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Elite Overproduction and Your Entrepreneurial Dreams

Dec 10, 2020 | Business & Enterprise, Short-form

Reading Time: 3 minutes

If you’re like many entrepreneurial folks, you trust in a certain idea. And that’s the belief that you can launch a competitive business or organization with a little bit of ingenuity and some hard work.

The good ol’ American dream of free markets and fair play.

It’s a praise-worthy ideal. But over the past two decades, I’ve noticed a concerning trend, which appears to be accelerating.

B-school applications for fall 2020 surged at the start of the pandemic as students sought ways to ride out a tenuous job market. Now, full-time residential M.B.A. programs continue to report higher application volumes for next fall and expect to have fewer spots to offer than in years past, since schools have allowed many international students to defer enrollment due to virus-related travel restrictions.

In the past few years, I had started to notice a steep climb in new “businessowners.” In fact, it seemed like half the people I met would tell me they had a business. Yet, when I scratched a little further, it was clearly only a side hustle to make ends meet or a hobby.

Now, there’s nothing wrong with starting there. And actually, my beginnings for business were very modest. At the same time, I tried to chalk it up as the internet making it easier and easier to start a business. However, part of me wondered something else about it.

Could this glut of entrepreneurs really be about people who want to get into the managerial class?

And increasingly, I would meet very well-to-do professionals who this seemed to be the case. Former executives at large corporations, financial managers, and more. Almost all of them would go into some sort of strategy consulting, aka premium managerial work.

Indeed, I’m not the first one to notice this elite overproduction. Peter Turchin has pointed out how a rise in lawyers is exactly this phenomenon. And I must admit, it looks like this could be the case with MBAs too.

And you can probably guess why.

When regular people want to start a business… they start a business with what they have at hand. Contrast the MBAs I’ve known: in every case, they were little more than business monkeys. Sure, sometimes they had some good methods. But it was inescapable that they also had read the right books but not the wrong ones. Or knew the latest buzzwords but not the latest industry news.

Or that they also viewed business as more grift than grit.

And as the economy has divided into a chasm between elite and regular people, many are asking themselves a question. And that’s not “how do I use grit against the elite?” Instead, it’s “how can I grift into or onto the coattails of the noble class?”

It’s an understandable if misguided desire.

Recently, I had the chance to meet one of these consultants with the inside track with the big names. The Harvard Business Review, Forbes, Deloitte. And it so happened that we sort of do the same thing, namely working with business owners on the details.

Yet, it was also clear that her vision of entrepreneurialism was little more than outsourced corporate lackey-ism for wealthy people. And it made me wonder if even the small business market isn’t really the singular monument to the American Dream that we think it is.

Instead, it’s become an avenue for the lazy to hope they can claw their way into the enriched class.

Or you could say, wanna-be rentiers seeking rental properties.

In the end, we get one type of business owner with a stamped piece of paper. They hope that it certifies them into the right connections for the right contracts.

And then there’s the other type of business owner.

But for their American dream, they may need to seize a more revolutionary spirit in business.


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