In recent years, I have visited numerous top-tier universities in China, meeting with graduate and undergraduate students to talk about my experience in my alma mater, in the corporate world as well as in entrepreneurship.

Many of the students who came to hear me speak were aspiring entrepreneurs in the process of getting MBAs. Many of them asked similar questions: “If I want to start my own company, is business school a worthwhile experience? Is it worth paying all this tuition — or will my degree just be a resume-builder?”

In my view, an MBA degree is not a prerequisite for entrepreneurship. Elite MBA graduates and successful entrepreneurs are not synonymous. Yet, business school training adds reputational, social and functional value to one’s entrepreneurial career.

Entrepreneurship is not for everybody

By definition, an entrepreneur is one who takes risk. It is an attitude and an appetite — one which may be hard-wired into one’s personality. Education can influence one’s attitude toward risk: for instance, understanding the principle of diversification may make an investor more willing to create a less “correlated” stock portfolio. But ultimately, can you teach someone to really enjoy taking risks? I don’t think so.

When I think about the value of an MBA for aspiring entrepreneurs, I see a parallel with the military. Countries spend billions of dollars training soldiers so they will be ready for combat — they are taught to fire rifles and operate in simulated high-pressure situations. But that training only goes so far. At war, a general never knows how a soldier will respond — whether he will hide in the cave, run in the other direction, or stand and fight, until the bullets start flying. How someone reacts in times of great stress relies largely in instincts and the makeup of his or her personality — and training only takes you so far.

The same is true with entrepreneurship. Understanding strategy, finance and marketing can be very helpful. But it is also important to possess self-confidence, a need for independence, energy and passion, curiosity, and an ability to communicate ideas. If you do not have these natural qualities, you will struggle as an entrepreneur.

Neither are MBA degrees

It is critical to determine whether your expectations for an MBA are aligned with what the degree will likely do for you. MBA programs offer three different types of benefits, all of which vary tremendously from one school to another.

1. Practical leadership and management skills

Management education has previously focused on quantitative analysis in areas such as finance and operations, with little emphasis on other aspects of organizational life. As a result, MBAs were often seen as being out of touch with the challenges managers face in the real world.

Business schools have realized it is not sufficient to provide quantitative and analytical training, because within a few years of leaving school, their alumni will add value more through their ability to lead and manage others than through their talents as individual contributors. Effectiveness in these more senior roles requires an entirely different interpersonal skill set. MBA programs have later responded by expanding their offerings in areas such as strategy, organizational behavior and leadership.

But the ability to provide quality training in these areas is unevenly distributed across MBA programs. The best schools have made leadership and interpersonal skills a high priority. You can learn about it through experiential activities that bring students together to help them understand their strengths and weaknesses, provide feedback and promote self-awareness. These activities require a very different approach from traditional lecture methods.

I do not suggest that the quantitative and technical skills that an MBA provides aren’t useful — they absolutely are. However, they are increasingly available through other venues that individuals can access on their own at a much lower cost. The special advantage of an MBA program is therefore the opportunity to develop leadership and interpersonal skills with a group of peers in a sequence of experiential courses informed by current research.

2. A credential that sends a signal to the marketplace

No career paths absolutely require an MBA — it is an optional degree and is nothing like a JD (Law) or an MD (Medicine) in the US that professions make them mandatory. There are many senior people in general management roles, in consulting and even in financial services who do not have an MBA — so do not assume that the credential will necessarily serve a meaningful purpose in your chosen field.

As the holder of MBA degrees from two top-tier business schools with 20 years of work experience in finance, I face two different “markets” — readers of my book (who are potential MBA applicants), as well as undergraduate and graduate students at large (who are future job seekers). In both settings, my MBA degrees send a useful signal. Readers feel more comfortable knowing that I have had substantial experience in business schools; university students trust that I understand the complexities and challenges of the business world that they will be facing.

Bear in mind, the nature of the signal being sent depends on the specific MBA program’s reputation. Yet, this is not simply a matter of prestige. Harvard, Stanford, and Wharton routinely top lists of US business schools, but they also have a reputation for entitlement and arrogance. While some firms seek out graduates from elite schools, others avoid them out of a concern they will be difficult to work with and disruptive to the established culture.

3. Membership in a learning community and access to an alumni network

Business school emphasizes working in groups, and MBA students often learn as much from their peers as they do from faculty, so it is important to consider whom you will be working alongside for two years. Those same people will become your fellow alumni, and access to that network is one of the most valuable benefits an MBA program can offer.

Of course, alumni networks aren’t created equal. Larger MBA programs yield larger networks. Certain networks are concentrated in specific geographic areas or in specific industries. Some B-school experiences create networks that are particularly active sources of mutual support.

I have benefited tremendously from the support of my fellow Yale and Chicago Booth alumni during two major professional transitions. In my job search after graduation and later when I began exploring entrepreneurship as a career path, alumni from both schools were extraordinarily generous with their time and insights. There is no way I could have succeeded without their help.

I believe that MBA programs give future entrepreneurs valuable tools and human capital to help them mitigate risk, navigate competitive landscapes and increase the probabilities of success. But even with those resources, only you know whether or not you have the heart to execute on the opportunities we all recognize to launch a compelling new business.

Vince Chan

A Hong Kong-based venture capitalist, entrepreneur and author of

《做自己的天使投资人》. Currently, she is the co-founder and managing partner of Mount Davis Ventures focusing on early-stage venture investment. She has worked in Hong Kong, Los Angeles and New York at TCW, Goldman Sachs, Standard & Poor’s, Hong Kong Monetary Authority, PricewaterhouseCoopers and Deloitte & Touche. A US CPA and a CFA Charterholder, she has received two MBA degrees — Yale University and the University of Chicago Booth School of Business — and a Bachelor of Commerce with High Distinction from the University of Toronto.

You can contact Vince Chan at Vince.chan@mountdavisventures.com