The Next Big Thing

Every decade or so, one "hot" sector captures the imagination of MBAs looking to be the Masters of the Universe - that big payday or that job that would be the envy of their classmates and peers. It's this glory seeking, trophy hunting and status-seeking mentality that drives the herd mentality within the MBA jet-set.

In the 60s, it was advertising. In the 70s, it was conglomerates. In the 80s, it was bond trading. In the 90s, it was dot-coms and venture capital. And in this decade, it's private equity/hedge funds.

It wasn't long ago when people were arguing that dot-coms were going to be hot for a long time. Even b-schools introduced ecommerce majors, as if business fundamentals were somehow different in a virtual world (well, they are when you are in a stock market bubble). Before that, quite a few assumed that bond trading would continue to be the darling of MBAs, and Silicon Valley was scoffed at as just a bunch of geeks in a garage. If history is a decent guide, you can probably fill in the blanks. Things change, but human nature never changes.

While some of the interest certainly is genuine, most of it is, like any market bubble, driven by greed and fear. Like any asset market, greed makes you buy when you should be selling, and fear makes you sell when you should be buying. The smart money got in before the sector got hot.

You probably know that the private equity market is overheated right now. Same with hedge funds. Too much cheap money chasing too few deals. Bad times never last forever, but good times never do either.

If you're looking for a career in the "hot" sector, by all means go for it. But if you're looking for glory, you're too late to the game. By the time you have a shot at glory, the party's over. All that talk of billion dollar bonuses at hedge funds and private equity shops are about 10 - 30 years removed from where most MBAs (and aspiring MBAs alike) are at today. Working as an underling for a big swinging dck isn't the same as *being the big swinging d*ck. The former is like being a chambermaid for royalty - just because you help make someone's bed, doesn't make you part of the family, nor does it mean you have anywhere near the same benefits and perks either.

Like celebrities in People Magazine (and MBA herd mentality is like People Magazine), all hot sectors "jump the shark" before it's replaced by something new.

And private equity has jumped the shark. What used to be the playground for burnt-out investment bankers in the past has now become the dreams of IT engineers - just as the market has peaked. It's like schoolteachers talking about the latest penny stock.

Like advertising, conglomerates, bond trading and dot-coms -- private equity won't disappear. But it sure won't garner the attention or glory in the future that it does now. And it may even institutionalize even further, making the "big swinging d*ck" in private equity as obsolete as it is in investment banking. The nature of the job is gatekeeping. You are a gatekeeper of money. The folks who made it big didn't make it big because they were good gatekeepers. They made it big because they got in early before others caught wind.

Again, if you're banking on glory, status or even just a huge financial windfall, don't count on it if you're this late in the game. By the time you make partner, People Magazine would've moved onto something else much sexier, trendier and more lucrative - you'll be yesterday's news by the time you've made it. All the press, accolades, and money that showered the partners today will be on some other industry by the time you've climbed the ladder.

The folks who generate the enormous windfall have one thing in common -- they get in early. Whether it's real estate, stocks, art collections, or even careers - they managed to stay ahead of the uninformed masses.

It's not about being smart, educated, pedigreed, or rich - it's about being early. Most of the personal wealth amassed by Google staff isn't concentrated in the Stanford MBA alums - most of it goes to those who were there in Google's early stages - from the CEO all the way down to the customer service rep. In most cases, the early birds have the largest piece of the pie in any venture.

Buy low, sell high. MBAs who are part of the herd mentality unfortunately tend to buy high and sell low.

So what is The Next Big Thing? It could be healthcare. International porn. Or it could be all about Eastern Europe, China and India (note to international students, and particularly the Indians who seem to be the most adverse to repatriating compared to other internationals -- if you believed this, is there any reason why you need to be an H1B indentured servant post-MBA, rather than being the early bird entrepreneur back home -- as an aside, the few folks who are going back now will likely reap greater rewards long-term than any H1B employee ever will who believes "someday I'll go back"; mark my word on this).

Personally, I have no idea what the Next Big Thing is nor do I really care. And you probably don't. That's the point. You're chasing your own tail if you do. It's not about trying to time the market or to play market contrarian with your career. It's simply about being brutally honest with yourself about what it is you enjoy doing, and sticking to it. Because everything will have it's day in the sun if you enjoy the job enough to stick through the tough times. Who knows, maybe even insurance or accounting may be The Next Big Thing... stranger things have happened. And if you're too risk averse that you have to stick with what appears to be safe, then don't expect much - greater returns come with greater risk.

What do you guys think of this essay?

Comments (180)

 
Jan 1, 2008 - 8:17pm

Gives me something to think about -- is this for a class?

You'd probably get a lot more reads if you posted this in the IB forum.

 
Jan 1, 2008 - 11:18pm

Personally, I think the hedge fund/private equity/banking market has most definitely peaked. When you have the leaders in the field (Blackstone, KKR, Och-Ziff) all going public or trying to go public, you have to wonder why they would do it now instead of waiting if they really thought there was significantly more upside in the future.

I have no idea what the next big thing will be. Based on the compensation structure in finance vs. other professions, though, it seems likely that it will be something in financial services - it's hard to make a lot of money when you don't deal with a lot of money.

I'm not sure how much longer the China bubble will last. That is a possibility for the next decade, but given the 500% return the Shanghai index saw in 2007 and the fact that most companies' earnings are coming from their own stock prices going up, the trend seems unsustainable. Or at least likely to burst in the near future.

 
Jan 1, 2008 - 11:33pm

Some decent points made in this essay. Private equity will arguably never be as hot as it was 6 months ago. Don't forget that the mid to late 1980's were an excellent time for private equity when high-yield, mostly Milkin/Drexel underwritten was bountiful, as were the mid 1990's, so I guess if you follow that progression, private equity is due for another cooling down period while the markets re-adjust (and who knows, may come back even hotter in 5 years). But even if PE never comes back to the extent that it was a year or two ago, I think it will still be a very sought after career path. I'd like to think that while many young finance professionals pursue private equity because of its recent fad factor, most people truly enjoy what they do and have a deep interest in finance from a deal execution and operational standpoint. Private equity is probably the best job I could have envisioned for myself because while I'm very interested in the operations of a company, at heart I'm partial to doing deals - I have no interest in becoming a Fortune 500 CEO or CFO like some of my other banking counterparts.

What I think may change in the future for PE is probably the fee structure. As more firms slowly give up more to their LP's because of less leverage from market outperformance driven by cheap debt with favorable terms, the fee structure will most likely change. Hopefully for the sake of us in PE, it doesn't devolve into that of a pledge fund, but it's not that hard to fathom.

 
Jan 2, 2008 - 12:03pm

IMHO I see 2 areas:

  1. Catering to sovereign wealth? Although that depends in large part upon how well individual countries can sit with the idea of having large companies and key infrastructure owned by these funds (think Dubai ports uproar in the US) and any reactionary protectionism that results.

  2. Also corporate restructuring and breaking up highly leveraged companies into smaller ones. Probably not all that big though atleast compared to sovereigns.

RBS is better than YOUR BS, and that's not saying much
 
Jan 2, 2008 - 3:23pm

sure, financing conditions will (and should) never be easier for lbos than they were in 06-07, and PE and MF strategies are sensitive to cyclicality. But you have to be joking if you buy the "private equity / hedge funds are sooooo over" argument. The underlying businesses aren't new, HF, and to some degree PE, boil down to a fee schedule and a marketing strategy. Sure, some other industry may become this week's hot synonym for "greedy capitalist" in the eyes of the mainstream media (and, if you're looking to get into PE or HF, wouldn't you prefer that?), but smart people with real experience and good ideas will continue to create a lot of wealth in these areas. Private investors were putting capital into deals before Kohlberg starting doing bootstrap acquisitions at the Bear, and the core strategies of most hedge funds (whether its distressed investing, risk arb, etc.) have been around a long time.

Also -- alternative investment firms going public being a jump shark moment? Sure, these are people whose core business involves trying to time the market correctly, so, like any in their right mind, they are looking to raise equity when the conditions are favorable. But, for the large PE shops like Bstone, KKR, Carlyle, etc., there's also a significant generational issue. The firms have built brands, and Schwarzman, Kravis, Rubenstein, etc. are (by wall street standards at least) old, have made more money than they need, and at this point are as interested in succession and permanence as anything else. Is it a coincidence that the large cap buyout firm with the oldest co-founder (Pete Peterson) was the first one to go public? Maybe, but providing liquidity for companies whose entrepreneurs were approaching retirement has long been a staple of smaller and MM PE deals - what is so sinister about the grandfathers of PE looking to create some permanent capital for their businesses before they go the way of all things and/or Tommy Lee?

 
Jan 2, 2008 - 4:25pm

Low interest rates were not the only thing propelling the growth of the "alternative investment" space. Another major force has been shifting attitudes among a lot of institutions and high net worth investors that hedge funds and PE funds are a ligitimate asset class with lower correllation to public equity markets and should be a significant part of every large investor's diversified portfolio. This attitude will likely endure through higher interest rates and bad credit markets because it's true.

One threat to the large buyout funds that I was wondering about was the possible future lack of targets. Mega funds love big bloated sleepy businesses with diverse internal operating divisions and mediocre management. Are targets like this still as abundant as they used to be? Modern business theory always teaches focusing on "core competencies" and outsourcing or divesting all other activities. If companies are increasingly doing this on their own, how will large PE firms do it for them?

 
Jan 2, 2008 - 5:40pm

Do you guy's think the PE/HF growth will spill over in emerging markets? I know for a fact that in India there has been increased FDI's and many PE/IB/VC offices are opening up. So maybe this trend of growth in PE and HF's will continue to expand in the emerging markets during the next decade, maybe it'll be something like a phase II of the PE industry's growth. Nowadays I always hear that the globalization of a firm is an important part of their profits and growth. So how does this globalization factor in PE/IB/VC/HF's?

 
Jan 2, 2008 - 5:41pm

What's the NEXT BIG THING? (Originally Posted: 06/17/2007)

Private equity is potentially at its peak, hedge funds are common now, VC is 90s; any idea what the next hot field will be in finance? Something new?

 
Jan 2, 2008 - 5:43pm

second that

"God takes care of old folks and fools, while the Devil takes care of makin all the rules", P.E. 1998
 
Jan 2, 2008 - 5:46pm

anything asian. asian equities, (japan, asia ex japan) those sales guys make a lot of money. higher margins, growing markets, etc. not much here on the trading side, asian equity traders at the big banks only handle the ADR's. you gotta go abroad if you want really trade them.

asian derivitives.. expect to see a tidal wave of instruments coming forward, and an even bigger wave of institutions investing in them. (converts are becoming a huge huge market right now)

and yes, distressed U.S. Debt and equity, higher interest rates wont make for the prettiest picture domestically. (and no there wont be any cuts, the fed may be dumb, but they won't let the dollar collapse any more than it already has)

also, this is probably the 50th time someone has asked this question since i started posting here a few months ago, its getting annoying

 
Jan 2, 2008 - 5:48pm

so, let's assume the next big thing is indeed distressed debt...how would you take advantage of this? i assume the lev fin/restructuring/sponsors groups are we you'd want to be?

 
Jan 2, 2008 - 5:50pm

is to get onto a distressed debt trading desk? Or work with junk bonds?

you wont find anything in banking that will deal exclusively with distressed debt on a daily basis,well maybe you could but who knows.

also, you could join a vulture fund, like oaktree or something. that would be fun

 
Jan 2, 2008 - 5:55pm

Goldmans ESSG or AmSSG is a very interesting option to aim for. The guys may be quite busy over the next couple of years if those cov-lite deals start to go pear shaped..

 
Jan 2, 2008 - 5:56pm

the answer is in the question. the next big think will be for the guys who made loads of cash in pe/hedge funds etc to pass it on to the next generation to spend.

"Living the dream 24/7 on http://theallnighter.blogspot.com"

____________________________________________________________ "LIVING THE DREAM 24/7 ON http://THEALLNIGHTER.BLOGSPOT.COM" ____________________________________________________________
 
Jan 2, 2008 - 5:57pm

The reason why I suggested the next big thing to be distressed debt, is that in the event of a market meltdown and/or a liquidity crisis.. the vultures as they(distressed debt investors) are known will come out in full force looking 4 the right carcass, you know the stuff with sum meat on it.

But if the market holds up, I believe the next big thing will be the last big thing.

 
Jan 2, 2008 - 5:59pm

its too funny. whenever someone mentions the next big thing, these kids cream their pants over ways to be a "part of it". get a life and just focus on getting a summer analyst position first.

 
Jan 2, 2008 - 6:01pm

Hey thanks Tekno; I didn't ask for you to opine on what goes on in my pants. I already work as a summer analyst doing deals quite similar to this GS group. It's a simple yes/no question. I don't need your bromidic condescension.

 
Jan 2, 2008 - 6:02pm

Biofuels of all sorts (ethanol, biodiesel, etc.) still make no sense from an economic standpoint.

1) Producers generally have no power in securing either feedstock or offtake contracts, and have never heard of hedging.
2) The energy input / output ratio still weighs in favor of fossil fuels. It takes a lot of oil and gas to produce the eco-"friendly" variety.
3) $4 corn (in the case of ethanol) is not good for anyone, save corn farmers. Has anyone else noticed the rise in the prices of chicken (chicken feed), Coca-Cola (high fructose corn syrup), or Mexican food (corn tortillas)?

If the U.S. government were serious about curbing fossil fuel consumption, it would at the very least eliminate tariffs on sugarcane-based ethanol from Brazil, which is produced far more cost-effectively than what we're doing here. But since there is a farming lobby to which to pander, that simply will not happen.

I read something today that said the only way for U.S. producers to hit ethanol production quotas by 2015 as set forth by the Bush administration, a "technological breakthrough" would be necessary. How can you bank on a "breakthrough" of any kind?

The key here is finding a politically, and economically, palatable balance between Energy Independence and Going Green.

Back to the original point: It's usually a good idea to dive into something that's been totally out of favor of late. Dot-com stocks, anyone?

 
Jan 2, 2008 - 6:13pm

Anything with "leveraged," "distressed," or "turnaround" in the title.

Array

 
Jan 2, 2008 - 6:23pm

Future trends, emerging markets, and next-gen technologies are three facets of the industry that interest me greatly. I have a little notebook that I write tickers and notes of companies, products, Nd trends that catch my eye, or that I have a feeling will get hot.

I don't know much about LF, so I am going to look into it; maybe it can help strengthen my personal portfolio even further, thanks!

 
Jan 2, 2008 - 6:24pm

How is this any different from distressed debt investing? Since distressed debt really trades on laws and documents rather than as an asset class, it's very much like when any other claims are traded on that desk.

 
Jan 2, 2008 - 6:29pm

Yes, because ethanol is the future too....

"I'm short your house"
 
Jan 2, 2008 - 6:30pm

Ethanol and solar have key differences that set solar apart. Solar panels can be used anywhere. You don't need to centralize them like you do a factory farm. Sure, centralized solar cells in the desert work well for generating a lot of electricity. But solar cells attached to homes and buildings can generate a nice amount of power as well. Furthermore, solar power actually helps the environment, whereas ethanol takes food out of peoples mouths and puts it into gas tanks.

The solar industry is risky and undefined, despite having been around for a while now. It does have the potential to become an enormous disrputer, and thus might be worth the risk if you have the time and the capital.

looking for that pick-me-up to power through an all-nighter?
 
Jan 2, 2008 - 6:31pm

I certainly agree they are two totally different things, but both the wrong answer. Solar definitely offers greater benefit, but I would bet in the coming years that extremely efficient, no-waste, sources of energy will show up. Didn't you see Wall Street 2? Just remember that ledouche called it.

"I'm short your house"
 
Jan 2, 2008 - 6:34pm

Ethanol is definitely not the future. The energy reduction cost of using it as a primary fuel source is marginally worse than the cost of cutting down vast amounts of forestry to make room for the necessary additional corn production. The main problem with solar right now lies in the inefficiency of energy absorption and transfer. Today's panels can only effectively capture a small percentage of the heat energy from sunlight, and this is what prevents solar from being one of the largest sources of energy.

I haven't seen WS2.

 
Jan 2, 2008 - 6:33pm

The next big energy source will be one that can be capitalized the best. Highly doubt it can be predicted right now, only reason to guess solar is because of how long it's been around and we can see how far its come over the years....

 
Jan 2, 2008 - 6:35pm

Mediabanker - Thanks for saving me the trouble of finding the bloomberg article you posted. I read it yesterday and thought it read god awful for solars. Only the strongest will survive that is for sure.

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
 
Jan 2, 2008 - 6:37pm

haha same here.

"Oh the ladies ever tell you that you look like a fucking optical illusion" - Frank Slaughtery 25th Hour.
 
Jan 2, 2008 - 6:41pm

Ironically enough, Saudi Arabia is in the process of developing the world's largest solar farm in the middle of the desert. The way it works, apparently, is that the energy produced from the solar panels is supposed to heat compressed air that will spin huge turbines in a huge tower right in the middle of the solar farm. I haven't even mentioned the nuclear powerplant the government is building lol no worries, none of that Iran crap. US gave us the green light.

It only makes sense for them to worry about it. Saudi Arabia is using approximately 10-15% of the oil it produces everyday. That number is only growing.

Long oil, anyone?

Greed is Good.
 
Jan 2, 2008 - 6:46pm

solar might not go up too high IF they find alternative and more powerful energy sources that can charge faster and hold more charges. solar is weak - it can't keep up with our growth rate for powerful energy-hungry electronics

 
Jan 2, 2008 - 6:48pm

The ignored 'Next Big Thing' & India (Originally Posted: 05/23/2014)

What will the world need the most in the next 30 years?? Renewable energy? Super-smart phones? Or extra-ordinary Nano materials? One thing that is safely ignored in the list by many is…FOOD. A world with more than 7 billion people (and expected 2 billion more to come) would certainly need the proportionate amount of food to contain the population. According to WHO data, the Global per capita food consumption, which was 2358 Kcal per capita per day in 1964 is estimated to be 2940 Kcal per capita per day in 2015. The impressive aspect being that the consumption is expected to be almost uniform all over the world except in the industrialized countries (3440), Sub-Saharan Africa (2360) and South Asia (2700). In short, food consumption per person has increased significantly throughout the world. The Global consumption is expected to reach 3050 Kcal per capita per person in 2030 and all regions are expected to follow the pattern.

How the demand will be met?

Well we cannot extrapolate all the data and conclude that simply growing more will satisfy the population. Food patterns have considerably changed in the past decades. The world is now more dependent on processed foods and animal based products. While the food processing and beverage markets have seen the highest growth in developed nations, the developing nations are catching up. Whereas the US, the UK, Germany, India, and China are some of the top producers of processed food and beverages, Saudi Arabia, Asia, Africa, Russia and South America are some of the leading importers. The case is similar with animal based products. Annual per capita meat consumption in developing nations increased 150% from 1964 to 1999 and dairy products consumption increased by 60% in the same period. It is predicted that, by 2030, per capita consumption of livestock products could increase by a further 44%.

The case of India

In India, the rapidly increasing urban middle class population is turning to processed food ranging from packed fruits to dairy products meant for daily use. The diet that once consisted of homemade bread (Rotis) and dishes now has sauces and soft drinks as fixed components. According to industry estimates, the processed food market accounts for 32 percent of the total food market in India that is approximately US$29.4 billion in a total estimated market of US$91.66 billion. The sector is growing at 10% every annum. The Government of India has allowed FDI up to 100 per cent in food processing sector through automatic route. For promotion and development of the food processing sector, it has allocated a sum of Rs 5,990 crore (US$ 1 billion) under various schemes of the food processing industries ministry during the 12th Five Year Plan. Along with strong domestic demand India has great export opportunities in Food processing. The coastal belts are already export hubs for sea food. In 2012-13, exports of marine products reached an all-time high of $3511.67 million. The industry faces its share of challenges too like constraints in raw material production, less availability of cost effective technology in food machinery, packaging and processing plants and inadequate infrastructure facilities. However, majority of these challenges can be met through adequate capital inflow.

Overall the food processing industry, especially in developing nations, could be in the list of 'next big things', although it may not be the biggest of them all.

 
Jan 2, 2008 - 6:49pm

Great post!

Mr.Mathie | Ideas are nothing without execution - Jeux de Commerce Central
 
Jan 2, 2008 - 6:50pm

what companies do you see benefiting from this? immediately coming to my mind are stocks like YUM, GIS, and K, not to mention the firms that make the special seeds to help raise crop yield like SYT, BASF, Bayer (cropscience division) and others.

what I'm curious about for India is infrastructure, they have a golden opportunity in front of them, but do they have the infrastructure to capitalize on it?

 
Jan 2, 2008 - 6:51pm

One quick observation, 3440 average calories consumed per day per capita in industrialized countries? can that possibly be right? that is an enormous amount of food, i'm a moderately active male that eats about 2000 per day to keep the weight off. is kcal a different unit than "calories" in the US?

 
Jan 2, 2008 - 6:56pm

next big thing (Originally Posted: 01/01/2008)

Someone picked up this topic in the private equity forum, but I thought it would be interesting to discuss this here as well. How much longer will the "investment banking fad" last? Will it still have the same amount of prestige and selectivity 10years down the line? Will there be anything more lucrative than investment banking in the coming years for fresh graduates, just like how advertising was the "hot career" in the 60s, conglomerates in the 70s, bond trading in the 80s, dot com and vc in the 90s, and investment banking and pe/hf for this decade.

 
Jan 2, 2008 - 6:57pm

Investment banks will continue to be selective. There aren't that many prestigious firms to begin with, and getting a job in a class of a max of 150 at GS/MS/LEH/ML/JPM will always be incredibly difficult.

Corporations need to raise equity/debt and sometimes merge, the expertise and access to capital that investment banks have are needed to keep the financial markets running smooth.

Understand that although people generally dismiss investment bankers as monkeys, you have to be pretty sharp to understand certain concepts and ultimately churn out pretty much flawless work.

Compensation isn't incredibly high as an analyst given the hours worked (~$25/hour). Say comp were to go down to 65k all in, and hours stay at ~90/week for an analyst... Top candidates would head for greener pastures, and IB wouldn't be as prestigious. In such a case, I'd argue that the economy had deteriorated to the point that the financial markets were in chaos, or junior level positions were outsourced.

Even if analyst positions were outsourced (doubtful), I'd say that senior levels of IB (which you'd be approaching after a few years) would still be extremely prestigious. Comp would be high as well.

PE/VC/HF may be a bit more cyclical, new things may pop up. That's why a base in a structured 2 yr IBD is so valuable. You can roll with those punches later.

PLEASE DONT CHANGE EXCEL SHORTCUTS!!!
 
Jan 2, 2008 - 6:58pm

To be honest (I hate to shatter peoples' dreams here..) a lot of what banks do is a commodity. Bank in the 1980s and earlier when information was much harder to come by and we didn't have resources like CapIQ/Factset etc., bankers provided value simply by showing up with the appropriate information in hand.

In the end, investment bankers are just agents; look at what Zillow and the Internet has done to the real estate business and real estate agents and I think there is some ground to the business becoming increasingly commoditized.

Will analysts be completely outsourced? No, of course not. But larger firms are outsourcing and have been doing so for quite some time.

If you look at other recent developments like the portal market for PE-owned companies seeking liquidity as well, it seems likely that others have realized the above as well.

I don't mean to cause controversy or offend anyone with the above. I guess the bottom-line is that history shows nothing stays "hot" forever and it would be unreasonable to expect that banking will be everyone's dream job indefinitely.

 
Jan 2, 2008 - 6:59pm

I agree with dosk17. History has showed that nothing stays hot forever. Besides wouldn't rampant competition between investment banks bring down salaries and bonuses? It's only logical to conclude that investment banks likes other industries follow a business cycle and will surely reach a down point. It may be in the growth/mature stage right now but eventually it would start to decline as an industry no matter how much someone may need advice with valuations or capital raising. There may be a point when firms would start raising capital without the help of investment banks or would be complacent to hire their own bankers and create their own mini-banking divisions to do so.

 
Jan 2, 2008 - 7:00pm

It seems that some of you made quite a few speculative comments that were incorrect.

"Besides wouldn't rampant competition between investment banks bring down salaries and bonuses?"

I doubt the first thing they would cut is salaries or bonuses. IB is a highly competitive field because it hires intelligent candidates who are well compensated. If things went horribly at a company, companies usually will shell out higher bonuses to keep top-level management and great employees. See Bear Stearns Companies also cut costs through a number of other ways before taking from the bonuses of their employees, pretty much the best way to have an employee want to quit/leave. Especially money hungry analysts.

"It's only logical to conclude that investment banks likes other industries follow a business cycle and will surely reach a down point."

Last time I checked its happening now. Salaries are still up, banking is still "hot" See every major bank minus GS huge write downs

"There may be a point when firms would start raising capital without the help of investment banks or would be complacent to hire their own bankers and create their own mini-banking divisions to do so."

IB is not useful enough to have a division within your company, cost ineffective. I dont think IB will be hot forever but it will sustain itself by adjusting to the markets needs. Anyone who can offer that salary and guarentees financial benefit pay scale (analyst -associate - ...) will have top graduates at their doorstep resume in hand.

 
Jan 2, 2008 - 7:01pm

Going back to the original Q. I think things/businesses related to the climate change will more or less dominate the next 10 or 100 years. Be it fuel efficient cars, snowmakers, energy efficient "everything", cars that run on water, devices that make water you can drink from sea water, alternative energy...you get the idea. Anything will be hot that will A.) slow down global warming B.) cure the effects of the already existing and coming aftermath. However no one really cares now, but the warming of the Globe will cause serious headaches to mankind and probably is the next big thing that will shape global politics too (think of wars for natural resources like water or oil--> /Iraq/). This trend is comming inevitably, so if you are in it one way or another, you can't go wrong for sure. But psssst, we do not wanna talk out the secret :-)

I think funds investing in this stuff will make nice returns. Think of the indexes created by the major banks tracking "green companies". That indicates something.

 
Jan 2, 2008 - 7:02pm

I think it is wrong to call banking a fad or a "hot" industry. Investment banking has been an attractive and lucrative industry for decades if not longer. And while it has indeed become a commodity (at least in the US and UK), it will continue to be attractive and prestigious at the analyst level for as long as it acts as a feeder into even more attractive and prestigious industries (dotcom, VC, PE, HF, the next hot thing, etc.). There is little indication that this is changing.

At the more senior levels, commoditization of the industry has resulted in less prestige (and relatively lower compensation) and most of the real talent has accordingly moved onto to other areas of finance (PE and HF). However, investment banking as an industry is here to stay as it performs a valuable service to its clients (especially for debt and equity raises, less and less so for process-driven M&A).

As for the next hot thing...plastics.

Author of www.IBankingFAQ.com
 
Jan 2, 2008 - 7:04pm

Bio-technology for the next decade... N'uff said!

No matter what the banks profit, they are the middle man ripping it all off. Tech bubble? Tons of IPO money for the bank. VC? Tons of IPO money for the bank. HF? Tons of money for the S&T departments.


Remember, you will always be a salesman, no matter how fancy your title is.
- My ex girlfriend

 
Jan 2, 2008 - 7:05pm

Could this be the next big thing? (Originally Posted: 01/18/2011)

Just came across this new start-up here in Toronto. It's the first of it's kind based on what I've seen. What do you guys think of the business model?

www.tuzo.ca

-MBP
 
Jan 2, 2008 - 7:07pm

Shameless self promotion?

He severed the chains of the masses, brought them liberty, The sun of Korea today, democratic and free. For the Twenty Points united we stand fast, Over our fair homeland spring has come at last!
 
Jan 2, 2008 - 7:13pm

That's pretty cool. Location enabled cell phones can open up a whole world in the industry of mobile gaming. Sweet concept.

--- man made the money, money never made the man
 
Jan 2, 2008 - 7:16pm

Well, to be fair, I don't think Scvngr came out that long ago, so they might've been in early development at least by the time S was rolled out

"You stop being an asshole when it sucks to be you." -IlliniProgrammer "Your grammar made me wish I'd been aborted." -happypantsmcgee
 
Jan 2, 2008 - 7:17pm

The next big thing (Originally Posted: 09/06/2011)

There's an old Wayne Gretzky quote that I love. 'I skate to where the puck is going to be, not where it has been.' And we've always tried to do that at Apple. Since the very very beginning. And we always will.
-Steve Jobs

The agricultural revolution, than the industrial revolution, the dot. com bubble, finance industry did quite well for some time. Which sectors do you guys believe is going to be the next revolution/wave?

Agricultural revolution again??

 
Jan 2, 2008 - 7:20pm

I think tech has a long way to go... so many new things in development that can change the world as we know it.

"You stop being an asshole when it sucks to be you." -IlliniProgrammer "Your grammar made me wish I'd been aborted." -happypantsmcgee
 
Jan 2, 2008 - 7:24pm

Pharmacogenetics. Period.

If I had asked people what they wanted, they would have said faster horses - Henry Ford
 
Jan 2, 2008 - 7:25pm

valentino suits and oliver peoples glasses

I have to return some video tapes.
 
Jan 2, 2008 - 7:26pm

I think the last "big thing" was the internet, and of which we shall continue to accrue the benefits for a few more centuries.

looking for that pick-me-up to power through an all-nighter?
 
Jan 2, 2008 - 7:28pm

I meant technology in general, everything from healthcare to internet (or the new internet) to electronics, and so on

"You stop being an asshole when it sucks to be you." -IlliniProgrammer "Your grammar made me wish I'd been aborted." -happypantsmcgee
 
Jan 2, 2008 - 7:30pm

You asked what the next big thing is, all of "technology" has the potential to be the next big thing.

"You stop being an asshole when it sucks to be you." -IlliniProgrammer "Your grammar made me wish I'd been aborted." -happypantsmcgee
 
Jan 2, 2008 - 7:33pm

Samsung & Jay-Z - The Next Big Thing? (Originally Posted: 06/17/2013)

Anyone hear of the business deal between Samsung and Jay-Z? A 3 minute Samsung commercial was aired during Game 5 of the NBA finals showing Jay-Z working on his album with producers Rick Rubin, Pharrell, Swizz Beatz and Timbaland.

" The album is titled "Magna Carta Holy Grail", and will be released on July 4. Samsung has agreed to purchase 1 million copies of the new album for $5 apiece, giving them for free to lucky Galaxy users a full 3 days before release. "

I think its smart: Jay gets $5 million in sales before the album is released, and Samsung adds incentive to buy a Galaxy product, while getting a ton of exposure from the larger-than-life presence of Jay Z. In my opinion, the $5 million + advertising is a small price tag for Samsung to pay for the amount of brand attention they are going to get.

What are your guys' thoughts on this?

 
Jan 2, 2008 - 7:39pm

milehigh:

After hearing the abomination that is Yeezus (minus a couple of ok songs), I'm just excited that there's another album to look forward to this summer.

People look forward to Kanye albums?

"You stop being an asshole when it sucks to be you." -IlliniProgrammer "Your grammar made me wish I'd been aborted." -happypantsmcgee
 
Jan 2, 2008 - 7:40pm

D M:


milehigh:

After hearing the abomination that is Yeezus (minus a couple of ok songs), I'm just excited that there's another album to look forward to this summer.


People look forward to Kanye albums?

Substitute "Kanye albums" with "the next crazy thing Kanye will pull out of his/his publicist's a*s" and we're good

 
Jan 2, 2008 - 7:41pm

I'm loving Kanye's album, blood on the leaves is just so raw. Looking forward to snatching the jay-z one once its all over the internet.

The error of confirmation: we confirm our knowledge and scorn our ignorance.
 
Jan 2, 2008 - 7:42pm

Mutt:

Makes the Samsung 'cool' - something I think it is struggling with at the moment (in comparison to other comparable phones, it is seen as a bit nerdy). Great price to pay to potentially shed this image, and ultimately increase sales.

Last time I checked, Samsungs cool factor was through the roof. I was just at the bars over the weekend, and every girl I ran into was way into my Note II. Not to mention over half of them had some form of Android phone.

Follow the shit your fellow monkeys say @shitWSOsays Life is hard, it's even harder when you're stupid - John Wayne
 
Jan 2, 2008 - 7:43pm

milehigh:

After hearing the abomination that is Yeezus (minus a couple of ok songs), I'm just excited that there's another album to look forward to this summer.

Born Sinner?

The answer to your question is 1) network 2) get involved 3) beef up your resume 4) repeat -happypantsmcgee WSO is not your personal search function.
 
Jan 2, 2008 - 7:44pm

heister:

Mutt:

Makes the Samsung 'cool' - something I think it is struggling with at the moment (in comparison to other comparable phones, it is seen as a bit nerdy). Great price to pay to potentially shed this image, and ultimately increase sales.

Last time I checked, Samsungs cool factor was through the roof. I was just at the bars over the weekend, and every girl I ran into was way into my Note II. Not to mention over half of them had some form of Android phone.

heister would use a Samsung Note.

 
Jan 2, 2008 - 7:46pm

I'm pretty excited about Jay's new album, should be good... hopefully

bfin:

milehigh:

After hearing the abomination that is Yeezus (minus a couple of ok songs), I'm just excited that there's another album to look forward to this summer.

Born Sinner?

I was expecting much more from J Cole, decent album though. Maybe I just held him to extremely high standards since I've been bumping his music for a while now.

 
Jan 2, 2008 - 7:47pm

Falcon:

I'm pretty excited about Jay's new album, should be good... hopefully

bfin:
milehigh:

After hearing the abomination that is Yeezus (minus a couple of ok songs), I'm just excited that there's another album to look forward to this summer.

Born Sinner?

I was expecting much more from J Cole, decent album though. Maybe I just held him to extremely high standards since I've been bumping his music for a while now.

I haven't listened to a song I decided this will be the second album I'll purchase so I'm going to listen to it tomorrow.

The answer to your question is 1) network 2) get involved 3) beef up your resume 4) repeat -happypantsmcgee WSO is not your personal search function.
 
Jan 2, 2008 - 7:48pm

Why the Next Big Thing isn't happening... (Originally Posted: 10/25/2017)

Marijuana has sporadically made the headlines ever since 2012 when Colorado and Washington became the first states to legalize the substance for recreational use. Today, recreational use of marijuana is now legal in eight states, but it seems that nationwide legalization is far from a reality. This stems from marijuana legalization's biggest hurdle: GOP leadership in Congress.

This year, Congressional Republicans have blocked numerous cannabis amendments from even being voted on, including ones to shield state laws from federal interference, to remove research roadblocks and even to allow military veterans increased access to medical marijuana.

What, for some, once seemed sure to be "the next big thing" is now being constricted of any consideration by leading Republicans.

What other once-promising "next big thing" is facing hindrances to its success?
(Ex: Certain biosimilars vs. FDA approval)

 
Best Response
Jan 2, 2008 - 7:50pm

Is 3D printing the next big thing? (Originally Posted: 03/30/2013)

I had the pleasure of attending SXSW this year and witnessed what I think is the next BIG thing in technology. We've all talked about Google's Project Glass and its potential to change the way we view and interact with our environment. We've also all seen the crazy shit that cell phones are now capable of doing, but after watching/reading up on what the guys at MakerBot are working on, I can't help but think that once 3D printing technology becomes main stream, it will be a real game changer.

Imagine that you have some object in your living room that you no longer like. You want something similar, but no longer like the look of the object you currently have. With MakerBot's scanner (they showcased a fully functional prototype, but are working out some kinks and hope to release a finished product sometime in the near future), one can simply take the object, scan it, turn it into a CAD file, and then manipulate it to one's liking. Afterwards, you can use your 3D printer to print your newly modified object. Or, if you lack creativity, you can just go online, download someone's CAD file and print it for your use.

Personally, I am really excited to see what kind of things people can come up once they have this technology in their hands. What do you guys think? Time to load up on stock of publicly traded companies that are currently producing these printers (see Stratasys, 3D Systems Corp.)? Or is this just another gimmick that will never go main stream due to the high costs of printers/ technology that the average Joe doesn't understand?

After originally writing this article, I came across a documentary that MOTHERBOARD did with Cody Wilson (the guy who figured out how to print guns from his house). Link is below, well worth watching in its entirety. He claims with technology like this, gun control is a thing of the past and can no longer be achieved.

 
Jan 2, 2008 - 7:52pm

Offtopic, but from the same channel :

, what the fuck?!
"Every man should lose a battle in his youth, so he does not lose a war when he is old"
 
Jan 2, 2008 - 8:01pm

RichardPennybags:
Offtopic, but from the same channel :
, what the fuck?!

I saw this a while back. Dude's hands shake like crazy.

 
Jan 2, 2008 - 7:53pm

I think it will be big, but right now the hype is ahead of the technology (see: 3D printing stocks). Cody is an example of this. If you watch the documentary, you'll see that he can't actually be a gun yet (and will never be able to build a full one b/c some of the critical components have to be made of metal).

 
Jan 2, 2008 - 8:02pm

dazedmonk:
If you watch the documentary, you'll see that he can't actually be a gun yet (and will never be able to build a full one b/c some of the critical components have to be made of metal).

If you watch the documentary, or know anything about the AR-15/M4, you'll see/know he can build the part of the weapon with the serial number on it. The rest of the weapon is just "parts" which can all be purchased as easily as any other consumer product. There is no need to print an entire gun. He did the part that counts.

When a plumber from Hoboken tells you he has a good feeling about a reverse iron condor spread on the Japanese Yen, you really have no choice. If you don’t do it to him, somebody else surely will. -Eddie B.
 
Jan 2, 2008 - 7:55pm

I think it may be the next big thing but its a while out.

The answer to your question is 1) network 2) get involved 3) beef up your resume 4) repeat -happypantsmcgee WSO is not your personal search function.
 
Jan 2, 2008 - 7:57pm

I'm actually really excited about this, but this is more a vc type investment still i think. The price of these printers is still way too expensive for individual consumers, and iunno if publically traded printer companies will be turning a profit on these types of printers for the next couple of decades

 
Jan 2, 2008 - 7:59pm

Yes, a century. This is like one of those things you see on TV--like, a hydrolic work chair--that is really cool but its cost to manufacture and acquire and its everday applications are inconsistent with a country comprised largely of lower middle and middle middle class consumers. Would the average consumer purchase a $1,000 3D printer so that they can manufacture a cheap, plastic POS lamp? The answer is no. Would a typical products manufacturer consider purchasing a $10,000 or $100,000 or $1 million commercial grade 3D printer? Heck yeah. It's not going to be a consumer product any time in the foreseeable future--it's going to be a commercial product. In fact, it wouldn't surprise me if the 3D printer never catches on as a consumer product.

 
Jan 2, 2008 - 8:03pm

DCDepository:
Yes, a century. This is like one of those things you see on TV--like, a hydrolic work chair--that is really cool but its cost to manufacture and acquire and its everday applications are inconsistent with a country comprised largely of lower middle and middle middle class consumers. Would the average consumer purchase a $1,000 3D printer so that they can manufacture a cheap, plastic POS lamp? The answer is no. Would a typical products manufacturer consider purchasing a $10,000 or $100,000 or $1 million commercial grade 3D printer? Heck yeah. It's not going to be a consumer product any time in the foreseeable future--it's going to be a commercial product. In fact, it wouldn't surprise me if the 3D printer never catches on as a consumer product.

I'm sure the same was said about computers, cell phones, and early dot matrix printers.. I disagree 100% on your assessment of both the future capabilities, time-frame and how long it's going to take for the price to come down to the consumer level. I'm long DDD @ the current price and waiting for an imminent short squeeze with a 30% short float.

 
Jan 2, 2008 - 8:00pm

^^^agree that the professional use is much more imminent (in fact already applicable), but 1) that doesn't mean these aren't profitable or useful companies/technologies (applications to dentistry, prosthetic, auto industry, etc are already in place/getting in place and are extremely profitable areas) and 2) again you must consider moore's law. These things get exponentially cheaper and easier to produce as we go along. In fact the cost to produce has already come down greatly. It's really not even prohibitively expensive for someone to own these for personal use as is (expensive yes, but it's not impossible).

We definitely aren't at the point of practical home use yet, but I disagree greatly that this is centuries (even decades away).

 
Jan 2, 2008 - 8:04pm

First, ease yourself into this field if you are planning to invest. I have done research and investment in the 3D tech field over the past two years and have seen excellent returns (take for example DDD- 3D Systems and their performance from the beginning of 2012 to the beginning of this year). The point is that the market and many investors have already been anticipating the huge potential in this industry so the primary companies like DDD and SSYS have seen huge gains. Do your research thoroughly before investing in the potential plays in the industry.

Second, the industry absolutely has huge potential in everything from smaller consumer printing jobs (cell phone cases, coasters, etc) to small and mid sized business needs (architectural models, consumer products, medical models, etc) to large scale manufacturing. Stratasys focuses more on the large scale printers for manufacturers while 3D Systems has been very gung-ho about developing more cost and size effective printers for consumers themselves. Very recently the industry broke through the $1000 barrier for smaller home 3D printers and with continued technological advances and investment in R&D I could see 3D printers becoming increasingly more attractive to individual consumers.

Third, "a century or two centuries" is quite an exaggeration of the time it should really take for 3D printing to become more mainstream. The technology itself has existed since the 80s and with the continued push in technological innovation over the past couple of decades the industry has been making great headway. On the consumer side the trend in 3D printers is very similar to home printers from HP back in the day. Recall, normal printers back in the day cost upwards of $1000 and some even more.

Finally, in my view the industry presents great potential for future investment but as always if you are considering investing in it you need to do the due diligence and spend time researching the industry, the technology, and the players to make sure you know whats going on.

"Successful investing is anticipating the anticipation of others". - John Maynard Keynes
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