When I accepted my offer at Deutsche Bank in 2007, it was a no brainer. I had sipped the syrup. NYC analyst was the only career move on my mind.
Next week, I head back to Indiana University to speak with the investment banking workshop about this choice. Pretty much everyone has offers lined up, so it’s their choice to make.
Given I left a comfortable position at a co-invest fund in NYC to become an entrepreneur, most assume I’m anti-banking. Otherwise, why would I have left. I made it out of DB M&A to a firm I liked.
Truth is, I tell 99% of college students to take their banking offer. Here’s why [a few quick thoughts that come to mind].
1) Odds are your startup will fail, getting some experience, learning how “the real world” works and if you go to PE, learning how to look at companies will improve your odds. Most new grads are naive, they think “if you build it, they will come”, but in reality that’s unlikely.
ConnectLAX started as a private lessons business, not only did not a lot of people come, but once they got together for lessons, they cut my out. I was naive to think 1) people to change (ie use my over Craigslist bc ‘better’ and 2) they’d accept my payment framework.
Now this part of ConnectLAX is free as a lead generator and the money is made in recruiting and video. CoachUp, a huge private lessons site for all sports I learned about a month after quitting [0/10 day for me], is stuck because same problems but raised money so can’t just up and completely pivot like we did.
I was visiting the professor who runs the workshop last year, he told me about a student, bright guy, who turned down a banking offer to launch a similar connection platform. But it suffered from the same issues and was slow going. I heard about it and knew the landmines he’d hit, ones where raising money likely can’t solve it.
2) Money, I bootstrapped my businesses to profitability thanks to four years of work; 2 in banking, 2 in PE. I don’t know of another career track that gives you that option. Time spent not fundraising is time spent learning, pivoting or building your business.
3) Greedy, I wanted to majority own my businesses, not work for someone else. Bootstrapping allowed that. I have no investors, which positions me well against my competitors in niche industries where 10x returns aren’t likely. See raising money <> making money.
4) Conservative, despite quitting my job to be an entrepreneur with no experience, I’m still a Hoosier at heart, so I’m conservative. Succeeding on Wall Street gave me optionality in case I sucked at startups for 3 years instead of 1.5. 3 year runway was clutch.
5) Time, assuming you don’t repeat the same mistakes twice, the longer a startup exists, the less risky it is. I had time to research other startups, learn from their mistakes and prepare for my transition. I started my first startup while in PE [I shut it down].
6) Lifestyle, the person you are at 26 is not the same as 22 [more dreams have burst, kidding, but probably]. 22 I had a big ego, by 26 I learned that ego mostly made life more difficult. I realized I valued time and freedom more than just money [common banking result]. Obviously I had an ego if a quit to launch a startup, but my goals were more attainable. It was more aim small, miss small.
I could always change directions or ramp it up once I had a base. A lot of the inspiration came from the operating partners I worked with in PE. We got along well, they knew I was going through the motions but my head and heart were somewhere else. When they said something, I was like dude don’t tell my boss you think that.
They said not to worry, but that if I’d come this far without being passionate about my job, then to think about what I could do in a job I was passionate about. Anyway, I realized the I looked up to them because I thought they were more passionate than my bosses. I could better imagine myself in their role than my bosses, so that’s when I realized it was time to carve my own path.