Three reasons why is harder for Latin Americans to apply to an MBA in the U.S.

Summarized English version of this post

Applying to an MBA program is always hard. Doing it from Latin America is even harder. The number of applicants is always larger than the supply, and MBA admissions can always ding more than 90% of the applicants and still get great candidates. People apply to an MBA because of the reputation and the knowledge that you can get from it. I personally know it! I was part of the Wharton Class of 2016 and because of that, I was able to work in Operations at Apple in Cupertino. Even more, I’m originally from Chile, and I know for a fact, that an MBA application from this side of the world is harder than any application from other parts of the world.

Can we see that on the data? We know for a fact that the number of people who had taken the GMAT from 2014 to 2018 has remained basically flat: from 244,000 to 242,000. In Spanish-speaking countries (Latin America plus Spain) the trend is very similar: just 3.6% of the total universe of GMAT takers is from a Spanish-speaking country, and that proportion has also remained flat. What about the quality of those applicants? For just Latin America, the number of GMAT takers who had at least a 700 score (considered good for a Spanish-speaking MBA applicant) has increased 16% each year since 2013. So, even if we are getting better, we are not seeing any proportional increase in our application rates.

Why just 3.6% of the relevant population is from a Spanish-speaking country? Why is so hard for someone from Latin America or Spain to decide to apply for an MBA program in the States? I think there are at least three reasons for that:

Reason #1: The language

Most countries in Latin America speak Spanish. It’s easy for us to move around the region without any problems. So there are not too many incentives to learn a new language (this is obviously changing, but we are way behind other regions in the world). Near 10% of Chileans speak English, and Chile is one of the largest ones. Being an applicant from Asia, for example, where your education includes English as a second language from almost day 1, it’s a huge advantage. Being proficient in English helps your score better in the GMAT, especially in the Verbal section. For us, that part is the hardest one. By far.

Reason #2: Being very comfortable in your home country

Most of the Latin American MBA applicants come from the best universities in their home countries. Most of them are engineers or business majors with an income that situates them in at least, the Top 10% of their’ home country income distribution. It’s a very comfortable situation.

When you go to the U.S., you don’t have this income anymore and you eventually become a student (again!), but this time, in a foreign country. Getting out of the comfort zone is something VERY hard to do. The reward is amazing though. My family and I were able to live two years in Philadelphia, and then work and live two and a half years in Cupertino, California. We grew immensely and met people from all around the world. Managing the production of new iPhones and living in California was an amazing experience, only possible thanks to my Wharton MBA. But YOU HAVE to get out of your comfort zone!

Reason #3: Because maybe it’s not a great investment, from a financial-project-evaluation point of view

This is a controversial one. If you’re going sponsored by your company, no need to worry. Your decision is a no-brainer. If not, this may be interesting.

The costs associated with an MBA program are staggering. Just regarding tuition, Wharton: US$ 80.000. Harvard: US$ 73.000. Stanford: US$ 73.000. It’s true that most of these programs have scholarships, differentiated tuition fees according to your income, and some loans, but still… it’s a huge amount of debt. Additionally, you have to consider two other factors: first, your “Other expenses” are going to be the only leverage for managing your debt at the end of the program. This leverage will definitely vary among students: some will be very lavish, some will be more frugal; second, you have to consider the alternative cost of not having an income during those two years. If you take into account those two factors plus the high cost of tuition and taking into consideration that only the difference between your salary with MBA and the salary that you may have without the MBA is the benefit that you have to consider, the present value of all this may not be positive.

BUT… if you consider all the other benefits (non-monetary) associated with the experience and the well-being of my family (in my case) that comes with the degree, the situation may change.

Finally, deciding to apply for an MBA from a Latin American country should be one of the most important decisions in your life. It won’t be easy. I took it, and I’m very happy about the result. So you can’t take this decision lightly. You have to compare all costs and benefits (financial and not-financial) and only in THAT way, you have to decide if it’s worthy of your time, energy and money (Hint: it is).