Dear Liz,
So, last year I got it into my head that I wanted to start my own business. The pandemic upended everything, and I lost my (pretty well-paying, btw) job as a retail buyer right at the start. It was fine because my husband and I had considerable savings, and as an attorney, his job proved recession-proof. So I figured, okay, let’s make this into an opportunity, and started thinking about finally opening my own bakery. I love baking and I’m legit really good at it, and I think I’ve got a good head for business resting on my shoulders. I co-managed a pizza place for a couple of years out of college. But I’m applying for business loans for some startup capital, and I’m getting really in my own head about never getting a business degree, and without my job, our savings have taken a big hit. It feels like such a risk. Am I making a huge mistake?
Marina W.
Hey Marina,
Before I say anything else, I want to applaud your entrepreneurial spirit. The pandemic wreaked havoc on women in the workforce, and I’m so heartened to see you trying to turn that into a business of your own. I believe with all my heart that entrepreneurship is the most effective way for women to achieve economic independence and everything that goes with it. And what’s more, you’re creating job opportunities for other women at the same time. For our readers’ edification, I want to stress that you have a lot going for you.
Now, for your question. The short answer is that no, you do not need a business degree to start a business. That’s doubly true for small businesses.
The long answer is a bit more complicated.
Now, I want to preface that by disclosing that I’m a product of NYU Stern School of Business. I have the highest regard for the education I received there, and it has 100% proved invaluable in my own entrepreneurial journey—the lessons I learned, the lifelong friends I made, and the mentors and collaborators I was introduced to while there have been vital throughout my career. That said, business school is a massive investment of time and money, the latter of which has spiraled upward in the almost thirty years (good lord) since I graduated. So the question isn’t, “Do I need a degree,” but “Is a degree worth it?” The only correct answer is the one dictated by your own judgment and circumstances. As much as “you have to spend money to make money” holds true, you must spend that money wisely.
The question isn’t, “Do I need a degree,” but “Is a degree worth it?” The only correct answer is the one dictated by your own judgment and circumstances.
For the kind of business you want to start, a small, locally-owned bakery, an MBA wouldn’t really be necessary, so join me in a collective sigh of relief that you won’t be on the hook for $130,000 a year. But even two-year undergraduate business degrees from a public university will cost you somewhere in the neighborhood of $8,000 a year in tuition alone, not to mention the other costs that come along with college. For a private college, that turns into almost $30,000. It sounds like your husband makes good money, but I’d advise you to think about the finances of pursuing a business education and potentially taking on debt before you’ve even applied for a business loan. These are all prudential judgments that you’ll have to make based on your present situation, but to answer your question in no uncertain terms: no, a business degree is not required.
That said, what I would recommend is finding a business partner who does have that degree if you’re not currently able to pursue one yourself. The skills a basic business degree offers, from financial planning to accounting to forecasting to logistics, are invaluable. Yes, you can learn them on the job, but you’ll have a much better chance of surviving your first year if you already have the right tools in your toolbelt. A business partner who can help shepherd your bakery through those trying first months would save you a lot of time and money on trial and error management, and if you’re able to, you can buy them out later to gain full ownership.
Whatever you decide, please, please don’t treat the lack of formal business education as an obstacle. Some of the world’s most wildly successful companies were started by outsiders and neophytes, from Facebook (Zuckerberg studied programming and psychology before dropping out his sophomore year) to Virgin Group (Richard Branson never completed high school) to Auntie Anne’s Pretzels (Anne Beiler, who grew up Amish, left school after eighth grade). Trust your instincts and your judgment instead of your fear. Fear is just the body’s response to uncertain danger, not a rational faculty of judgment.
Go boldly, but with eyes open. I can offer no better advice than that.
WRITTEN BY
Liz Elting