Education: The Mandatory Step#

• I know my video last week talked about thinking twice before getting a college degree, but if you want the top job at one of these companies, a degree is absolutely mandatory.
• Every single non-founding CEO of a Fortune 500 company has a college degree.
• Even among the 21 founding CEOs, 16 have at least a bachelor’s degree.
• The remaining 5 founders, like Mark Zuckerberg, dropped out of schools like Harvard because their businesses took off before they could finish.
• I know the story of a high school dropout starting a successful company is popular, but the numbers don’t lie. If you want to reach this level, you need to go to college.

Society has rules, and the first rule is:

• You go to college.
• You want to have a happy and successful life? You go to college.
• If you want to be somebody? You go to college.
• If you want to fit in? You go to college.

College: Where to Go and What to Study#

• You also need to go to a good college.
• Almost 10% of the list of non-founding CEOs went to just one particular school. That’s right, DeVry University. Yeah, no, obviously it was Harvard.
• Other Ivy League schools are also very well-represented among this group of CEOs.

Once you get into one of these schools, you need to pick what to study.

• 41% of Fortune 500 CEOs have an MBA (a Masters of Business Administration). That’s a solid choice.
• MBA programs focus on business structures, corporate governance, and the roles of executives in organizations, so it makes perfect sense that this is a top choice.
• Many companies will actually require their senior executives to complete an MBA part-time while still working their regular jobs. This is a grueling task on top of already demanding corporate executive commitments. But sometimes, the companies pay for these degrees because they value them so highly.
• Beyond the lessons on running a company, the connections you make at an Ivy League school are worth the tuition costs themselves. So many powerful and influential people coming from these schools creates a self-fulfilling prophecy – more powerful people come from these schools because they spent time there interacting with powerful and influential people.
• So, if you want to be a Fortune 500 CEO, your best shot likely comes from getting into an Ivy League MBA program and networking like crazy while you’re there.

But an MBA is a master’s degree; it’s postgraduate. That means you need an undergraduate (bachelor’s) degree first. Picking the right degree right out of high school might feel like a bit of a crap shoot, but Fortune 500 CEOs overwhelmingly favor one type of degree above the others. You might think it would be business, finance, or economics, but you’d be wrong.

• 97% of the 500 CEOs on this list studied engineering as an undergraduate.
• There’s some selection bias here – engineering is a tough degree to get into, and unlike law or medicine, it doesn’t have one single, narrow path of progression.
• But engineers are still highly prized assets in the business world.
• Fortune 500 CEO engineers interviewed about their careers admitted they chose engineering because it had the lowest unemployment rates and great options for career advancement. People who are thinking like that at age 18 are the kinds of people who will go on to lead Fortune 500 companies, and people like that pick engineering. “We hire great engineers as fast as we can find them.”
• Engineers are trained to be good with numbers and complicated information. But they are also trained to use their skills to complete projects while working with people who have different areas of expertise.
• Engineers are also quite valuable to startups as early technical employees. The list of Fortune 500 companies is dominated by businesses that weren’t startups very long ago, and early employees with the right skills are prime candidates for the top job once the founder steps down.

The school you get your bachelor’s degree from is much less important than the school where you get your MBA.

• The most represented undergraduate school among Fortune 500 CEOs was still Harvard, but only 3 of them went there for their bachelor’s degree.
• The rest of the list is spread out among more than 300 other schools.
• So, just go to the best school you can get into and work on being near the top of your class. That will make Step 2 (getting into a good MBA program) a lot easier.

Building Your Career After Graduation#

The average age of a Fortune 500 CEO is 57. So don’t worry, once you’ve graduated with your engineering degree, you have plenty of time to work on your career and eventually get yourself into that Harvard MBA program.

If you want to be the CEO of a big company, you have two main options for starting your career:

Option A: Start with Promising Startups

• You can begin working with promising startups. If you hitch your wagon to the next Microsoft or Amazon, you’ll be a prime contender for the top job down the line, and you would have likely picked up some valuable stock options along the way.
• According to the New York Times, the average net worth of the first 2200 Microsoft employees was over $10 million. So, even if they never became CEO, they likely never needed to work again.
• This strategy is very risky. For every Microsoft, there are thousands of other businesses with 2200 employees that don’t grow at all or, even worse, go bankrupt.
• To increase your chances, target a business with around 1000 employees, good institutional backing (like from a Private Equity firm), and operating in a field with a lot of room for growth. Tech, Finance, Healthcare, and Direct to Consumer are all good options.
• Once you land that first job, you have to do the hard part: work like crazy, outlast the other employees, hope the company does well, and be in the right place at the right time when the founder steps back and needs a new CEO.

Option B: Start with Established Companies (More Active Approach)

• If you want a more active approach to landing the top job, you should start your career at a more established company, preferably one with significant business pedigree.
• “Bulge bracket” investment banks like Goldman and high-end management consulting firms like McKinsey should be your top picks. I’ll explain why later.
• Competition for graduate programs at these companies is fierce, so if you can’t get in there, almost any big company will do.
• Your mission at this stage is to get to an executive level role as quickly as possible.
• Doing good work is critical, but it will only get you so far. You need to market yourself in every way you can to become your own brand name in the industry.
• Social media, if used correctly, can be great for this. My good friend Richard over at The Plain Bagel works as an investment analyst, but he’s well-known outside his firm because of his YouTube channel. You don’t have to go that far, but putting yourself out there makes it much easier to jump between jobs as you climb the corporate ladder.
• Internal promotions are slow and difficult to get in most large companies. The average employee who switches employers every two years earns 50% more than the average employee who stays put longer.
• If you do a good job of marketing yourself within your industry, you’re more likely to walk into a job interview where the recruiter already knows about you or something good you’ve done. This is a huge advantage over the regular schmuck with less than 500 connections on their LinkedIn profile.

You can also fast-track this process. The reason starting at a top investment bank or management consulting firm is a good idea is because you can work two years there as an analyst and gain more experience than you might in a decade at a regular company. Recruiters know this, so the “exit opportunities” for bankers and consultants can be extremely good. You can often score an executive-level role before you are 30. The traditional route (analyst -> team lead -> manager -> executive) would take a lot more time unless you get lucky with job switching.

A word of advice based on my own experience and no further research at all: if you go the investment banking or consulting route, you should avoid exiting into tech companies, even if you’re an engineer by education. You should be able to land a good job with these outfits, but it can be difficult to move up because the culture of these businesses tends to look down, with their soy lattes and on tap kombucha, on the old school business bros who totally don’t even know how to hacky sack.

A better plan is to get a job at a big company that is really boring. A boring company is going to have less young talent, which means you won’t be competing against every other hot shot, career-driven 30-year-old to get an executive position.

Once you have worked yourself into a role where you are overseeing at least 200 other employees, it’s time again to start thinking about that Harvard MBA.

The All-Important MBA#

• Personal branding is going to play a big role in getting you into this highly coveted course.
• Harvard and other Ivy League schools love to brag about how many presidents, Supreme Court Justices, and Fortune 500 CEOs went to their schools. The best way for them to keep those bragging rights is to only admit people their admissions office thinks are likely to go on to become a president, Supreme Court Justice, or Fortune 500 CEO.
• If you can talk confidently and provide proof to an admissions officer about how you have reshaped your industry, you are much more likely to get in.
• You will also need to take the GMAT, which is a test to assess your business acumen. If you’re serious about becoming a Fortune 500 CEO, this is just one of many tests you will have taken in your career, so study hard, and you should ace it.

Once you have received your MBA from Harvard, life should be pretty good for you.

• The average salary for a Harvard MBA in their first year after graduation is $207,000.
• That figure should be significantly higher if you go back into an industry where you already have executive experience.

Reaching the C-Suite#

Your next goal is the c-suite. To get there in a Fortune 500 company, you’re going to need to double down on that personal branding.

• At this level, it’s not unusual for individuals to hire public relations consultants.
• These consultants help arrange for them to give speeches and appear in media. This makes them appealing to high-end recruiters, but also to company directors and shareholders, who ultimately have the final say over who gets to be the chief executive.