Goldman Sachs meets match in Google - When recruiting Graduates !

Here is a great bloomberg article which describes how Wall Street Firms - Goldman Sachs & Morgan Stanley are competing against Google for the same talent...not only for Technology but even Corporate Finance jobs. Thoughts ??

Source :
Goldman Meets Match in Googleplex When Recruiting Graduates

By Lisa Kassenaar

June 27 (Bloomberg) -- Everyone wanted to hire Qiushuang Zhang.

Before earning her master's degree in computer science at Georgia Institute of Technology in May, Zhang had two job offers from Goldman Sachs Group Inc., two from Microsoft Corp. and one from Google Inc. Then a headhunter phoned to pitch a job at Renaissance Technologies Corp., the $20 billion hedge fund firm led by math guru James Simons.

``Goldman says I can make lots of money,'' says Zhang, 24, a native of Harbin, China, who wears bright purple glasses and spent last summer writing video game software for Electronic Arts Inc.

Zhang asked for advice from a Chinese friend who once worked at Goldman and is now at a San Francisco-based hedge fund. The woman agreed that writing software for Goldman's option traders in New York would be thrilling, Zhang says. Then she confided she can't sleep at night because of work stress. ``Life is different if you focus too much on money,'' Zhang says. Besides, after growing up in China's frozen northern provinces, she says she loves the California sun. She starts at Google in July.

Wall Street and Silicon Valley are courting Zhang and graduates like her -- kids with top grades, finance and math skills and a couple of languages -- more heavily than any students since the days of the '90s dot-com explosion.

With the surge in mergers and acquisitions, leveraged buyouts and hedge fund investing, U.S. securities firms are struggling to fill all of the empty spots at their investment banks, in trading rooms and on quantitative finance desks. Employment in financial services grew 37 percent to 830,000 people in the decade ended in 2006, according to the New York- based Securities Industry & Financial Markets Association, an industry lobbying group.


It's ferocious,'' says Connie Thanasoulis, <span class='keyword_link'><a href="/company/bank-of-america-merrill-lynch">Merrill</a></span> Lynch & Co.'s director of campus recruiting.You have to get the technology part right because that's become the guts of the organization.''

The students they're fighting for are members of the generation born from 1982 to 2002 called Generation Y, or the Millennials. They need to be approached differently from previous graduating classes, says William Strauss, a marketing consultant and co-author with Neil Howe of ``Millennials Rising: The Next Great Generation'' (Knopf, 432 pages, $15.95). Their parents have often scripted their lives from kindergarten to college, they've faced intense competition in school and many have been so busy burnishing their resumes that they've never held a paying job, Strauss says.


They aren't as experienced with the notion of getting to work on time or other elements of workplace etiquette,'' he says.You can hear them coming in their flip-flops.''

The Millennials' arrival in the workforce heralds a demographic crunch. The baby boomers' child-bearing years peaked in 1990. Those born that year are the cohort graduating from high school in 2008. The birthrate fell 9 percent in the following nine years, according to the National Center for Health Statistics. ``With the amount of business out there right now, everybody wishes they had more talent,'' says Stefan Selig, global head of M&A at Banc of America Securities LLC.

Our hiring issues are a high-class problem,'' says Janet Raiffa, head of U.S. campus recruiting for Goldman Sachs.The students we want are the same ones that everyone else wants.''

Nowhere are the recruiting wars being more fiercely fought than for those who can write the algorithms used in computer- based trading or search engines. The securities industry earned 19.5 percent of its net revenue from computerized trading in 2006, up from 12.6 percent in 2005, a Sifma report says.

Dwindling Candidates

Meanwhile, the number of U.S. students choosing computer science as a major plummeted 39 percent in the five academic years ended in 2006, according to the Washington-based Computing Research Association. Those with technical expertise are the same ones that Yahoo! Inc., Google and a growing number of hedge funds and private equity firms also want. Technology is the hardest to hire for,'' Raiffa says.We really have to compete.''

To fill math-intensive jobs, banks are bringing in more non-U.S. employees -- people like Zhang who came to the U.S. to study. They typically started out in countries such as China or India, which have been more focused on math and science education. One dividend is the knowledge of cultures where firms such as Goldman aim to expand.

``We know that we are hot property,'' says Rishi Dhingra, a master's degree candidate in quantitative and computational finance at Georgia Tech.


Banks are adding engineering schools to the roster of business campuses where they recruit. During the past two years, Citigroup Inc. has started visiting Carnegie Mellon University in Pittsburgh; Massachusetts Institute of Technology in Cambridge, Massachusetts; and Georgia Tech in Atlanta.

``We tell them, `You could be the person to create software that's used on a trading floor tomorrow,''' says Caitlin McLaughlin, Citigroup's global head of graduate recruitment. At a tech company, she says, developing a new product can take months or years.

The banks are also trying to woo younger students -- often preferring undergraduates to those with a master of business administration -- and even some high school students. Goldman Sachs runs a program for minority teenagers and GS Camp for incoming college students to introduce them to investment banking. Morgan Stanley has 15- and 16-year-olds from schools such as New York's math-strong Stuyvesant High School work on its trading floor as part of a mentoring program during the summer.


With their ease with technology -- the Internet is as basic a tool as pen and paper to them -- the Millennials are smarter than their bosses were at the same age, Strauss says. Most don't see themselves working at their current job for more than a year or two. And having seen their boomer parents struggling to juggle careers and family, they aren't willing to sign on for a life of 80-hour workweeks.

That point was brought home to Linda Riefler, Morgan Stanley's chief talent officer, at a breakfast meeting with a recent hire from Harvard Business School. His opening comment was, `Tell me about how you balance work and family,''' Riefler says.That would never have happened five years ago.''

Riefler, a member of Morgan Stanley's management committee, says the company is looking at ways of offering extended unpaid leave. ``All the firms are now competing to re-engineer jobs and to show that success doesn't have to mean 24/7,'' she says.

`Sexy Image'

Morgan and Goldman have a long way to go before they can compete with Google. Google has a very sexy image,'' Goldman's Raiffa says.There is a coolness on Wall Street, but it's a much more corporate environment.''

Zhang agrees. ``Goldman's current package is not enough to compete with West Coast IT companies,'' she says, especially when you count the benefits.

Flexible hours are standard issue at Google. So are a host of other perks that make the atmosphere at the Googleplex -- as the search engine company calls its Mountain View, California, headquarters -- not that far removed from that of a college dorm.

Workers can play pool or ride scooters from one area to another. They get three free meals a day, laundry and gym facilities and free massages on their birthday. Zhang, who says her first name is Chinese for `autumn cool,' says Google will give her $5,000 toward the purchase of a car if she buys a hybrid vehicle. (She's leaning toward a Toyota Prius.)


Google is the No. 1 place where both U.S. undergraduates and MBA students want to work, according to a poll by Universum Communications in Philadelphia. Universum asks more than 44,000 undergraduate and 5,450 MBA students a year where they'd most like a job. Goldman was the third choice for MBAs, behind McKinsey & Co.

Even among students who majored in investment banking, Google is climbing the ranks. It was No. 9, up from 17 last year, says Claudia Tattanelli, Universum's U.S. chief executive officer. Goldman was No. 1 in that group.

It's still harder to get into Goldman than into Princeton University. The bank offers jobs to about 5 percent of applicants -- about half of the 9.5 percent acceptance rate for the New Jersey school's class of 2011. Some 900 undergraduates at the University of Pennsylvania's Wharton School -- out of a student body of 2,400 -- applied for summer internships at the bank, Raiffa says. Just 70 of them were accepted.

Parents' Day

Investment bank recruiters say they're trying to gear their pitches to Millennials' close ties with their parents. Merrill Lynch last year added a Parents' Day for families of minority interns, flying 11 families to New York from as far away as Nigeria to see where their children would work.

We are dealing with a generation of parents who realize the importance of every decision their investment is making,'' says Elton Ndoma-Ogar, 34, head of diversity recruiting for Merrill's investment bank.We call the children their 'investments.'''

Every firm now sends its most-senior executives to campus. JPMorgan Chase & Co. CEO Jamie Dimon met students at eight schools in the past year, including Duke University in Durham, North Carolina, and Stanford University in Stanford, California. At Harvard Business School, his alma mater, Dimon taught a one- day class on JPMorgan's $56 billion purchase of Bank One Corp., the Chicago-based company he ran from 2000 to '04.

Styled by Prada

Recruiting is absolutely critical right now,'' Dimon says.I send senior people to campuses now, and they have to show up.''

They're also trying soft-sell approaches. Merrill sponsored a dress-for-success night for women at the Wharton School in Philadelphia, with stylists from Prada. (Tips: Avoid bright red nail polish. And wear closed-toe shoes -- no flip-flops.) Merrill also hands out video games, including ``Cyber IPO,'' in which players score when they correctly order the steps for a fictitious company's initial public offering.

Goldman Sachs sponsors workshops at more than 50 schools giving advice on resume writing and how to behave in the workplace. (Sample: Always have a short pitch prepared about your current project, so that you can deliver it if you ride the elevator with the CEO.) JPMorgan, which hosts cocktail parties and coffee chats, does remind students in its recruiting booklet: ``The fact is, this is all about business, and if you find that boring, investment banking is not for you.''

Perk: Money

Bank recruiters can still offer the same perk that has always brought people to Wall Street: money. Undergraduates in investment banking or information technology typically get a $60,000 salary, plus a year-end bonus that starts at about $10,000 and, for some first-year bankers, could reach $80,000 or more.

That compares with average starting salaries of $45,837 for business majors in general, $52,177 for computer science majors and $31,333 for liberal arts majors, according to the National Association of Colleges and Employers. And Wall Street earnings can soar above $1 million with time. The average pay for a Goldman Sachs employee was $622,000 last year.

For a sizable slice of the Millennials, money is critical.

They're graduating with more debt than any generation before them, Strauss says. Tuition, room and board at private U.S. colleges is climbing toward the $50,000-a-year mark.

``They look with despair on things like buying a home,'' Strauss says.

Comedy Central

A year ago, Puneet Singh, Wharton's junior class president, thought he might move to Hollywood when he graduated. He's got a resume that includes an acting credit on an episode of the ``Law & Order'' television series.

He was also an intern at Comedy Central's Colbert Report,'' where he became known on the air as Stephen Colbert'sSikh friend.'' His stand-up comedy act, performed on campus and at Galapagos, a club in Brooklyn, New York's Williamsburg neighborhood, includes jokes about his conservative upbringing as the child of Indian immigrants in Canfield, Ohio. (A clip of his routine on shows Singh, 20, wearing a turban and joking about being mistaken for a terrorist in the Akron airport in Ohio.)

Singh, who has a 3.8 grade point average, also may graduate with more than $100,000 in college-related debt.

``Last summer, I would have said, `You are out of your mind' that I would do banking,'' says Singh, whose parents wanted him to be a doctor and only relented when he got into Wharton.

Different Fun

He was won over by a presentation made on campus by Goldman, where he's interning this summer, and a Wall Street salary that will go a long way toward paying down his student loans, he says.

Money is important to me in the long run,'' Singh says.In my 20s, I want to train myself and build a network so that when I'm 30, I can be doing what I want and support a family.''

As an intern, Singh is earning about $1,100 a week. ``It's going to be a different kind of fun than Comedy Central,'' he says.

Courtney Patterson had little time for fun when she was an intern on Wall Street. Patterson, 22, who graduated from the University of Virginia in May with a bachelor's degree from the McIntire School of Commerce, spent last summer in the media investment banking group at UBS AG in New York.

She says she enjoyed working on deals, including Comcast Corp.'s $483 million purchase of Patriot Media & Communications CNJ LLC, a New Jersey cable company. Most of her time was spent preparing Power-Point presentations, pitch books and Excel spreadsheets, she says. Patterson had dinner at the office most nights, including some weekends.

Takeout Food

``You get to know which takeout places were 24-hour,'' she says. Though Patterson got job offers from Bear Stearns Cos. and Lehman Brothers Holdings Inc., she decided to return to UBS full time as an analyst in the media banking group, earning $60,000 plus bonus.

It was hard to say no to UBS,'' says Patterson, who grew up in Kenilworth, Illinois, a wealthy suburb of Chicago.I really don't know what I want to do long term, but they play up the aspect of how many opportunities there are,'' Patterson says. She could go abroad or work in a different industry besides media, for example, she says.

Like many of her generation, Patterson isn't ready to make a career-long commitment. For now, she'll be living in an apartment two subway stops from the Swiss bank's midtown Manhattan office so she won't spend too much time commuting. She'll be one of more than 400 full-time analysts and associates starting at UBS's U.S. investment bank this summer -- a 41 percent increase from 2006.

Goldman's Confidence

Patterson's classmate, Tyler Walk, a 22-year-old math and finance major, also toiled long hours last summer -- as an intern at Goldman Sachs. Housed in a New York University dorm, Walk says he spent at least 80 hours a week in the office as an investment banking intern for a group working on industrial companies.

``I couldn't do that pace forever,'' Walk says. The high point, he says, was being sent as Goldman's sole representative on a trip with a client to four Eastern U.S. cities to visit factories.

``Goldman showed confidence in me after only a few weeks,'' Walk says. Now that he's finished his bachelor's degree, he's returning to Goldman full time in the same department.

The challenge for Goldman, and the rest of Wall Street, will be hanging on to the elite graduates of the Millennial generation.

Hired by Phone

Georgia Tech's Dhingra, 27, grew up in Bareilly, India, and earned a bachelor's degree in electrical engineering at Indian Institutes of Technology in Kanpur, a science and engineering school with seven campuses that accepts only the country's top students. Then he worked at Oracle Corp. in Hyderabad, India, for almost two years as an applications engineer doing data modeling.

When Dhingra, who graduates in December, went searching for a summer internship this past January, he phoned an Indian friend who works at Lehman Brothers. Dhingra had three interviews over the phone on a Friday and got a call the following Monday from a senior vice president, who offered him a job doing math for Lehman's equity analytics group.

They were pretty eager to have me,'' he says with a grin. Dhingra says he'd like to go back to Lehman for a few years after he graduates to gain expertise in the financial markets.Most of us want to start at an investment bank and then go on to a hedge fund,'' he says.

Intel Patent

Jay Anderson also has the skills that Wall Street can't afford to lose. Anderson, who expects to get his bachelor's degree in computer science from Georgia Tech in December, spent the fall of 2005 as an intern at Santa Clara, California-based Intel Corp.

The 21-year-old was given a problem to solve related to the company's BIOS, or ``basic input/output system,'' program which makes sure that all chips, hard drives and ports work together to start a computer when it is turned on. Anderson's solution so impressed his managers that they put it up for patent consideration.

He became fascinated by the legal details of seeking the patent, he says, and, a couple of months later, applied to law school.

In the meantime, Anderson went to a Goldman Sachs presentation for minority students in computer science that piqued his interest. Goldman flew him to New York for nine back- to-back interviews and offered him three summer internships the same day.

The first was writing algorithms for Goldman's high-speed global trading business; the second was writing risk management software that uses information from legal contracts, a position that acknowledged his interest in law; and the third was in equities technology.

Harvard Calling

I went for No. 2,'' Anderson says.I wanted something different from the usual tech fare.''

Anderson is excited about working in New York, but he may not stay there long. This spring, he was accepted into Harvard Law School. He's deferred entry until September 2008 and says he's considering doing a joint law degree and MBA.

Even Zhang, Google's new hire, isn't making any promises about the future. Ever since she was in high school in Harbin, she says, she has dreamed of living in the U.S. and working on the most-advanced technology.

``It's like you're running at the front end of this age,'' she says. When she starts at Google, Zhang says, she wants to learn more about the company's so-called underground teams -- those working on secret projects that can't be discussed with her until she officially starts her job.

In a couple of years, Zhang may move back to China and go into business for herself, she says. Her widowed mother, a former school principal, lives there, and Zhang is her only child.

That's one plan, at any rate. Like other sought-after Millennials, Zhang can always change her mind.

To contact the reporter on this story: Lisa Kassenaar in New York

Comments (7)

Jun 28, 2007


Jun 28, 2007

subtle georgia tech troll

Jun 30, 2007

i didn't know math and computer science are becoming SUCH an integral part of the IB industry.

i recently switched my majors from Econ-Math to Econ-PolyScience as i wasn't doing that great in math and that was pulling down my GPA

this article makes me depressed, seems like the only way u can get into IB from a non target school (UCSD) is if you are a math or engineering major

Oct 5, 2011

yeah..............this was in 07. does this article still hold true today?

Oct 5, 2011

prob not

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Oct 5, 2011

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Aug 30, 2015