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Common sense might tell you that the more educated an entrepreneur is, the greater their chances of success will be. Going to college, getting an advanced degree and undergoing multiple training programs should equip them with more knowledge and experience they can use to build their business.
But at the same time, there are plenty of stories of entrepreneurs who dropped out of college (and even those who dropped out of high school) and still did something incredible. So how much education does an entrepreneur truly need to succeed?
The anecdotal evidence
First, we need to acknowledge the fact that you can find anecdotal evidence to back your claims no matter what your position is. For example, the found of Tumblr, David Karp, dropped out of high school and is now a billionaire — along with fellow billionaires Henry Ford, John D. Rockefeller, Amancio Ortega and Francois Pinault.
Similarly, you can find stories of entrepreneurs who dropped out of college and became wildly successful. Famously, Bill Gates, Larry Ellison, Michael Dell, Larry Page, Mark Zuckerberg and Steve Jobs all left college at some point — and many of them did this so they could focus on their landmark business full-time.
And of course, there are plenty of stories of entrepreneurs who became successful only after graduating college with an advanced degree.
Anecdotal evidence doesn’t tell the full story, however.
Dropping out of college to become an entrepreneur
Zooming out, we can see that the alluring tale of the “college dropout entrepreneur” is a bit unfounded. Although there are some specific examples of people who abandoned their education and became successful, these tend to be exceptions rather than the rule.
Looking at the data, we can confirm this. Among the Forbes 400 (the 400 wealthiest people in the United States), there are 362 people with publicly available education records. Among them, only 44 were college dropouts — meaning 12.2 percent of billionaires were college dropouts. In fact, the vast majority of wealthy individuals hold at least a bachelor’s degree.
It also doesn’t take much research to confirm the idea that education leads to better results for the average person; with a college degree, on average, you’ll make something like $630,000 to $900,000 more in lifetime earnings than your high-school-educated counterparts.
The benefits of education
No matter how you look at it, education has some imperative benefits for entrepreneurs, including:
- Knowledge. First and foremost, going to school equips you with more knowledge. Depending on where you’re going to school and what you’re studying, you might gain information that helps you plan and manage the business, or you might get to know your target audience better. Whatever the case, you’ll be prepared for more situations, and you’ll be capable of making better plans.
- Job opportunities. Sometimes, going to school can present you with more immediate job opportunities. Having a degree increases your chances of getting hired, which in turn makes it easy to rack up more experience that you can use in the course of your entrepreneurship.
- Exposure and perspective. Going to school also increases your exposure and, eventually, your perspective. You’ll get to meet a diverse array of different people with different ideas and philosophies. Collectively, this can help you think more creatively and open your mind to new ideas.
- Networking. Don’t underestimate the importance of networking. While in school, you’ll have an opportunity to connect with hundreds, if not thousands of people — many of whom might be in a position to help you grow your business in the future. It’s tough to make up for lost time networking.
Drawbacks of education
There are some drawbacks to getting more education, however:
- Timing. If you have a great idea for a business that you launch in college, and that idea starts to take off, you might miss the opportunity if you abandon it in favor of completing your studies. Dropping out to work on the project full-time might behoove you, allowing you to capitalize on an opportunity that may not come again.
- Debt. Depending on your circumstances, going through higher education programs will likely leave you saddled with debt. Although this doesn’t prohibit you from starting a business, it can make the financial side of things more difficult to manage.
- Irrelevant subjects. Not all forms of education are specifically helpful for entrepreneurship. For example, a philosophy degree might not help you as much as a business degree (especially if your business doesn’t have anything to do with philosophy).
Some specific situations might call for a person to drop out of college or even high school to pursue their dreams of becoming a successful entrepreneur. But overall, the pros of education far outweigh the cons — and more education will increase your chances of success. Don’t let the stories of dropout entrepreneurs convince you otherwise.
Originally appeared in Entrepreneur