Your Non-HBS Degree is Worthless - The MBA Show Episode 18

The GMAT company has good news: every MBA is getting a job. The bad news comes from a study at Kellogg Northwestern: If you didn't go to HBS or Wharton you may have a hard time getting that i-banking job.

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(1) Headlines: WE ARE ALL GETTING JOBS
• GMAC, company that makes the GMAT, released it’s annual hiring survey
• Good news: 20% more companies hired at least one MBA than 2009. even better next year
• Nearly everyone is maintain or increasing the salaries they offer MBAs.

The unemployment rate is over 9.4% and home prices are falling, and for MBA’s hiring is up 20%!

Miro: Is that good news?

This is part of a new presentation strategy that I’m trying out. I end every rant with a positive statistic and say everything like it’s good news. Go ahead and try it out with some more stats.

Our national budget deficit this year is $1.5 trilliion
Our national Debt is $13 trillion
64% of companies plan to hire MBA’s next year.

Celebration. Things are looking bright my friend!

http://www.gmac.com/NR/rdonlyres/4E0EF485-A6DE-40EB-B2FB-11747DCF2711/0/2010EmployerPollReport_WebRelease_Amended.pdf

(2) Headlines: YOUR NON HARVARD DEGREE IS WORTH NOTHING

Many people wonder how many schools are the top tier of b-school.

We’ve been doing an informal survey of people and we have found that if you ask students at the 5th ranked business school, they’ll say that there are about 5 elite business schools. And if you ask students at MIT, the 9th ranked MBA program, they’ll say that there are about 9 elite business schools.

But now, for the first time, has scientifically determined the actual number of top-tier schools out there. The number is 2.
Lauren Rivera, an assistant professor of management and organizations at Northwestern University has gained access to the secret hiring practices of several prominent firms and
If you go to Harvard or Wharton, your degree is like gold. You are sporting some killer fairy dust.

Since we don’t know who these mystery companies are, lets just call them G. Sachs. and O’kinsey.

What she found was a hiring culture that is extremely obsessed with pedigree.

No surprises there. But even great schools don’t make the cut:

“Hey, I didn’t go to HBS [Harvard Business School] but, you know, I am an engineer at M.I.T. and I heard about this fair and I wanted to come meet you in New York.” God bless him for the effort but, you know, it’s just not going to work.

What happens to a resume that comes from Rutgers? And the guy says “I’m just being really honest, is basically goes into a black hole.” Yikes.

Miro, this hurts me because

So the take away is if you are going to a non-harvard, you can still get an iBanking job, but don’t expect to be hired because of your degree. You need to bring real skills.

http://poetsandquants.com/2011/01/07/is-an-elite-mba-degree-worth-the-cost/
http://chronicle.com/blogs/percolator/brown-and-cornell-are-second-tier/27565


3) Jargon: Fairy dust
Is that an MBA street drug? Not quite. Fairy dust is what you get when you rub your resume really hard against a top tier educational institution such as Harvard.

So how would someone use this term in a sentence.

Well, suppose someone asks you why you are attending Harvard Kennedy School to get a dual degree along with your MBA. You might respond in the following way. Well Miro, aside form the obvious Harvard fairy dust, I’m hoping to go into politics.

So you’re saying that It’s a way of casually acknowledging that part of the reason that you’re going to Harvard is just so that you can say I went to Harvard. Which everyone knows, but it feels cheap to say it out loud.

(5) Business School Tip of the Week:
- Get two referrals at the end of every conversation. Job networking, business starting. Any question.
Follow-up: can i use your name

You only need one cold introductionn.

Thanks for sitting down with me. Who else should I be talking to about this topic?

(7) What’s on your Radar?
Miro: Nephew’s birthday
Tom: Tutoring Tutoring Tutoring

How Much Money Did You Lose In The Dot Com Boom?

Take a trip back to the go-go late 90s with The MBA Show. While Tom and Miro are on vacation, they look back what life was like when everyone was getting rich and nobody knew what their Internet Start-up did or how it would make any money.

Tech Bubble 1999

Big news.  My company just IPO’d for $50M

what does the company do?

Here’s the pitch content-is-king, get big fast, first-mover-advantage.  

You don’t know what your company does do you?

Not in the slightest, but that doesn’t seem to matter to investors.

So how much money have you made in this game so far?

Billions, you should see my e-trade statement. 

So how much actual CASH have you made so far.

Well none, but that’s simply because I haven’t sold the stock yet.  And why would I do that?  Stocks only go up!

Stocks don’t only go up.  What about the tulip craze or the great depression

This time is different! Any information you need in the world, will be available at your fingertips.  Two years from now, you won’t have: a phone, a TV, you won’t need a photo alumb, you won’t need to buy dog food, you won’t go shopping, and the PORN, my god, THE PORN!

Miro, this is the internet:

picture of naked person slowly downloading … it frose.  [both: ahh, damn]

Business School tip of the week:

Both: Drop out.

MBAs Sure Did Love Coke In The 1980s - The MBA Show Episode 16

While they are away on vacation Miro and Tom dip into the MBA Show archive for this classic episode on Corporate Raiders from the 1980s.

LBO (1981)

(4) Jargon: LBO

LBO: like a regular business, except set to the musical soundtrack of the hit movie wallstreet

Seriously though, a leveraged buy out is where one company takes out a loan and uses that loan to buy another company.

Famouslt used in hostile take overs. Where the management doesn’t want to sell, and so another company. A Raider, takes out a loan so big that they offer the individual shareholders of the company a price they can’t refuse.

And what’s great about this type of play is that once you buy that company, you can take any cash that they have on hand and use it to pay off the loan you took out!

For example:

show business card and then structure of new business with giant debt card underneath.

Returns are multiplied by 10 times! 1% becomes 10%.  10% becomes 100% We CAN”T LOSE!!!  What if we lose money?  [pause]  WE CAN”T LOSE!

* What if we DO lose money?  

I don’t know, what if we quit our jobs and start non-profits?  [pause] hahah

So this shows why you don’t want to sit on a mountain of cash? Because people will buy your company and finance it with that same cash.

But isn’t this irresponsible?

no, irresponsible would be giving huge mortgages to people with no credit, no down-payment, and no job.

that is a rediculous example.  Something like that could bankrupt the entire financial system.  WHat bank would be stupid enough to do that?

I know, what’s on your radar?

A ton of coke.

Well, it is the 80’s

Finally, A Professional School For The C Student - The MBA Show Episode 15

Harvard awards the first MBA : (1908)

How are you going to teach business?  It’s not a real science like metallurgy or phrenology.

Harvard is hiring former executives to teach people how they became successful.

Give me an example of how this might help me?

Well, the classic example is this:  Your family’s whale oil business has fallen on hard times because of those hippies and their green, all-natural oil that comes right out of the earth. So, you got to school to find out how to compete.

So, will all the teachers be former whaling executives?

Some of them will be, but you’ll really be learning from people in other industries who have solved similar business problems before already.

This is a total scam.  You can’t teach business in a classroom.  You have to get our there and learn by doing at your father’s company.  You can’t learn your way into the aristocracy.  We’re at the top now, and we’ll always be at the top

what about those people who aren’t at the top?  

You mean the jews and the irish?  They’ll never own companies.  They don’t have the moral fiber for such a lofty persuit.

I’ll drink to that!  To WASPy christianity.  To the the rich getting richer.  Here’s to C-students finally having a professional school that they can attend.

(2) Undermining the constitution. States make a move to amend the constitution to allow something called an “income tax”.  [Fade to black] 

Son of a bitch!