what's the reason for pre-MBA positions?

Does this even happen outside of banking? Maybe consulting?

Seems like a strange question

In my job search I've seen a lot of postings for Pre-MBA analysts or associates. I'm pretty sure it's because after 2-3 years of working there, it's expected of them to go for an MBA. It's also expected that after 3 years they shouldn't be an analyst anymore and should be moving up to associate level.

I guess they're just acknowledging they know that you don't plan on sticking it out for 15 years at their firm anyways and are using it as a stepping stone.

Gives both sides an option to get rid of you after your 2 years. However, if you truly are a great employee they will retain you through either associate promote or third year.

Outside of banking, not that common that they "kick you out" but rather you move onto a specific team or position. Some positions which you may be referring to have you cycle for 2 years and then specialize after.

I think there are generally two reasons underpinning pre-MBA programs with a fixed timeframe and low to no promotion probability. Note that I am most familiar with PE funds, so this answer primarily addresses those, although I have also heard of consulting firms that do not do direct promotions; many of these will give a return offer and cover all or some of the cost of business school.

1) Firms where the pre-MBA role is not viewed as a developmental/apprentice role but as a separate skill set; this is the most commonly mentioned reason for PE funds to have analysts/pre-MBA associates leave. Depending on the structure of the firm, the set-up of deal teams, etc. there are often analyst / pre-MBA associate positions that are very defined (building models, market research). These skills are not actually that significant at the senior levels, so some firms make a conscious choice to separate those positions from the development pipeline (many of these firms will not have analysts/associates attend board meetings, management/diligence meetings, etc.)

2) Firms that are not growing quickly enough to accommodate a regular promotion pipeline. Many of these firms will actually promote from within or give offers to return from business school, but they position their programs as two years and out as a way to manage expectations. Given the relatively rapid promotion timeline post-MBA in most PE funds/consulting firms and the average duration of a professional career, only the fastest-growing firms can realistically promote more than a small portion of their analyst/associate class. It is more palatable (and more accurate, given the probabilities) for all involved to think of the promotions as exceptions than the other way around.

If you are considering a "closed end" two year program, I would suggest giving it some real though, particularly if firm culture seems to lean toward the first point above. Working at any decent PE fund is a great experience and career booster, but ask any bschool friends you might have and you can get a sense of how different pre-MBA experience can be and how much more can be gained by exposure to more responsibilities and aspects of the business.