Do the best entrepreneurs learn the ropes through college or entrepreneurship education—or do they learn through real-world experience? The question of whether education is essential to small business success, or simply a waste of time, has been debated since before I knew how to pronounce “entrepreneur.” And according to a new survey, even entrepreneurs themselves disagree on the answer.
Let’s back up a bit. Does education matter more than experience when hiring employees for your small business? Apparently not. In a Manta survey earlier this year that polled nearly 1,000 small business owners, half say they hire staff who don’t have a college degree. What’s more, more than 60 percent say they see no difference in performance among employees with varying education levels. Desire, drive and the willingness to work hard matter more to business owners in the study when it comes to choosing who to hire.
But it seems small business owners don’t extend themselves the same leeway. Entrepreneurs in the study predominantly said a college education was important to their own success as small business owners. Almost 70 percent of those polled have at least a bachelor’s degree; more than six in 10 said a college education had been important to their business success.
I can see a degree being valuable in some fields, such as consulting or professional services. But if you want to start your own restaurant, open an auto repair shop or start a hair salon, is a college degree more crucial than real-world experience in your chosen field? I’d argue that in many industries, street smarts and hands-on learning outweigh anything that can be learned in a college classroom setting.
Maybe when small business owners tout the value of education, what they really mean is the ability to think things through and plan a path to growth. Entrepreneurs in the Manta study cited a strong business plan as vital to getting their businesses off to a good start. Over one-third said that a business plan was the most important success factor in starting a business—more important than capital, networking or mentorship.
The role of business plans has changed in recent years. With our economy changing rapidly and disruptive businesses sprouting up, many feel the traditional business plan that looks out five or 10 years into the future is outdated. But while your business plan may not be as “etched in stone” as it used to be perceived decades ago, I agree with the entrepreneurs Manta polled that it’s of great value—in many cases, I’d say, a more valuable piece of paper than a college degree.