
Spend $120K in angel investing instead of MBA studies - dirtyaura
http://www.fourhourworkweek.com/blog/2010/06/28/mba/?utm_source=feedburner&utm_medium=feed&utm_campaign=Feed%3A+timferriss+%28The+Blog+of+Author+Tim+Ferriss%29&utm_content=Google+Reader
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jacquesm
That's about as false a dichotomy as I've ever seen.

You could spend that $120K in much more productive ways than either of these
two, besides, when you're of the age to go in to studying usually that money
is given to you as a debt with a purpose to spend it on your education so
you'll be in a position to pay it back later.

If the return-on-investment in startups would be better than the return-on-
investment of student loans you can bet that banks would be a lot more willing
to borrow money to start-ups. At best this will teach you a thing or two about
investing and leave you in debt to the tune of $120K. You'll be working for a
bank the rest of your life.

If you are in the position of spending the money on a startup spend it on your
own first, build a success large enough that you no longer lose any sleep over
losing a 100K+ and _then_ become an investor in other peoples companies.

Terrible advice this article.

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rmc
The author is intentionally not trying to earn money. As far as he's seeing
it, he's fully expecting to _lose_ the $120k.

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jacquesm
If you have $120K to lose that's one thing. But most students don't have that
kind of dough lying around and to borrow it in order to throw it away is
inviting trouble. That's a $400 to $700 millstone you're tying around your
neck with little to nothing in return and no easy way in to the workforce
because everybody else was stupid enough to blow their money on their
education instead.

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RiderOfGiraffes
Submitted 5 days ago:

<http://news.ycombinator.com/item?id=1472622>

but it garnered one upvote and no comments, and 6 days ago here:

<http://news.ycombinator.com/item?id=1470665>

where it got around 50 upvotes and 14 comments.

Another example of the importance of timing your submissions. In some senses
this isn't a "problem" as such, but I'd like to see some way of better
consolidation of the same item submitted over and over. The existence of the
existing duplication detection shows that it is, in some sense, an issue, but
better duplicate detection would be, well, better.

In particular, it would be nice not to have the discussion spread over
multiple items. Either the same thing gets said over and over, or important
and interesting points are made that get missed.

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damoncali
I had two of the best years of my life at B School. I met lifelong friends,
learned a ton, and got to push the reset button on my life.

But business school is a bit of a scam, and the willing victims are the
students. They sell glamor and wealth on Wall Street and throughout corporate
America. "You'll be making half a mil in 5 years, what's $160k in debt?"
Everyone is going to be a master of the universe. Except it doesn't work that
way, even if you play by all the rules. Even at Harvard, Stanford, and Penn.
Correlation is not causation.

Would I do it again? Hell yeah. But I was fortunate enough to go to a highly
ranked public school for a fraction of that. I find it incredibly hard to
believe that Stanford is worth 3-4x what I paid at Texas.

BUT... blowing $120k on angel investments seems like a very, very poor
substitute for the B School experience. Yes, spend a crap ton of money
educating yourself outside of school, but don't piss it away on angel
investments. Spend it trying to _do_ something.

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dkuchar
while that's a great idea in principle, in practice, no one's going to lend
you $120k to invest in startups. If you've got the cash and you're looking to
pay out of pocket, it's a nice idea. but to my knowledge the gov't doesn't
over low interest loans for education-via-angel-investing.

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mukyu
You need to be an accredited investor in the first place for this to be an
option--which means you have the money.

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ahk
Who accredits investors?

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iamelgringo
The SEC: <http://www.sec.gov/answers/accred.htm>

Feel free to discuss here: <http://news.ycombinator.com/item?id=1487724>

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kljensen
This does not get you the two primary benefits of attending a top tier school:
1) the social proof that comes with a credential like an MBA from Stanford or
2) the instant network of friends and alums.

(Furthermore, the other comments about accredited investors is spot on. And
lastly, imagine somebody told you they did this and lost it all, would you
hire that guy? No, you'd think he's nuts.)

~~~
ecaradec
As an angel you are invited to many events where you can connect with other
angels and networks.

Even better it's not a future network that will grow over the time as previous
students get at better places and positions, it's an already active network of
more senior people and you'll meet them as homologue not in a
student/professor relationship.

You can probably get a better network by loosing 120k. May be you could choose
the right categories of startups to meet the category of people you are the
most eager to meet ?

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jeza
Sounds like a case of the blind leading the blind. If you figure you may need
an MBA, it doesn't seem you'd be best suited to coaching startups, since that
is part of the aim of angel investing. If they all turn out to be dud, then
you're not really getting a complete picture. Perhaps it'd be quicker, cheaper
and easier to study some existing successful and non-successful startups.

Furthermore, his suggestion to go out and deliberately lose say $5,000 on
gambling just doesn't seem like sound business advice to me. Though if anyone
does want to throw away $5,000 I'd be happy to talk to them, heh.

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joshkaufman
If you don't have $120K to invest in startups, I recommend spending ~$1,400 on
a few very good books: <http://personalmba.com/manifesto/>

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cstuder
Discussed here: <http://news.ycombinator.net/item?id=1470665>

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zacharyz
The main message of this article is the importance of investing in yourself.
Ferriss chose to do that through Angel Investing and the knowledge he would
gain as an advisor. Going to an expensive MBA program isn't the only way to do
it.

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sachinag
I'd love to be angel investor. I'd love to spend $120K doing 12 deals at $10K
each. Guess what? I'm not accredited. Also guess what? I can't get loans to go
become an angel investor. So I'm going to business school instead. (OK, not
really, but this is really fatuous.)

Also, if you're going to B school to learn, you're kinda doing it wrong.
Everyone here who's smart/disciplined enough to be an autodidact to learn new
languages and frameworks is smart enough to learn B school skills from books
as well. You go to B school for the social proof, the networking, the
recruiting (if you're a top-tier full-time program), and, yes, the fun.

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davidw
Seems to me that going into business yourself is a better way to learn than
giving money to people going into business.

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michaelfairley
He had already founded and exited a successful business.

~~~
davidw
Ok, so what'd he need an MBA for then?

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rms
How to lose $120K.

~~~
tomjen3
I sometimes think that it is better to burn the money (as in, set it on fire)
than it is to get an MBA if you want to work in startups.

On the other hand, if you want a cosy job in a nice company that does
something that relates to physical production, an MBA would be suitable.

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kadavy
I took a slightly more conservative approach: I wandered from cafe to cafe in
SF for a year, coworking with other entrepreneurs, working on my own ideas
while advising theirs, and eventually starting my own business.

Additionally, I started a DIY-MBA group of about 6 entrepreneurs that invites
successful business people to brunch to pick their brain.

I've spent way less than $120k, and now I have a pretty solid business, and an
even more solid network.

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igorgue
<http://en.wikipedia.org/wiki/Accredited_investor>

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pramit
Try The Success Manual method - It goes one step ahead of Personal MBA
manifesto - Quotes and summaries from greatest business books and more -
<http://thesuccessmanual.bighow.com>

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iamelgringo
To be an accredited investor and make angel investments legally, you need an
annual income of $200k or a net worth of $1M. (ref:
<http://www.sec.gov/answers/accred.htm> )

I dare say, if you have the means to become an accredited investor, you might
not need an MBA to teach you how to make money.

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known
Spend $120K in angel investing if you're _not_ rich & connected.

