The path to securing a job while in business school may be clear if students want to work at an established company. Recruiting and networking events are filled with decades-old firms and other employers that welcome MBAs. Those interested in startups, however, often must find a different way to go after jobs.
Startups often look for new talent through job postings, experts say, to save money on recruitment. Sometimes, they will give presentations at business school clubs, says Susan Kline, acting co-senior director for the career development office at the Massachusetts Institute of Technology's Sloan School of Management.
Students at business schools with incubators, however, may have a more direct route to joining a startup or launching their own.
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"An incubator is like learning to ride a bike with training wheels," says Charlie Baecker, administrative director for the Don Beall Center for Innovation and Entrepreneurship at University of California—Irvine's Paul Merage School of Business.
A school incubator can connect budding entrepreneurs with experienced professionals who advise on creating new technology, marketing, funding and other kinds of sources, he says. Incubators usually welcome local entrepreneurs as well as business students who are excited to launch a new venture.
The most important role of an incubator is to help the entrepreneur become what experts call "cash positive," Baecker says. "At that point, you're generating more cash than you're using."
Today there are about 1,250 incubator programs in the U.S. About 32 percent of North American business incubators were sponsored by academic institutions, according to a 2012 report from the National Business Incubation Association.
The Darden School of Business at University of Virginia, Wake Forest University's School of Business and the Trulaske College of Business at University of Missouri are just a few schools that offer incubator programs.
Because incubator programs have limited resources, entrepreneurs often must apply to join. Once accepted, they can use the university's network, and work with professors and students with other backgrounds, such as engineering or software development, to develop an idea.
Prospective MBA students interested in using an incubator to develop a business idea or find startups to work with should consider these questions as they plan their MBA career.
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• What kind of ventures does an incubator support? Incubators at some universities support very specific kinds of business ventures, narrowing the type of proposals accepted.
"We're mainly focused on the commercialization of technologies," says Jake Halliday, president and CEO of the Missouri Innovation Center, which is an affiliate of the University of Missouri. The center focuses on product-oriented companies and does not focus on small businesses, he says.
"Companies that we coach and accept into the incubator typically have a potential to complete $20 million-plus in sales after five or six years," says Halliday, who also lectures at University of Missouri.
Other schools such as UC—Irvine, for example, cater to various kinds of entrepreneurs with multiple incubators.
• What kind of students can join? An MBA candidate with a business idea is an obvious fit for incubators, but they are not the only type of students who can benefit from the experience.
Some students join with the hopes of helping others build their business, says Baecker. Working in a group can have long-term benefits.
"We stress that entrepreneurship is a team sport," he says. "If you try to do it alone, that is probably the best way to ensure that you will fail."
In a group setting, students may feel more accountable for not completing a task because their business partners will also be let down, Baecker says.
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• How long can students use it? Because an MBA student's first year is usually spent managing school work, students typically get involved with incubators during their second year.
Incubators understand that it can take time for a new business to find its footing. Some allow entrepreneurs to stay for one or two years, even after a student has graduated.
Others give new businesses more time. At the Missouri Innovation Center, businesses developed through the incubator can stay as long as they need to.
• What are the challenges of working in an incubator environment? Business school students sometimes team up with someone with a more scientific background to get a business off the ground. In this setting, students can develop an inferiority complex about not having technical skills, says Halliday of the Missouri Innovation Center.
Even if someone is able to physically build a product, not knowing how to market it or control financing can still lead to failure, making an MBA candidate a particular asset.
"They are perhaps even the most valuable member of the team," Halliday says.
He encourages students entering an incubator to be ready to work hard. The long hours needed to launch a new business can be grueling.
"New ventures consume every minute and every ounce of energy," he says.
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