Investment Banking vs Startups
I have already signed my offer at an investment bank and am planning to start very soon. I am deeply considering reneging my offer as I have recently received a strategy role at a very promising tech startup whose mission/product really resonates with my values.
Compensation is slightly lower at 90k base + stock. They are also promising a great work life balance with typical hours being 40 hours/week.
Some things I am considering: - I would love to learn more about how decisions are made at a company as I am very passionate about building businesses from the ground up - I didn't feel like I got any deep exposure to any of the businesses I worked on as a summer analyst that required critical thinking (felt like very surface level work). - Working at a startup would allow me to make a big impact - investment banking pay and prestige is great, especially considering my student loans - I can probably work at a more senior role at a startup after IB if I wanted to - Even if it's not decision making skills, I'll definitely learn how to look at growth businesses and value them at my ib analyst role - investment banking might get automated away at the junior level as there is zero decision making power and therefore zero necessity for human accountability - I already know investment banking is not what I want to do in the long term, and know I would either like to work with startups or in venture capital with startups down the line. - better work life balance at the start up means I have the flexibility to build my own business in my free time.
I'm definitely grateful and happy to have options but it's definitely a dilemma for me. My gut is telling me to close the door to IB and pursue my passion, but I'm afraid that I'll have regrets later on when I realize that I need to go get an MBA or find ways to receive more tangible training to move forward in my job. Would very much appreciate any sort of advice..
Well your post sounds exactly how I am feeling (minus the IB offer lol).
Would love to hear what you did during your time at the Startup and how you got the offer.
Sounds like your heart wants to do the startup.
Honestly in this case I would do IB though.
Agreed, can you elaborate on why?
If all you care about is money do IB, if you want to pursue what you are interested in than it seems obvious… you will have great career exits either way
Is the tech startup doing AI stufff? If so, JOINNNNNNN. Investors are pouring money into AI.
Most startups, even if well funded, will fail, not immediately but 5 yrs.
Startups offer a false sense of impact and ownership, unless you are one of the first 5-10 joiners.
Equity is likely in the form of options that may expire anyway.
Pursuing your passion is great.
Pursuing what you are skilled at is even better.
I work with my tech firms “venture fund”, and of the 3 exits we’ve seen in the last 2 years, 0 have been sold at price point where common holders get anything. Pretend that the stock portion of the comp package doesn’t exist and then weigh your options.
I did 2 years in banking then moved to a startup. Have also mentored / worked with a few people in the same situation as you. Strongly recommend you take the banking offer.
I’ve seen multiple people get burned recently who did take a startup offer over banking or consulting. The reality is that we are in an awful macro environment for tech, even most strong private companies will either not make it or have significant additional layoffs, and with no experience you are adding less value and will be cut before the associate who did a FT banking stint.
Startup roles will always be an option.
This should just get pinned at the top.
Tech is in a proper downturn, and although it will pass eventually, the short- and medium term prospects are not good. As others have pointed out, you'd likely have to be very early into the startup, and hold a substantial amount of equity for it to have a meaningful impact on your lifestyle. Don't let the inflated job title, tabletop tennis, and Thursday beers get to you.
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