IESE MBAs Storm Startup Epicenter

IESE students gather at Salesforce headquarters in San Francisco

The mutual infatuation between MBAs and the tech and startup world continues to blossom. Over the past few years, Amazon has emerged as one of the biggest employers of elite MBAs. Google and Apple now top McKinsey, Deloitte and other MBA-centric firms as the “most desirable” places to work for MBAs. And increasingly, MBAs from nearly all corners of the globe are frequenting the tech-rich Bay Area to see just what is in the water that breeds world-beating tech powers and early stage ventures, alike.

The most recent to do so was a group of 28 MBA students from the IESE Business School at the University of Navarra in Barcelona. Last month, IESE students from more than 15 different countries joined one faculty member and a staffer from the career services department on a spring break trip to get face-time in front of some of the most influential and impacting startups and tech companies. The group’s visits ran the gammut of the entrepreneurial lifecycle and the Who’s Who of the Bay Area’s finest. Students spent the week with the likes of hyper-competitive accelerator, Techstars; tech Goliaths, Salesforce, Dropbox and of course, the mighty Google; and veteran venture capitalist, Bill Reichert of Garage Technology Ventures, among many others. Poets&Quants tagged along for the first day of the five-day trek, called IESE Meets The Valley, which was the school’s fifth edition of the trip.

As we walk from San Francisco’s Union Square to SOMA to the Financial District, MBAs from Russia, Germany, Italy, Japan and Finland all speak about their keen entrepreneurial interest. According to trip organizer and second-year MBA, Sebastian Schambach, students applying to go on the trip double the amount of spaces they have. Interested students must fill out an application and pen an essay, lobbying their worthiness to make the cut. Schambach speaks about his own entrepreneurial interest and the entrepreneurial zeal many of the students possess. He boasts about his classmates’ skill sets and background more than his own as we walk from Techstars to Salesforce.

ENTREPRENEURIAL INTEREST SURGING AT IESE

Indeed, MBAs launching their own businesses and entering tech are on the uptick at IESE. For the graduating class of 2015, some 6% started their own businesses and 3% went back to their family businesses, up from 3% and 2%, respectively in 2014. For those entering the corporate sector in 2015, the most (11.1%) chose e-commerce over healthcare, information technology and consumer goods. In 2014, a quarter of the graduating class entered tech (13%) or e-commerce (12%). Meantime, some 24% entered consulting and 17% went into financial services.

IESE’s entrepreneurial focus may start immediately in the full-time MBA program, but majority of the training begins in the summer. After their first year, IESE MBAs may spend six weeks in the summer focusing on developing a business idea. Those who want to see their summer project come to fruition may then focus their second year electives on developing the idea. The very best ideas and entrepreneurs can then apply to enter the coveted IESE Finaves–an accelerator run by the school which has produced 30 businesses that have generated upwards of $80 million in revenue and more than 1,500 jobs since 2000.

Charles Crawley

JUMPING FROM LOCAL GOVERNMENT TO TECH AND ENTREPRENEURSHIP

While the students joining this year’s entrepreneurship trek represent a diversity in nationalities, they also boast a diversity in entrepreneurial interest and skill set. Charles Crawley, a first-year at IESE, has spent the vast majority of his career in policy and government, mainly in Newark, New Jersey. The U.K.-native decided to pursue an MBA to transition from the public sector to tech and entrepreneurship.

“In many ways, I saw a similar idealistic focus on the future as in government, but with a very different operating environment,” Crawley said in a follow-up conversation with Poets&Quants. “Whereas the pace of change in government is (often) necessarily slow and structured, the Silicon Valley culture is marked by quick pivots, flat hierarchy and no red tape.”

Crawley says the idea of creating and growing a business with a group of like-minded individuals is “incredibly appealing,” but he is unsure of exactly when he’ll pursue that entrepreneurial call. Still, Crawley plans to stay true to his original plan of fixing inefficiencies in government work, be it through an early-stage tech venture or creating one of his own.

USING THE MBA TO LEARN THE EUROPEAN MARKET

Fellow first-year, Natasha Sagar, meantime, has already started and is currently running her own luxury footwear e-commerce venture. After short stints at Goldman Sachs and Bank of America, Sagar ran business operations for her family’s hospitals in India, Sagar Hospitals. In 2014, Sagar and her sister saw an underserved piece of the shoe market–“comfortable luxury.”

The sisters created T&N Collection in New York City as a test-run in the U.S. market. With no prior experience in shoes or e-commerce, they figured the U.S. market would be a more forgiving one. When they began getting inquiries from European consumers, Sagar had a realization.

“I realized that there is a huge market that I knew nothing about and I lacked certain finance skill sets required to grow my company,” says Sagar. “An MBA was always a part of my plan, it just seemed right to pursue it now, where I could get an understanding of a new market, learn some valuable skills and build a valuable network in a market that was foreign to me.”

Natasha Sagar

EARLY ON, COURSES AND TREK HAVE PROVED FRUITFUL

With a newfound European market, Sagar, who has spent the majority of her life in South Africa, India and the U.S. focused on European MBA programs. “IESE immediately stood out with the Finaves program and the abundant mentoring opportunities,” she says. “The variety of elective courses it had on entrepreneurship sealed the deal for me.”

Courses like Analysis of Business Problems and Marketing Management have already proved beneficial to Sagar and developing her venture. “It (Analysis of Business Problems) helped me develop an analytical framework all the while, keeping the big picture in mind, which I found particularly useful because in a startup it’s very easy to lose track of the big picture and focus on smaller details,” Sagar concedes, noting how hectic it has been for her to continue to help with the company while being in a full-time MBA program.

Sagar says visiting with top venture capitalists and learning about what they look for in early-stage startups and their growing interest in fashion tech was the most useful part of the entrepreneurial trek.

ENCOURAGEMENT DESPITE H-1B VISA FRUSTRATIONS

Despite the trip to the tech and entrepreneurial Center of the Universe, a major road block is mentioned multiple times during conversations with the international MBAs: H-1B work visas. As Poets&Quants reported last year, the U.S. is losing out on elite MBA talent because of the controversial lottery-based system. One-by-one, as IESE’s students on the entrepreneurship trek voice they’ll likely look for jobs in London or other hubs outside of the U.S., the issue seems profound. According to a 2015 GMAC study, only 28% of employers that plan to hire MBAs expect to hire international MBAs–the main reason given was the lack of guarantee of a visa.

Despite the hurdle, many voiced their encouragement from being around such a contagious and successful environment.

“Meeting other entrepreneurs was very comforting knowing that there are other people who are on the same crazy roller coaster ride as you,” Sagar reasons. “To be able to connect with them and talk about some of the highs and lows of our ventures was almost therapeutic.”

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