How would an undergrad student make this decision?
Would you spend your time creating a valid business plan and then evaluate your decision?
Would you work on your skills for IB + your business idea at the same time?
Or would you just stick to getting into IB (Assuming you get in).. play it safe and then take a shot at your idea?
Let me know what you think + if I should elaborate more on what I am trying to ask.
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Entrepreneurship is the best way to make money provided you have the personality for it.
It's also never been easier to raise money, so if you want to give it a shot then do it now.
I would definitely do both IB + entrepreneurship at once.
Do you think its even possible to do IB & entrepreneurship at the same time? I can't imagine there is much time availability.
No, it's really not possible to do them at the same time. However, consider that the IB experience can provide you with enough money to get things started....so in a way, you are working toward your business by building capital.
Look at the background of any major entrepreneur. Usually, there is a parent that gives them a little start-up money. Even Bill Gates got something like $10K from his parents (good bit of money back then). If you're in a situation where no one can give you that first boost, then banking for a year or two is one way of doing it. Also, you're a lot more credible at raising money with two years of IB on your resume. Just some thoughts.
Lol how - They both require 80+ hours a week
Some businesses do not take a huge amount of time initially.
For example when I started my first DNVB it took us 5 or 6 months of going back and forth with a manufacturer on samples. The rest of the work like lining up marketing assets took us like 10 hours a week.
Totally agree with this. Entrepreneurship is all about having the personality for it.
One important factor to know before diving head first into your own start-up is definitely having a solid business plan that has had a good amount of support. Personally I would present my idea to a ton of people/professionals and make sure that people think that its a viable plan. I would not want to fully commit to something that the majority of people think won't have demand.
Google "Odds of business failure" and ask yourself if you would walk into that casino? Never.
Entrepreneurship gives you 20% of success after 5 years. Chasing a career in your 20's and learning how things work has close to 100% success rate.
I'm technically an entrepreneur but I bristle at the idea of taking any risk. Go do a search fund if you want the best of both worlds.
Good luck
Given that I am 20 years old, do you suggest I spend the majority of my time securing a spot in IB and in my extra time put in some work on my business idea? Once I get into IB (assumption), then its clear I put my idea aside.
absolutely work in IB first...save all the $$ you can...and then after a few years you will have options.
How do you suggest he gets a search fund off the ground as an UG?
Thanks for the comments.
I feel like I should elaborate on personality... so here it is: - I am ridiculously motivated/ambitious - i work very efficiently and well on stress - I can work insane hours (16-18h +) and absolutely love it. - i do very well in school (major in Finance, GPA: Above 3.7) However, I’m no mathematical wizard of any sort... Given all this, I am having trouble with this decision.
All Characteristics of IB analyst
Well, ask yourself this:
You work 12 hour days, 6-7 days a week, for 2-3 years. But in the end, there's no big payoff. Your company / startup has tanked, and you have nothing to lean back on. All savings are exhausted.
How many times would you be willing to go through that cycle again?
Because truth be told, most entrepreneurs fail multiple times before succeeding - and many never succeed.
If you're used to working hard, because you know there's light at the end of the tunnel, that may not translate well to the world of entrepreneurship. Hard work and persistence def. helps increase your probability of success, but entrepreneurship is such a different game, with more variables. You need to assess the risks, compared to other career paths.
Rather than chasing the money alone, maybe a better way of choosing is thinking about what journey you would enjoy more. In IB, you will likely bring in a good paycheck but it is still just a paycheck. When you are stressed and working all the time, it's tempting to spend that income on amenities like a more comfortable apartment or meals. Money easily goes as fast as it comes, especially in Manhattan. Lifestyle creep.
A big part of working at a bank is conforming to the office culture and people around you. Some people welcome that. Other people can't stand being in an office that long. (It drove me nuts.) Would you enjoy 16 hours a day financial modeling and putting together documents and materials that your manager will be presenting to clients? Some people do.
Entrepreneurship may offer less certainty of results, but you have incredible freedom on how you approach problems and what you focus on. It requires a lot more creativity. Not everyone can handle the lack of structure. Even Elon Musk, who got rich off of Paypal, almost went bankrupt when starting Tesla. Not everyone can stomach that kind of risk.
Being an entrepreneur not only requires a business idea, but you have to get together a team of other talent that's going to make things happen - developers, managers, financing. Entrepreneurship doesn't have to be something completely original. It doesn't have to be trendy like a software product. You can start a business with a truck. I know guys who didn't go to college but started off with a simple transportation business, or a landscaping business, and over years grew that by hiring help and buying more equipment. Over time they can get pretty wealthy.
The downside of entrepreneurship is that it may not work out. Personally, I find the sales aspect - prospecting for clients willing to pay for a service - to be the most challenging aspect. But that may not be the case for someone else more savvy in that area. One time I met a fairly well known entrepreneur who described himself as a "cereal entrepreneur" - because he has to be so cost conscious in running his business that he eats mostly cereal. But this guy also came from Goldman Sachs and all he had to say about it was it is a nice place to be "from". He didn't like IB lifestyle, but was much happier working on his own ideas despite being financially broke.
IB vs Entrepreneurship... completely different worlds. Ask yourself... in 10 or 15 how would you define success? If you had to look back which experience would you be most proud of?
If you were really ambitious and motivated, you would be grinding your ass studying 400 QS. Ivey kids are going to run circles around you if you continue to be indecisive.
I feel like this is never really a choice people make in reality. Either you have a passion you want to pursue and you go for it, understanding the risk/reward ratio, or you don't have anything you feel confident or really good about, and you just fall in line wherever your peers are headed.
I don’t have a passion one bit. I care about what other people want and why they want it. I come up with my ideas by focusing on human emotions and psychology.
I must say, those qualifications you mentioned don't help distinguish your choice in any way. It qualifies you for either but that's it. It's nearly impossible to determine (as a kid) if you are better suited an an entrepreneur or employee. 90% want to be the entrepreneur and society tells us all to have that dream but maybe only 1-2% really are. So, 88% of future entrepreneurs are deluded. Here's the difference, everyone wants to be a Navy Seal or F1 driver or Entrepreneur. Only one of those can you do fully with zero skills or qualifications (entrepreneurship).
I'd try to get at it differently with thought experiments; - If you were born upper-middle-class in, say, Guatemala with a good family, good schools and good opportunity. let's say your mom was a nurse and your dad an attorney - would you move to the city, work hard and use your natural talents to become comfortable upper-class? Or would you hop a train north, sneak across the border into the US and build your fortunes from nothing? - If you were in a communist country, how long could you resist entering the black market? - How close have you grown up to entrepreneurism, do you really understand it? I came from generations of entrepreneurs and people who never fit in the mainstream. My wife's family excelled right smack in the mainstream. They would succeed 100/100 attempts to have a great career and would fail 100/100 attempts at entrepreneurship because the just don't understand the street-fighting nature of what it takes to survive on your own.
Stuff like that, I think it will help you sort this out.
Amazing comment that will not be seen by many but should be.
Thanks
I’m very glad you brought this up and I would like to tell you about my personal life (It’s anonymous so I don’t really care).
I come from an upper-middle class family, been to relatively the best high school, Cegep (I live in Canada) and I am currently in a good business school with high academic achievements. My family is involved in professional careers such as Accounting, Law... etc.
For myself, I’m a grinder. I don’t have much of a social life and all I think about is hustling. Ive stayed awake 40+hours straight countless times (Not the smartest thing to do) but i just want to emphasize how much I like working on anything.
I’m creative. I’m not a math wizard but I do well. I just have an insane work ethic that makes me unstoppable. And I think most importantly, I am not good at socializing because of my personality. I essentially cannot communicate nor relate well with others.
I have ups and downs for IB and Entrepreneurship...
All this being said, do you understand why this is a hard decision for me to make?
I think I’m repeating myself a little... I guess that shows how frustrating this is for me to make this life decision. Nonetheless, your comment has been extremely helpful. I will put more thought into it.
OP, 5 things;
Your comments seem to glance right over mine and provided zero introspection.
If you can add/subtract/multiply/divide you're mathematically qualified for IB/MA/PE. I'm not sure I've ever used more than 8th grade math since I graduated college.
Your 'personality' is just some bullshit concept you've created in your own mind. If it weren't we could go in and surgically remove it or alter said personality.
Networking. I hate people and I hate small talk but I do them both because doing what makes you uncomfortable is the only path to growth.
Given all your comments, the answer is clear to me. Pursue a corporate career path, at least initially.
Best of luck
Amazing Comment that will probably not been seen by many.
Where are you at regarding both potential paths. You're 20 years old, meaning uni is coming to a close. Have you had a SA internship? Do you have business plan for something tangible you actually want to bring to market? Saying you want to be an entrepreneur sounds great, but from those I've seen that make a career out of it.. they typically don't have the goal of becoming an entrepreneur. More often, they have a deep passion for something, and eventually the right cards come into hand and they capitalize on the opportunity they never planned on coming across.
I haven’t done a SA internship yet but I worked just below 2 years in the back office at a major Canadian back (if that has any value other than CTRL C CTRL V). I have two years of uni left, I have above a 3.7 GPA and currently enrolled in the Honors Finance program. I DO plan to get an internship for the Winter term and Summer 2020.
I’m working on a business plan but I’m at the very start.
The reason I’m bringing entrepreneurship as a goal is because I came to the realization that I come up with ideas for apps and products like magic. Now, are any of them shit? Ya probably. But that’s not the point because ONE idea will be it.
I don’t have a passion... Ive had some past events that sucked the life out of me and my only goal is success in terms of financial wealth. I just have a drive to compete at high levels and accomplish things for the sake of accomplishing it and proving a point. I guess I lack something in myself.
I say this out of love because I admire your desire for greatness, and see a lot of a younger me in you, but this is something you need to hear as uncomfortable it may be. To start, you don't come up with ideas for apps like magic, if you did, you would have already thought of, developed and sold something by now. I know of one person on a personal level who sold their company for 10 figures and a few who have sold theirs for considerably less, but still gobs of money. Acquaintance who sold his for 10 figures was younger than 22 at the time. This is an extreme example, but his creation was a craft he had honed over the greater part of ten years. This is what I mean when I say people don't grow up saying "I want to be an entrepreneur." Well they do.. but like others in this thread have stated, the vast majority do not follow that to fruition. Typically, those that develop something truly great and unique are following their passions, and stumble upon something special along the way. More on this later...
Facet two, you're already behind the ball in terms of internships and IB. Stop gloating that you can do all this bullshit and actually apply it to something. Those that truly grind and succeed at it have had 1 or 2 internships by the time they're your age. With this in mind, I advise you buckle down and start applying yourself to learning all of the skills necessary in banking and begin networking like mad. You've got an uphill battle in front of you, but you seem to come from a well connected family so you should fair relatively well.
To tie this back to the beginning.. so you still want to be an entrepreneur. Given you don't have any passions or expertise in any niche product group, I advise you start mastering the hard skills needed to succeed in banking. This will a) put something tangible to your name and b) help you to start bolstering the resume. From there many doors will open and if you play your cards right, you'll progress up the food chain learning more and more valuable skills along the way. Eventually you will have learned enough, and made enough connections to start your own firm, thus ending up in the entrepreneur seat that you seem to have your heart set on. If along the way you come up with a great idea that you can actually bring to market, then fuck it, maybe run with it. But right now you don't have that, and you need to work on something that will actually propel you forward, not just staying up for 40 hours on end for shits and giggles. My 2 cents, hopefully you can turn them into a few billion.
Man, I feel your pain and really want to be helpful - and I Really want to do it without sounding like a dick.
Go with your 3.7 and honors finance program. That's a whole 'nother stratosphere from where I was at your age. That, an internship and your maturity, drive, etc - you'll do fine. Go get laid and enjoy your age a little. And then learn niche-tricks in finance with your spare time. Learn the intricacies of asset based lending, commodity hedging, study a section of the UCC - cool niche stuff that will keep you focused and be just arrow in your quiver.
Anytime someone equates ideas with entrepreneurship - RUN. It's like a child playing with a loaded gun. You just triple-convinced me that you should abandon all thoughts of entrepreneurship for the next 5 years.
I failed at entrepreneurship when I approached it with all my heart, dreams, love, talents, passion and desires. My second shot at entrepreneurship I went at it with rage, absolute fking rage. Like someone did something horrible to my daughter level rage. And you know what, that's the speed the game is played. I'm not a wolf amongst sheep, I'm a fox amongst wolves (and a few Tyrannosauruses). By your own words you might be a confused, passion-lacking bunny rabbit with a proud academic career - focus on your strengths.
I greatly admire what you've done, where you are and your (anonymous) openness. If you ever end up in commercial finance in Canada, PM me and let's find a way to work together. Or go find some hairy industrial deal we can buy.
Your experience with entrepreneurship seems very similar to my experience with playing poker.
I started playing blindly at 18 years old and obviously lost tons of money. Mydue to taking way too many shots at stakes way above my bankroll and possibly skill set (keep in mind I am 20, turning 21 soon). I never had more anger in my life after that experience. With school, I decided to move past it (didn’t have much of a choice). What I’m saying is, the anger and rage that accompanied my failure in poker has given me is my fuel to succeed academically and professionally.
I do actually feel like a lone wolf lol
Also, ill take you up on that offer when my professional career develops.
Thanks a lot Distressed Industrial Buyer and EatClenTrenHard
I really appreciate and value the words you’ve guys have shared with me. To be honest, I didn’t expect this type of great feedback from anyone on a forum.
I’ve been out of town for a few weeks alone to free up my mind. I will be back home in a couple days and plan to start grinding the essentials and network like a thirsty fuck. I know I’m behind in terms of valuable experience but I’m going to get in done before I graduate within the next two years.
Your comments have made it clear to me that Entrepreneurship is PRESENTLY not the best idea for all your above-mentioned reasons. Given my current skills I will push further into getting my foot into IB before it’s really too late.
Thanks again.
Remember to live a little along the way. No one wants to work with someone who lacks basic social skills. Keep me updated on your endeavors, wishing you nothing but the best
I will keep that in mind. Thanks man, likewise.
Agree with many comments above. Let me add a few more not-mentioned points:
Entrepreneurship is not about grinding hard. Many many people in this world work hard. The single mother working three jobs to put food on the table works hard. The neurosurgeon who completed a 32 hour straight surgery works hard. That does not (necessarily) mean that either one of them should or could be an entrepreneur. Most important is your ability to grind when everyone doubts you. How many rejections can you handle? Would you still keep going if 50 different VCs tell you you're an idiot? Would you double mortgage your home to keep your business running? Would you beg your parents / grandparents / friends for money if required?
It's been said above, but ideas are worthless. There is a reason why so many new businesses fail, and it is because anyone can come up with an idea that he or she thinks will be the next Facebook or Uber. But the reality is that there are so many other things that determine if a company becomes a success. You have to consider the economic climate. You have to consider if the world is technologically ready for a certain change. You have to consider if your future competitors are smarter, luckier, faster than you. All of these will determine your own success.
Most important as an entrepreneur is your ability to execute and build a business. Do you know how to raise money, e.g., the specific process and tax considerations that investors must take into account for different jurisdictions? Do you know how to sell? Do you know how to code? Do you understand the industry and unique challenges, processes, regulations that that industry faces? Do you have industry connections in high positions to introduce you to the right people? Can you push those people to go to bat for you? Can you lead other people to do those things if you can't?
All of these doubts and roadblocks leads to the low chance of success. You hear about Zuckerberg and Gates building multibillion dollar empires, but what you don't hear about are the millions of 35-45 year old entrepreneurs with years of work experience in their respective industries building successful multimillion dollar companies. The former is almost impossible; the latter still incredibly difficult. An IB analyst position in comparison is a cakewalk.
You are likely going to lose sleep over any job so it is really a question of what you would rather devote your time to. With IB you always have your exit opportunities after the initial madness, and can move on to PE HF or VC making great money.
On the other hand as an entrepreneur you have the ability to work on things on your own and make a lot of money (IF YOU SUCCEED THAT IS).
In all honesty if that is the road you are interested in I recommend pursuing VC. I have learned an irrevocable amount of entrepreneurial information, and if I was passionate about a start up I can leave and begin with all the right connections. If I end up not wanting to pertain the risk myself I can stay in VC and help startups, be a member on their board etc.
Starting in VC can be hard but I did it without going the IB route. Anything is possible but you definitely gotta WORK for it. Best of luck!!
Btw I’d like to mention that I just turned 21. Don’t let anyone tell you that you’re too young. Age is not always reflection of experience or determination
Thanks man, and I absolutely feel you on that!
Do IB. I'm very pro-entrepreneurship and my career has slowly inched more in that direction over time. But out of undergrad, banking is one of the best jobs for building hard skills, soft skills, connections and knowledge. It'll just make you better positioned for entrepreneurship afterward.
If you still have a couple years of uni I'd say do both.
The only red flag that I've heard is what other people have mentioned - if you have such good ideas all the time why haven't you pursued any of them? Like others have said, the best entrepreneurs come organically because they're passionate about an idea and put the work up front to see it come to life. Entrepreneurs start businesses because they "can't not" see their vision through to fruition, not because they want to be an entrepreneur.
I was in your shoes at one point. Going down the IB rabbit hole. Then I got an idea that I had to make happen. I ended up punting a few MM IB interviews because I was up the night before preparing for launch getting customers on-boarded. That's when the "entrepreneur vs IB" decision made itself for me.
BTW if you do start something it makes for a great talking point during interviews but you'll undoubtedly get the, "If you get this role will you quit working on your business?" question.
Interested to hear about your ideas. My co is in tech/mobile space so send over a DM if there's anything I can help you with.
I haven’t pursued them because of purely confusion. I am an “ALL in or NOTHING” type of guy. Either I spend all my time on something and disregard everything else in my life or i dont pursue it. That being said, I struggle between choosing to study for IB and working on my business ideas. This ends up leaving me to procrastinate and barely move forward in both areas.
And thanks for offering your help.
Paralysis by analysis.
Make a decision and get started pursuing. Otherwise you're 'grinding' on nothing and wasting your capacity to stay up 40 hours on nothing.
Reiterating some comments but want to accentuate a reality:
If you have to ask which, you're not an entrepreneur. Being one isn't learned in school or by getting modeling experience. Being an entrepreneur is a mindset. You have to welcome risk, have a burning desire to start something, not care what anyone else says or thinks, and you must be able to SELL (your product, service, vision, process, etc.). Think of an org chart with your name in most of the boxes. You make some revenue, you hire and replace your name with someone else. You make more revenue, hire more people and ultimately you're only in a few boxes. The really hard part is figuring out when to work on the business vs. in the business - two very different things. The failure rate is high because the vast majority are not cut out for creating, building, and running their own thing. If that doesn't appeal to you, go IB all day. Ironically, if that does appeal to you, you'd hate IB all day as you'd feel like a caged beast.
Definitely different mindsets!
if you fail as an entrepreneur you'll be 25-30 with no real skills or history to get anything above an entry level job. The only thing that might fly is that if you were a software engineer.
I started in M&A, left early/mid Associate to start a software company, sold it. Am now working for the acquirer, enjoying not doing 80+ hour weeks while I figure out whats next.
Take of leave my advice, it is only one data point.
The short version:
1) Ideas are worth very little
2) Go IB first because it will make going back to a conventional career track 10x easier
3) Do not start a software company unless you are a rockstar fullstack dev or have a co-founder that is a rockstar full stack dev
4) Ideas are worth very little
5) Get work experience first because you probably are too young to see why your ideas are flawed, but don't wait until you are too old to innovate
What I think I did right:
Starting in IB gave me a financial foothold (I also graduated with no debt so I was ahead of the curve). The financial foothold was imperative to this all working out
When I felt ready to leave the bank I was at I was upfront with then about my entrepreneurial plans (in hindsight it was way too early) - surprisingly they asked me to stay on my current deals but did not staff me on new pitches/other work, this gave me a slow exit and maintained good relationships with the sr. bankers
Took on small side projects to keep cash flow up while I started the company, conveniently I found a many projects helping LMM bankers run processes and made a few solid success fees along the way - having been at multiple banks gave me the credibility and knowledge to do this and kept my banking skills sharp in case I needed to return to the M&A grind. As a side-bonus, the LMM bankers I was worked with were getting used to introducing me as a VP, and it turns out I loved LMM and could see a future there...
Found a partner who was a successful multi-time technical founder. I could have never been successful if I chose a less qualified developer OR tried to hire developers. If you plan to hire developers you need to rethink your plan
Left early my career young enough that I did not have debt, kids, girlfriend, or anything but myself to risk
Learned to "grind it out", manage stress, and product high quality work in IB which it turns out helps a lot when you go out on your own
Took my company as far as I could while at the bank until I needed to leave. Being the non-technical founder this was much easier. Still, I left IB too early and undervalued the ability to use my high income to pay people to do tasks for me (why I took on side-projects)
I should have seriously considered getting a 9-5 job after leaving IB rather than doing deal-work for LMM bankers, it worked out for me but I doubled down on the financial risk, still had deal stress. and lumpy workload. It turns out stability is a very important balance when starting your own company and you will be shocked at how far you can push a company with an IB work ethic and only 9-5 work hours!
If anyone is interested I could elaborate further, but I have real work to do and shouldn't spend all day on WSO...
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