One of Mike Hughes's first memories of business school was a discussion led by a professor who asked the class "What do you want to do when you leave Stanford?" About 40 per cent said they would like to start their own businesses.
"Business school," Hughes says, "is relatively focused on issues that face larger companies in terms of strategy, finance and human resources, rather than the more pragmatic concerns that face a start-up – how do I find investors, how should I structure a term sheet or an angel round of investment, how do I register my company, and so on."
But you are exposed to people who have successfully started their own companies (and, perhaps more important, a few that have failed and tried again). And second, you meet a group of people who go on to be business partners, financiers and advisers, he says.
With his MBA fees lightened by a Sainsbury Management Fellows fellowship, Hughes went on to found Ring2 Conferencing – offering dial-up audio conferencing from mobile phones – with Steve Flavell, a friend he made at Stanford. A fellow classmate is the biggest investor.
As Hughes proves, not everyone wants to be a hedge fund manager and an MBA course can be a good way to nurture an enterprise or to become an "intrapreneur", taking the entrepreneurial spirit to an existing enterprise and expanding it. Big corporations are crying out for this quality in their recruits.
Dimitris and Vasilis Nicolaides are unusual examples of the family business entrepreneurs, but only in that they are twins. They decided to take the full-time MBA at Cass Business School in London to complement each other in their hotel business in Cyprus. On the MBA, one of them specialised in marketing and the other in international business. Now there are three Atlantica Hotels in Cyprus, and two more in Greece.
The entrepreneur who has an idea and sells it to backers has been much publicised on television's Dragons' Den and Tycoon. Many universities now run open "escalator pitch" competitions. At Oxford it's "Idea Idol" and at Cambridge "Where Angels Dare", with a total prize fund this year of £30,000. The two universities pitch their winners against each another and this year's victors, TouchSight Vision Mitt from Cambridge, went on to scoop almost £7,000 in an international contest in Monaco for their low-cost mobility aid for the blind and partially sighted.
The prize money for such competitions is now as competitive as the pitches. The winners of the new Oxford University 21st-Century Challenge, organised by Saïd Business School, stand to win £45,000, with £10,000 each for two runners-up. This is believed to be the biggest such prize at any university and the competition is open, but there are some new rules. Entrants have to send in only their idea, not a full-blown business plan (organisations such as Google say they find business plans of increasingly limited use when acquiring start-ups). And the school is looking for ideas in only three categories: environmental, healthcare and medical, and social inequality.
"There were a number of seminars here looking at how businesses could solve social challenges and still make money," says Ben Mumby-Croft, in charge of the competition. "It seemed to us an ideal opportunity to relaunch this competition.
"We're not abandoning the business plan. We'll have the traditional investors and business angels there as judges, but we're also trying to get in investors with experience in environmental technology and working for the community – social entrepreneurship."
London Business School is known for its finance expertise but its MBA has a popular core course called discovering entrepreneurial opportunities, and like other schools hosts a thriving entrepreneurship club, with conferences. This summer a group of LBS students won the European Business Plan of the Year Competition in Milan. Their newly formed business, the Currency Warehouse, recognised that more than $24 bn (£12bn) in annual currency flows from 1.2 million foreign students in the UK, USA, Canada and Australia.
Successful businesses often do spring out of business schools – eBay was one such – and digital start-ups remain popular. ClickAngel, brainchild of a team of Leeds University graduates, exploits Pay Per Click marketing, and DietPlus, run by Bill Gregory, also from Leeds, distributes ready-made diet meals to UK internet clients.
Biotech is the other growth entrepreneurial area. But just as popular these days are practical ideas that help the community. For example, having written a business plan for Fleetwood Gym, a youth club, as part of the New Venture Challenge at Lancaster University Management College, MBA students there found themselves painting, restoring paths and cleaning kayaks as well.
Pierre Janicot, an MBAstudent at the French school Essec, transformed cHeer uP!, his own non-profit organisation, into a nationwide network of 300 volunteers helping some 400 cancer patients throughout France to fulfil their personal goals.
'Using what I had been taught, I turned loss into profit'
Heather Williams did her part-time MBA in entrepreneurship at Manchester Business School and is now setting up the British arm of Fruits & Passion, a Canadian-based aromatic home products chain.
"On the MBA we had an hour and a half lunch break – just enough time to slip out to the Arndale Centre. The shopping there was fantastic. That's why I chose Manchester to launch Fruits and Passion in the UK. The plan is 25 shops in three to five years, a household name in 10.
The MBA changed my life. I was a tax consultant working for KPMG and aiming to be a partner. But we studied small businesses and my project was a cosmetics firm called Lush. They invited me to change chairs and join them. Suddenly I was making 25 per cent of what I had been earning, but loving it.
When I joined, Lush were heading for a £1m loss. Using what I had been taught I turned that into a £1m profit. Now Lush have about 400 shops in 37 countries. Fruits & Passion is well established in the States but setting it up in Britain feels like starting my own business from scratch. It's very exciting."