TECH v. IBD debate

Hey guys,

So throughout my university degree I have been working really hard to get into IBD. However, the more I think about it, and the more i hear about it (such as the VP post on WSO saying "do not go to IBD it never changes") I am wondering what other valuable opportunities could exist.
I am going to graduate from a fairly general field (think economics, PPE, business) and will surely undertake a master in the next following years.

IBD was attractive first because of the intensity, very broad vision, very blended mix of hard and soft skills, prestige and of course..... compensation.
But, the more I advance in my life the more I consider the fact that grinding 100 hours a week until i am 50 is completely irrational: I won't have the opportunity to build a family the way i imagined it, travel, carry on my hobbies, take part to charitable work and engage in things which make a true impact (I've always been very involved in sustainable development and climate change related causes for instance).
Thus, i was wondering what kind of jobs (tech for instance or start-up?) would pay as much as IBD or more, be passionating or very stimulating in the sense of creating something great and meaningful for society?

Thanks for your answers !

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Comments (45)

  • Prospect in IB-M&A
Feb 17, 2021 - 7:08am
:

Thus, i was wondering what kind of jobs (tech for instance or start-up?) would pay as much as IBD or more, be passionating or very stimulating in the sense of creating something great and meaningful for society?

Lmao none. Stop having a hard-on for tech. People look at Google, Facebook and Apple whereas "tech" is actually the software company in Texas that's getting undercut by Indian coders and the startup founder who's still living with his parents at the age of 40.

  • Analyst 1 in IB - Gen
Feb 17, 2021 - 8:55am

I mean that's not what most people think when they think "tech" lol the fuck? Tech is usually referring to companies based in tech hubs that have some form of interplay with the VC ecosystem. It usually does not include random enterprise shops serving some niche as fuck industry out in the middle of nowhere with an army of outsourced Indian / Eastern European devs.

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  • Analyst 1 in IB - Gen
Feb 17, 2021 - 9:37am

TL;DR: tech is not a career path, it is an ecosystem of companies in certain locations. you cannot just assume tech = SWE. you don't have to code to work at a tech company. comparing "tech" to banking is beyond stupid. it's like comparing oil&gas to a career in acting..wtf does that even mean?

Think of basically any company that was "birthed" out of (or if not birthed at least modelled after a company like that) the ecosystem of VC firms (i.e. they received funding from VCs then exited) and HQ'd in tech hubs (areas with high density of "tech" companies and VCs); the largest one being the San Francisco Bay Area (or "Silicon Valley" as the metonym goes). Other major tech hub ecosystems exist in New York, Seattle, London, Los Angeles, Boston, Shenzen, Bangalore, etc.

The world of tech is largely bifurcated between the public (or "established / mature" if they're still private) companies and scaling startups.

EstablishedTechCos have more reliable / consistent equity that basically gets paid out like another salary except it can flex up or down (once realised) with the stock price. Whereas scaling startups can range depending on their stage.

If they're early stage, then your equity is basically a bet / investment (could be worth a lot or could be zero). If it's later stage / close to IPO then your equity is more certain and any upside is limited to how much higher the IPO (or acquisition) price is from where you received your equity.

Random ass, middle of nowhere companies don't fall into the above rubric because they sit outside of that universe and the norms that come with it.

For clarity:

  • EstablishedTechCos would be a Facebook, Google, Microsoft, Indeed, Spotify, Netflix etc type place
  • Later stage / pre-IPO would be a Stripe, ByteDance, Affirm etc type place
  • Early-mid stage would be any company that recently got anything from a Seed round to a Series B round in funding (though I'd exclude companies who've received mega rounds from this, they would go in the group above)

And even within each of these groups, some companies have higher compensation structures than others. If you take a look at: https://www.levels.fyi/charts.html you can start to see that even within say the "established tech co" group the likes of Google, FB, Lyft, Uber etc all pay more per level than e.g. Microsoft, Amazon, Adobe, Tesla etc.

Roles wise, there are effectively:

  • "core" roles surrounding the product (and infra related to the product). Some require a specific skillset like Software Engineering, Data Science / Analytics, AI/ML Research, Design / UX etc. Whilst some are for generalists focused on a specific piece of product building: charting the future of what a product looks like / being the mini-CEO of the product (Product Management), shaping the messaging / positioning of the product in the market (Product Marketing) and coordinating the operational processes / programs required to build the product (Program Management).
  • the customer-facing teams in a b2b company. so this would be your pre-sales teams, sales teams, account management / customer success teams and any implementation / consulting teams.
  • standard functions + management: Finance / FP&A, Treasury, Corporate Marketing, HR, Supply Chain (if hardware), Strategy &Ops, CorpDev, Business Unit Leadership teams etc

Long whistle stop tour of what "tech" really is.

Also: It's not just Tech = SWE, you gotta choose where in a tech company you want to sit functionally. Banker / Consultant types would naturally fit in CorpDev, Strategy &Ops, Finance/FP&A, Product, Product Marketing type roles as the transition is more seemless since both banking / consulting and those areas are for generalists. Shock horror, you don't need to code to work at a tech company.

Conversely, moving into a role that requires a specific skillset would mean you need to develop that skillset. There is no room for a Designer or SWE who is only good at talking, schmoozing or simple logic you actually need hard skills to do the job. 

There's a whole bunch extra stuff like what "levels" are or how comp is structured that I didn't touch on. But you can pick up that stuff in your own time

Feb 17, 2021 - 9:22am

Have you tried tech / coding? At least when I thought of this path, I took an introductory coding class and immediately gave up lol. This shit was 50x harder than finance work, at least for me. If I truly wanted it, I probably could've worked at it and gotten better, but I really don't regret this all that much.

From what I've seen (most of my friends are in tech / startup), tech in FAANG isn't exactly easy to get into, and it's super competitive with the amount of people flocking to it nowadays. If you fail, you can go to something like a startup, but then you're likely getting compensated lower with a significant amount tied to equity comp which you may never see. 

With banking, you make $ a lot faster and with less risk. It just depends what you can handle and your risk appetite. Are you willing to really dedicate yourself to compete with the hardcore coders out there for FAANG or take the risk of a startup failing? Also keep in mind 100-hour weeks isn't a perpetual thing. As you move up the ranks that decreases, or else no senior bankers would ever be able to have a family.  

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  • Analyst 1 in IB - Gen
Feb 17, 2021 - 9:38am

As someone you started in computer science and switched to finance:

- Tech culture is very peculiar (not a good fit for me)

- Good luck keeping up with the latest technology after you are 30, average shelf life of a software developer is lower than finance dudes and that is saying a lot, things are constantly and massively evolving

- Significantly more challenging and tiring intelectually (and by a few orders of magnitude)

If you are not into, don't do it. Same as the debate Law, Med School vs finance etc, pick something you like, those paths are so different that I will guarantee if you do proper dd you will find the best path for you

  • Analyst 1 in IB - Gen
Feb 17, 2021 - 10:11am

It's not a real debate. 
 

if you went to tech without a computer science background, at entry level you would work in sales and marketing, or FP&A, or a startup founder. 
 

1) FP&A probably isn't for you if you're considering IBD

2) If you don't have any idea you'd better not create a startup for the sake of it

3) You could be an account manager or sales rep in B2B SaaS and make good money.
 

However, if you're hesitating between tech sales and IBD, I would urge you to lock yourself in your room until you figure out which one is best for you sooner rather than later. These are completely different. One is significantly more performance driven and based on communication skills, the other is more analytical and process-driven. Also a different lifestyle and compensation path. 
 

Also, people And cultures are different. Do you prefer working with techies/nerds or sales people, or ambitious high achievers finance guys who think they are taking over the world and work themselves harder than their friends can imagine ?

  • Intern in IB - Ind
Feb 17, 2021 - 10:19am

I would have done tech if I didn't totally suck ass at coding. 

  • Intern in IB - Ind
Feb 17, 2021 - 10:43am

Yeah I read your other comment, but I guarantee you that OP meant SWE when he said tech and so do 90% of people. SWE is THE connotation of tech. Sure you can do non SWE stuff at a tech company, but how's that any different than CorpFin/Dev at any type of company besides the industry? When most people say tech they mean SWE or a role that requires coding in some capacity. 

Feb 17, 2021 - 1:33pm

This is one of those completely fucking pointless debates clueless college kids like to have. (Or maybe slightly autistic low EQ people).

If you like Tech, the go do tech. If you like finance, then go do finance. Not sure? Try both and see which one you have an aptitude for. They're both lucrative fields with lots of opportunities. THAT'S ALL THERE IS TO IT.

At the end of the day, if you're making good money nobody gives a fuck (at least nobody really should...) whether you're making 250K instead of 300K or whether your compensation is tied to stock options or cash bonuses. If you're smart, hard-working, and wise, you'll end up rich either way.

  • Prospect in S&T - Equities
Feb 17, 2021 - 2:26pm

I had done two BB internships (one in PWM in my and one in S&T). I also had BB IBD internship offers but chose to do the S&T internship instead. I am currently working as a SWE at one of the largest SV unicorns and am very happy with my choice.

For people who haven't learned coding but want to explore career opportunities in tech, I would suggest trying out roles like product analyst/data analyst and then lateral to PM later if interested. The technical requirements for these roles are fairly low. As long as you know SQL, the rest is presentation/communication. These roles have great WLB and also offers a great return/risk balance if you join a pre-IPO company. The comp is around 150k all-in for new grad and can grow substantially with stock appreciation/Fed money printing. And you also don't have to worry too much about having to catch up with new technologies after 35.

Feb 17, 2021 - 9:45pm

I had done two BB internships (one in PWM in my and one in S&T). I also had BB IBD internship offers but chose to do the S&T internship instead. I am currently working as a SWE at one of the largest SV unicorns and am very happy with my choice.

For people who haven't learned coding but want to explore career opportunities in tech, I would suggest trying out roles like product analyst/data analyst and then lateral to PM later if interested. The technical requirements for these roles are fairly low. As long as you know SQL, the rest is presentation/communication. These roles have great WLB and also offers a great return/risk balance if you join a pre-IPO company. The comp is around 150k all-in for new grad and can grow substantially with stock appreciation/Fed money printing. And you also don't have to worry too much about having to catch up with new technologies after 35.

You're not getting a data scientist role in a tech hub making 150k only knowing SQL...

Guy I know who's a DS major knows Python, R, Java, C++, SQL, advanced statistics, advanced Calc... yeah you get the point.

On top of that he says (and not just him but others I know who broke in) you need side projects to even have a shot.

i mean just look at any LinkedIn posting and you'll see how competitive these roles really are. Hundreds of applicants for any decent company. Saw one in the Bay Area that had over 2000 applicants for one spot.

Array

Feb 17, 2021 - 10:39pm

Well he said data analyst but based off the 150k number I assumed he meant data science.

Array

  • Prospect in IB-M&A
Feb 17, 2021 - 10:41pm

Maybe he was implying data science, you could be right. To be honest, I'm not one to opine here, I'm not super knowledgeable about the tech industry.

  • Analyst 1 in IB - Gen
Feb 18, 2021 - 4:47am

Nomenclature doesn't really matter.

In SV type companies Data Analysts are referred to as "Data Scientist - Analytics" or "Data Scientist - Product". Plenty of undergrads get those types of roles.

It's the ML Research or advanced analytics stuff that often requires a postgrad degree.

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