Don’t become a statistic. According to Bloomberg, 8 out of 10 small businesses fail within the first 18 months. Be the business that succeeds by investing in your education. Find out how graduate school offers start ups a competitive edge.
Demand is at an all-time high for the next generation of entrepreneurs, and it’s reflected in the rise in entrepreneurial education, according to Cari Coats, the Executive Director for the Center of Advanced Entrepreneurship at the Rollins College Crummer Graduate School of Business in Winter Park, Fla.
“In the United States alone, more than 400,000 students are enrolled in entrepreneurship courses – a strong validation that entrepreneurship is no longer an accidental discovery, but an intentional career track that requires thought leadership, discipline, process, and a business model and mindset to complement that great idea,” said Coats.
Discover five ways entrepreneurs can benefit from attending graduate school.
1. Learn How to Develop a Business Plan
You have a great idea, but realistically speaking, who hasn’t had a great idea? Before you blow through your savings and mortgage your house on the way to becoming one of the 80% of small business owners to go bottoms up within two years, realize that you also need to comprehend the financial side of business. “Entrepreneurs need to understand how to raise initial investment capital, how to manage cash flow, and how to access the market for their products or services,” said J. Howard Finch, Ph.D., Dean and Professor of the Brock School of Business at Samford University in Birmingham, Ala.
Finch said a graduate business degree, such as an MBA with an entrepreneurship focus or concentration, will allow new and small business owners to develop comprehensive business plans. “Such knowledge greatly enhances the likelihood of entrepreneurs competing successfully with larger, established competitors and bringing their new venture to commercial success.”
2. Gain Management Skills
Your employees can make or break your business through pilferage, poor customer service, or even one terrible social media post that goes viral. Learn how to hire, manage, and if necessary, fire them. According to Howard A. Stern, PhD, an associate professor and the co-director of Carlow University’s MBA program in Pittsburgh, Pennsyl., many entrepreneurs hit a brick wall when it comes to supervising employees. “Although it’s difficult to teach the entrepreneurial spirit, MBA programs are great for teaching good management skills that can be transferred to the day-to-day logistics of running a business,” said Stern.
3. Build on Your “Good Idea” Through Innovation an Strategy”
A great chess master, Savielly Tartakower, once said, “Tactics is knowing what to do when there’s something to do, while strategy is knowing what to do when there’s nothing to do.” Every successful business starts with a good idea, but that’s just one part of the equation. Coats said many students in her classroom think successful entrepreneurship is about having that “next big idea,” but they don’t have a clue about creating business opportunities around them.
“It might not seem so on the surface, but there is a stark difference between creativity and innovation: Creativity is the ability to transcend traditional ideas and create new ideas; innovation is creativity plus opportunity. While a good idea is critical, it’s just the first step of many,” said Coats.
4. Overcome that Plateau
Sometimes you’re doing everything you know to do, but there’s a lot that you may not know. Entrepreneurs who have hit a plateau and just can’t seem to take their business to the next level have frequently found graduate business school useful, according to Jerry White, the Morris Endowed Director of the Caruth Institute for Entrepreneurship at the Southern Methodist University Cox School of Business in Dallas, Texas. “It helps them see where their deficits are, and helps them acquire knowledge and skills to overcome those deficits–often with stellar results.”
White used a specific case to illustrate this point. One student built a landscape maintenance business but struggled to communicate with his corporate clients. He thought that by going to graduate business school he could solve this problem. By the time the student graduated, White said he noticed a transformation. “Whether it was liquidation preference, internal rate of return, efficient markets, accruals, deferrals, or cap rates, he learned to speak their language and to use it to good advantage.” White added, “He put together a professional Board of Directors, expanded into logistics, and at last check was growing with more than $20 million in revenue.”
5. Grow Your Network
Honestly, your friends and family members are only going to purchase so many units of your products or services before they stop answering your phone calls and “forget” to invite you to gatherings. As an entrepreneur, you need to rub shoulders with others who can help propel your business forward.
Jacqueline Jenkins, Director of Graduate Studies at LIM College in New York City, N.Y., said the graduate experience provides entrepreneurs access to an invaluable base of resources. “Potential business partners may be found through relationships developed in the classroom, advisors are often identified among faculty members, and a student pursuing an entrepreneurial venture is often able to leverage support from the program’s alumni network.”