It’s on-campus recruiting season. Are you good enough to ignore the banks and consulting firms?
I read the recent piece Michael Lewis wrote about young people choosing to work on Wall Street over Silicon Valley, and found myself nodding along in agreement. The first time.
But something wasn’t right.
So I re-read it a bunch of times over the weekend and tried to figure out what was bothering me. His description of what happens when recent graduates — usually recruited the previous fall — go to Wall Street really resonated, but his conclusions about why they go feel wrong. In particular, his view that Wall Street has a permanent choke hold on the best young minds in the world feels almost naive.
Technology entrepreneurship will never have the power to displace big Wall Street banks in the central nervous system of America’s youth
Nothing is permanent. This is NOT the way it will be in the future and it is NOT what I see when I spend time with college students.
Over the past 3 years, I have been a part of creating and building Dorm Room Fund — the first student run venture capital fund dedicated to investing in student-lead startups. I have spent a ton of time with many of the most talented students in the world.
This experience has made three things clear to me:
The career development offices at top universities are designed to funnel talent into finance and consulting, not startups.
The startup industry is the best place for the best students to get the best professional start
I would not get into college today
There are a ton of challenges in displacing Wall Street banks and management consulting firms as the go-to options for the top university talent, but most of them are marketing challenges. The banks and consulting firms have rigged the system to leverage all their advantages, and I think if more students could see this, it will help startups win.
As on-campus recruiting heats up, students have to decide if they are talented enough to ignore the Wall Street Banks and the management consulting firms. They have to decide if they want to help scale a startup or get help to scale a corporate ladder — and if they are confident enough to wait until Spring to secure a job. This is really hard to do. Here are just a few of the challenges I see, and some ideas:
Students are process oriented:
Students at the best schools are accustomed to high achievement. They’re comfortable with fixed processes that evaluate relative performance against their peers and quantifiable results that are tied to easily articulated rewards. Banks and consulting firms run very clear recruiting processes (and in fact, set the rules on timing with the career services offices at most schools to create a fixed process). These firms are open about having a specific number of “slots” for students from each school, and they operate in a competitive landscape with a well organized stack rank of status from top to bottom (McKinsey>BCG>Bain and Goldman>Morgan Stanley> Credit Suisse). Both reinforce the relative competition for tangible rewards that students have been trained to react to like Pavlovian dogs.
Startups can’t compete here without a huge investment in education and marketing. The recruiting budgets for most of these firms are multiples of the seed capital most startups raise (even today). The career development offices help students know what to expect and then push them down the well-trodden path. Startups are different — They start recruiting in the late spring because of the fast paced nature of their business makes hiring needs hard to predict over long periods of time. This means students who want to work with them have to forgo offers from bigger companies and trust that they will find something better, later. Traditionally, to get recruited by a startup, you have to abandon the well-mapped paths and bushwhack your way into an interview. You have to figure out where you want to work based on what the company does and find clever ways to get noticed by someone who can make a hiring decision. This is changing and while the timing is still MUCH later in the year, it is becoming easier to find and apply for a job at a startup now more than ever.
The process should be clearer to everyone. Most startups and venture firms have “jobs” pages that list available opportunities in their portfolio. Most startups are listing jobs on AngelList, Indeed, and HackerNews Job boards. ReadyForce has a very cool platform and so do Venture for America, startup hire, and VentureLoop. If you don’t have a computer science degree or internship experience at a startup, Lynxsy is a good resource for surfacing opportunities specific to non-technical roles. For those of you who want some more coaching and guidance during their search, The Muse and HIRED both provide more hands-on support throughout your process until you find your dream job.
I have also noticed many more startups hiring a recruiter or hiring manager much earlier in their growth — often focused on specific experienced roles, but also open to meeting with talented young people with tons of horsepower.
Unless you are an engineering or CS major, the specific jobs that are advertised are unlikely to be an exact match — but you can learn a lot about a company by looking at their hiring needs and how they change over time. Are the jobs that they are posting different so you can assume the company is successfully building a team? If you search for the company on LinkedIn, is there growth in employees? Do the people filling the roles seem to be high caliber with deep experience? Is a founder in charge of the functional area where you believe you could add value? If not, has the person leading this group been there a long time and has the group grown below them, implying they are a good leader? How would you be able to add value? Where would your skills fit in this early-stage company?
Goal #1 is to graduate with a job:
Prior to graduation, most top students have never faced real uncertainty. Yes, post high school there is stress about where you will go to college, but if you land at one of the top universities in the world, there was probably never doubt about how you would spend the next 4 years of your life. Now you head into senior year and the next chunk of time in your life is undefined and uncertain. This is scary. The banks and consulting firms know this. They also know how many cogs they need in the associate wheel years in advance and are happy to help you sleep at night by offering you a job before you head home for Thanksgiving and face your friends and family — and the inevitable questions about “What are you going to do after graduation?” Pretty f’ing sweet to say, “I’m going to Goldman…” and have smiles all around while you drop the mic and ask Grandma Mildred to pass the mashed potatoes.
Startups, in contrast, try to achieve just in time hiring. Long-term HR planning is not a strong suit. Startups are dynamic, fluid organizations that accelerate at different rates and in different directions over time. It is hard to know how many talented people you will need in 6 months and even harder to know what you will need them to do. Even if startups decided to make offers in November for jobs that started in June, it’s very likely that the job description would change dramatically over that time — and this makes hiring with a defined process difficult. If you choose to work at a startup, you will have to endure Thanksgiving and winter break with no job and likely have to balance spring break plans with interviews that you have had to chase down on your own. When you do get the job, no one will know the company where you are working and even fewer people will understand what you are doing. If you get into the details of the salary etc. it will be less than what bankers make and the concept of options are about as foreign to most people as Iraqi Dinars.
I would argue that the way a company hires is often a strong indication of how they manage, develop and promote talent as well. The hiring process for the banks and consulting firms is up or out, the internal culture is up or out. The process is designed to extract everything they can from you and deliver the best outcome for them. The work of an associate is more of the same. A great startup hiring process filters for fit; looks for a flexible mind and approach that can adapt to the changing realities of the company and the market; and in many ways requires the job seeker to define the role and lead the process. You have to make your own way and unlock the opportunity. You have to be a leader. If you are, you will learn 10x more, have 10x more impact and be 10x more engaged than any of your banker or consulting peers.
Prerequisites are acceptable in student life:
Students are trained to accept prerequisites. When a university says, “To take this really interesting class that you are passionate about, you have to grind your way through these 3 others that require long hours and brutal, mind-numbing problem sets or research papers,” the best students dig in and grind. When a sorority, fraternity or other group makes hazing a part of the vetting process, students accept it and engage in the punishment. The consulting firms and banks have marketed the role of associate as a prerequisite for successful pursuit of what you really love. They figured out the vulnerability of financial instability and a general feeling of being highly educated but unskilled, and they leaned into it. Hard. Come for a few years and work hard, learn a lot, make great connections, pay off your student debt and then, and only then, go start a company or join a startup or join the Peace Corps. Michael Lewis nails this piece of the puzzle when he asks, “Then what?” The functional things you learn are likely not helpful outside your industry of focus, and the moral compass that you adopt is probably unusable beyond the walls of the Death Star bank you choose to join.
Don’t fall for this. College was the prerequisite to the opportunities you want. You have earned the right to pursue your passion, and you will do that the fastest at a scaling startup led by amazing people. It is a myth that you need to have technical expertise or that you have to be a founder to build a career in the startup industry. Many of our best founders start their careers by joining successful startups as managers or individual contributors. They get to learn what it takes to build a company by being part of building a company, and for the lucky ones, it is a great company with a great team and culture.
I have a ton of respect for Michael as an author, and many of his books are my favorites, so it hurt to hear this view coming from someone who has studied sudden and dramatic shifts in industries and written so much about disruption in established systems. I want to see the banking and consulting monopoly on talent broken and see many, many more people pursue a career in the startup industry.
If you are graduating in 2015, you have already been programed to work at a startup and to be an entrepreneur. You have newfound beliefs and often they are tightly held. You are optimistic and want to change the world. You are full of passion and push stuff to the edge, often because when you try something for the first time, the only fail safe way to find the edge is to go over it. Learning has been your primary focus, and you should continue on this path. Click here to get started in the First Round Community or connect with someone from our Talent Team and they will help you accelerate your career at startup speed.