Should I Leave My IB Gig? An Honest Conundrum

I have been with my group for 5 years after my MBA graduation. When I recruited for banking, I genuinely thought I would do this for the rest of my life. People made it sound like the hours got better over time, the job more interesting, and the pay greater. Hours have not gotten any better, I'm still pulling all-nighters. The only thing that improves is that I get to rest while juniors process stuff, but I need to be awake to review what they do. You still need to review models, etc. To me, the job has lost its appeal. I don't really care about deals, I haven't felt happy when I've closed transactions other than for not seeing client X anymore. Pay is not as high as it was pre-financial crisis.

I think I lost my passion for the job in the first 18 months and have been grinding my way through it ever since. I believe I could make it to ED if I keep my cruising speed, but I hardly see myself ever being promoted to MD. I simply don't have the salesmanship skills or the desire to develop those skills. It's not in me. I have more than 5 failed attempts at recruiting for corporate roles, in each I felt short at different stages: some at the beginning, some after final rounds, some I decided to walk away in the middle of them. It hasn't been easy to get traction with employers (and I work for a top 3 US BB IB). Only calls you typically receive are for PE roles, nothing for corporate. I have had PEs on the other side in several deals and at my level I feel it's the same s**t but with sesame seeds on it.

I am aware of the many positives about my job. It is interesting (compared to the average job), you get to see new situations every week and learn stuff (even if you don't care about most of the stuff), it pays better than the average job, there's clear visibility into career trajectory, you get access to senior executives (in my case, I ascribe no value to this), you work with smart people (even though some think they are smarter than they really are), and it's prestigious (I also ascribe zero value to this but understand some people do). I am also very aware of the many negatives: the long hours, the meaningless tasks, the money-centric people can become (since you have no time for anything else, it's very difficult to grow in other areas, to have hobbies, to be an interesting human being, so you focus exclusively on money), most deals would still happen without bankers (so you question your impact constantly), you become a sophisticated secretary (e.g., organize meetings, organize weekly calls and go through a list of tasks in which you are responsible for less than 10% of the tasks, follow-up on emails people don't reply, etc.), rinse and repeat analyses/slides, ruin 20-y.o.'s weekends because "things need to get done", and a long list of etc.

Now I am presented with an opportunity to get out of the hamster wheel and start my own business with a former colleague. I must say that his reality is completely different than mine. His dad's a millionaire and has several businesses. This colleague has no downside risk. He also has a vast and powerful network, which I understand has value when launching something new. My cushion is my savings and my wife, who has a job that could easily pay for living expenses for the both of us and is supportive of me leaving IB. The only things that are preventing me from quitting and going full steam with this venture are: 1) fear that it fails and I lose my steady high salary and bonus, and 2) fear that if it fails, I will have a hard time finding a new job (I've had a tough time finding one in the past 5 years!). For context, I am the highest earner in my family's history. I come from a humble background and an IB gig is meaningful. If I have children and I continue at my bank, I will have secured a plethora of opportunities for them that I didn't have growing up.

Don't get me wrong, I am very excited about the prospects of doing something new and I value the upside. I also know I will probably be working as long if not longer hours for the first couple of years. The conundrum for me is the following: do I stay in this golden cage of IB for 3-4 more years (because I honestly see no chance of making it to MD), increase my net worth by 1-1.5mm and look for an average-paying job anywhere in the world then or do I give this venture a try? I would obviously try to be employed as long as possible if I decide the latter.

Any advice is greatly appreciated.

22 Comments
 
Most Helpful

Want to applaud you for actually caring / feeling some type of empathy around ruining 20 year olds’ weekends

 

Comes down to risk / reward which is tough when you have kids.

Any chance you could do part-time for a year to see if the business has traction before making the move? Also I think even if it does not go well, you could find a CFO type role at a startup / PE-backed company with your IB experience and now more entrepreneurial endeavor. 

 

My advice obviously isn't gospel but if the two fears you gave are the main two reasons why you wouldn't do the business, then I'd say go for it. Reason being #1: If you didn't do it you said you'd only stay in IB for 3-4 more years anyways so you're not "losing" much and #2 The type of average job you're talking about getting after IB would definitely still be possible after the business. I think you exaggerate the difficulty of getting a job after that amount of IB experience + the friends contacts could be useful in that regard. But that's just my two cents.

 

Sounds like you have a phenomenally amazing wife, she does well enough to keep your family afloat if things go wrong whilst also being fully supportive of you leaving IB.

My advice is to take the risk, the most valuable thing a man could ever wish for is a strong loyal woman by his side and based just off of your post it seems like you have that. All of the most successful men in the world have had strong, loyal women and whilst you aren’t guaranteed to be the next Elon Musk, I would argue you couldn’t be in a better position for this venture. Great wife, your friends’ huge network, coverable living expenses even if you fail, the capital backing to make things work it seems like your friend has.

You’ve already broken family history, but why stop climbing when an opportunity as golden as this one presents itself to you? You may/may not be familiar with MMA but an extremely famous fighter, Jon Jones, once said: “When you get butterflies and are feeling anxious, that’s when you’re most powerful, and not enough people harness that power”

Harness that power and take the leap my friend, I wish you well

 

wish all "want to get our of IB/hate IB" were as analytical and self-aware as this one: an objective view of the good, the bad, and the ugly and personal aspirations weighting risk/reward.

incentives trumph ethics
 

Here are a few thoughts from a former banker and then company founder.

  1. I went into banking as a way to learn about how companies are financed and run.
  2. I always wanted to found a company as many in my family have.
  3. I never hated the grind in banking and stayed from An1 at a BB to Sr VP at a boutique.
  4. I left to start a company with a co-founder. It was so much more time and stress than IB...way, way more stress even though things went generally well.
  5. Despite it going well, I also blew through all of my savings starting it, over 7 figures between funding our lives and investing heavily in the company over a period of several years.
  6. It takes a toll on you, and if you have kids, it's even worse. I had 2 kids while we were getting off the ground/ in fast growth mode.
  7. I finally got a reasonable salary after a couple of funding rounds, but it didn't rebuild my lost savings.
  8. Theoretically I have a ton of valuable equity in a still growing company, but I decided to leave because I was so burnt out. I left after running it as CEO for >10 years. We got to around 250 employees, and HR was becoming an ever bigger part of my life. Managing a lot of people with limited resources isn't that fun.
  9. My net worth on paper probably looks pretty great, but it's not the same as cash in the bank.
  10. I learned a lot, but to what you point out, I'm not an obvious fit for many traditional path type jobs. 

I ended up in a unique PE role through friends, but is it the right call long term for me? Not sure, but it's fine for now. Early stage companies don't like me because they are somewhat worried I might somehow displace the CEO/founder, but I have zero desire to be a CEO again. The recruiters don't like me because they all want experienced CEOs for that title, but I'm not interested in doing that again for a company I didn't even found. Banks don't like me because I am too far out of the loop from IB in their perspective, although we fielded in-bound buyer interest frequently and were involved in 3 M&A processes (2 we declined and in the other the buyer walked for non-company related reasons). Investors don't like me because I haven't sat on enough boards or closed enough deals in my current role (7 months in). Corp Dev doesn't like me because I am not "corporate enough" or haven't worked on enough big deals lately. They all discount that I raised 5 VC rounds at my startup and built a profitable company, and I've worked on tons of multi-billion dollar deals over my career as a banker. I can run a freaking process is all they should care about. When you run your own company you also sort of ignore your career. You don't keep up with relevant headhunters or really anything beyond your core mission and goals. You reemerge a decade later and many relationships/things like that aren't still in place that once were. 

I can't say I have a clear path forward other than continuing in a currently decent role, but I was somewhat surprised that people couldn't figure out how my background applies to any of these roles. Maybe it's too small of a sample size on my part, but going from former founder to salaried worker is not super straight forward. I just want to point that out. The easiest path is to get acquired and then just work for the buyer until you figure it out. I left after a failed acquisition and subsequent large funding round. I just needed a break.

If we'd already exited, and I had a ton of cash I wouldn't feel this way. I now make some money, and my wife also does well. We can easily pay the bills. I tend more to wonder about opportunity cost, even though I learned a lot. It seems like those skills are either being poorly communicated by my or just not valued/understood. 

 

kuf135

Great post with a lot of wisdom for the monkeys thinking about doing their own thing.  Two questions for you:  (i) do you regret doing what you did? and (ii) for younger folks maybe disillusioned w/ the traditional finance path, when is it the right decision / time to go and build something of your own? 

This is hard to say. I always knew I wanted to start a company so I had to do it, but it was also really hard. Unless you are extremely passionate about what you are pursuing, don't do it. It is all consuming.

The younger you are the better as financial risk and fewer dependents is easier to take, but without tangible experience relevant to what you are building it is also much, much harder. Unless you are comp sci at Stanford or similar with a few FAANG type internships, it will be hard. The other path is to build something completely on your own/with friends and start to scale it. 

I don't regret it, but I wouldn't do it the way I did again. Someday I should get a decent financial outcome, and what we built is important and matters to millions of people so it's been a success. I have many lessons learned. I could have done things differently on several fronts and moved faster and potentially avoided taking VC, which would have offered a lot more flexibility as I now see how we could have been profitable way earlier. It's easy to look back and say if I knew then what I know now (hindsight 20/20, etc.)...

 

pj2016

Are you kidding? If ur wife can cover expenses then your downside is much smaller than you think. And the idea that you will be relegated to an average job if it fails is an unfounded assumption. Your network will grow in ways you cannot imagine. Asymmetric opportunities will appear. Just do it.

Yes, having a wife that can also pay the bills is game changing, but once kids come around things get more dicey. Who is responsible and when? Whose career takes priority? 

There are definitely relationship challenges that occur and sometimes odd power dynamics. When I left my prior CEO role my wife expected me to be full time with the kids, but I was also still working on a variety of projects/consulting gigs at >$1,000/hr. 

The passive income I generate is still 3x her earnings, and I pay all the bills. Her view was you're not always on call, as she is. Fair point, but my life hasn't become being the full time nanny. She got better about it over time realizing that I have our cost basis covered financially, and I am swinging for the fences. She's super intelligent (Columbia grad as valedictorian and masters). She broke into a field that is much harder to get into than IB based on jobs/applicants. She also equates a high paying job to success. For a long time I've made more on personal investments than I have on salary/bonuses going back to when I left IB in 2012. I also hold a ton of equity in the company I started, but you can't really count on that until exit. 

 

TechBanking

pj2016

Are you kidding? If ur wife can cover expenses then your downside is much smaller than you think. And the idea that you will be relegated to an average job if it fails is an unfounded assumption. Your network will grow in ways you cannot imagine. Asymmetric opportunities will appear. Just do it.

Yes, having a wife that can also pay the bills is game changing, but once kids come around things get more dicey. Who is responsible and when? Whose career takes priority? 

There are definitely relationship challenges that occur and sometimes odd power dynamics. When I left my prior CEO role my wife expected me to be full time with the kids, but I was also still working on a variety of projects/consulting gigs at >$1,000/hr. 

The passive income I generate is still 3x her earnings, and I pay all the bills. Her view was you're not always on call, as she is. Fair point, but my life hasn't become being the full time nanny. She got better about it over time realizing that I have our cost basis covered financially, and I am swinging for the fences. She's super intelligent (Columbia grad as valedictorian and masters). She broke into a field that is much harder to get into than IB based on jobs/applicants. She also equates a high paying job to success. For a long time I've made more on personal investments than I have on salary/bonuses going back to when I left IB in 2012. I also hold a ton of equity in the company I started, but you can't really count on that until exit. 

I’m laughing because I posted yesterday that I’d prefer to never be a CEO again, and 24 hours later I am considering it. I’m over trying to make sense of any of it. It’s a very good first world problem. Within a day of posting this I get a CEO offer I probably can’t turn down. Life is weird, and I get that most don’t get these opportunities. Work long and hard enough, and you will. 

My call was simply, hey this portco is not figuring it out, you want to be CEO? That’s the difference between people who know you and a number of the paths/jobs I referenced above. 

 

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