INSEAD MBA: Yay or Nay?

Atiba's picture
Rank: Monkey | banana points 33

Hi community,

I don't want to spark another general ,,MBA worth it or not" discussion, instead I'm interested in your opinions based on my specific situation. Some background info:

  • European citizen
  • 31 years of age (yes, old but quite normal where I'm from)
  • Master's degree in Economics at a Tier 2 uni
  • 2 years DCM at a Tier 2/3 bank in Frankfurt (think HSBC, BNP, RBC)
  • 2.5 years Private Debt Fund at Tier 1 AM in London (think Pimco, BlackRock, MetLife)

Last week, I have been accepted at INSEAD for the full-time 1-year MBA program starting in summer 2018. When the program starts I would have 5 years of work experience in total.

Generally, I'm in a very comfortable position at work. The salary is fairly competitive (>$200k) and I have a good standing in the team. On the flip side, I don't feel very committed to my work and I start wondering what else could be out there that is more aligned with my interests. This is where the MBA comes into play. I see it as an opportunity to make a step back and to try out new things.

All this comes with a massive price tag of $130k, including tuition and living expenses. I know this is still cheaper than US schools, which was exactly the reason why I only considered 1-year European programs. However, when I add opportunity costs to the bill, it can get quite scary. The feeling of using almost all of my hard earned savings frustrates me but education is priceless, isn't it? I won't get any scholarships and my family doesn't have the financial resources to support me.

So, this is where I'm now, at the cross roads of either continuing with my current comfortable path and maybe look for new coherent moves within AM or maybe within corporates, or take the leap of faith and enrol at INSEAD and see what the year brings. I'm aware that it is quite likely that I may end up in a similar role again or even in a role that is far less paid, looking at median salaries in INSEAD's employment reports. I know that it doesn't make any sense in my case to look at it from an ROI perspective. The question is how much do I value the option / the bet that the MBA would give me, the new experiences, the new friends and colleagues and the network overall, as well as the signalling effect and the feeling of accomplishment.

I don't expect that you guys have the right answers for me but any comments are appreciated. Maybe one of you has been in the same position, attended INSEAD or has decided against an MBA, whatever it is please share your experiences with me that could be helpful in my decision making.

Best

Financial Modeling Course

  • Get An Edge For Your Interviews & Finance Career
  • The Best (and Most Affordable) Financial Modeling Self-study Courses.
  • WSO Members receive a 15% discount

Comments (20)

Dec 12, 2017

You already have a Masters and are earning >$200K w/ terrific work experience at a tier 1 firm yet you want to switch careers and pay 6 figures for the privilege? To be honest it's baffling from where I'm sitting.

Before diving in ask yourself exactly what career it is you want that you expect to be more fulfilling. I'd hate to take a gamble on something uncertain in your position. For the lengths you want to go I'd have to see a specific, defined plan that relies on the MBA.

But I'm assuming you wouldn't have applied if you didn't want out, so it's a personal decision. But I'd advise against. These schools aren't going anywhere and you could always do an Exec MBA down the road. $200K per year gigs, on the other hand, aren't exactly out there in abundance.

But I value money and security more than any prestige or "signaling".

Dec 19, 2017
TheGrind:

You already have a Masters and are earning >$200K w/ terrific work experience at a tier 1 firm yet you want to switch careers and pay 6 figures for the privilege? To be honest it's baffling from where I'm sitting.

/end thread

It's more than a bit absurd. If you're already making $200k salary, the only decision you need to make is whether you leave to run your own business or continue to collect "comfortable" checks.

    • 1
Dec 13, 2017

You are already at the type of company/position/salary that many in business school are trying to get into. I went to CBS and I can confirm that you are in a position where many would have loved to be in AFTER their MBA. Unless your company is fully paying, which in your case is not, dont do it!

    • 1
Best Response
Dec 13, 2017

Take this with a grain of salt because I'm younger than you, but I've also asked myself if there is a ceiling (age/income/position) to business school.

First, your situation is unique. Advice from INSEAD alums should give you a better value of their MBA than a more US-centric site. Ask them if they think INSEAD could help you. Most if not all will likely say yes, but understand their reasoning why they think so.

I don't see having a Masters at a 2nd tier university as a disqualifier for an MBA. Most Europeans have these under their belt, and lets be honest you're getting an MBA to primarily grow your network outside of what your previous schools aren't able to do. INSEAD will do that.

How "comfortable" are you at work? My opinion is not everyone lives their dream job. I had a discussion with an M&A MD at a tier 1 investment bank (GS / MS / JPM) and it was brought up that if he was to do it differently he would of joined a PE firm like some of his classmates did. My point is, questions of what-if may always come-up but it doesn't mean you can't be successful in what you're doing now. However, if you feel that your commitment is effecting your work performance, then yes you probably should leave for something else but not necessarily an MBA. You seem to have the grass is always greener on the other side bug. As the saying goes, its not always greener and as pleasant.

Another thing that popped out from your question is I couldn't figure out what you want to do after your MBA. Even a typical (2-year MBA) goes by quick, now imagine a 1 year MBA. You have less time to look for a new position than you think. I strongly encourage anyone doing an MBA to have a good idea or conviction on what they want to do before actually doing an MBA. During your MBA you will see so many job prospects that can be tempting, but by the end of the MBA, you may be not be any closer than when you started to figure out what you want to do the rest of your life. Figure this out first.

Based on your background INSEAD seems like a good match, but have you looked at LBS and executive education programs in general. I have a bias towards LBS, but my impression of the more experienced programs are that they are for people that missed the boat for a normal MBA when they were younger, but need a first tier school to get a promotion, find a business partner for a new venture, etc. They may not move jobs immediately during or after their MBA, but it's something that helps later in life.

Dec 13, 2017

Thanks all for your comments!

Looking at the above, I guess the scale tilts towards ,,Nay" in my case. I tend to agree with the majority of your comments, yet I'm struggling with a definitive decision.

Something that comes up in your comments is the question of what I'd like to do post MBA and whether this path requires such a degree. I can't really think of any profession in Europe that really requires an MBA, with a few firms being the exception. Therefore, I believe the answer to the last question is ,,No". The first question is a lot harder to answer. I don't have a clear route that I'd like to pursue after graduation at this stage. I rather wanted to use the MBA to figure that out and to see what other doors may open along the way. However, you rightly pointed out that one year is not a hell of a lot time to philosophize about various potential career tracks.

Why do I even bother with an MBA then? I thought it would give me the chance to round up my profile. The things I have done so far are quite technical, while I actually would like to spend more time with the underlying companies I invest in and also get more involved in operational decisions, which is less the case on the debt side unless you are facing restructuring cases. Sure, I could move to PE but it always amuses me how I get pigeonholed as the debt guy who lacks M&A experience. So, I assumed the MBA may blur the lines in my CV a bit and position myself for a wider range of roles. This doesn't mean that I want to get into PE at all cost, it just one potential path I could identify myself with.

I still have a few weeks to think about it but your comments were all helpful. I know that I could also do exec programs at a later stage if required. I briefly looked at them but thought the full-time experience is more valuable. I also got accepted at LBS for the MBA program but I prefer INSEAD, given that I have lived in London for the last couple of years and to refresh my French.

Anyways, I'll keep you updated.

Best

Free Consultation

We know you have questions as you prepare to apply to your target business schools. What are your chances of being admitted? How can you differentiate yourself from so many other applicants? What is the best way to showcase your accomplishments or mitigate your weaknesses? Start getting answers to all your questions by taking advantage of a free 30-minute consultation with an expert from MBA Vantage Point team. Learn more.

Dec 13, 2017

I might be biased, but as an INSEAD alumn, I would advice you to take it. In my year, a good number of people that wanted PE (and who had legitimate PE experience) got into funds, with a few consulting folks getting solid PE gigs.

The caveat is that these group of people knew from day 1 that they wanted PE and started working towards it. While OCR for PE is average, there are a ton of alumni in the field who are willing to help out. If you looking to transition out of finance, there are a ton of industry/consulting/tech OCR across numerous geographies. Beyond careers, it is truly an amazing experience travelling the world, partying and exploring with people from all corners of the world. Coming from finance myself, the opportunity cost is definitely worth it

    • 4
Dec 19, 2017

I got into a far better school (i.e. HSW) and am extremely glad I didn't go. The fact that you're asking this question makes me (and others) question your intelligence.

    • 5
Dec 19, 2017

May I know the reasons if you dont mind sharing?

Dec 23, 2017

Interested to hear your background and reasons for deciding against the MBA. Are you saying MBAs are generally not worth it?

Glad to hear your thoughts! Use simple terms otherwise I may not understand it.

    • 1
Dec 19, 2017

I am in a similar boat. On a FICC desks which is probably the weakest place to be in finance now. So the 1 year mba appealed to me. Plus, I love traveling and Insead basically sounded like a 1 year vacation in Paris and I could trade on the side. Expand a global network, etc.

In the end I decided on apply to booth part time. Insead seems well placed for consulting gigs which I think would be a lot of fun, but doubt i leave the potential rewards of finance. And Booth is very solid in finance. Price tag is a little higher. It would be actual work instead of a vacation, but ROI and optionality is higher. Plus I have a mortgage so tough to just make a huge transition.

Array
Dec 20, 2017

You sound German.

Two big considerations.

1) Do you think your current income can grow (at best) or is sustainable over time (at a minimum)? Long-only institutional money, attractive as it is, is facing a significant challenge from ETFs. You're well-positioned; you're in private debt. ETFs aren't going to get in that. How good do you feel about being able to survive or revive your career should that market hit a nasty roadbump (they all do eventually).

2) Is there a career you would rather have, that is unrelated to DCM/Private Debt? Google. BCG. Corporate M&A. Etc. INSEAD would probably set you up nicely for that. But if you're not interested, it's probably not worth it.

The other issue is, do you want to go back to Germany? They don't "get" MBAs over there and your efforts will be undervalued and underappreciated. Of course, they wouldn't understand a career switch either, so you are stuck with private debt no matter what. I personally wouldn't be able to stomach the idea of dicking around with schuldscheins for the next 25 years, but that's how German society is built.

At a personal level, I would say that I greatly valued what my MBA experience gave me. The friendships, the exploration, the experiences, the education, the options. I like variety, I like optionality. It's never an easy financial decision, but for me, between living/working at different grades of upper-middle class vs lower-upper class is not as important as the question of enjoying my job or hating it/being totally bored by it.

Congratulations on your career success and your tough decision. Ultimately, know what your short and long-term goals are, and whether an INSEAD MBA is a better path towards them than your current path is.

    • 4
Dec 23, 2017

Thanks again, your input is quite interesting. After talking to a lot of people and reading your posts, I question the MBA investment on pure economic terms. At the same time, I wonder if you should really make a yay or nay decision solely on that basis.

It seems like a lot of people are impressed by the >$200k pay check and therefore dismiss my MBA thoughts per se. I think that my salary is actually pretty in line with market for my years of experience working on the buy side. I doubt I'm the only one considering giving this up for exploring new things via an MBA. This might be a difference between US and European people, as European MBA students seems to be a bit older on average with more years of work experience.

I haven't seen any posts of people yet that were admitted to MBAs but then have decided against it, except for the HSW high flyer above (but not sure what to do with that comment). On the other side, I'd like to read comments from someone who were more experienced and giving up a 6 figure salary, i.e. not looking at the MBA from an ROI angle only.

For the record, I like what I am doing and I'm glad that it goes beyond buying Schuldscheine. However, in my early 30s I just ask the question if this is really what I want to do for the next couple of years or if I should try something new. I always believed in a strong general knowledge rather than being specialised in something. But I might be wrong with that view.

Anyways, love the activity here. Enjoy the holidays!

Best

Dec 24, 2017

The thing is, the buyside is already the holy grail for most top MBAs, and you've given us no indication that you're in danger of hitting a plateau or need the MBA for a particular dream goal. So it seems frivolous from the outside looking in. I went to school with a few people who left these types of careers to pursue some nebulous goal, and they either ended up back where they left off or worse, had to take big pay cuts to switch industries while losing lots of career momentum. The results have been decidedly mixed.

It seems as if you're not getting much satisfaction from your career, but let me tell you-the grass often is greener. There's something to be said for collecting those comfortable (huge) paychecks while at the top of your field.

Dec 25, 2017

There is no risk of hitting a plateau any time soon. Noone in my team has an MBA, nor would such a program teach anything vital for my job. I could go up the ranks by keep continuing a good job and as long as markets are in favour for our product.

As said, I don't have a specific dream job. I was thinking of moving into PE to get more exposure to strategic and operational work streams. However, this is certainly not the only route. I also like the idea of changing to the corporate world.

The idea of doing the MBA was mainly triggered by knowing quite a few people in good PE shops or in senior corporate positions that have done such a degree. I saw it as an additional door opener. Although I have a good brand in my CV and I strongly believe that the skills I have gained are 99% transferable to the roles I'm after, it is not that easy to land interviews as the classic M&A background is still preferred. INSEAD has a good PE network in Europe for example and I could see some value in tapping that. Obviously, it will come down to my performance in interviews, etc. but the MBA could give me the initial boost to get the foot in the door. Caveat to this is that I haven't been in full interview mode yet and the above is based on experience for a few processes and some talks with headhunters.

Best

Dec 27, 2017

Hard to say.

The path you are going down definitely seems the specialist path. That said, private debt is a relatively unstructured part of the finance world, so you might be able to network your way/build a reputation into some kind of broader mandate.

If what you want is to be more of a generalist, then yes, an INSEAD MBA is a solid first step. However, the curricular content is only a part of the whole story - and many would argue, a relatively small part. Being around a diverse peer group will help enhance your thinking. But your post-MBA gig is the other giant step in your quest for breadth.

As others have said, the economic aspects of the post-MBA opportunity might be disappointing. European PE is less formulaic in its recruiting than US PE, but there's still a preference for pre-MBA PE, IBD or MBB types. MBB would probably give you the strong general knowledge you crave, but it's a very significant paycut relative to your current position.

Again, hard to say. This is a very personal choice. In my individual circumstances I'd gladly make the same choice a thousand times over, but in yours, it's truly a tough decision.

Whatever decision you make, do it with conviction and don't look back. Happy holidays!

    • 2
Dec 24, 2017

INSEAD alum here. i didn't give up a 200k+ salary to attend but i had the same concerns re: financial ROI. From a personal standpoint, the ROI has been better than I expected but more than that, there is something truly invaluable about being in such a unique environment and being surrounded with such a diverse group of like-minded, ambitious, and straight up interesting people.

From an anecdotal perspective, of all the PE guys who gave up 120k in tuition and a year of salary to either find themselves or just take a vacation, not one of them has regretted it. That being said, most of them ended up going back to PE with only modest salary increases.

Dec 24, 2017

i think your question is a false dichotomy. there are many, many ways to use ~$330k over a year other than an MBA that could round up your profile, involve you doing cool things and meeting cool people, give you time to think, etc.

in your shoes i wouldn't go to INSEAD. wiping out my savings is not my idea of optionality. i would consider making a lateral move to a role with more operational focus. this might even be possible internally, allowing you to hold onto your salary. or you might wanna take some time off to travel then get in touch with headhunters or however your space works.

    • 2
Apr 7, 2018

What did you decide at the end?

Apr 7, 2018

.

    • 1
Apr 28, 2018