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Tuesday, May 19, 2009

Go Midwest Young MBA!

A few weeks ago, I read the Slate article on the new hot MBA destination which is University of Wisconsin in Madison. Part of the reason for the article appears to be that the writer, Daniel Gross, really needed to get out of New York City. He was probably amazed by all the trees and seeing animals besides rats and pigeons. Daniel Gross admits that much by calling it a detox center. However, you do have to like a city that calls its capital building on the hill, the Nipple of Knowledge. Here's the main sumary of the article and below is my take with my defense and indictman of Wharton.

Madison struck me as blessedly detached from the ailing financial sector.
Of course, Wisconsin is suffering along with the rest of the nation. Its unemployment rate in March was 8.5 percent. But Madison, with its three-legged economic stool of education, state government, and health care,is faring somewhat better. More significantly, the business school isn't having a dark night of the soul, as so many of its Eastern counterparts are.

Columbia Business School and the University of Pennsylvania's Wharton are
basically satellites of Wall Street. Half the students have memorized the
partnership roster at the Blackstone Group the way I once knew the lineup of
1970s-era Cincinnati Reds. An MBA from Columbia or Harvard or Wharton is
basically a leveraged bet on a student's ability to make it in finance. You pay
a ton of money, most of it borrowed, so that you can land a really high-paying
job with one of the big investment banks or private-equity firms that visit
campus. By their second year, most MBA students at Wharton are already scoping
out the Hamptons for the second homes they know they'll be able to buy in a few
years. But with the gilded pipeline to Wall Street temporarily shut down, the
rising MBAs are suffering the kind of existential crisis more generally
associated with comparative literature majors. The New York Times last month ran an article about students at Wharton who were suddenly at sea. Some were considering working for nonprofits!

When I walked into undergraduate finance classes and asked, "How many want
to go get a kick-ass job on Wall Street and make a ton of money?" not a single
hand was raised. The students are mostly kids from Wisconsin studying the
basics—management, accounting, corporate finance. Some plan to stay in-state and
find a job with a small business or with one of the big local firms: Kohler,
S.C. Johnson, Kohl's, Harley-Davidson. Many head to Minneapolis or Chicago for
jobs with consumer products companies.

Now despite the portrayal of Wisconsin as a meat and potatoes general management school, it does house the Applied Security Analysis Program whose graduates' ferocity for Wall Street jobs would rival their east coast counterparts. They are just slightly more polite about it. The only thing that I know about the program was chronicled in an old blog that was last updated during the Bush administration. However, I do know Wharton and can respond in bullet point format to the points raised:

  • First the defense. There are a total of 1600 full time MBA students and not all are finance jackels looking to suck the marrow out of Excel spreadsheet cells. The diversity has increased since I left and during my time it included 200 students who were really truly interested in non-profits before the Wall Street melt down and produced the Social Impact Mangement Conference series starting in 2003. There are even more marketing students that embrace the quantiative style and compete with Kellogg for telling companies how passionate they are about cereals, snack food, drugs, and over the counter products like KY Jelly. Hey, I even get exited typing that list and I am not a marketing guy. Finally, there are 150 students in the Health Care Management program figuring out new ways to improve bed pan technology. There is a lot of diversity at this here finance school.

  • While the marketing and health care students play frisbee on the green and the non-profit students play with their devil sticks, the finance students do lurk. There are some benevolent finance students but probably 25-30% of the class does make up those finance jackels who are scoping out their future homes on the Hamptons as described above. There is a reason that Wharton is still known as a finance school. It's not the entire school but the finance side does loom large and nothing causes excitements like the investment banking interview schedule as the very beginning of the recruiting session or the stir when the Venture Capital firm posts an opening. However, like every school, there is diversity and with 1600 students, you're bound to find at least 50 fellow classmates interested in whatever you're doing. Except playing with devil sticks. For that, you have to find the undergrads.

  • One final factor is Wharton's finance factory reputation is the Wharton undergrads. While I never actually talked with one of them, there presence did loom since we shared the same building and some classes overlapped. I found them to have the sharpest financial teeth of any of the jackels since they started in the finance world so young. For some, the bitterness of an investment banking career already had the same rotting effect on their brains as crystal meth. When I read article like the one above, I do wonder how many of those described Wharton students were undergraduates. To put in perspective, all of the Trumps went to Wharton undergraduate and their reputations loom large over the entire Wharton program.

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