Charlie Olson and Eric Lax began meeting for weekly coffee dates, they applied and were accepted to Stanford GSB’s Lean Launchpad course. There, they were able to test out an idea that they since moved on from — but while that idea failed, the duo didn’t.
“We dropped the other idea and started with what is now Pando,” Olson says.
Olson says Stanford does a few things to make entrepreneurship “and risk-taking more generally” easier to undertake with confidence. Through non-grade disclosure, the school “structurally liberates” MBAs to experiment and explore, he says, while the school’s faculty, staff, fellow students, and extra-curricular opportunities provide fertile ground for ideas and connections: About 34% of Stanford’s elective courses available to MBAs are focused solely on entrepreneurship or innovation, and some 16% of student-run MBA clubs were also focused on innovation or entrepreneurship. About 40% of full-time MBAs were members of the school’s main entrepreneurship club. One result of that commitment: 16% of Stanford grads launch startups immediately after graduation, compared to 7% at Harvard Business School.
“There’s a startup culture at Stanford,” Olson says. “If you look at a map, you’re right off Sand Hill Road. There is a lot of capital that is there to nudge people in the direction of starting things. And it’s amazing how quickly that capital can show up.”
The Best MBA Programs For Entrepreneurship & Innovation
Harvard Business School. Courtesy photo
The Best MBA Programs For Entrepreneurship & Innovation
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