Unicorn founder vs PE founder
If you had to choose two career paths, which of the following would you choose?
Stanford CS undergrad -> Facebook SWE internship -> Unicorn founder and billionaire at age 29
Harvard undergrad -> Drexel/Lehman -> HBS -> MF PE associate -> MF PE senior MD -> founder of MM PE fund (billionaire at age 50)
bump
Analyst at a fintech investment bank -> 140k base at 22
🤯
Easy. Unicorn founder and become a billionaire at 29. Take the proceeds and raise a PE fund. Boom get the best of both worlds..
lol the first career path is actually real. Look up "andy fang" and "stanley tang" on google. They're the co-founders of doordash, became billionaires at age 28/29 and did stanford cs undergrad and facebook swe intern
Please tell me their future PE/VC fund is going to be Fang Tang Capital. That shit rolls off the tongue.
Lol so is the second, look at pretty much any PE billionaire.
This is a stupid question money earlier is better than money later
Then why are you in finance? You should do tech lol
Bc the overwhelming majority of outcomes will be somewhere between 0 and a number well below a billion. What that in mind I prefer my current odds
I love how everyone thinks if you know how to beep boop a few lines of code you have what it takes to find and build a multi billion dollar company. These founders have much more savvy than just “knowing how to code”. That’s like saying the analyst that really “knows how to model” can go out and successfully raise a multi billion dollar fund just because they model the hell out of a LBO.
While your point has some merit, there are way, way, way more young billionaires in tech than in finance. Just due to the nature of finance. No 24 year old would ever raise a fund in PE because he has no track record. To raise a fund in PE, you need decades and decades of experience and you would need to have MD/partner experience at a reputable fund.
But anyone can create a startup and raise money given you have some type of decent idea. Many, many people in their 20s (or even teens) get VC backed/get angel investment.
- Austin Russell – founder and CEO of Luminar Technologies and the world's youngest self-made billionaire
- Vitalik Buterin – co-creator of Ethereum, billionaire at 28
- Doordash guys - billionaires at 28/29
- Dylan Field - co-founder and CEO of Figma, billionaire at 30
- Evan spiegel - founder of snapchat, billionaire at 25
- mark zuckerberg - founder of facebook, billionaire at 23
etc etc
Clearly all these guys are extremely talented and a lot smarter than the average banking analyst, but it is a lot easier to get rich quick in tech than it is in finance. That's just a fact
You‘re talking about the extremes, for the average person in tech/ finance, things are pretty similar, and if you don’t live in the US, I‘d even say finance leads to higher average net worth than tech
Personally know someone who raised a billion dollar fund at the age of 28. Not Ivy Summa Cum whatever, not born into riches, etc. You think he won’t become a billionaire soon enough?
The names you keep listing are public because they’re forced to be. There are plenty of people in finance that prefer staying lowkey, you just will never hear of them.
I’d also add in people nobody has ever heard of who have amassed smaller, but still very sizable, sums of money. I personally think the $20MM - $200MM space is way underrated and underestimated.
While I don’t speak from personal experience, the difference in lifestyle between $10mm and $1.0bn is not nearly as significant as the difference in lifestyle between $0.1mm and $10mm. Even if I had a 10% chance of being a billion by going into tech, I’d rather take a significantly higher chance of being worth ‘only $10+mm’ in finance. The marginal value of a dollar falls off a cliff at these levels. Knowing this, the fact that finance offers a significantly higher likelihood of reaching this threshold makes it a more appealing career path for someone like me who won’t get a lot of incremental happiness beyond these levels.
Fair, but I feel as if people overrate the ceiling of tech vs finance, when taking into account the people who actually make it there. How many people in your analyst class will make it to MD of PE/HF/IB one day?
I feel as if most college students go into finance with the idea that they want to make the most amount of money and don't care about WLB. But then once they start actually doing the job, they burn out and end up doing something with better WLB/lower pay than grind it out for MD.
Funny enough, one person in my analyst class pivoted from finance after doing 2+2 and started a business with friends from school which they sold for more than $500 million a few years ago. The skills he gained as an analyst and junior PE professional definitely contributed to his subsequent success at a start-up.
I did my analyst stint from 2007 - 2009 so I can actually tell you exactly where all of my fellow analysts ended up. While only a few of us went to PE (thanks to recruiting for PE in 2008), roughly half have because senior professionals (MD/Partner) in either banking or PE. A few have gone the corporate route and are working their way up the ladder. A few are not on linkedin and I have no idea what became of them.
So all in all, nearly everyone ended up in a good spot putting them in the top 1% of earners. And for those who are curious, it definitely feels like there is a correlation between the quality of the analysts and the long term outcomes -- although admittedly no one knows exactly how everyone was bucketed when we were analysts -- but you could kind of guess.
The point is majority of people won't make PE Partner/MD etc. but they'll end up at PE principal or VP level which is still a lot of money. If your startup flops then you're broke.
My brother, why even create a throwaway PE account when you’re obviously someone who chose tech trying to cope? Be at peace with your decision, there are lots of merits to choosing the tech career, but creating this thread and being so defensive in the comments reeks of insecurity.
Your argument holds no water — there are 1,100 unicorns globally. Putting aside the fact that half of those were produced in the tech bubble of the last two years, the number of MM and up PE firms (even excluding HF, VC, etc) ALONE exceeds that, notwithstanding each fund having tens or hundreds of partners sharing in the wealth while it’s really only the founder that makes incredible money from a unicorn. Founding a unicorn is a WAY longer tail outcome than making partner at a top fund, that is not even up for any kind of debate, on a risk adjusted basis if you’re only optimizing for money this is not close.
Of course, optimizing for lifestyle, culture, interesting / stimulating work, fulfillment etc might give you a different answer. And the reality is the best job for you is the one you’ll be best at, a tech founder couldn’t run a buyout firm just as there’s no way in hell most PE bros could start a unicorn. Be at peace with your career, no need to be insecure.
Lol im actually going to BB/EB IB FT next year, did a SA this last summer. Not insecure at all nor am I coping. I'm just saying that tech has a higher ceiling than finance, despite what people on WSO think.
Moreover, are you sure that making partner is that easy at MF PE / HF etc? Pretty sure it's brutally competitive to 1) get an offer 2) get the senior associate promo 3) get the call back to VP 4) make it to partner
I'd argue that you have a higher chance of making a decent, but not unicorn sized startup. Tons of people make startups and sell them for 50M or around there
Selling a VC backed startup for $50M would net you $5-10M. IB MDs will easily be worth that unless they are retarded with their money and it isn't too difficult to get that if you're prepared to stick it out.
Not sure why this is even a question. The tech billionaire at 29 has his entire net worth tied up in the equities of the company and won’t be able to exit for years without completely collapsing the company. This means that they have to put up with the stress and work hours that are many times worse than the MF PE partners. This is not even mentioning their significantly lower quality of life during majority of this time period because they sunk their entire net worths into the company.
Lol yeah, working for 6/7 years to make 2 billion dollars by running Doordash is worse quality of life than working for 30 years for 70+ hours, dealing with all the office politics, corporate bs, and promotion bs? And the worst part - you have to work for someone instead of working for yourself
You're talking about extreme outliers here on the tech side. I know lots of people who are struggling their way through the startup life.
I know a guy who founded a successful VC-backed startup that has been working for c.$100k in a high cost of living city for nearly a decade. He is worth millions on paper but has absolutely no liquidity and the VCs won't let him get out. If he leaves the job his equity will plummet in value because he is the founder and driver of the business. VCs and prospective investors are very much his 'boss' even though he calls the shots. The stress is enormous and he has called me at 3am (US time, thankfully I was in Europe) on more than one occasion to ask for advice. And this is for what many would consider a successful startup...
It sure would be nice to found a startup that reaches unicorn status within a few short years, never takes on VC investment, and gives you plenty of liquidity ... but there is a reason they are called Unicorns -- because they are so rare that they practically don't exist.
During those 7 years you’re living like shit compared to IB analysts taking home 200k package every year. Past the first few years, I’m pretty sure partners work under 60 hours while the majority of time are spent being able to enjoy the money they’ve made. Again even on the off-chance that you do create a billion dollar company, your quality of life doesn’t improve much from someone that has been consistently taking home 7 figures for years. Those claims about less corporate bs are also lies created by the tech companies to attract more coding monkeys. You will be constantly making pitches and sucking off to countless ‘angel investors’ and VCs especially if you have a untraditional business idea (which is usually what it takes to become one of these billion dollar companies). Not to mention, after you get funded, you will have to do everything to please these investors.
Will someone more patient than I please explain to young'un here the concepts of probability and risk?
Trust me, I know about probability and risk lol. I have the statistics on median career earnings in hedge fund, PE, and IB
For the love of god, anyone? please?
Go for it! Don't forget about me when I supported you when no one else did
Basing any decision on likelihood of making a billion dollars is fucking stupid. Most people who go into literally any field won’t scrape 1% of that.
Also, you’re doing yourself a disservice by looking at early 2021 charts before the most recent tech bubble blew up. As of the 2022 Forbes list, finance is #1 and tech is #3, behind manufacturing and just above fashion… maybe you should’ve studied process engineering or textile design rather than computer science? Or maybe it’s completely irrelevant either way and both finance and tech are clear paths to upper middle class incomes in your 20s and upper class incomes later in your career, with a handful of tail cases making fuck you money in either industry
https://www.forbes.com/sites/jamesodonnell/2022/04/06/how-to-become-a-billionaire-these-industries-have-the-most-people-on-the-2022-forbes-list/?sh=1d12b8e26898
lol only since I actually did read the article a while ago...
Facebook, Instagram, Pinterest, Snapchat and TikTok and more... were moved to the media and entertainment, which actually skews Tech downwards a bit
I.E. Should Bloomberg be considered a finance, tech, or media & entertainment company? (According to Forbes, it's a media company)
Not too sure about upper class incomes in Tech though, would say Finance probably has the upper hand there
attention to detail jk
Jesus Christ, this is why bullying is important.
Just start Unicorn company and become billionaire before 30 bro
Caged
First choice is literally impossible and requires an insane amount of luck. Second choice is a much more realistic/doable career path. People here really think you can just take an intro to python course and you’re on your way to become a sub-30 yr old billionaire
Some people really think after learning how to walk through a DCF that they're on the path to MF PE
Lemme fix that for u - Some people really think after learning how to walk through a DCF that they're on the path to MF PE Partner making 10 mil a year
You left out the important detail of having very wealthy business owning parents to begin with lol.
Look at these famous tech billionaires today, you'll notice a pattern that goes well beyond which university you attend. It wasn't long ago that just having access to a computer was very rare, let alone having one in your home.
Could you ask around your friends/family/community for a quarter million for your new tech business idea? If this entire idea of making a massive tech venture revolves around statistics and probability, would a certain class of people not have the statistics in their favor with the data points to prove it?
Wall Street is no different. There are legitimately fund managers who borrowed millions from friends and family to start their funds, like it's just a thing you do. Do you think this fund will have a hard time finding wealthy clients and accessing decision makers at major investment institutions? People are not even trying to imitate them, they are chomping at the bit just to work for them and make a large bonus.
If you aren't born into this club, you'll have to join it eventually to succeed at this level. I'm not trying to be a billionaire. I broke into Wall Street to accomplish goals that if revealed would seriously compromise my ability to accomplish them. The longer I've been in this business, the more I've learned how important it is to keep your cards close to your chest. It is a ruthless machine and many at the top are literally criminals. Nothing about it is fair, it is "rigged" by its fundamental structure.
A career path is something for a working person. Massive success in business is more like a competition, and the playing field is anything but level.
"A career path is something for a working person." lol it's funny you say that because everyone wants to go from IB to MF PE to HBS to MF PE which is a career path
Wow love that analysis. You seem like a guy I'd like to get a beer with.
Those are both nice paths. How do you rate this one? johnnycan
UPenn history BA -> nonsensical self-created liberal arts masters at UChicago for 3 years (hiding out from unemployment I guess after a tough showing at UPenn..) -> execution trading at zero-prestige Chicago sweatshop for 6 years -> 2 years of full time "extracurricular" activities trying to look well-rounded for MBA programs (fluffed up 6-month "consulting" gigs and volunteering) (around this time you ask Autoadmit or WSO if you should pretend to be gay on your MBA apps and write a story about coming out to your religious family) -> dinged everywhere, forced to attend Columbia's EMBA without employer sponsorship -> Moves on campus and joins like 7 full-timer clubs, goes as far as explicitly claiming to be a full-timer on Linkedin, and somehow goes on FT-MBA retreats as an EMBA student according to a classmate -> Big Tech (the orange one) FP&A -> swiftly PIP'd -> Finance for some chain of walk-in clinics (???) -> Unemployed for 2 years but spins it as "head of finance" for a (made up) "stealth startup" that you can't name now even though it's been like 4 years since you started there (must be top secret) -> Finance for a boring computer hardware retailer where your boss's boss is a Cal State Sacramento accounting undergrad alum who's like 8 years your junior. And you've been a legendary troll known as Brady4MVP, MBAVSMFIN, JJC, or JJC1122 on 3 or more online forums the whole time. And I think you're 43 in November - JJC-11-22.
Prestigious?
how do you even know this
Stupidest fucking question I've ever seen.
Risk-adjust the chances of these happening.
Would I rather be 7' tall, born into Elon Musk's fortune, 10/10 looking, and extremely athletic or 5'8", have middle-class parents, and be 5/10 looking?
It's not like you can just pick. Hard work could realistically lead to a strong future in PE. No amount of hard work guarantees one will be a billionaire through SWE, in fact, morons get rich through this path and is hardly predictable (Neumann)
Most impressive founders I know were boot-strapped. Richest person (his main home is worth ~$30M) I know doesn't run a unicorn but runs a steady company that I'd imagine he'll sell to a financial sponsor once he retires. Lost a huge chunk of his net worth during 2001's bubble burst so at one point, he was probably richer than he is now.
Know of other founders who created more "lifestyle"/family businesses and are worth $10M+. Their kids do not work for them but their inheritance would probably mean they would never have to work a day in their life if they choose to (not the case, one of their kids is doing incredibly well on the buyside and likely makes similar comp to his parents at a much younger age).
OP, it’s a lot easier to aim for a few million than any billion by two exact paths.
Those are the extremes and unlikely you will be a part of. Tbh these sort of posts make me assume your an intern or college student?
Reality is 200-300 by 30 is already hard and and a grind. It’s not hard to get into IB imo but it’s really fucking hard to wake up for the next decade doing this without the pressure of “billionaire by x”. Hell your plan can just be shredded by recession and hiring freezes.
Holy shit this is the dumbest post ever. If anyone of us thought we were smart enough to found a billion dollar company in our 20’s why the fuck would we be in finance gargling dick until 2AM.
lol a lot of ppl here disagree tho
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