The class of 2023 from two of the nation’s most prominent business schools founded nearly 100 startups, according to data released by an international software design and development firm.
The data from Symphony revealed that the Stanford MBA class of 2023 founded 23 companies, while Harvard MBA grads started 64 companies.
At Stanford, Symphony noted that the number of health care startups founded increased by 100% from 2022 to 2023, with more companies birthed in health care than in any other industry.
Meanwhile, at Harvard, Symphony found that AI technology has grown the most since 2022, following more significant industry trends surrounding artificial intelligence.
“There’s lots of money going into AI and health care. A lot of this has to do with chasing the bucks,” Jack E. Gold, founder and principal analyst with J.Gold Associates, an IT advisory company in Northborough, Mass., told TechNewsWorld.
“Health care has long been an area that is not only well-funded but is also ripe for disruption,” added Charles King, the principal analyst at Pund-IT, a technology advisory firm in Hayward, Calif.
“Toss in the steadily growing numbers of baby boomers moving into Medicare and other sizable health care programs, and it’s easy to see why entrepreneurs are flocking there,” he told TechNewsWorld.
Allure of Health Care
Young entrepreneurs have been drawn to the health care industry in recent years for many reasons, explained Mark N. Vena, president and principal analyst at SmartTech Research in San Jose, Calif.
“The industry’s vast potential for innovation and disruption offers young visionaries a unique opportunity to make a tangible impact on people’s lives,” he told TechNewsWorld.
“The allure of purpose-driven entrepreneurship and the potential for meaningful change are fueling the attraction to the health care sector,” he said.
Another attraction for young entrepreneurs cited by Vena is the growing global demand for health care services, coupled with technological advancements, which fosters a fertile ground for creative solutions and startups.
“Furthermore,” he continued, “the rising awareness of health and wellness among millennials and Gen Z drives their interest in creating ventures that address pressing health care challenges.”
“More people are becoming health conscious,” added Kyle Jones, co-founder, and current chief innovation and branding officer at iCRYO Franchise Systems, which has more than 300 franchise locations in the United States, Canada, and the United Kingdom.
“Ever since Covid hit in 2020, the world is looking at health and wellness differently,” he told TechNewsWorld. “Instead of being reactive, they’re being proactive about their health. People in general, not just from a graduation perspective, are paying more attention to their health than ever before.”
Climate for Startups
Another domain attracting grads with a startup yearning is the environment. Climate tech continues to be top of mind, Symphony noted, with a steady number of startups founded in the category from 2022 to 2023.
“Climate change is an existential issue and a threat that needs intelligent and effective solutions,” King said. “It’s a natural area of interest for smart, ambitious people.”
“Almost everyone is being hit in some way by climate change,” added Rob Enderle, president and principal analyst at the Enderle Group, an advisory services firm in Bend, Ore.
“It’s creating the impression that the field could be highly lucrative, and it addresses growing personal needs for safety and comfort,” he told TechNewsWorld.
Vena explained that a heightened awareness of the pressing climate crisis and a desire to be part of the solution and create positive environmental impacts are increasingly drawing young entrepreneurs to climate-tech startups.
They’re also aware that the growing global demand for sustainable and eco-friendly technologies presents a significant market opportunity, he continued.
“Additionally, governments and investors are increasingly supporting green initiatives, providing access to funding and resources,” he said.
“The potential for scalable and impactful solutions further motivates young innovators to tackle climate challenges,” he noted.
“Moreover,” Vena added, “the interdisciplinary nature of climate tech encourages collaboration among experts from diverse fields, fostering a rich ecosystem of ideas and innovations.”
One tech segment that appears to have lost its luster with graduates is Web3. Grads have stepped back from the new iteration of the internet, with only four startups in Web3 founded across both schools in 2023, Symphony revealed.
“The tech industry has a history of chasing after potential markets and abandoning those that fail to live up to their original promise,” King said. “Increasingly, Web3 appears to be heading toward the latter category.”
Enderle maintained that Meta’s very public problems with Web3 may be influencing young entrepreneurs. “It appears to have taken the bloom off the Web3 rose,” he observed. “When folks saw what Web3 currently can do, they just weren’t all that excited.”
“No one knows what Web3 is anymore. Everyone has their own definition,” added Gold.
“How many companies out there are making a lot of money with Web3?” he asked. “The metaverse is tanking.”
“The bottom line is,” he continued, “if you’re going to do a startup and you’re not going to make any money, you’re not going to be in the startup very long.”
Value of an MBA
Vena asserted that uncertainty is a factor contributing to young entrepreneurs shying away from Web3. “The rapid evolution of the Web3 space brings a high level of uncertainty and risk, deterring risk-averse individuals from investing time and resources into the technology,” he explained.
Complexity is another factor. “The complexity of blockchain technology and its steep learning curve may discourage newcomers, making it challenging for young entrepreneurs to jump into this domain,” he maintained.
“Additionally,” he continued, “the lack of clear regulatory frameworks and concerns about environmental impact pose ethical dilemmas, causing some to reevaluate their involvement in Web3.”
Will young entrepreneurs find their shiny new MBAs worth the time and money it took to earn them?
“The importance of an MBA when starting a company can vary depending on individual circumstances,” Vena explained.
“While an MBA can provide valuable skills and knowledge in areas like finance, marketing, strategy, and operations, it is not a prerequisite for entrepreneurial success,” he said.
“Many successful entrepreneurs have built thriving businesses without formal business education,” he continued. “Practical experience, a strong vision, adaptability, and a willingness to learn from failures can also play crucial roles in launching a company.”
“However,” he added, “an MBA can offer networking opportunities, mentorship, and access to resources that can accelerate business growth and enhance decision-making.”