It's a perennial question among entrepreneurs: Is it better to get a degree and then start a business, or does it make more sense to forego college in favor of entrepreneurship?
This question has always been challenging as those who've been to college typically claim doing so was helpful for running a business, while entrepreneurs who didn't go write it off as wasteful. But today, as the nation's youth battle sky-high levels of unemployment, the chances of landing a job out of school have gotten even slimmer -- making the question of what to do after high school all the more pivotal.
When I needed to make this decision, times were considerably different. As I recall, the most difficult economic dilemma facing the U.S. was whether to sign the North American Free Trade Agreement. Still, my family was very supportive -- even though I didn't head off to college like so many of my peers. For me, figuring out what to do after high school was simple. I had experienced some early success in running businesses -- my brother and I started out in eleventh grade selling imported stereo equipment and magic kits to fellow classmates. So, I decided to go with it. But, of course, I would continually hear from teachers and counselors that I was making a mistake.
Advocates of higher learning often point to statistics about the differences in the lives of those who graduate from college vs. those who don’t get a degree. For example, workers with a bachelor’s degree earn, on average, more than 60 percent more than non-degreed workers, according to the U.S. Bureau of Labor Statistics. Unemployment rates are also significantly higher among people without degrees, at nearly twice the rate of degreed wage earners. Add to that the numbers that suggest people with degrees are healthier, live longer and are generally happier, and the case for college seems pretty solid.
There’s something those statistics don’t take into consideration though. As detailed in a recent New York Times article, 2010 graduates who took out loans during school left college with an average of $24,000 in debt, according to FinAid.org publisher Mark Kantrowitz. The heavy burden of student loans, coupled with the high unemployment rate among recent graduates, shouldn't be ignored.
A college degree is by no means a guarantee of success as an employee or entrepreneur. To make it as an entrepreneur, you need drive, determination and a true passion for what you’re doing. With those qualities, just about anyone with the money it takes to attend college and four years to work on a business could make amazing things happen. Just look at me. I didn't go to college and during that time I managed to buy and sell two businesses, each for a considerable profit. So rather than winding up jobless with a mountain of debt, I was ahead of the game.
But before you conclude that I’m set against college, hold on. There are some very good reasons for a would-be entrepreneur to pursue higher learning. For one thing, the value of networking during school cannot be denied. Graduates who have gone on to be successful entrepreneurs often credit their time in college with helping them make incredible connections. Some found business partners, while others made friends with people who were able to help them with their entrepreneurial ventures in other ways.
To be sure, I’ve built a Rolodex of contacts many would envy. But in fairness, it has probably taken me longer to do so than someone who was surrounded by hundreds of like-minded people in college for four straight years.
Additionally, college provides learning experiences beyond the classroom. To be successful in school, you have to learn to balance work and personal time, meet deadlines and follow through on commitments. These skills are also valuable to entrepreneurs. I learned them from my grandfather who guided my early entry into entrepreneurship at the age of 8, but if someone hasn’t had that opportunity, college can be very helpful for teaching these lessons.
Then, of course, there’s the education itself. While you won’t learn all you need to know to be a successful entrepreneur in a classroom or from a book, everything from business basics to sales and negotiation are taught in university programs. Some schools even help you startup a small business while in school. Would I have learned as much attending college as I did in "the real world?" I don’t think so. But it is possible to come out of school with a reasonable grasp of important entrepreneurial skills.
Further, having a degree -- particularly in the field that your business is in -- can offer a level of credibility. When you're dealing with bankers and investors, for instance, having more knowledge of the industry you're working in will only serve you. That wasn't true for me, but I can see how it could help.
So what’s the answer? Should an aspiring entrepreneur attend college or not? To a large degree, it’s a matter of your own abilities and expectations. If you don’t have drive, determination and perseverance, for instance, no amount of higher education is going to help you make it in the business world.
Personally, I don’t have any regrets about not attending a university, and I don’t think my decision to forego school has hurt me. But if you think you may need a bit more time to prepare and make connections, attending college is a worthy option. In the end, it all boils down to personal choice. And following your heart and your gut will often lead you down the right path.