Wanting to start a business after banking
I am really into business, and I want to start my own venture (not a fund). And I saw that being investment banking or being in the buyside is a good way to go. Right now, I am planning to work from a small investment banking shop and work my way to get into a big firm like BofA, MS, etc. To which this totals up to be 4 years give or take of working in banking. But I am not sure if working til I am 25 is suitable just to start a business. Should I stay in banking and keep working until I am confident enough in a business idea I found, or should I just quit? Or should I maybe go into a different industry like growth equity where you constantly look over start-ups? Right now, my main goal is to just start a lucrative business, and my goal is to find the best way to get there. Any advice really helps as I am a bit lost.
Growth equity isn’t startups
It's very difficult to jump from tiny boutique banks to the large firms, usually takes at least 2 moves (often 5+ years just to start at that BB bank) and you're completely reliant on hiring markets being VERY strong which they have not been for 3 years now. Lots of people who were hoping to make that jump have been stuck for years now.
IB does not teach you to be an entrepreneur - it's just good broad finance experience and branding. It's also tough to get into, so if you are past sophomore year you will not have an easy time.
If you want to start your own business, go work in VC (investing in startups; growth equity is pretty large companies) or at a startup
The best entrepreneurs we fund are people who have done it before. They know nothing about banking, accounting, investments or anything. They know everything about their industry niche, the regulatory side, how to find & hire the right staff and have operational knowledge.
My previous IB/BB and other finance skills didn't enable some magic experience that would allow me to start a business. But talking to thousands of founders, investors, travel, and experience in that field would.
any idea what you are aiming for?
Don't work in VC, please. Unless you are from Harvard or something, you will practically be working in a search fund role. At least out of college. I've heard it's not beneficial to go to VC immediately from college.
Sure go the IB route from small to big (could take 6-8 years it seems) and in the mean time, you'll gather good experience, credentials, and a network. Also, pay will be pretty good I assume at any level even if it's a small boutique shop. If you have a good idea on the way, then work on it. If you meet someone on the way who's starting something cool, then work on it. Maybe at some point you move to PE or a VC fund after you have experience.
I just think that banking gives you a safer route. I know sometimes big risks = big rewards, but also big risks = 90% of people getting NOTHING. So coming from a guy who has a moderate risk tolerance (you consider yours as well), I say that go to banking, you'll have a stable network and platform to jump from when you start your venture. And perhaps something to come back to if it doesn't work.
Not sure why the ms, i think this is reasonable advice
from observing peers who are grinding the vc/startup route with little reward in sight, I’ve appreciated more my time in IB, albeit grinding away and not that happy, but gaining good experience and saving loads of money while still enjoying my life
which I feel is a better balance than grinding away for nothing doing my own thing before I am realistically ready
That’s not how startups and VC work
I was in a similar spot, weighing whether to grind in finance or just jump into a business idea. Took a few months to test a small side project while still working, and it helped me see what stuck. If you’re thinking about going full-time, this article may help you, they make setting up a Limited Company in the UK super easy, so you can get the legal side done fast and focus on the actual business.
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