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The Truth About MBA-Founded Startup Unicorns - NextView

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It's become somewhat trendy to criticize or doubt the hunger, drive, and entrepreneurial success of MBA students. So we did some research at NextView about various unicorn startups founded by these individuals, including schools like Harvard, Stanford, Wharton and more.

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The Truth About MBA-Founded Startup Unicorns - NextView

  1. MBA REPORT @NextViewVC NextViewVentures.com the truth about MBA-Founded Startup UnicornsStartup Unicorns
  2. For better or worse, it’s at times fashionable for tech personalities to scoff at MBAs as founders.
  3. Perhaps most famously, Guy Kawasaki once said the value of an MBA to an entrepreneur is “probably about a negative $250,000.” For better or worse, it’s at times fashionable for tech personalities to scoff at MBAs as founders.
  4. For better or worse, it’s at times fashionable for tech personalities to scoff at MBAs as founders. Perhaps most famously, Guy Kawasaki once said the value of an MBA to an entrepreneur is “probably about a negative $250,000.” *   * Spoiler alert: It’s “for worse”
  5. Fortunately, there’s been a recent uptick in thoughtful comments about an MBA’s ability to start and grow a meaningful tech business.
  6. Fortunately, there’s been a recent uptick in thoughtful comments about an MBA’s ability to start and grow a meaningful tech business. NextView pitched in, too, creating this HBS-specific report last year:
  7. Along those lines, this year, we’re taking a broader view to examine the 157 current unicorn startups (reported as $1B+ private valuation).
  8. Along those lines, this year, we’re taking a broader view to examine the 157 current unicorn startups (reported as $1B+ private valuation). Although valuations aren’t everything, this is a readily-accessible metric we can use to measure the success of a specific cohort of entrepreneurs. In this case, we looked at unicorns with at least 1 MBA as a co-founder. (The following data is based on research completed on January 1, 2016. As of this writing, 1 unicorn has since sold – Legendary Entertainment.)
  9. Key Insights: 3838 24%24%unicorns, or have at least 1 MBA founder
  10. Key Insights: 6363MBA founders are found among the 157 unicorns (meaning several have more than 1 MBA as a co-founder)
  11. Key Insights: $65 Billion$65 Billion MBA-founded unicorns are valued at about of the combined $533B valuation of all unicorns
  12. Key Insights: 1313 The MBA programs with the most unicorn startups founded by alumni: (HBS has the largest class size among MBA programs – a factor to consider throughout.) 77 55
  13. Unicorns Founded by MBA Alumni
  14. Unicorns Founded by MBA Alumni (international)
  15. Key Insight: Harvard’s larger MBA classes have produced almost the total unicorn valuations of Stanford GSB. 2.5X2.5X
  16. Total Valuation by MBA Program
  17. per capita basis? Key Insight: How about unicorns founded on a per capita basis? If we use a weighted average, with HBS at 10, the “per-MBA-student” average favors Stanford: 12.2 to 1012.2 to 10
  18. Key Insight: A few more data points about MBA-founded unicorns and what we learned…
  19. Geography Breakdown
  20. Geography Breakdown 10% of unicorn companies are based in Asia, but they account for 25% of dollars raised by MBA-led unicorns.
  21. Sector Breakdown
  22. Sector Breakdown Highest valuations: 1.  InMobi (HBS) 2.  Mu Sigma (Chicago Booth) 3.  MongoDB (INSEAD) 4.  Red Ventures (HBS, Wharton)
  23. Sector Breakdown Highest valuations: 1.  Dianping (Wharton) 2.  Delivery Hero (Vienna) 3.  Houzz (Tel Aviv) 4.  GrabTaxi (HBS)
  24. Sector Breakdown Highest valuations: 1.  Coupang (HBS) 2.  Global Fashion Group (HBS, INSEAD, Wharton, Booth, IIM Calcutta) 3.  Blue Apron (HBS) 4.  Honest Co. (UCLA Anderson)
  25. Key Insight: In general, startup unicorns are found in these sectors too, but none are led by MBA founders: •  Hardware •  Security •  Aerospace/Defense •  Hardware •  Security •  Aerospace/Defense
  26. Key Insight: Some hypotheses as to why: •  These capital-intensive startups aren’t as widely pursued by VCs •  Speaking very broadly, MBA founders typically launch less technical companies
  27. In the end, MBA founders must be taken seriously when it comes to their abilities to execute on big, visionary ideas.
  28. The notion that MBAs are somehow less qualified or less hungry is an overstatement at best, uninformed knee-jerk at worst. In the end, MBA founders must be taken seriously when it comes to their abilities to execute on big, visionary ideas.
  29. The notion that MBAs are somehow less qualified or less hungry is an overstatement at best, uninformed knee-jerk at worst. For anyone to conclude otherwise would indicate they’re being too romantic about what successful founders look like and where they come from – a slippery slope of personal bias to say the least. In the end, MBA founders must be taken seriously when it comes to their abilities to execute on big, visionary ideas.
  30. JOIN THOUSANDS IN TECH on our weekly email about startup traction with advice, stories, and resources shared by entrepreneurs from these companies and more: ADD ME TO THE LIST (we’ll reply with our most popular resources) Research by David Fairbank HBS ’16 & MBA Associate, NextView

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