The “Optionality” of Business School: How deferred admissions MBA programs can make you rich

Getting accepted into a deferred MBA admissions program frees you up to take career risks early on, knowing that you can always fall back on recruiting for a cushy management consulting or investment banking job in business school. This is a huge, liberating blessing. Taking career risks early allows for truly superior financial returns in life. Consider an analogy to a financial portfolio. Salaried labor is like a bond – it pays consistent, steady, reliable returns. At the start of your career, you have 30+ working years ahead of you: a veritable basket of bonds. In contrast, starting a business or working at an early stage start-up comes with potentially volatile and uncertain salaries, but the potential for enormous upside through equity. This profile is much more like a stock.

Because you have many working years ahead of you, working in a steady job is equivalent to investing your portfolio 100% in bonds: low-risk, but low-reward. Doing this doesn’t make sense when it comes to personal investments; most financial advisers recommend young people invest 10% in bonds and 90% in stocks. Therefore it is important that you diversity your “portfolio” by taking a lot of career risks early on. Later in life, when you only have a few years of work left before retirement, it’s advisable to shift your personal investments to 90% bonds and 10% stocks. Accordingly, you won’t want to be working at a start-up and instead should have a steady, salaried job.

A deferred admission to business school essentially allows you to take better advantage of this high-risk early strategy by limiting your downside. If you follow this advice and take a bunch of career risks right out of college and your start-up becomes a unicorn, netting you millions of dollars – awesome! Take the money, decline your business school offer and never look back. However, if your start-up flops you can just come to business school and either start again on another start-up with the validation of a brand-name school, or switch to a traditional “bond-like” job at McKinsey.

Many two-year MBA programs allow students to take a number of years off between their first year and second year (at HBS, it is 5), so many students come into school, form a start-up, and take time off to run it, safe in the knowledge that if it flops, they can always come back and get an awesome job.

When you think about it, the payout profile of business school is similar to that of a call option – it lets you sell your labor at a predictable price (~$140,000 in salary for most consulting firms). How do you increase the price of an option? Through increased volatility in the marker. And how do you get that? By taking a ton of career risks. Once you have your admissions offer in hand, taking these risks is just a prudent thing to do to increase the value of your property.

In that way an early admission to business school equips you with the tools necessary to greatly increase your earnings and potentially make you rich.

Top Podcasts for MBAs

How I Built This 

How I Built This is a podcast about innovators, entrepreneurs, and idealists, and the stories behind the movements they built. Each episode is a narrative journey marked by triumphs, failures, serendipity and insight — told by the founders of some of the world's best known companies and brands. If you've ever built something from nothing, something you really care about — or even just dream about it. (45 min per episode)

• Good for: Entrepreneurs, Tech, VCs, General Managers
• Interesting interviews with CEOs and Founders that help you "see sooner, faster" when reacting to challenges that any entrepreneur will encounter. Episodes are pretty inspiring. If you're an entrepreneurial person with a good idea but who has also been procrastinating, this will light a fire under your butt.
• Very conversational and easy to listen to. Guy Raz is a great interviewer and the subjects are pretty compelling.

NPR News Now

NPR News Now is the latest news in five minutes. Updated hourly. (5 min per episode)

• Good for: everyone. 
• The fastest way to keep up to date on your way to and from class. New episodes are updated hourly (indexed on Washington DC time) and seldom repeat segments wholesale, so it is worth listening to whenever there is an update. Episodes are short so they won't burn your cell phone's data plan.
• An excellent balance of US and world news with a consistently professional narration and neutral tone of voice. Much less prone to hysterics and hyperbole than CNN or Fox.

Revisionist History

Revisionist History is Malcolm Gladwell's journey through the overlooked and the misunderstood. Every episode re-examines something from the past—an event, a person, an idea, even a song—and asks whether we got it right the first time. From Panoply Media. Because sometimes the past deserves a second chance. (~35 min per episode)

• Good for: consultants, social enterprise, public sector
• Basically, every episode of this podcast is a case study in how to get a good grade in a case-based classroom. You may not always agree with Gladwell's points, but they are always incredibly interesting, consequential, well-researched, and surprising. Gladwell points out how complicated systems such as government work and where they have broken down in surprising ways in the past. This is a great source of inspiration if you are interested in improving the world but are unsure which issues are most pressing.
• If you've read any of his books (or better yet, listened to any of his audiobook readings) you know Gladwell is a master story teller and narrator. These are the kinds of podcasts you enjoy alone, like a rich dessert. 

Freakonomics Radio

Freakonomics Radio is an award-winning weekly podcast with 8 million downloads per month. It can also be heard on public radio stations across the country, on SiriusXM, on several major airlines, and elsewhere. Host Stephen J. Dubner has surprising conversations that explore the riddles of everyday life and the weird wrinkles of human nature — from cheating and crime to parenting and sports. Dubner talks with Nobel laureates and provocateurs, social scientists and entrepreneurs — and his Freakonomics co-author Steve Levitt. Freakonomics Radio is produced by Dubner Productions and WNYC Studios. (~40 min per episode)

• Good for: Investors, Bankers, Consultants.
• Conversational show that presents contrarian views meant to change your mind. Definitely has a libertarian anti-government lean and has been criticized for letting ideology get in the way or research.
• Generally interesting ideas to bat around with friends. Might even lead to some interesting investing decisions. 

Planet Money

The economy, explained, with stories and surprises. Imagine you could call up a friend and say, "Meet me at the bar and tell me what's going on with the economy." Now imagine that's actually a fun evening. That's what we're going for at Planet Money.

• Good for: Investors, Entrepreneurs, VCs
• Each episode examines a person or dissects a big idea that had had a profound and previously hidden impact on the economy. Great at helping build an intuition for the cause and effect of business decisions and policy on the overall landscape of the economy.
• Great presenters with a lot of enthusiasm for their ideas. Perfect balance of conversational and informative.

Recode Decode

One of tech's most prominent journalists, Kara Swisher is known for her insightful reporting and straight-shooting style. Listen in as she hosts hard-hitting interviews about the week in tech with influential business leaders and outspoken personalities from media, politics and more.

• Good for: VCs, Tech,
• Kara Swisher interviews the heros of VC, tech and other fields. It's as close as you would otherwise get to a lot of them. However, Swisher is no "gotcha journalist" and often the episodes turn into puff pieces for their subjects. Regardless, it is a front row seat into the mindset of Silicon Valley and the first edition of what leaders there are talking about. 
• An easy podcast to come and go with. Good for listening to when you are doing something else.

Frequently Asked Questions

What was your goal in founding Ivy Admissions Group?

When we went through the MBA admissions process, we found it full of unnecessary anxiety, odd speculation, and bad information on sketchy websites. The goal of Ivy Admissions Group is to take the stress out of the process by sharing good information born out of our own experience and working with admissions.

So it’s just the two of you?

Yes. We’re not trying to be a big industrial admissions consultancy. We only want to take on a few select clients and offer them exceptionally insightful and highly personal advice. We have very different backgrounds and are confident that between the two of us, each applicant gets a diverse set of perspectives.

What makes Ivy Admissions Group special?

A lot, actually.

1. We focus on narrative and know how to build credible, authentic ones.
2. We’re Harvard MBAs. We’ve walked the walk and can empathize with clients.
3. We have the results. Our clients have been admitted to Stanford GSB, HBS, Wharton, Booth, and elsewhere
4. We’re boutique, not an application factory. All clients work directly and only with us.
5. We’re marketing managers. We are used to brilliantly marketing things to discriminating audiences.
6. You get two diverse perspectives for the price of one.
7. We’re not just copy editors. We intimately help with application brainstorming and crafting that perfect package.

Why are you so focused on narrative?

I (Nate) know from experience. When I applied, I had all the right elements. An above average GPA from a target school, a perfect GRE, impressive leadership experience in the military, and glowing recommendations. What I had was a brand, but not a narrative, and so I was placed on the waitlist at HBS, Stanford, and Wharton. Through update letters that established my narrative, I was able to get admitted to all three. So take my advice, and get your narrative right the first time around.

How did you start advising admissions applicants?

I (Nate) started by re-reading college applications of younger friends after they had been deferred admission from Dartmouth. I’d go over essays about community service and cringe because I knew that admissions officers would read them as “vacation stories”. I would work with them to improve their narratives for the general admissions cycle and got a lot of satisfaction watching them get get into fantastic universities.

Did you hire admissions consultants when you applied?

No. We wanted more than just a series of worksheets and spell-checkers. We wanted someone who had actually been admitted to HBS, who knew what the classes and clubs were like, and who had enough contact with admission deans to know how they think. We built Ivy Admissions Group to be the service that we wish we could have used.

When did you decide to make this a business?

When we found ourselves spending 20+ hours per week advising MBA applicants for free! We realized the advice we were giving them was superior to what our advisees were getting from paid consultants, that we were more responsive than paid consultants, and that we sometimes found ourselves more invested in our advisees' admissions prospects than they were. Switching over to a professional service allows us to go deeper with a smaller number of motivated applicants.

How do you set your prices?

We have day jobs (as marketing managers), so we're not in it to earn a living. We believe in offering the best value of any admissions service, while charging and fair and consistent prices that are just enough to make it worth our own substantial time investment in each applicant. Definitely do your diligence before choosing a service, but let us know if you can find a better deal.

How do you determine which clients to work with?

We only work with clients we think we can offer substantial value. If we don't believe we can move the needle that much in a particular case, we figure that out upfront, refund that client's money, and try to refer them elsewhere. We believe our value is clearest for applicants applying to top schools, where the admissions process is most difficult.