Entrepreneurs Do Better With College: Study

[Rickson9]

"People with little education who become successful entrepreneurs are few and far between," he says. "If you want to become a successful entrepreneur, your odds are much better if you graduate from high school and go on to college. Many studies show that better educated entrepreneurs have greater access to external capital, lower business failure rates, greater business sales and employment growth, and more profitable ventures.

"In fact," he adds, "the data show that the average startup founded by a college graduate has 25 percent greater sales than the average startup founded by a high school dropout, and the average startup founded by a person with a graduate degree has 40 percent greater sales than the average startup founded by a college graduate."

Entrepreneurs do better with college - studies - SFGate

 

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[Vigilante]

These studies are always amusing. This is the guy that authored and oversaw the study (and I would have wagered $1,000,000 that he never would have reached a different conclusion.) Acedemia perpetuates itself.

Vivek Wadhwa is Vice President of Academics and Innovation at Singularity University; Fellow, Arthur & Toni Rembe Rock Center for Corporate Governance, Stanford University; Director of Research at the Center for Entrepreneurship and Research Commercialization at the Pratt School of Engineering, Duke University; and distinguished visiting scholar, Halle Institute of Global Learning, Emory University.

Wadhwa oversees the academic programs at Singularity University, which educates a select group of leaders about the exponentially growing technologies that are soon going to change our world. These advances—in fields such as robotics, A.I., computing, synthetic biology, 3D printing, medicine, and nanomaterials—are making it possible for small teams to do what was once possible only for governments and large corporations to do: solve the grand challenges in education, water, food, shelter, health, and security.

In his roles at Stanford, Duke, and Emory universities, Wadhwa lectures in class on subjects such as entrepreneurship and public policy, helps prepare students for the real world, and leads groundbreaking research projects. He is an advisor to several governments; mentors entrepreneurs; and is a regular columnist for The Washington Post, Bloomberg BusinessWeek, and the American Society of Engineering Education’s Prism magazine. Prior to joining academia in 2005, Wadhwa founded two software companies.

 

[GPG]

That you don't need a college or university degree to become a successful entrepreneur has been proven many times. The number of posts which mention a successful entrepreneur who has dropped out of college are endless by now. However, a college or university may actually be useful for starting entrepreneurs and the study above proves that to some extent.

Learning how to make strategic decisions (Which suppliers, partners, customers, distribution and marketing channels), managing finance and legal issues seem useful skills for an entrepreneur. Learning everything by trial and error isn't a dream scenario either.

 

[Kak]

I am never returning to higher education. A BBA is plenty.

 

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[vtlambo]

I am never returning to higher education. A BBA is plenty.

My BBA degree does look pretty good on the wall for decoration though. Most expensive thing on the wall in my house lol.

 

[JAJT]

Me and a buddy were discussing averages just yesterday.

Averages are great in showing the behavior of crowds but they completely discredit the value of individual effort. Too many people think averages apply to them because "that's what the statistics show".

People choose/accept behavior based on best chances rather than expended effort. Beating the odds isn't necessarily hard, it juts requires you to do what most people aren't. And because most people aren't doing a goddamn lot of things, that opens up a ton of opportunity.

Look at the economy/job market. I read so many people bitching about how they can't get a job because of x, y or z and then cite news stories and unemployment statistics and layoffs and bla bla bla. They completely discredit the fact that as an individual they can excel, rise to the top, and get a great job in the worst economy if they just expend the effort in the right directions.

Or the poor and their hardships - on average poor people stay poor and rich people stay rich. Ergo, to them, the odds against their individual self succeeding is so low they might as well accept it. This completely ignores the fact that expending the right effort in the right places results in a steady increase in your standard of living. Likewise, a rich person focusing on the wrong things will result in a steady loss of standard of living.

It seems like the only time your average person ignores statistics is when it comes to the lottery. 1 in 100 chance of being a millionaire through effort? Impossible, crazy, I'm an idiot for suggesting it. 1 out 15 million chance at the lottery? Well... "someone" has to win.

 

[nation]

Some quick things that jump out at me & such.

"People with little education who become successful entrepreneurs are few and far between," he says.

I wonder what the definition of "successful entrepreneur" is.

That seems to be a key thing in all this. Is it making a SaaS that generates you $10k per month (take home pay) with very little ongoing work?
To a vast majority of the world that would be super, but I wonder if that situation fits with the idea of this article. (my guess is no)

"If you want to become a successful entrepreneur, your odds are much better if you graduate from high school and go on to college.

I can see this statement being very true, with the exception of people who start a business while in High School, or accomplish something else before graduating high school (earning the Rank of Eagle in the BSA, USA, fits for me ... same with competing in the Olympics).

They are all indicators that you have developed a level of Grit - or sticktoitiveness - so that you are more likely to push through the hard times in the voyage towards your goals. I think Seth Godin's next book devotes a good bit to grit ( [url]http://aly.me/tid/[/URL] )

Many studies show that better educated entrepreneurs have greater access to external capital, lower business failure rates, greater business sales and employment growth, and more profitable ventures.

I think they confuse education with networks. People with networks have greater access to [the things they list] .... There is another element that they are contributing to "education" but is really not - it's the instant connection due to being a part of a group, fraternity, or association.

This is one of the powerful elements of all fraternal organizations, no matter if it's a greek based in US Colleges, the Order of the Arrow, or the Boy Scouts of America ... even membership in a church provides some network, or being a part of something like The Foundation or going on a show like Survivor.

There is something powerful about a common background that causes instant credibility and speeds the relationship building between two people ....... formal education applies to this too. You find someone who graduated from your school === you have a connection point.

There is value to that, but as I said, it's not the only way.

Edite: ran it through a spell checker after I noticed some typoes.

 

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[splok]

I hate articles that just give linkbaits headline with no real info to back it up. Admittedly, to really know what a study is saying, you need to read the actual study (which they never F*cking link to), but most articles don't even try.

Ok, of the 500 tech startups that they looked at, the ones by college graduates have 25% more revenue.

Fine, but what are the revenue numbers, and what's the average age and personal debt load of the founders? I'd sure as hell rather have a 100k/yr business as a debt-free 20-year-old than a 125k/yr business as a 30-year-old with a mountain of student loan debt.

Also, I'd like to see the numbers broken down by university tier. Hell, I'd just like to see the numbers with Stanford removed. All universities aren't created equal.

It seems like the only time your average person ignores statistics is when it comes to the lottery. 1 in 100 chance of being a millionaire through effort? Impossible, crazy, I'm an idiot for suggesting it. 1 out 15 million chance at the lottery? Well... "someone" has to win.

Fantastic point!

 

[The-J]

This debate needs to die

 

[Vigilante]

This debate needs to die

Agreed. There is no "better." People take all different paths through life. There is no right answer.

 

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[MJ DeMarco]

Many studies

I love "studies" conducted by organizations/individuals with a clear bias.

And again with all studies "success" becomes subjective and relegated to some arbitrary number. The lifestyle design guy clearing $5K/mo (yet working 25 hours a week) would be deemed a failure. The guy making $200K/year and yet is miserable with no time, well, he's a success ... and of course, don't forget that cool degree hanging from the wall.

The real question is will a college degree give you better chances at being HAPPY?

I'd like to see that study.

Agreed. There is no "better." People take all different paths through life. There is no right answer.

This debate needs to die

Perfect ending.