Once you’ve cleared the requisite MBA admissions hurdles – the intense GMAT preparation, the essays about finding your life’s purpose, and the interview questions about five-year plans and scenarios involving desert islands – you will be ready to begin a two-year odyssey into the world of spreadsheets, income statements, and cocktail happy hours known as business school.
For the next two years, you’ll be advancing towards your degree, so for at least a little while, you don’t really have to think too much about the future. But wait. You do.
Given the debt burden that you’ll face, and the career importance of not spinning your wheels as you “find yourself” post-graduation, it’s never too soon to be thinking about what you’ll do once you take off that silly cap and gown on some sweltering late spring day.
If you’re going to head into the fancy-pants world of consulting or finance, be ready for recruiting to start pretty much the minute you hit campus, anyway. Other popular areas, such as operations management, marketing, communications, or finance, follow quickly on the heels of the first two in recruiting season. And if you’re crazy enough to consider launching a business – something far more of your peers will say they’ll do in September of Year 1 than will actually do in June following Year 2 – then you really better heed the words of Fleetwood Mac – don’t stop thinking about tomorrow (and while you’re at it, think about the next day, and the day after that, too).
Before even considering what your business will do, how it will earn money, and how it will grow, first ask about the most basic practicalities of your own life. How much income would you need to scrape by? Think rent, food, car, insurance, etc. and then realistically project a reasonable budget for discretionary spending. Don’t assume that your new streaming app idea (the one that will synchronize your toaster to your TV remote) is going to suddenly rain buckets of money upon you. In fact, assume it won’t. As Winston Churchill used to say, “Hope for the best, but plan for the worst.”
It doesn’t really matter what your basic source of necessity income is, provided that one exists. You may have significant savings from your previous employment. You may have a spouse whose income covers all your household basics. You may have inherited a few million when your distant Uncle in Malibu passed away.
In any of those cases, all the issues towards the lower end of your hierarchy of needs will be met. You can now proceed to get serious about focusing on getting that business off the ground (if only people could just understand the need for toaster/remote synchronization…someday they will!)
If none of those apply to you, however, it’s time to get creative. You will need to pitch your idea to angel investors (wealthy folks who would invest their own money) or to venture capitalists (professionals who invest funds of other people’s money in start-ups like yours). Getting money from either will prove difficult if you don’t already have a sustainable revenue model and a bit of a track record.
If the angel/VC route isn’t your thing, another way forward is to take side jobs in order to keep some gas in your tank, Ramen in your belly, and the lights on in your home. Some MBAs have found part-time, hourly consulting gigs that are perfect for these sorts of situations. Others have found seemingly-menial, lower-paying jobs that come with the downtime they need to be working on their businesses on the sly. Others still have found tutoring to be a great way to maintain flexibility and a solid income (Shameless recruitment plug for Cambridge Coaching? Absolutely).
The biggest caveat to the side-job strategy is that if the time demands of the side jobs begin to crowd out the time you need to spend on your business to really make it hum, you may be destined to just spin your wheels on both fronts.
A bank loan or line of credit is yet another financing source, but one that comes with its own perils as well – as the signer of either, you will be on the hook for repayment regardless of whether your app becomes the next Flappy Bird…or just a flop. Going with either option means you would then need a backup plan that would not only address the question of a Career Plan B, but also a means of repaying a hefty sum of money on top of your other debt obligations.
Entrepreneurship is not for the faint of heart! Behind all the glamor of pitch competitions, start-up fairs, accelerators, incubators, and magazine covers, the decision comes with a lot of soul-searching and second-guessing.
So before addressing all those other critically important questions – the what, the where, the when, the who, and the how of your enterprise – the first question every wannabe founder should ask himself or herself is simply, “How am I going to cover my basic, personal expenses?” If that question proves unanswerable, then the suit-and-tie world might not be so bad by comparison.