Accept MBA sponsorship?
Hey guys - first time, long time here. I’ve searched the forums, but I haven’t seen a good discussion around how to evaluate the MBA sponsorship decision.
My particular situation -- from MBB, heading to H/S. No family money or anything like that, I’m paying my own way and still working off my undergrad debt. I’ve been highly rated at my firm, and I like the job well enough, but I definitely won’t stick out the journey to partner. If I decide to accept sponsorship, I’ll leave after paying off my two years. Long term I see myself at a smaller hedge fund, or in a younger growth company (like a kayak or a groupon). I like the thought of growing something. Primary purpose of school is to figure out what that something is.
By accepting, I won’t take on ~$130k in debt, I’ll receive a little bit of upfront cash (essentially my signing bonus pulled forward) and I’ll have a well regarded job waiting for me. That will make the 2 years much less stressful from a workload and financial perspective, which will allow me to focus on building relationships and exploring other interests. It will also put me in a great financial position leaving school. But on the other hand, by accepting, I won’t be able to participate in recruiting on campus, which is one of the main benefits of an MBA experience. It limits any entrepreneurial ambitions right out of school, and it probably means I miss the last formal entry point into the financial world.
And finally, I completely recognize the potential douchiness of this question. Trust me, I consider myself incredibly fortunate to be in this position...it took a lot of years of hard work, and probably a few lucky breaks as well. I'd love your honest thoughts about how to evaluate this decision (especially from those that have been through school), but also won't take offense if you take the opportunity to tee off on me.
How can you expect us to figure out your life for you if you don't even have the slightest idea of what you want to do...Correct me if I'm wrong, but you're juggling 3 choices: entrepreneurship, working in a startup/growth company, and staying in finance. Here is what I'll tell you upfront. After going to business school, you probably won't have some miraculous light at the end of the tunnel that will show you the way. I recommend that you figure out what you want to do right now before making any decision.
However, if you insist. Then you should probably take the MBA sponsorship and stick with the firm since from what I can tell you don't like debt. Entrepreneurship is risky and you probably need to take on a lot of debt or sell your soul to investors. I don't know what is your current job so I can't tell you how you'll fit in a startup/growth company.
Decision tree, can't go wrong.
MBA w/o sponsorship: Cons 1)Will have more debt 2)Cannot go through formal recruiting 3)Due to large debt load, will need a six figure job to cover payments and live decently (goodbye start-up dreams, for now)
Pros 1)May get a higher paying job
MBA w/ sponsorship Cons 1)Locked into current employer for another two years 2)Not free to dedicate full-time to a start-up
Pros 1)A lot less debt 2)2 years to build your bank roll 3)You don't have to learn all the ins and out of a new company, more time to dedicate to your start-up
Do the sponsorship. Not having 130k in debt is well worth the 2 years, especially since they will be paying you handsomely after school anyway. You will be able to save up as much as you can after school in the 2 years to start a company or subsist working for nothing at another start up. I don't see this as a difficult decision from what you posted above. On top of that, you can also break your contract and pay your firm back the money for school if you find something else that completely blows your mind and you can't pass up.
But he might not find the thing that blows his mind since he will be completely excluded from recruiting. So I think it is a legitimate decision, but I would still take the sponsorship.
I'd take it
I'd take it, considering your financial situation. 2 "lost" years (if you're seriously considering entrepreneurship) and no OCR opportunities are significant issues to consider though.
If in the long-run you want to start a business or join a small financial/innovative/insert whatever company I would take the sponsorship. If you actually want to join a hedge fund in trading or investment role, I would turn down the sponsorship and spend the next 2 years getting an HF job.
P.S. Disclaimer: I have done the whole start-up business (overrated), the hedge fund thing (can be a cushy job) and somewhat the management consulting (not all that), and I am in a similar but worse situation than yours.
First off – Congrats.
I would advise you to take the sponsorship because you aren’t dead set on anything yet. If you were gunning hard-core for a PE job, I would tell you to decline sponsorship and pursue OCR. $130K isn’t that much money for someone who desperately wants a high finance job, and who will be making bank after HBS / Stanford. It IS a lot of money for someone who a) doesn’t know what path he wants, b) may need start-up capital in a few years, and c) seems like the kind of guy who could get a badass finance job, and then walk away to pursue other interests after 18 months. Taking the sponsorship will provide you the freedom to figure out where you want to go, and allow you to pursue riskier ventures without worrying about paying off debt.
Hey man -
been at mbb for a couple of years and hoping to be facing your situation this time next year.
here's what I'd say. I'm thoroughly burned out on consulting - I just can't do it again after business school. I'm tired of the traveling, the bizarre & unpredictable hours, dealing with jackass clients (not that they all are)...
If you can stomach consulting for 2 more years, then fine, take sponsorship. It trims your job options - no PE, difficult to jump to HF - but at the same time, you could make a move to VC, industry, or take your financial security to a startup. All of this is actual anecdotal evidence - i've seen these moves happen out of my firm.
But if you're as burned out as I am... loans aren't a good reason to spend another two years on something you're not going to enjoy, and the stipend sure as hell isn't. If you're going to entrepreneurship, then you'll have to deal with debt anyways; if you're taking an established job and it pays less than 6 figures, why the hell did you go to b-school?
just my 2 cents - i've put some thought in this recently as I ramp up the process. good luck either way.
Depends on your age. Assuming you're relatively young (24 or 25), I'd take the sponsorship. You'll be out with a top MBA and finished with your work at MBB before 30... you may have to start at a less than top-tier firm, but I bet if you're good enough to dominate at MBB you're smart enough to move your way into finance at that point if you like. Hiring an associate on a (relatively) low salary at 29ish with 5 years work at MBB and an MBA from HBS isn't exactly hard to justify for a guy at a PE firm or HF. Keep in contact with your H/S buddies and you'll have plenty of friends in high places a few years down the road.
I understand why you wouldn't want to take the sponsorship, but I also think you'll regret it during your two years at school when you're living tight and worrying about job placements, etc... i'd take it. Plus, this way you can really, really enjoy the next two years and go on ski vacations and all the rest without feeling irresponsible.
You sure there is no way to back out? My firm sponsors, but if you get an internship with a competitor, the contract becomes invalid. You can also refuse to come back and they won't pay your bills.
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