Oded Rose graduated from the Wharton School of Business at the University of Pennsylvania in 1995. Shortly afterwards, the newly-minted MBA met Walden Israel co-founder and general partner Eyal Kaplan at an alumni conference. Kaplan introduced Rose to the fund, where he joined, and eventually rose to general partner. Rose then joined Aurec Group as investment manager.
Amos Goren graduated from Harvard Business School in 1990. He now handles healthcare and biotechnology investments for Apax Partners (Israel). He is one of Apax Partners's two partners in the healthcare sector.
“Two of Apax Partners’ three founders dreamed of founding the fund while at Harvard Business School,” reminisces Goren about his connection with the fund. “They found me through a mutual acquaintance in the Harvard network.”
Ilan Cohen received his MBA from INSEAD at Fontainebleau, outside of Paris, in 1990. INSEAD is considered one the best MBA schools outside the US. He and his partners founded the POC Group strategic consultancy and Internet venture Daka 90. Cohen admits he feels an obligation toward graduates of his alma mater. “I frequently meet INSEAD graduates, and try to see how I can help them. For instance, if I know that one of my clients is looking for a manager, I might make an introduction. Graduates sometimes ask me for business introductions, and I’ll try to help them.”
These are only three examples of networking among graduates of the world’s prestigious business schools. Fresh graduates enter the world with more than just a respectable MBA; more importantly, they have a long list of new friends, and within a few years will find starting-position jobs throughout the world.
These social networks that began in the classroom, and which will accompany them throughout their careers, are the most important advantage they will have earned at university. Every starting manager knows that having a Rolodex stuffed with business cards of friends working in positions of influence will help him or her obtain financing faster and more cheaply than any academic course in financing, no matter how prestigious.
“The alumni network works at many levels, says Scitex Vision VP business development and strategic planning Itai Halevy, who graduated from INSEAD in 1989. “The first level is when job-seeking graduates initially contact alumni from the same school to create a first personal relationship, rather than directly contacting personnel departments.”
Halevy has hired numerous INSEAD graduates for their first or second jobs. He says the second level is establishing business relationships in Israel and overseas. “If I want to examine a product or set up a collaboration, I open the INSEAD alumni book, and call alumni who can help me in the field I am interested in. This INSEAD alumni-to-alumni contact is a codeword that opens doors. It is a vital two-way business card. When someone needs something in the digital printing sector, he calls me.”
Scitex (Nasdaq: SCIX; TASE:SCIX) is an excellent example of the alumni network in action. Over the years, one of Israel’s former high-tech flagships has employed 14 INSEAD graduates. Two of them became president of the company.
“As an INSEAD alumnus, I have a moral obligation to meet other alumni to see if I can help them,” says former Scitex president Yoav Chelouche, who graduated in 1979. “Many INSEAD graduates have worked at Scitex over the years. When the company was growing and most of its staff were engineers, we hired MBA graduates to add marketing capability to Scitex’s technical capabilities.” Chelouche is now chairman of Europe’s Fantine Group, which provides business development and venture capital services to high-tech companies.
Chelouche joined Scitex Europe as CFO immediately upon graduation with the help Scitex Europe general manager and eventual Scitex president, Arie Rosenfeld, himself an INSEAD graduate. “One of the best ways to enter an unknown field is to create a personal relationship with INSEAD alumni, and learn how things are done in that field,” says Chelouche.
NICE-Systems (Nasdaq:NICE; TASE:NICE) CEO Haim Shani is a member of INSEAD’s class of 1987. Rosenfeld once help him get a job at Scitex. Shani internalized this obligation to help INSEAD graduates, taking it to NICE. “During my time at NICE, I hired three or four INSEAD graduates,” he relates. “When an INSEAD graduate contacts me, it gets my attention, and enables me to attend the initial interview by the relevant department, although it obviously isn’t an automatic entry permit. I’ve had several ‘Bingo’ wins in the business world thanks to the relationships I developed in class. Other alumni return my calls immediately, and I can close practical deals through the network.”
“A different magnitude of opportunities”
Young men and women who have marked out a career terminating at a major investment house, thriving high-tech company or wealthy venture capital fund, know well that a two-year MBA program at the right school is a vital springboard. The response for the presentation Harvard Business School held a few weeks ago at the Herzliya Interdisciplinary Center is therefore unsurprising. The organizers had prepared a large hall in advance, but were still forced to turn away 250 people, due to lack of room.
Their studies give graduates their entry ticket to the network, brightening their career prospects, finding business opportunities, and getting attractive job offers and promoting their businesses. As Goren puts it, “I have many acquaintances from my time at the university, including CEOs, Wall Street analysts, and many others in executive positions, who I can always call.”
Bear hug
Social connections must constantly be preserved and fostered, and business school graduates, aware of the importance of their relationships, maintain a well-oiled communications network. It includes constantly updated lists of alumni, with their current jobs, telephone numbers and e-mails, club membership, where they can periodically meet to renew old friendships and create new ones, and a who’s who. These methods keep lines of communications open between the alumni and between them and their alma mater.
The most prominent networks in Israel are 140-member Wharton and Harvard Business School Clubs in Israel; the 280-member INSEAD network; and the 100-member Columbia Business School network.
“You feel you belong to something great,” says Isaac Devash, who got his BA at Wharton and MBA from Harvard. He is now president of the Wharton and Harvard Business School Clubs in Israel, which operates as a united club. “Harvard’s alumni book is updated every few months. The alumni cooperate, informing it of every major change in their careers,” says Devash. Devash earlier managed the Bronfman family’s Renaissance Fund, and founded Israel International Fund (IIF), in which SHAHAL (of the SHL Telemedicine (SWX:SHLTN) group), MoreCom and Israel Direct Insurance all invested. Devash arranged the SHAHAL investment through Ziv Carthy, son of a former SHAHAL chairman and a friend from Harvard.
The INSEAD alumni club in Israel also operates as a well-oiled machine, even though its members work on a wholly voluntary basis. It has managers and an ombudsman committee. Its goal is to help Israeli INSEAD graduates find suitable jobs. The club charges a token annual membership fee, and organizes conferences every few months at which top executives, academics and economists give lectures.
INSEAD’s Israeli alumni celebrated the 40th anniversary of their club in January 2003 at the Tel Aviv Hilton. Market strategist Mike Astrachan was invited to speak at the event, while wine-sipping, expensively-garbed alumni rubbed shoulders.
INSEAD alumni club in Israel Doron Nachmias says the number of Israeli students at INSEAD has doubled since 1996. “130 Israelis have attended INSEAD in the past six years, thanks to our club’s intensive work in Israel,” he says. “We give Israeli graduates a bear hug. Every year weinvite Israeli companies, such as Comverse Technology (Nasdaq: CMVT), Aladdin Knowledge Systems (Nasdaq: ALDN), Amdocs (NYSE: DOX) and Scitex to come and recruit employees from among new INSEAD graduates.”
Nachmias, who owns Prime Time Marketing Associates, which rescues troubled consumer products and cosmetics companies, admits that relationships are vital, and he takes pride that, “our alumni have the best relationships. There are no political borders, and an Israeli who has completed the studies program can go and do business anywhere in the world, including in Arab countries.”
“The Harvard alumni club in Israel’s original concept was to create a mechanism to send information between alumni,” says Devash. “We set up an alumni website that eventually grew into a community that helps members communicate with each other and send information.”
Periodically, the club publishes a book that includes details about all Israeli alumni, as well as alumni who have an interest in Israel. The yearbook contains cross-tables that can be used to locate every alumnus’ current job, class, etc. Over time, the alumni meetings became regular events. Nowadays, a quarterly convention is held, at which economic and political personalities give talks. A larger and more expensive meeting is held once a year.
Two years ago, the Wharton club in Israel hosted an international conference of alumni from 130 countries, entitled “Globalization and business technology in the post-dot.com era”. Although the US State Department had issued a travel warning about Israel at the time, over 250 alumni from around the world attended the conference at the Tel Aviv Hilton.
“We decided to send a positive message, and show that Israel was doing business despite the problems,” said Veritas Venture Partners founding partner Gideon Tolkowsky, who chairs the Wharton alumni club in Israel. “The conference put our club on the map, and Wharton realized that there was an entity in Israel that could help it market the school here.”
Morgan Stanley investment banker Oren Beeri completed his studies at Wharton two years ago. While still at school, he and some colleagues founded a club for Israeli students with the objective of showing Israeli business to the students. “Even as students,” he says, “we published an 35-page annual paper, whose key topics were how to do business in Israel, and Wharton alumni in Israel. We also encouraged students to visit Israel to get an impression of the country and learn about Israel’s business climate. We also tried to bring Israeli businesspeople to Wharton.”
The schools’ interest
The business schools have a clear interest in preserving contact with their alumni. The key positions the alumni eventually attain constitute a key rating factor for calculating their ranking against other schools. The ranking is a critical factor for attracting more students and teaching staff, and has a direct impact on the school’s ability to raise money. A self-respecting business school will therefore invest heavily in maintaining contact with its alumni long after they graduate, and it will spend a fortune to foster relations between the alumni.
The network’s capital is of course the US, where most of the world’s top business schools are based, and best job opportunities found. “80% of workers at consultancies and investment banks on Wall Street are graduates of the top 15 business schools,” says Merrill Lynch country manager for Israel Jerry Mandel, who graduated from Columbia Business School in 1992. “While it is true that someone who did not go to one of the top schools can get a job with one of these firms, he’ll find a lot harder to participate in major financing deals.
“There are companies that select a group of universities whose graduates they want to hire, and they’ll invest intense efforts to attract the best candidates from them. Headhunters come during the school year to try to recruit students nearing the end of their studies.”
The Shocken-Nimrodi connection
The global slowdown and sputtering US economy changed things in the past couple of years. An increasing number of newly-minted MBAs from prestigious universities have found it harder to find management opening positions. MBA-sated US companies have cut back on their headhunting raids at universities, and reduced the salaries they pay the ones they hire.
That has not affected demand for places at the universities. To the contrary, applications to the top business schools has jumped 50-100%, leading them to further tighten their acceptance criteria. The schools admit that last year wasn’t a very good one for the class of 2002, and many graduates had a hard time finding jobs, or even repaying their huge $100,000-plus debts for tuition and board accrued during their studies.
This is also the time when the students apply the academic knowledge and practical tools acquired in the classroom to the real world. “In their first years, most graduates emphasize the place where they completed their studies in order to reach various positions,” says former Jerusalem Venture Partners partner Yuval Cohen, who is currently founding a technology buyout fund. “In the US, if you mention you graduated from Harvard Business School, it opens doors.”
“In the end, however, you learn that that is something quite artificial, and you’re evaluated on your real abilities. Over the year’s I’ve learned that I must present more receipts in addition to the name of a school. Although the degree opens many opportunities, and the network is important and shouldn’t be disparaged, in my opinion it isn’t the right operating strategy. Those who go to university should stress the learning experience, not the networking,” concludes Cohen.
That may well be so. But here is a small anecdote that can testify to the sense of mission and obligation that alumni have years after they graduate: The young men and women who filled the hall where the Harvard Business School was holding its presentation learned about the event in the newspapers. The notices were placed free of charge by two Harvard Business School graduates: “Ha’aretz” publisher Amos Shocken (class of 1970), and “Ma’ariv” publisher Ofer Nimrodi (class of 1989). After all, that's what friends are for.
Published by Globes [online] - www.globes.co.il - on February 27, 2003