Being an Asian in finance in the United States
I'm Asian-American. I see tons of Asians going into finance at the analyst level, and many who are Asian at the lower levels of PE firms (associate, analyst), but it seems to me that it's rarer to see Asians at the higher levels of PE or IBD. In my opinion, I think this is because it's simply harder for Asians in general to develop relationships with all you white folk who run the companies of this country (than for other Caucasians), and thus Asians tend to bring in less revenue.
Why this is so is possibly because people in general tend to get along better with similar people - others with similar backgrounds, cultures, and appearances. Another plausible reason is because of immigration patterns that led to second generation Asian-Americans being much larger now than maybe 10 years ago. Nevertheless, I can't seem to think of a single important Asian-American financier in the United States among the hundreds of important American financiers out there today.
One of my friends who worked at Goldman Sachs this past summer but decided not to accept his return offer told me one of the main reasons is because he thinks his chances of making it to the top are really slim since he is Asian. He decided to pursue a PhD instead.
What do you guys think about Asian-Americans in finance? Do you think I'm overthinking things? Is there potential for someone like me to be the Jeremy Lin of finance?
Interesting. Asian-Indians, in comparison, tend to have little problem with the 'bamboo ceiling'. In fact, considering their share of the US population (0.9%), they've done exceptionally well. CEO of Pepsi, Citigroup, McKinsey, Deans of Harvard Business School and UChicago Booth, several of the top (not the very top, obviously) executives at Goldman, Blackstone, Bain Capital, Governors of two States, etc.
I personally think it has to do with the personality types of the East Asians who do end up going into finance. At my school at least, all are incredibly intense, focused, and of course smart. The Indians, in comparison, are all of that and also, crucially, laid back. Meh, just a theory.
Tell your friend the PhD, that he needs to understand "sampling bias" before he writes anymore papers.
I remember reading this in an article somewhere but they attributed this to the simple fact that not that many minorities entered finance until the 90's. Even during the middle to late 90's many people who entered finance were still of the old boys club variety. Nowadays its quite common ( maybe more than common) to see an Asian in finance. Maybe after a decade, the vast influx of minorities who enter finance right now will move onto the MD level of the firm. Just look at people at Qatalyst,they have three Asian MD who went into finance around the 2000s and lots and lots of East Asian analysts and associates.
I think the bamboo ceiling is vastly exaggerated. Its not that uncommon either to see an Asian person in the MD level especially in the West Coast and there isn't a inherent bias against Asians in finance. As long as you can perform and you are sociable, you should be totally fine.
I think you're overthinking things. There are a number of different Asian-Americans who are prominent in business that I could point to, but no amount would probably be enough (Stephen Chao and Jerry Yang are two that come to mind immediately; if you're looking for pure finance, how about Ping Jiang or if you're looking at dealmakers, the Greenhill MD who brought in the ATT/T-Mobile deal was Asian, and yes, I realize it fell apart). The point is that it's possible for an Asian-American to attain the highest level of business in the US. If the only reason your friend didn't return to GS was because of this, then I don't think he made a very good decision; there's no way the sample sizes we're using could be anywhere close to being statistically significant, and while I realize that's not how we make decisions in real life, I still think it's a very narrow minded view. After all, there's nothing that says that unless you make MD at GS by a certain age, then you fail at life.
Another point that's been raised is why Indian Americans tend to succeed more in finance than (East) Asian Americans, and I think this is a very valid question. It seems that you can extend this trend more generally to the entirety of the business world as well. My answer to this is that while both groups are traditionally associated with highly skilled positions (doctors, engineers, computer scientists), Indian culture is more embracing of business careers and aspirations. Part of this is because East Asian cultures place a huge emphasis on the group over the individual, meaning there is pressure to conform. While conformity has its advantages in some situations, in the corporate workplace, it's not very conducive to getting noticed and therefore promoted.
Additionally, this focus on the group's well-being also encourages risk-aversion in most East Asians; careers in medicine or engineering are viewed as 'safe' in that unless something really bad happens (i.e. losing your license to practice medicine), you're going to have a marketable skill that's in demand. On the other hand, business, and to an even greater extent, finance, is seen as much more risky; it's a foregone conclusion that recessions will occur, and that during these recessions, jobs will be cut. When my Asian roommate in college told his parents that he wanted to accept his IBD offer and not go to grad school, they didn't flip out per se but they sure tried to talk him into doing something more 'tangible'.
Anyway, the bottom line is that your race/ethnicity/gender/whatever doesn't define you. It's a part of your identity, but it's only as important as you let it be.
Here's another notable Asian-American financier: Chinh Chu. Look up his story -- very fascinating.
In summary, he fled to America from Vietnam at a very young age (Vietnam War), learned good engrish, funded his own education at a NON-TARGET (for all you monkeys out there) as a door-to-door salesman/telemarketer, and became one of Blackstone's youngest senior managing directors.
Some years back he closed the Celanese deal -- the largest public-to-private deal in European history. He's now co-chair of their private equity division / serves on the exec committee.
Oh, and he owns the top penthouse in the Trump Tower. What a boss.
The funny thing is that I just had a counseling session with one of the WSO mentors last night and I actually brought up the same question. I am a South East Asian and so is the mentor. I have been working close to five years in Finance, from BO to MO and to FO. It is all the same. Based on my personal experience here are a few things that I would like to point out:
Meritocracy. Finance is based on meritocracy. You are either making money for the bank or you are not. In the end of the day, bottom line matters.
Don't play the victim card. You can keep blaming why you can't be a MD because you are Asian, White, Black, Hispanic, Woman, Old, Young, Veteran, went to target school with liberal art major, went to non-target school, and the list goes on. But what does it really accomplish? Nothing. Instead of complaining, you could have focused on getting something and going somewhere.
Play with the cards you are dealt with. Fine, you are a minority then look out for programs that can give you an edge like this one: http://www.seo-usa.org/Home. Join community groups within the bank or within the region that provide you a support system. Find people whom you can relate to and make them your personal and professional advocates.
Manage perception. Everyone is going to have bias and stereotypes against people whom they don't know. Instead of complaining about it, go out with them. Find topics that you can relate to them. After meeting so many people, I realize that we all wants the same thing: Happiness. Everyone of these people 1) love their families, 2) want to do something that they are good at, 3) want to be loved, get a gf/bf, get married 4) have a hobby/cause that they are passionate about.
You have to prove it all the time. In Finance, you can have a track record, but it doesn't mean anything. As you progress in your career you change role, company, location, you start from ground zero again. The main focus is trying to learn the business, work harder than everyone else, maintain a great professional relationship in the industry, always take a stand for your opinions, and make money for your group. That is the only way that you can move up. And everyone (White, Black, Asian, Woman...) have to do the same thing. Company promotes competent people, and not necessarily because you talk or look a certain way.
Your perception determines your reality. Finally, I am a firm believer in self-determination. I believe how we think affect how we are as a person. If you think of yourself as likable, intelligent and attractive, you are going to act this way. And when you act this way, people are going to view the same. That's why I believe that we can actively manage our perception by focusing on our inner self. As William Ernest Henley said in his poem, Invictus, "I am the master of my fate: I am the captain of my soul." And that is how I view and want to live my life.
Hope this helps.
Your core issue is that you're focusing on the wrong market. Come back to Asia. Don't think you'll find many successful PE firms run by us white folk.
In other words, stop bitching about what you don't have and take advantage of your opportunities.
By the way, I'm based in Tokyo where the total number of immigrants is less than 1.5% of the total population. Of that there are a handful of us in finance, especially after the earthquake last year.
He's Asian-AMERICAN, what do you mean "come back to Asia"?
Come back to Asia? When was I ever in Asia? Are you fucking stupid?
Listen, you're just perpetuating the stereotype of asians being pussies. Shut the fuck up and make money for the firm, and you'll make MD.
Continue being a pussy and you'll end up as some back-office PHD quant.
I would say the primary reason why you don't see many East-Asians in the upper echelons of finance is as follows. Up until recently most Asian's on Wall Street were still first generation Americans (meaning sons / daughters of immigrants generally still born in Asia) who were raised under specific cultural norms to be good analytical employees that followed the rules, didn't speak up, showed respect for management, and knew their place - qualities that, for lack of a better word, don't show leadership. Hence because of this perceived lack of leadership many hit the "bamboo ceiling." It is mainly a culturally driven phenomenon...I think you'll start to see this change with time as this new generation of Asian-Americans begin to move into the workforce. They will have grown up with more American values and social skills that will allow them to move up the ranks in finance. I think if we fast forward 10 years you'll come to see Asians representing a more meaningful portion of management.
I can speak first hand about the generational thing.
From my hazy memory of my time as an analyst in the 1990s, I remember out of an analyst class of around 80, there were around 10 Asian or Asian-Americans. The rest were white (American, European, etc.). And that was the late 90s when it was already changing - and I remember some of the Indian/Asian VPs back then who said that when they were analysts in the late 80s/early 90s, they were often the only non-white analyst in their entire year. And at the junior levels at the top tier PE shops and LBO funds -- almost exclusively white. In the last 5-10 years or so, that has been changing, and changing quite rapidly.
It will change as the influx of Asians at the junior levels in the 2000's eventually become MDs and partners in then next 10-15 years, and in fact there's already a LOT more than there used to be (even if it still seems like there's still relatively few).
I don't think it's a cultural issue at all - it's simply a generational one.
The Asian/Asian-Americans born in the 1970s who grew up or emigrated to the US at a young age were far fewer in number compared to the huge influx starting in the mid-1980s and beyond. If you think the numbers of Asians are relatively small even in a big city like Chicago, you can imagine what it was like in the 1980s when even in the large cities, you might as well be an alien from outer space because you may be the only Asian other kids have ever met.
As such, you'll see in the next 5-15 years more Asians in all facets of American life/culture/industry: in finance, media/entertainment, sports, and so forth.
It's more about numbers than culture. Especially when you're talking about Asian-Americans, and as those who were born in the 1970s have 2nd or 3rd generation Asian-American kids, you will see more numbers of Asians in all kinds of professions without any huge cultural barriers. Not saying there's no cultural/racial issues that come up (and there are, but that's another discussion entirely), but when it comes to workplace issues, it's really about numbers and generational differences.