Why You Shouldn't Disregard MBA Hires, No Matter What Peter Thiel or Elon Musk Say

2015-06-03-1433360959-382824-JohnTabis.pngAuthor John Tabis is CEO & Founder of TheBouqs.com.

In an interview last September, Peter Thiel said that MBAs tend to participate in herd-like thinking. The luminary PayPal co-founder and entrepreneur further explained he generally avoids hiring business school graduates because they often exhibit high extroversion but low conviction.

That sentiment got some good pickup around the startup space, but it's an opinion we've heard before from smart leaders in the startup world. "They don't teach people to think in MBA schools," said Elon Musk  in an interview with the American Physics Society. "And the top MBA schools are the worst. Because they actually teach people that you must be special, and it causes people to close down their feedback loop and not rigorously examine when they are wrong."

In my experience, as an MBA and founder, I must respectfully disagree. MBAs don't necessarily fall victim to groupthink. And I don't believe an MBA is any more likely to think they are "special," in the negative sense, at least not compared to any other entrepreneur who believes he or she can change the world through smarts and sheer will. Just like non-MBAs, professionals with those three big letters can be founder material. It takes an idea, drive, smarts and flexibility, and in my experience, MBAs can bring those qualities and more to the startup table.

And even if the Master of  Business Administration isn't the founder, business school grads can add great value at various stages of startup growth. Beyond innovation or tech chops, other qualities such as critical thinking, analytic chops, process management and financial planning are essential to running a high-growth startup -- especially when creating and managing a scalable business model. MBAs are more likely to have these skills, making them great candidates for startups in scaling mode.

For these reasons, I disagree with Mr. Thiel and Mr. Musk. Startups shouldn't avoid hiring MBAs, and MBAs don't make lesser leaders. So before you swear off hiring MBAs because of what you may have heard from a few uber-smart and well-known opinion leaders, here are some examples of successful entrepreneurs who may make you think twice.

Dave Gilboa, Neil Blumenthal, Jeffrey Raider and Andrew Hunt

After spending their first semester of grad school squinting and complaining about the high price of eyeglasses, four Wharton School students began developing the idea for Warby Parker, an online store providing trendy, affordable eyewear. Though the proposed business plan didn't make it through the final round of Wharton's Business Plan Competition, they launched in 2010.

Soon after, the four founders saw an even greater need. Nearly one billion people in the world lack access to eyeglasses -- which means they can't read, learn or work effectively. To address the need, Warby Parker partners with nonprofits like VisionSpring to distribute a pair of glasses to someone in need for every pair sold. The company has sold more than one million pairs of glasses, and is now valued at $500 million.

Brian Spaly and Andy Dunn

Brian Spaly began making his own pants when he had trouble finding pants that fit him correctly in stores. Recognizing the opportunity, he and Andy Dunn launched an online clothing company, Bonobos, after graduating from Stanford's MBA program in 2007. The company specialized in selling flattering pants for men -- no more "khaki diaper butt" here. Despite the rough economy at the time, the startup was successful and raised $30 million in just three years.

In 2009, Spaly left Bonobos to run Trunk Club, a shopping service for men that offers personalized designer clothing. Nordstrom bought the company for $350 million last summer.

Aaron Hirschhorn

A graduate of the UCLA Anderson School of Management, Aaron Hirschhorn founded DogVacay -- often called the "Airbnb for dogs" -- in 2012. Through its website and app, the service connects dog owners with thousands of screened and insured pet sitters across the U.S. and Canada.

The idea formed when Hirschhorn and his wife struggled to find a place to take care of their dog, Rocky, while they went on vacation. They settled for a kennel, which proved to be a $1,400 bad experience. Hirschhorn's dilemma inspired him to start a home dog-boarding business on Yelp, which led to the creation of DogVacay. After bootstrapping the concept for some time, funding from a who's who of Valley VC's followed, and the concept took off.

Last October, the startup celebrated the milestone of reaching 1,000,000 booked nights in a little over two years since launch.

Matt Salzberg

After graduating from Harvard Business School in 2010, Matt Salzberg accepted a Rock Center Fellowship to continue working on his business ideas. Two years later, he launched Blue Apron, a service to satisfy epicureans who don't have much time to spend at the grocery store. The New York-based startup delivers recipes and pre-measured ingredients from quality wholesale providers to subscribers each week. Meals can be prepared easily, within 40 minutes, with a basic set of cookware.

Since launch, Blue Apron has expanded service in several U.S. states, and as of April 2014, sells more than 1 million meals each month, surpassing annual revenue of $120 million.

Eric Baker

While attending Stanford GSB, Eric Baker met classmate Jeff Fluhr, and the two shared frustrating encounters with ticket brokers. Their mutual experience gave them an idea for a secondary ticket market website. They developed a plan for the business-to-be, Stubhub, and entered it in a competition. When it made it to the finals, they pulled out of the competition and devoted more time to the idea.

Baker graduated with his MBA in 2001. Despite 9/11, a rough economy and an impending war that year, Stubhub launched successfully. In 2007, eBay purchased the business for $300 million.

An MBA isn't necessary to create a successful startup -- plenty of entrepreneurs have shown this to be true. But many successful businesses, which thrive today, got their start while the founders were in B-School, or are driven by a team of MBA grads as they scale.

An MBA, or lack thereof, shouldn't be a primary indicator of a candidate's potential performance in a startup. A candidate knows what he or she knows, and executes that knowledge and experience as needed, whether learned in business school or self-taught. In startups, it's all about getting talent with the ability to identify and solve problems. Don't close your mind off to any potential candidates, including the more entrepreneurially minded MBAs knocking at your door.

Happy hiring!