When Camilla Jeffs went back to school to earn her MBA, she was 36 years old with five young children. “I had yearned for years to be in the corporate world and once my youngest turned three, I seized my opportunity,” she says. “I was one of the oldest in my cohort at BYU’s full time MBA program and intentionally took 21 credits each semester. I wanted to learn everything!” 

She started several businesses before she purchased KohlerHaus Remodeling Co, where she serves as president. She describes her firm as “elevating the construction experience through quality remodeling and excellent communication” and reports it earns seven figures a year.

“I always say the MBA was a catalyst of confidence for me. I had previously identified as ‘just a mom’ and the MBA helped me add ‘powerful business woman’ to my identity,” she observes. The courses she found most useful were finance and accounting, marketing, and leadership. 

“While my MBA program did not prepare me to be a small business owner—they were more interested in helping us land jobs at big corporations—it was definitely helpful for my future,” she reports. 

We’ll share additional insights from other MBA graduates who run their own businesses—including a few who don’t recommend an MBA to future business owners—but first let’s cover the basics of what an MBA is, how to earn one, and less expensive alternatives if your goal is to start a new business. 

What Is an MBA?

MBA stands for Master of Business Administration, an advanced degree. The average cost of an MBA in the United States is around $56,850 per year, according to the Education Data Initiative. 

MBA students at prestigious B schools like Wharton, Stanford, MIT or the University of Chicago may pay even more. The Education Data Initiative reports the cost of earning an MBA from Harvard Business School, for example, is over $230,00. 

It usually takes 2 years to complete the coursework for an MBA if you are taking a full-time courseload. 

Will an MBA Help Me Understand Finances?

Yes and no. An MBA can definitely help you understand business finances, but it may be too high level for a startup. It may also leave out practical topics like how to get a small business loan, leverage business credit cards, or how to establish business credit. 

If the financial side of your business is an area where you are struggling, it may be worth it to hire an employee with expertise in that field or enroll in a single course or two to help you fill this knowledge gap. (See suggestions below.)

You can also get help from your accounting professional or your local SBA resource partner such as a Small Business Development Center (SBDC) or SCORE.

Benefits of Getting an MBA

Not only do you gain insight into many different aspects of running a business when you get an MBA, you also show future investors, and business partners that you are able and willing to learn new skills. 

You’ll also get the opportunity to network with other future business leaders. If the school has a strong alumni network, that benefit can be as valuable as your business degree! 

Skills You Gain From an MBA

You can hone your skillset in business school. Some of the skills you can gain from an MBA:

Soft skills:

• Communication
• Working in a collaborative/team environment
• Resilience and hard work

Hard skills:

• Data analytics
• Financial ratios and formulas
• How to conduct market research
• Understanding and creating financial statements/business plans/etc

Is It Worth It To Get an MBA?

Those considering an MBA are often unsure whether it is worth their time and money. Usually individuals are recommended to calculate the ROI of the degree. 

But it’s also important to consider your time. Would you be better off working on growing your business during that time? Or will the MBA help you avoid costly mistakes?

There may be other costs you need to take into account, such as money you could be making during this time, expenses associated with moving/living somewhere new, additional costs associated with going back to school. 

While common advice is to compare the cost with the increase in salary you may achieve by going back to school, that comparison is harder when it comes to building a business. 

Do I Really Need an MBA To Start a Business?

You do not need an MBA to start a business. While obtaining an MBA may be a good idea before starting a business, as it will help you understand what goes into running a business and may even help you get a loan/attract investors it is not a necessity. 

Alternatives to an MBA

There are several business school alternative, including 

• MOOCs: MOOCs stand for Massive Open Online Courses. These courses are usually free or low-cost and tend to offer an in-depth look at one specific topic making them a great option for a small business owner that knows what they are struggling with and just need some resources to help them. 

• MSc in Business Administration: A Masters of Science in Business Administration is another alternative to a traditional Masters of Business Administration. When comparing an MBA to an MSc in Business Administration there are a few things to be aware of. An MSc is typically seen as a more specialized degree compared to an MBA. If you are getting an MSc in Business Administration, this is less of a concern because business administration is such a vast field. But if you instead go for a MSc in Finance and want to compare that to an MBA you may be more restricted in the classes that will count toward your degree. However, the duration and cost of the programs are usually similar although costs and duration will vary among universities. 

• MBA certificates: MBA certificates are certification programs tied to a larger MBA program that allow students to explore an MBA topic of their choice. These programs are similar to taking a semester’s worth of courses at university. Many MBA programs let you use the credits earned during your program for your MBA if you decide to pursue one.

• Mini MBA:  Mini MBA programs are becoming increasingly popular for those who want to gain insights into the business administration field and acquire key skills. Often these programs are shorter than MBA certificates and therefore are usually cheaper as well. Additionally, some companies such as PWC offer mini MBAs so you may not even need to enroll at a University. 

Read: 5 Online MBA Programs That Will Work for About Anyone

Alternative MBA Programs

So where can you find these alternative MBA programs? For MOOCs you will probably want to start at MOOC.org which offers over 3,000 courses (for free) on a wide range of topics including business administration courses, bookkeeping courses, financial accounting courses, business analysis courses, and many more. If you can’t find what you are looking for on MOOC.org, Coursera also offers MOOCs. 

If you are looking for an MSc in Business Administration, most accredited universities offer these programs. If you have the ability to go overseas for your studies, you may want to consider it as many top European universities look for international students and are much cheaper than universities in the U.S.

When it comes to MBA certificates, not all universities offer them so you may have to do some searching on the internet. Just remember to look at the cost of the certificate, how your credits might transfer, and the accreditation of the college or university offering the certificate. 

There are also a number of schools focused more specifically on entrepreneurship education. The Kauffman Institute report Entrepreneurship in American Higher Education details ways schools are integrating entrepreneurship into a wide variety of courses. 

Alternative Ways To Understand Finances

If you want alternative ways to understand finance, consider taking a course at a local community college, finding an online course, or even finding a podcast/YouTube channel.

 Just remember that not everyone has the same credentials/experience so make sure you are investigating the qualifications of the person or company 

disseminating any financial information. 

Check out these YouTube Channels: SCORE and Nav 

Can I Learn What I Need To Know Using AI or ChatGPT?

AI tools like ChatGPT can be great resources to help clear up confusing concepts or when solving a specific problem, but be careful. There are potential pitfalls. 

You must know what questions to ask. 

While you can certainly ask ChatGPT about different business financing options, creating a business plan, designing a marketing strategy, etc if you don’t know what follow-up questions to ask or how to ask the questions at a deeper level you will probably just get basic surface level answers that may or may not be right for your business.

You need to know when an answer is wrong. 

ChatGPT (and other AI models) can provide incorrect information and if you aren’t able to detect this, you may be operating with false information. Having the basic understanding of a topic allows you to check the information you are receiving and decide whether you need to investigate further.

Why Getting an MBA Degree Is Totally Optional

Getting an MBA may not be right for everyone, whether it is because of the cost, the time involved, career goals (or business goals), or other factors. For those that can’t or don’t want to get an MBA there are a ton of other learning options available—including the option of learning by building a business!

We asked several entrepreneurs with MBAs what they think about the value of an MBA for running a successful business. Here’s what they shared: 

“Getting my MBA was the right move for me at the time,” says Laura Laura Gariepy, owner of Every Day by the Lake, LLC. She provides customer content solutions to busy entrepreneurs and editors and believes her MBA helps her stand out since she often writes about financial topics. 

Working in human resources at the time she earned her degree, she saw her salary nearly double within a year. Now that she runs her own business, she says there are a few things she’d do differently—none of which require an advanced degree. 

First “I’d get clear on the product or service I was selling faster. I fell into freelance writing by a happy accident.” Secondly she says she’d “network more from the get-go. Connecting with others has been critical to building my business.”

Kelsa Dickey, money coach and CEO of Fiscal Fitness Phoenix, earned an MBA from the University of Phoenix with a specialty focus on Accounting. Her employer at the time provided tuition reimbursement. 

Her take? The courses didn’t provide enough real-world education. “I wouldn’t recommend an MBA for those who want to start or run a business. The cost is too great and there are much less expensive ways to gain the knowledge needed and in a more targeted approach for your business,” she says. 

She says she wished she had studied psychology instead. “So much of business is really about people- customer service, pricing models, sales psychology, decision-making, mindset, leadership, you name it!” 

On the other hand, Lanesha Mohip, MBA, MHRM, Fractional CFO & Accounting Consultant, Polished Business Solutions, says she would “absolutely” recommend an MBA to prospective business owners. 

She earned hers through the prestigious Keller Graduate School of Management in Chicago, IL. At the time, she thought she would use it to help earn enough credits to sit for the CPA exam. It turned out she didn’t want to work in tax or auditing but it did help her find her niche.

“Many small business owners lack basic understanding of the total operations of running and growing a business outside of making a sale,” she observes. “The right MBA programming will help you think objectively and take your sights off of the individual roles and the importance of hiring, training and developing specialists so that you can be a great owner and CEO.” 

Still she wishes she had taken more marketing courses. “Everything around us as consumers is marketing,” she says, and she recommends learning about “how to build out a marketing strategy, who to hire and budget to hit your revenue goals faster/more efficiently.”

Read: Why I Quit My MBA Program After 6 Months

Nav’s Verdict

A graduate business education can be a valuable way to increase your marketability to current or future employers. If you have a job with an employer who will pay for your MBA, it may be a good way to gain a valuable credential. 

But for those who don’t plan to take a traditional career path, you’ll want to carefully weigh whether it makes sense to attend business school. In some cases, you may be better off developing your business skills by starting your own business, whether it’s a side hustle or a full-time startup. 

There are many successful entrepreneurs who don’t have college degrees, much less graduate degrees. There are many paths to successful entrepreneurship, and a business degree is just one of them.