Instead of another boring lecture, last week my students at UC-Berkeley got quite a treat: a lively discussion with TechCrunch founder Mike Arrington. I once described Mike as a cross between Oprah Winfrey and Howard Stern; so I was ready for a little controversy. But he ended up lighting such a big fire, that I’ve been bombarded with questions from students about their education and careers. The questions aren’t just coming from Berkeley; after the discussion was posted on TechCrunch, students at Duke asked me to discuss this at a keynote I am giving at their entrepreneurship symposium on Wednesday; and students at other schools, from as far as India and Singapore, have asked for advice. So I’ll just respond here in the hope of quenching this fire.

At the UC-Berkeley Distinguished Innovator Lecture Series, last week, Mike and I discussed a variety of topics. We agreed on most subjects—except on the importance of education (and dearth of women in tech—which is a battle I’ll fight another day). When I brought up my TechCrunch post on the importance of MBA degrees, Arrington questioned why students needed to get any degree or go to college at all. He talked up the success of tech CEOs who had dropped out of college—Zuckerberg, Gates, and “countless high-profile entrepreneurs including Larry and Sergey” (Mike: Larry and Sergey both have undergraduate degrees and were completing PhD’s). Despite being interrupted by Berkeley professor Ikhlaq Sidhu (who I was afraid would come on stage and strangle Mike before he could finish his sentence), Arrington said that he didn’t learn much from college; gaining admittance to a Berkeley or Harvard is the only certification a student needs; dropping out from college doesn’t carry a stigma anymore; so “the best thing in the world is to go to Harvard for a year and drop out because everyone knows you were smart enough to get in”.

Arrington told students that the kind of person who wants to increase his chances of success by getting a masters degree isn’t an entrepreneur; older entrepreneurs have no chance of raising money (so they’re a lost cause); success means building a billion dollar business and making a lot of money—it’s not good enough to build a good lifestyle business that pays the bills and brings you happiness. So they should “ready-fire-aim” and go for the big prize rather than thinking small.

Here is the problem with Arrington’s logic: students may come up with great ideas and start a company, but they aren’t going to be able make it big unless they have the educational foundation. Maybe Zuckerberg lucked out by being at the right place at the right time, but he wasn’t born with the knowledge of how to grow a business. To build a business, you need to understand subjects like finance, marketing, intellectual property and corporate law. Until you have been in the business world for a while, you don’t know how to negotiate contracts, deal with people, manage and nurture employees, and sell to customers. Most importantly, if students don’t learn the importance of finishing what they start, they will never achieve success—this requires perseverance and determination. And by dropping out of college, they won’t have the alumni networks that they need to help them later in their careers and in business.

The harsh reality is that for every Zuckerberg, there are a thousand who drop out of college and fail. Many get discouraged after their failures and move to other professions which require less skill and education. Some universities do readmit students who dropped out for a short period of time, but most students end up burning through their savings and loans from friends and relatives, and can no longer afford their education. Some give up and look for jobs in big companies, but big companies don’t generally hire people without degrees—because they want employees who have the discipline to finish what they start; who won’t jump ship and chase every rainbow.

Plus, if you look at the backgrounds of the people who actually built Facebook—the executives and employees of the company—you’ll find that they aren’t college dropouts; they are highly educated. Facebook, Microsoft, and Apple—all started by college dropouts are the most selective in hiring; they are the most fussy about degrees.

My advice to students is to get all the education they can, while they can. Complete at least a bachelors and get a masters degree if you can. The degree doesn’t have to be from an elite college like Harvard or Stanford; any education will carry you far. As this chart shows (based on an analysis of the backgrounds of the founders of 652 successful technology companies), there is a huge difference in the size and revenue of companies founded by people with college degrees. But there is only a small difference between those with ivy-league degrees and the average (which includes all startups).

After you graduate, you should gain some practical work experience and learn the realities of the business world before making the plunge into entrepreneurship. Work for a big company for a few years; learn about how the corporate world works; get good at people management, project planning, and teamwork. Then join a startup—which will probably fail as most startups do. But you get to fail on someone else’s dime and learn all the valuable lessons.

In his talk, Mike Arrington said that he got little from his education. He also said that he wished he had gotten an MBA instead of a law degree. But what Mike didn’t seem to acknowledge was that he needed the law degree to become a lawyer; when he was a lawyer, he gained an in-depth knowledge about the tech world and its problems —which led to his startups; and this education gave him the knowledge to take on unethical companies and question unethical practices—all of which have helped make TechCrunch the world’s leading tech blog. Does anyone think that Mike would have been able to build TechCrunch if he was a college dropout?

In our discussion, Mike joked that instead of doing the law degree, he wishes he had learned to play the guitar in junior high—“maybe he would have become a rock star”. I have no idea if Mike has any musical talent, but a smaller proportion of guitarists become rock stars than techies who become CEOs.

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  • Vishalg

    The question to ask if you are a student reading this is – do you want to end up as Arrington or Wadhwa?

  • http://twitter.com/DaveLG David Gillooly

    If you are truly riding the “arrogance made me great theme” one can’t allow people to get the idea that your greatness had anything to do with something traditional or something as lowly as education. That would go against the rebel messianic framework that must be constructed and promoted.

    In short, polite society tags many successful, wealthy people as being arrogant. If the same people were not wealthy they would be simply referred to as jerks.

  • petegrif

    This is sane advice. No question about it. But it is a little one sided in that the argument is way strongest when one assumes that the degree is vocational. However, if the average person goes to college for a four year degree then a masters in liberal arts they can emerge from the end of the process with a degree of little practical value and a lot of debt. In recessionary times employment is not easy to find for such graduates and the debt does not go away. This problem is becoming increasingly acute because the cost of college is skyrocketing. The trends then for non-vocational subjects are pretty grim. I value education, but how many people will be able to afford it?

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  • Woogsj

    This article is flamebait.

    I whole heartedly disagree with almost everything Vivek has said in the article. Except for getting all of the education you can.

    Maybe I am the exception and not the rule. But when Mr. Wadhwa says ” big companies don’t generally hire people without degrees—because they want employees who have the discipline to finish what they start; who won’t jump ship and chase every rainbow.” he is wrong.

    I moved to San Francisco, actually, hitchhiked with nothing except a backpack and a tent. I had nowhere to live, no education, no money and only one friend. This was in 2005. I was twenty five years old. I also had no job experience. But I have programming skills which I taught myself by reading various books and writing code. Oh yeah, I dropped out of high school in ninth grade with all F’s.
    My mother never graduated from college and my father dropped out of school in the tenth grade. So to say that I come from a family of academics is a bit inaccurate.

    Five years later I am making more than $120k a year with a large company in the fortune 500 and I write code for them. I just got promoted in fact. Working for 120K a year seems nice but
    it is still working for someone else and it is a waste of hours better invested in building equity in a business that matters. A business that I am building.

    Now, with all of that said. I know I am not Zuckerberg. In fact, he is more intelligent than I. As are many people. Now let me tell you why that does not matter.

    1: I drive hard to achieve what I want. The difference between being intelligent and rich and being intelligent and broke is typically action. There are thousands of people more intelligent than I that could have my job in a heartbeat. I struck while the iron was hot, I ignored everyone of the haters that said I could not do it and here I am with the position that many Stanford grads, Princeton grads and *IVY league* grads applied for.

    2: Intelligence in action is worth a hell of a lot more than intelligence on paper. Lots of people I work with want to debate algorithms, math, data structures and while they are debating I am coding. I get the results first and that is what matters to a boss. Results. I might not know the big O but I can get shit done.

    3: I have been poor my entire life. I did not wear a pair of name brand jeans until I was 25. Name brand cereal was a big deal in my home as a child and coming from one of the poorest neighborhoods in Washington state the odds were not in my favor. I have sold T.V’s to pay rent, almost been evicted when I was younger, gone without food and I have been homeless for long periods of time. That experience has given me the drive to succeed, the will and knowledge in how to survive on nothing and the resourcefulness to turn what seems like a horrible situation into a less horrible situation.

    I don’t want a job like millions of other jobs. Boring. I am going to start a company. What is interesting is so many people have already told me that it is too risky and it will not happen because I do not have enough money, friends, network of investors, blah blah blah. So many reasons it cannot happen… Whatever. Who cares about working for someone else for 30 years and relying on the company for medical and dental. Ugh, that depresses me.

    If anyone is interested in co-founding a billion dollar company with me I can be reached at woogsj@gmail.com. It would be awesome if you can hack electronics, are insanely driven and possibly a bit insane. I have a few ideas. All of which I am working on. Which, once again, everyone says is the wrong way to do it. We could talk about them all and pick the best one and knock it out of the park.

    I live in San Francisco right now but in two weeks I am moving to San Jose.

  • http://twitter.com/zaqqus Zach Dexter

    The fallacy here is that your chances for success are dictated by statistics, so because earning a college degree makes you statistically more likely to succeed, it must therefore be a good idea to pursue one at any cost.

    But that’s not the case. College degrees might correlate with success, but a college degree has never caused someone to be successful.

    Whether you are a college graduate or not, your chances for success are based on your level of competence and your tenacity, neither of which comes automatically with a degree.

    tl/dr: If you are in college just for the sake of being in college, there’s a good chance you’re wasting your time and money.

  • MM

    Where would Zuckerberg be right now if the idea for facebook didn’t fall into his lap?

    • http://twitter.com/Nichelings Jamal Burgess

      He probably would have made something else. Lets remember that he had a music app that he COULD have pushed BEFORE facebook. After doing a little research on him he was very much smarter than the average teenager. Ok I won’t say he was more smart, but he applied himself. Speaks several languages…known for memorizing old poetry, etc. He was exceptional.

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  • Trajan

    Why not do both? Go to school and create a startup? Why limit yourself?

    • http://steventruong.com/ Steven

      Because that’s not as realistic. Your chance of success in either greatly diminishes

  • Sundar

    I can see why Mr. Wadhwa makes much sense in today’s America.

    His old school wisdom (read Indian frugal mindset and conventional wisdom) combined with the opportunities he has come across has made him create or value or talk about companies and individuals who have made a sustainable development. He does not jump at the idea of selling pet food online, he does not believe that one can work wonders overnight, he does not believe in accidental invention instead all his thoughts, actions and words are bound by a common glue called “sustainability” – No wonder he is a top advisor to many start-ups and provides the much needed “adult supervision” to the boys in silicon valley.

    This article also hits the nail on the head of college kids who want to “cash-in” make a “billion dollar exit” etc, instead of dreaming and working towards building something sustainable. You see Mr. Wadhwa, for U.S to regain its pre-eminent position in innovation they need a lot of “adult supervision” and you would better serve the humanity by being with the boys in the silicon valley than in India. :)

    Please continue to write, talk, share more of such blunt revelations – we in India will learn like “ekalavya” of Mahabharatha!

  • http://rishabhagarwal.com Rish

    Ermm.. No talks about taking “Risks” ?

  • Anubhav Chattoraj

    Old-school bullshit. College doesn’t teach any of the stuff Mr Wadhwa claims is essential for entrepreneurship. Nor does working a desk job give “real-world experience”. I could as easily claim that Mr Arrington was the exception, that he “lucked out” by having a job that actually gave him more insight into the subject of his future venture.
    The hiring practices of large corporations are irrelevant to the discussion of whether you need a college degree to become an entrepreneur. I regret to say that Mr Wadhwa appears to be grabbing at straws, trying to say, “Look, other people think so too! ZUCKERBERG thinks so too! I’m not alone in saying this!”
    The truth, as several young people are realising today, is that knowledge of the real world is best gained in the real world. Gaining every kind of experience that’s available just because it’s available (college, desk jobs, working in start-ups) is probably not the best use of your time.

    • http://www.wadhwa.com Vivek Wadhwa

      Did you drop out and are you an entrepreneur?

      • http://steventruong.com/ Steven

        I actually agree with Anubhav. I did drop out and I did sell my first startup within 2 years in the millions. It really depends on the individual and their learning capacity BUT college don’t teach you any of those things (the stuff they teach are often wrong) and the hands on experience is much better and faster

    • http://twitter.com/TheRahulM Rahul Mehrotra

      Can you clarify what you mean by “…knowledge of the read world is best gained in the real world..”?
      Are you trying to say that degrees don’t matter – and the only way to become an entrepreneur is starting a company after high-school and learning from your failures?

  • Bob

    I agree with author’s argument that the founder of fb is an exception rather than the rule. However, his narrative seems to suffer from the same narrative fallacy of his opponent. He appears to confuse association with causation. Furthermore, Mr. Wadhwa neglects other aspects of one’s personal calculus.

    • Sush

      I was just thinking the same thing as I read this. Zuckerberg, Jobs, Gates & Co are exceptions…not the rule. Once the world’s richest man, Warren Buffett completed undergraduate and graduate degrees. Other wealthy entrepreneurs (if that’s the only measure of entrepreneurial success) are also highly qualified. Not that education is a definite means to triumphant business success, but it definitely helps to know about what you’re creating and selling – which is the underlying spirit of Mr. Wadhwa’s essay.

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  • http://www.ChannelStack.com/mychannelstack/RVTV RamVaz

    If you don’t try you will never know. You have to be willing to take risks to get rewards.

  • Anonymous

    Very Very True..nI agree with you

  • innovation

    heard you speak this week…was wondering do you have a company in india or are there any contracting opportunities to the india goverment with cyber technology? or a way to help them innovate?

    • vivek

      No, I am not in touch with the Indian government at all…

  • Raj

    thanks for giving realistic advice.