The former CEO of Microsoft delivered a damning assessment of the technology sector this week.
Steve Ballmer, speaking to a group of Oxford Said MBA students, might have discouraged the next generation of business leaders when he said: “Most tech companies fail. They are zero trick ponies, never do anything well. You’re a genius in our business if you’re a one trick pony, and even companies that get public have one trick, generally. And then the companies go away.”
He pointed out, of course, that Microsoft was at least a two-trick pony. “I’m proud that we’ve done at least two tricks… we invented the modern PC and the second [thing] we did was bring microprocessor tech into the data centre,” Ballmer said when taking questions from MBAs.
Yet they fell behind in the mobile tech race, he admits, somewhat cryptically. “We didn’t put the hardware and software together soon enough,” Ballmer said. “We would have a stronger position in the phone market if I could redo the last ten years.”
But it is persistence and unrelenting commitment to a tech company that will allow MBAs to be successful in the technology sector.
“Do you give up and go home? Or do we build assets to seize on things going forward? We go forward. We prepare for next generation,” Ballmer continued. “If you’re going to do a start-up, you’ve got to be in and stay in, not just for six months or a year, and take a long-term view.”
If there is one thing that Facebook’s $19 billion acquisition of WhatsApp tells us, it’s that innovation is still thriving in the tech sector, and people are prepared to pay big for it. And for the next generation of MBA entrepreneurs, they should be well prepared to go the distance.
The statistics tell us that it is an ever popular corporate career path too. Tech employers, big and small, want MBAs more than ever. Asia has driven an era of unprecedented growth in such demand.
More high technology and computer services companies are looking to MBAs to commercialize their products. In Africa & the Middle East, there was a 30 per cent increase in demand for MBAs in 2013 among employers surveyed by QS Top MBA.
North America saw a similarly encouraging 21 per cent. “The high tech corridor on the west coast remains vibrant,” says Tom Kozicki, director of career services at UC Irvine.
Some regions of Europe saw about 14 per cent more demand. Oracle was reported to be on a huge recruitment drive last year, while it was revealed that Infosys plans to recruit 200 MBA graduates by June this year.
“This MBA hiring drive will not only increase customer engagement, but will also increase high-end consulting which in-turn will bring in more revenue,” said Srikantan Moorthy, the company's Group Head of Human Resource Development, at a recent recruitment event in London.
Microsoft’s Ballmer, who stepped down as CEO last month, said that MBAs have to embrace every part of their business to be successful. MBA education is sometimes criticized for being generalist, but in this respect, that could be a huge advantage.
“You can’t not like anything; you’re not allowed to. If you want to lead a company you have to want to lead the whole company. You can’t shy any from anything,” said Ballmer.
Entrepreneurship has taken the business school world by storm. Around a quarter of MBAs see themselves running their own businesses eventually – more than the percentage who envisage themselves running large companies, according to a QS report.
Recruiting is another key to tech start-up success. “That was the most valuable thing I added to Microsoft. It’s the lifeblood. I didn’t know much, but I got the hiring machine going because I interviewed for a lot of jobs,” said Ballmer.
Bernhard Niesner, CEO and co-founder of language learning tech site Busuu, agrees. “Financing was a problem, but the biggest challenge was hiring top talent,” he told BusinessBecause.
Bernhard has an MBA from IE Business School and his business was created during the program, he says. He met his co-founders at business school and the company has swelled to about 35 employees since its foundation in 2007.
“But we are hiring strong and growing to more than 50 in due course,” Bernhard added. It was part of the reason why they moved from Madrid to Tech City in London.
Other MBA graduates are enjoying success in the technology industry too – in both entrepreneurship and corporate careers.
Grant Gudgel graduated from the EMLYON Business School MBA and is now the COO of vidCoin, an exciting tech SME that displays branded video campaigns to players of high-quality social and mobile games, in exchange for virtual currency.
Entrepreneurship was "100 per cent of the reason" why he chose EMYLON. “I knew I wanted to focus on entrepreneurship and, already trying to launch one of my business ideas, I was a quick fit with EMLYON,” he says.
They launched their first product in June and have experienced a 50 per cent growth month-on-month, he says. “[The MBA] has given me exposure to the start-up world in an accelerated way. I know how the game works now.”
Alexandre Sagakian launched a tech start-up after the dotcom bubble burst. The ESSEC Business School MBA graduate ran his online market research company for over a decade, raising €600,000 in seed-funding before selling it on to Bolloré Group, the French investment firm.
He is also a Director at Techstars, one of the best-known tech start-up accelerators in the world.
He used ESSEC’s entrepreneurship program to develop his business idea, and was approached by investors before even graduating. “I couldn’t just say wait, could I? They don’t care if you graduate or not. I left the program and raised some finance,” he says.
He went back and finished his MBA, however, and that gave him credibility among tech investors. “I don’t think people would have invested in me if I wasn’t an ESSEC graduate; it gives you credibility,” Alex says.
“An MBA helps because you need the background, the additional edge. It’s more than a label too; it’s a whole concept. You will learn how to create a business plan, manage finance and build a network.”
Microsoft’s former CEO may be right about technology companies’ failure rate. But that does not deter MBAs. As entrepreneurship continues to pick up steam, the tech sector will continue to grow in popularity at business school.