06ROI.txt

# What is the ROI? 

_And in the end, the love you take is equal to the love you make. - Beatles_

## MBA vs. Coding School
Should you get an MBA or learn to code? What is the return on investment (ROI) for a programming course?

Return on investment is a plain concept that both prospective engineers and business students can understand.  The following comparison may not be a perfect apples-to-apples comparison, but don't miss the forest for the trees.  Let's compare two scenarios:
* Option 1 - attend 2-year full-time MBA program
* Option 2 - attend 3-month full-time programming course

What are the invested costs and expected salary after the program? For simplicity, let's compare gross (before-tax) salary and expenses.  Basically, cash in and cash out.  We will leave the discussion about the intangible things like network or personal growth, etc.  It's definitely relevant, but best left for a separate debate.

__Get an MBA?__
Let's take a premier Business Schools - Harvard Business School (HBS)

__Investment__
Per [HBS cost summary page](http://www.hbs.edu/mba/financial-aid/Pages/cost-summary.aspx).
yr 1 - Fully loaded cost - $87k/year for single person
yr 2 - Repeat at $87k/yr => let's round down to $170k for two years

__Return__
Salary depends on the industry/company, but let's take highest median, which is private equity/LBO per [HBS Employment Report](http://www.hbs.edu/recruiting/mba/data-and-statistics/employment-statistics.html).
* Summer internship salary for LBO/private equity (assume 3 months) - $24k
* Yr 3 - median LBO/private equity salary year 1 - $150k
* Yr 4 - let's assume 10% bump with good performance in year 2 - $165k

__So, here you are__, 4 years after you first attended business school.
__ROI__ = $339k / $170k = 1.994 or basically 200%

__Go to a coding school?__
There's not a strong or widely publicized salary data around this yet (so this is slightly an orange), and so I use a well-recognized [industry report from Riviera Partners](http://rivierapartners.com/2013/02/12/2012-engineering-salaries-in-review/) - a San Francisco based placement firm for tech talent.  I can corroborate these figures based on indeed.com postings and also local tech group mailing lists where salary figures are thrown around ... so it's reasonable.

__Investment__
This varies by program from around $10k to $20k, but let's use an approximate mid-point at $15k for the program duration, which is generally about 3 months.  You can read more about the schools and coding in a blog post - [Soon your taxi driver may know more Ruby than you do](http://findinbay.blogspot.com/2012/12/soon-your-taxi-driver-may-know-more.html).
* yr 0.25 - $15k
* rest of year 1 - 0, you're making money
* rest of year 2 - 0, you're making money

__Return__
Salary figures, as noted are from [Riviera Partners 2012 engineering salary review](http://rivierapartners.com/2013/02/12/2012-engineering-salaries-in-review/). Let's use JavaScript.
* yr 0.75 - junior dev: $83k * 0.75 = $62k
* yr 2 - $91k (after 10% raise)
* yr 3 - $100k (after 10% raise)
(junior dev is 0 - 3 according to this report, so afterward you're a midlevel*)
yr 4 - $132k ($120k in 2012 reasonably adjusted for inflation - but likely higher)
* The reality is, many graduates from the 3-month program are hired directly out as non-junior devs and after 3 years, may work as senior developer.

__So, here you are__, 4 years after you write your first lines of code at a school.
__ROI__ = $385k / $15k = 25.66x

## Beyond ROI

So which would you rather have? 

This analysis is not air tight, but certainly gives traditional education something to think about.

Financially, it might be a no-brainer.  Of course, we encourage not to make decisions only for the money. But, the truth is financial motivations are rational basis for making decisions about your career. That said, a fulfilling career is more than simply marking a buck.  It is doing things you love doing, and about working with people you enjoy working with.