Wall Street vs. Entrepreneurship

Dr. Dres's picture
Rank: Monkey | 53

I am very new to this but I thought I would post something I feel many of us students have thought about at some point in time. This may be more tailored to first-gen, low-income, students who attend non-targets. Can apply to others as well so feel free to critique?

You spend hours at school, hold a part time, commute, and have large responsibilities making sure your home is stable. All this with little to no complaints. Yes, I know life is hard. It took until the end of your sophomore fall semester to find out what Investment Banking is. You suddenly become infatuated with the idea of making it to Wall Street. You go out, get involved in school, join development programs, network, etc. The odds are against you but you've read the several success stories of other students who broke into Wall Street after being in the same position you are currently in. Reading and learning becomes a daily habit you never thought you would develop. Although we know who our competition is, we don't give up. We want the knowledge, the experience of working on deals, valuating companies, doing shit that was once a fantasy, and of course, proving momma didn't raise no bitch.

Our minds are pacing back and forth trying to do what we can to create opportunities that were never handed to us. Whether it be at work, in class, or in bed, you suddenly think about an idea that can potentially be something big. You actually pitch the idea to potential clients, professors, etc. It ends up receiving positive feedback. You want to continue working on this. Suddenly, you think about Investment Banking. Then you think about entrepreneurship. You realize that both can bring major success, but neither are guaranteed.

What do you choose? Dedicating all your time to joining the community of the smartest individuals and gaining experience that only a special few get to receive? Or do you work on becoming "your own boss?" Given that both entrepreneurs and IB analyst can potentially work the same amount of hours, workload isn't an issue.

I don't know if anybody is currently going through this or may have gone through this. How do you even tackle this?

Comments (97)

Best Response
Apr 5, 2017

"Dedicating all your time to joining the community of the smartest individuals and gaining experience that only a special few get to receive? Or do you work on becoming "your own boss?"

None of that falls under IB.

heister:

Look at all these wannabe richies hating on an expensive salad.

    • 10
Aug 16, 2018

True. I think IB people get it twisted. The smartest of the graduating class launch companies or go to med school.

Apr 5, 2017

The work of entrepreneurs is at least going to be a lot more interesting.

Apr 5, 2017

Coming from the specified background that you mention, I think you get outstanding grades, network hard and take the IB job. If you have no safety nets and potentially some extra dependents its just so risky to go the entrepreneurship route straight out of college. You're also going to have a much harder time accessing capital if you try to go straight into entrepreneurship out of college. Put in a few years on Wall Street, save up some money, make good connections and you'll probably have a much easier time pursuing your other venture after proving yourself a bit and giving yourself a modicum of financial security.

    • 4
Apr 5, 2017

That is the plan I initially intended on pursuing. I agree with you that at the end of the day, gaining experience and then becoming an entrepreneur is the more rational route. However, there are so many minds out there trying to solve problems that no idea is exactly safe. My idea could easily be taken, not necessarily by someone I told, but just from anyone who is trying to solve the same problem I am.

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Apr 5, 2017

I mean that's always a risk. But if that happens, poor you, you fall back on a lucrative career in high finance and will have the resources at your disposal should you decide to pursue another venture some time in the future.

Apr 6, 2017

My intent is not to be negative and if you truly believe in the idea you will not care, but if your idea can easily be taken or replicated its not a good idea.

"Not me. Im in my prime"

Apr 8, 2017
Dr. Dres:

That is the plan I initially intended on pursuing. I agree with you that at the end of the day, gaining experience and then becoming an entrepreneur is the more rational route. However, there are so many minds out there trying to solve problems that no idea is exactly safe. My idea could easily be taken, not necessarily by someone I told, but just from anyone who is trying to solve the same problem I am.

Yup. That's a risk. But if you're from a low ranked school without anything else to differentiate yourself and your start up fails you're fucked, you won't find a recruiter that wants to talk to you and most F500 roles are out, not to mention high finance/consulting.

Bear in mind that your failure rate is high too, because you don't have the network and pedigree to have access to capital and talent.

If you spend two years in IB first, you have access to capital AND talent, have a wow factor when fund raising, have a network to draw on for sales and if your startup fails, you can walk into another six figure job without much trouble. The safety net factor is huge.

    • 3
Apr 13, 2017

Your idea is not original. A bunch of people have already had it. The only thing that matters is execution.

Work to put yourself in the best shape to execute on this (or any other) idea you are passionate about. That might mean doing it straight out of school, but more likely means getting some experience/ money/ credibility working somewhere first.

Apr 5, 2017

If you want to merge your entrepreneurial spirit with finance interests, it sounds to me that you should be heading into VC

Apr 5, 2017

Yes, but the reality is that the VC door is not open to people who are simply interested in finance and have an an entrepreneurial bent. VCs either want a former entrepreneur (failure is ok as it is a badge of honor) and/or something with a tech or industry specific background.

Apr 8, 2017
junkbondswap:

Yes, but the reality is that the VC door is not open to people who are simply interested in finance and have an an entrepreneurial bent. VCs either want a former entrepreneur (failure is ok as it is a badge of honor) and/or something with a tech or industry specific background.

Failure is not ok, and it's not a badge of honor. That is media driven nonsense.

Apr 5, 2017

Don't take the risk, go with the paycheck. You know the stats on small business success, entrepreneurship is a wasteland of broken dreams and balance sheets. Russian Roulette has far better odds, though higher consequences for sure.

    • 2
Jan 5, 2018

You're working that hard because it's yours. Congrats on chasing the dream though, that's impressive to me.

Jan 5, 2018

grats man! keep us updated

Jan 5, 2018

Nice work, dude! Keep it up.

Jan 5, 2018

Nice work. Though I will say one thing - you're working that hard because you've designed your business to require those kind of hours. Take a step back and try to think of a few ways that you can remove yourself as the single point of failure. See if you can apply the Pareto Principle to your business - it's likely that 80% of your revenues come from 20% of your work. Try to simplify, and you'll be a ton happier (even if you give up 20% of your revenue - isn't it worth it for 80% of your time back?)

Before anyone says it can't be done - I'm about 30 days away from quiting my PE job to run my two startup businesses full time. Each one takes about 10 hours a week of work to run and manage, because I've structured them to be automated and run without my direction. Whenever you can, replace people with automation, and when you can't, make sure they have the authority to act without consulting you on everything. It's scary at first to give up that micromanagement, but it will save you tons of gray hair in the long run.

Jan 5, 2018

Tim, is that you??!

CaptK:

Nice work. Though I will say one thing - you're working that hard because you've designed your business to require those kind of hours. Take a step back and try to think of a few ways that you can remove yourself as the single point of failure. See if you can apply the Pareto Principle to your business - it's likely that 80% of your revenues come from 20% of your work. Try to simplify, and you'll be a ton happier (even if you give up 20% of your revenue - isn't it worth it for 80% of your time back?)

Jan 5, 2018

^4-hour work week...

Jan 5, 2018
oldmansacks:

^4-hour work week...

I think it's no secret around here that I'm a huge Tim Ferriss fan - you're right on the money.

Jan 5, 2018

And we'll all be so JELLY.

Jan 5, 2018

Read through most of the book. haven't started working full-time yet but i think it would make sense to pursue this after working for a year or two.

Jan 5, 2018

Nice

Jan 5, 2018

Congrats on having the courage to take the risk to launch your own company.

Check my post on the "freedom of being an entrepreneur" that echoes your opinion.

Best of luck!

Jan 5, 2018

I love you, CaptK, and you need to change your name to TimoF

Jan 5, 2018

Thanks everyone.

@CapK: I completely agree with you - I have designed my business this way. I am in the growth phase right now, and I have to actively put in blood, sweat, and tears to see this baby mature. I have a plan where in a couple of years I will hopefully be working less hours and earning more money from this, but right now I have applied the Pareto principle everywhere I can...

And I'm also a big Tim Ferris fan, although not sure how well the 4-hour-body would work.

Jan 5, 2018
Beef:

And I'm also a big Tim Ferris fan, although not sure how well the 4-hour-body would work.

Trust me, pretty damn well. I dropped 35lbs and about 10% body fat, wrote up my experience here: http://www.wallstreetoasis.com/blog/meat-on-the-st...

Jan 5, 2018

The freedom of being an entrepreneur is NOT about the hours or the dedication to the job. The "freedom" is that you're your own boss. You eat what you kill. You can't get fired. You can pick your office space. You can choose how you travel. Your hours are yours. The harder you work, the more you make (usually). I think you're misinterpreting what freedom means. You will truly be free when you're dead.

Jan 5, 2018

I posted this in the thread with the NY Times article on MBAs pursuing entrepreneurship, so the article I'm referring to is that one. Just figured it'd be worth copying and pasting my comment there into this thread since this thread is more active:

As someone who would also like to start and run a business one day, here are a few quick thoughts on this topic.

--I think people gravely underestimate how easy it is to actually start and run a viable and legitimate business that has any sort of lasting power. Everyone sees these tech startups blooming around them and many people think "hey, I could do that too," but the reality is that there are so many duplicative tech startups of little or no value out there right now. How many "social" "local" and "daily deal" businesses do we need?

--I'm not knocking those that choose to go into the tech startup world, but I think people need to be realistic. Again, there are only so many e-commerce discount sites that are actually viable and only so many niche-review sites capable of being supported by ad revenue. The sheer number of niche-review websites out there (think Yelp, "The Feast," and others) is getting kind of absurd.

--When I think about businesses I've worked with in the middle / lower-middle market that were run by their founders, I realize that these people didn't just have "ideas" or "programming skills," they had specialized knowledge about a specific field. Their specialized knowledge and skill-sets allowed them to start, run, grow, and eventually sell highly successful businesses. I think it's a little too easy to hear about stories like this one and read stuff by guys like Tim Ferriss (good ideas, overrated in my opinion) and think to yourself "man, I could totally do that." But, without gaining some sort of specialized knowledge, it's not nearly as easy a decision to make as this article implies. I'm not implying that you need to spend years and years in an industry to do it, but I think it's harder to go from being an excel monkey to running a tea pot business (for instance) than simply deciding one day to do it.

--Obviously there is no real path to entrepreneurship, and if you've got an idea for a business then the only way to put it into action is to actually put it into action. But, I feel that entrepreneurship is in some way cheapened by articles like this one and self-serving sites like TechCrunch.

I hope this wasn't too much of a rambling mess, I think there are plenty of things to discuss in this regard and would like to hear others' viewpoints as well.

Jan 5, 2018

stick to banking, entrepreneurship is just too damn volatile . Some days you are on top of the world, other days your company is crashing down, hard. As you can probably tell today is one of the latter days for me. fuck

Jan 5, 2018

@TheKing - Yelp is a niche review site?

Although I generally agree with the sentiment.

Jan 5, 2018

@Sterling Archer:

No, but it's one of many local review sites. There are tons of little niche review sites out there (think shit like foodspotting or related bullshit like crowdbeacon) that I think people get way too caught up in the hype. The world only needs so many daily deal sites and other crap. Another thing I see on sites like techcrunch is the idea that there are all these "problems" that need to be solved, and many of these so-called problems are ficticious machinations of some bubble pumping dumb ass tech geek who thinks that what the world really needs is more photo apps.

Sorry for the rant, I just think it's important to understand just how challenging starting and running a legitimate, profitable, and lasting business is.

Jan 5, 2018

It's definitely challenging. Also, the per-hour pay is probably pretty crappy. For example, a client that pays me $2000 for a project... I might spend $1000 or more on development. I have fixed costs like servers and memberships to certain tools, then how much of my time will I spend dealing with the client and the 1000 little things he wants changed here or there? Later on as the project value increases and I can afford to hire project managers, this will improve, of course. But I think that's something about the services industry - it's hard to scale.

I think it'd be easier to run a business that scales well. For example, anything where the user pays $50 per month to use a web service of some kind, and pretty much is never in contact with you. There are still fixed costs and a certain percentage of users will need support and etc, but because this scales more it'd easier to hit it big when, for example, some genius marketing play or mention in a big name blog increases your traffic by 10000% for an entire week.

With my current business, if the number of clients I get goes up 10x, the amount of time I have to spend working probably triples, or worse.

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Apr 5, 2017

Q: Who's going to give a nobody capital?

A: Nobody

If you are coming up with some tech company you can create in your dorm room with nothing but spare time, then go ahead and do that while you're in school. But, if you need money to get your business started.......good luck.

Apr 5, 2017

Yes, I realize funding is a big fucker, but thats part of the game. I'm positive you know how it works.

In your defense, I did not elaborate on the idea, but I can tell you it can't be created in a dorm room with spare time.

That is the issue. I would need to allocate all my time towards prepping for Wall St. or creating this product, pitching it, doing customer discoveries, finding funding, etc.

Apr 5, 2017
AndresV23:

Yes, I realize funding is a big fucker, but thats part of the game. I'm positive you know how it works.

In your defense, I did not elaborate on the idea, but I can tell you it can't be created in a dorm room with spare time.

That is the issue. I would need to allocate all my time towards prepping for Wall St. or creating this product, pitching it, doing customer discoveries, finding funding, etc.

You're going to need to create revenue or a big following that can be converted to revenue to get funding. Not sure what you're referencing, but unless it's something like a Facebook that they created as a goof, it's probably better to prep for interviews. Ideas don't mean shit in the overwhelming majority of cases.

    • 4
Apr 5, 2017

This may sound harsh but get your ass off WSO now and make this damn thing. If it strikes out then you'll at least have a wealth of experience and a couple months to prepare for interviews.

Jan 5, 2018

http://www.linkedin.com/in/kimballthomas http://www.linkedin.com/pub/davis-smith/1/0/796

This article significantly downplayed their achievements...

Jan 5, 2018

As someone who would also like to start and run a business one day, here are a few quick thoughts on this topic.

--I think people gravely underestimate how easy it is to actually start and run a viable and legitimate business that has any sort of lasting power. Everyone sees these tech startups blooming around them and many people think "hey, I could do that too," but the reality is that there are so many duplicative tech startups of little or no value out there right now. How many "social" "local" and "daily deal" businesses do we need?

--I'm not knocking those that choose to go into the tech startup world, but I think people need to be realistic. Again, there are only so many e-commerce discount sites that are actually viable and only so many niche-review sites capable of being supported by ad revenue. The sheer number of niche-review websites out there (think Yelp, "The Feast," and others) is getting kind of absurd.

--When I think about businesses I've worked with in the middle / lower-middle market that were run by their founders, I realize that these people didn't just have "ideas" or "programming skills," they had specialized knowledge about a specific field. Their specialized knowledge and skill-sets allowed them to start, run, grow, and eventually sell highly successful businesses. I think it's a little too easy to hear about stories like this one and read stuff by guys like Tim Ferriss (good ideas, overrated in my opinion) and think to yourself "man, I could totally do that." But, without gaining some sort of specialized knowledge, it's not nearly as easy a decision to make as this article implies. I'm not implying that you need to spend years and years in an industry to do it, but I think it's harder to go from being an excel monkey to running a tea pot business (for instance) than simply deciding one day to do it.

--Obviously there is no real path to entrepreneurship, and if you've got an idea for a business then the only way to put it into action is to actually put it into action. But, I feel that entrepreneurship is in some way cheapened by articles like this one and self-serving sites like TechCrunch.

I hope this wasn't too much of a rambling mess, I think there are plenty of things to discuss in this regard and would like to hear others' viewpoints as well.

Jan 5, 2018

King, I really appreciated those thoughts.

I'm curious, do you (or anyone) think working at the junior level on an industry team (as opposed to a "product" team) in ER/IB/PE/VC provides adequate industry knowledge to begin thinking of business ideas within said industry and to eventually pursue said idea(s) via start-up?

Jan 5, 2018

Swagon:

I suppose it's possible. Coming out of IB / PE gives you some really solid general skills in understanding how various business models work, forecasting, financial analysis, and so on and so forth. The downside is that it's all transaction-oriented, so the ins-and-outs of running a business (dealing with customers, suppliers, managing processes and people) aren't there. Not to mention, a level of credibility would obviously be built by working in an industry and developing relationships that you don't get from cranking on models and pitch books all day. Note that I don't really count Corp. Dev. guys who negotiate deals as industry relationships since they're really just deal guys. Obviously there are exceptions to the rule, and there obviously are people who can leave it and successfully start a business, but the barriers to doing so are, in my view, higher than they are made out to be by this article and others who are very quick to encourage entrepreneurial ventures in general. It's for these reasons (among many, many others) that I don't see myself working in finance too much longer. Yes, the paycheck is nice, but I don't feel as though I'm building any real skills or knowledge that will be too useful in the long-run for anything else but the deal business.

Jan 5, 2018

Interesting thought and I can see where you're coming from King. I do agree with you that these articles make entrepreneurship sound easier than it really is. Also, you hardly hear about the business start-ups that fail. I really do think that you need experience in a certain field to start a business in what will likely be the same field. That is the reason I would not start a business without having industry experience. I guess this is more related to the service industry, because if you invent something during university it would be a different story i guess.

I am curious though what you think would be a good place to start if your goal is to start a business one day, would it be VC, consulting perhaps?

Jan 5, 2018

I agree with King. I think it USUALLY requires specific knowledge/skills. Tens of thousands of idiot college kids have a project every year to make a business plan or present an idea of some sort. As Einstein said, it's 1% inspiration and 99% perspiration. Any fool can come up with a cool or interesting concept--but it takes someone with real knowledge to implement those ideas. I could never do what I'm doing today 4 years ago when I graduated from college--I didn't have the necessary knowledge or skills. And the truth is, I still have a lot to learn before I'm really a good entrepreneur. And here is a universal rule--business is 100% about the money and 5% about the rest. Without knowledge you have nothing. Without money you have less than nothing. You can't copyright or patent ideas for the most part. The Bill Gateses are the exceptions to the rule.

Apr 5, 2017

Banking is less risky than entrepreneurship, but entrepreneurship can potentially have a greater return.

This isn't as simple as banking vs entrepreneurship. It's more like: stable job vs no safety net/no security; foreseeable earnings vs uncertain return; some guide to success vs no guide (very little) to success; help along the way vs alone; and etc. If you're contemplating it, you're not ready and you should just take the banking job or any job for that matter.

Apr 5, 2017

Let me be the first to clarify that working in traditional PE will absolutely not be the best way for you to learn how to run a business. Banking will also not teach you how to run a business. However, by going the banking route you protect your downside risk in multiple ways:

1) you can build an emergency savings base and use additional savings to fund the start-up and growth of your business after working for a few years

2) you can build your resume by working with a reputable firm, which will help you get back into the workforce should the business fail

3) you can build a network of contacts that may help you in the future

4) you can use your downtime and free time in banking to work on the business concept

5) you can build a valuable skill set in finance, accounting, etc. that may assist with your business

Some people may say that this advice is too risk averse but given your non-target background, the high failure rate of start-ups, etc., I think you would benefit by working for a few years and building the business "in your garage after hours."

If you want to PM specifics about your field I can probably give you more tailored advice. Good luck to you.

    • 2
Jan 5, 2018

@junkbondswap Thanks for the advice. My idea applies to financial services information security and compliance software, a niche that my dad was wildly successful with in the HC industry, so he can definitely steer me in the right direction.

I too think working while keeping it as a side project would be a good idea to start to make sure I have funds to live, but I'm concerned with an IB workload that I may be overwhelmed and lose passion in the startup. That said, I would probably learn a lot better insight of what compliance teams are looking for and how to structure the tool/software. Though, it is meant for investment advisors, funds, brokers etc so not completely applicable.

@parctribe Yes, my safety net is definitely there, and he is in a very similar position in a different industry if you read above. I agree that it's a rare opportunity so I definitely want to explore my options.

@wallstreetoasis.com My idea is pretty unique to the industry, and with my dad doing something so similar, I feel like I have an advantage over most young entrepreneurs. That said, it will be still be extremely difficult, but I think it would potentially be much more rewarding intrinsically and monetarily versus banking.

Jan 5, 2018

Fabulous advice above

Edit: it was fabulous for me. Others will definitely suggest different viewpoints that may appeal more or equally to you, OP. All the best.

Jan 5, 2018

Great stuff from junkbondswap.

But just to provide a different perspective--It sounds like you already have a fairly good safety net, since your dad has founded multiple successful companies (which could also help with funding your startup). Few people have the opportunity to go for a startup without the fear of failure, especially at a young age, so this could be your golden chance to do something cool and much more interesting than banking.

I think you need to think about this niche you found and how long it will be there. If it's something that some other company will do within the next couple years, you may want to go for it to get first mover advantage. But if you think it's something that you could wait to pursue for a few years, you could potentially do an analyst stint (and gain all of the benefits of money/brand name resume/contacts/skill-set/etc.) and then go hard at your startup idea. Just a thought.

Jan 5, 2018

I'd echo what junk said, but just remember, ideas are cheap, it's all about execution. Even with a great idea in a good niche, you may be able to get a quick test done to see if it has any legs before making a decision.

Entrepreneurs dont need to be "risk takers" - you can go into banking and quit if/when the idea has been proved either through initial market testing (not a survey asking if people will buy, but an actual splash page with marketing materials that gets people to part with their $s). Don't spend months and months developing a product or service hoping it will sell. Sell it first with pre-orders / marketing and then deliver in X months (if possible) to prove that there is enough of a pain point that people will pay.

Again, you'd probably be better off sharing your idea and getting feedback from the community than keeping it a secret and thinking you're the first one to think of that specific niche. Odds are that you aren't and odds are there is a reason that nobody is going after it...

Either way, best of luck! Not an easy decision :-)

Patrick

Jan 5, 2018

I'm saving this thread because of the gold in all the above posts (except mine, of course). This thread may just go viral. Please start bookmarking in mobile, Patrick. Or at least, till that happens, stop giving such great advice? :P

Apr 6, 2017

As a guy who created his own business when was 18 I can tell you this. You do not choose Entrepreneurship out of purely logical arguments.

The odds are against you, the hardships and the times you are gonna be dumbfounded and asking yourself" What am I gonna do now?" are far too common. There is no MD to go to, there is no boss that you will pass a difficult problem. Most of the times you hang between bankruptcy and just getting by. Anxiety about the future will not let you sleep at night and at day is a constant struggle about what to do next.

Yeah, entrepreneur sounds cool . Being the boss of yourself and all that is nice to tell to a symposium or a ball licking convention. You might even get some fancy awards and cool looking business cards. But serious entrepreneurs, those who do not just waste their inheritance money , don't care about these because they are probably anxious about the following day.

Why do it then? Well for me is like a calling. You just know that you have to do it. Its creative and challenging. Plus that depending on the business you might actually feel like you contribute something.

But if you seriously do it for the ROI, don't .

    • 2
Jan 5, 2018

In Freshman year I had ibanking aspirations. My parents yelled at me and told me to do something meaningful to society - like become a doctor or invent something and make a business out of it.

Sophomore year I sat in my dorm room for 5 days without going to class/fucking my gf/hanging out with my frat to program an iphone application - it was a video game with an educational twist aimed at middle schoolers. Had over 500,000 downloads. I will NEVER say which one or it will give away my identity. I was forced to take it down due to my immaturity/naiveity - someone apparently had already patented my idea, trademarked a similar name, then threatened to sue my 19 year old ass. My parents yelled at me again and told me that I should secure a job before I go entreprenueral or else I will ruin my life. They're right. I knew NOTHING in a world of businessmen with 40 years exp. under their belts.

So I'm now back to ibanking. 99% of start up companies die within 5 years. And then what am I going to do? I gave the argument that I'm young and it's early to mess up and it'll be fine. They said "hell no" and that I should have a good job secured, have income flowing in, and work at a business on the side. As soon as I feel like there's an 80% chance it will be successful, THEN I quit my job. Or else I'll be fucked.

they're right. im back to ibanking.

Jan 5, 2018

-

Jan 5, 2018

^^^ That's sad, dude, because it sounds like you have a knack for entrepreneurship and your parents just gave you terrible advice (no offense). I know it's hard to realize when you're 19, but lawsuits are meaningless. I was sued for $14 million when I was 26 and that went nowhere. When someone threatens to sue you, there is only one appropriate response: Bring it on.

Don't doom yourself to the 40-40-40 cycle (or the 100-25-40 banker version of it) just because you made a competitor a little nervous. Remember, it's always better to beg forgiveness than permission.

To the OP: there is more support available for budding entrepreneurs today than ever before in history. If money is what you need, angels are lining up to give it to you. As anyone in venture capital these days: there is way too much money chasing way too few deals.

Save yourself while you still have a chance, kid. Or do what I did and just use Wall Street to fund your entrepreneurial dreams.

Jan 5, 2018

take this as constructive criticism

If you need someone else' opinion to find out what truly excites your molecules, you're missing the point.

dont listen to anybody, i dont care how good/expert he/she is. Listen to urself and only urself. if u want it badly enough - whatever that it is - you'd get it.

just dont be a pussy and ask people on public forums, "guys what do i do with my life". be bold and let it roll, just do it.

Jan 5, 2018
Don Corleone:

take this as constructive criticism

If you need someone else' opinion to find out what truly excites your molecules, you're missing the point.

dont listen to anybody, i dont care how good/expert he/she is. Listen to urself and only urself. if u want it badly enough - whatever that it is - you'd get it.

just dont be a pussy and ask people on public forums, "guys what do i do with my life". be bold and let it roll, just do it.

Irony, much?

Regards

Jan 5, 2018

@Edmundo Braverman: Really! I thought that there was less money to go around, but that's a relief about funding.
So what should I do. Should I start it now in college or wait until i graduate?

Jan 5, 2018

entrepreneurship

youre young, you can take risks. dont put it off and say "oh, ill just do it when im older and more experienced" because by then you might hafta worry about family, bills, mortgage, etc. no better time to take risks than now. if i was cut out for entrepreneurship, i would have without a doubt gone that route over banking, but its just not for me. since it sounds like it might be for you, id say go for it. if, however, ur not completely cut-out for it, then feel free to play it safer and go with finance. as hard as bankers work, ur gonna hafta work twice as hard as an entrepreneur, but its worth it in the long-run. really though, do what you enjoy more, but if it comes down to it and youd like them equally, take the higher road

Jan 5, 2018

How do you get angel investors (or any other investors) to invest in your company strait out of college w/o a track record? Is it solely your bus. plan and personality? And how do you get in contact with them? Any websites?

Jan 5, 2018

bump 10char

Jan 5, 2018

in my opinion i feel that you have time for both. i've started a business, ended it but wll revamp in the near future. i'm now working for a bank, yet on the side i'm trying to get my non profit up. you have to start somewhere. i keeo my expenses low as i use my salary to fund my business ventures. i also agree that when you are younger w/o serious obligations it's easier to juggle everything, so go for it!

Jan 5, 2018

Do both :P

Jan 5, 2018

take the risk while you are young, not married, and pre-mba. Once your venture fucks up, and theres a high chance it will, you will apply to a top MBA program and come in as an associate with some unique experience. Nothing worse than regretting later on life that you never tried to open a business.

Jan 5, 2018

I do both--I work in CRE. I work my day job, which gives me legit knowledge, a strong resume, and funds my ventures. The ultimate goal is to leave my job and build my company full time. But I've got to crawl before I walk, walk before I run. I've learned an enormous amount in the last 3 years, information that I didn't have in college when I tried a similar venture. That venture went nowhere in college because I was illiquid, un-educated, and had no track record and knew nothing about actual business.

However, if you have an idea that's independent of need for business and industry knowledge--like something technical (a piece of medical equipment, a computer design, etc.)--then go for it. But I think there should always be a back-up plan because it's easy to say, "well I'll go for it and if I fail, so what?" But the truth is, your failures have lasting consequences and your loved ones--for example, who takes care of you when you are broke and unemployed? When I broke my leg 2 months ago and found that I couldn't drive for over 3 months, my parents came to the rescue, as did my employer-paid health insurance to the tune of $50,000+. There are consequences to your actions and to those around you. Always have a back-up plan, insurance, and do what you can to avoid burdening your loved ones.

Jan 5, 2018

Check around campus and enter some business competitions with some people. There should be some around, and the prizes are usually really good (funding for business). Even if you don't win you will still be able to network.

Apr 6, 2017

Everybody has a "great idea". Great ideas are a dime a dozen. The rub is in having the experience to a) execute b) anticipate / know how to handle setbacks c) because of said experience, having the grit to know when to push through and conversely when to reset. You also need a steady stream of money for execution and a competent, dedicated and loyal team for execution. None of these tools and financial assets are things a college student or someone a few years out of college possesses. If you can't tell, I strongly advise against "entrepreneurship" for someone as young and inexperienced as yourself

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Jan 5, 2018

Before you go the entrepreneurial route, first read Peter Thiel's "Zero to One". According to Thiel, your business needs to be able to affirmatively answer at least 6 of the following 7 questions:

1) Can you create a breakthrough technology instead of just an incremental improvement upon current technology?

2) Is now the right time to start your business (i.e. is the industry ready to go in its life cycle)?

3) Are you starting with a big share of a small market (i.e. can you quickly create a monopoly in a certain geographic area or on a certain platform, e.g. PayPal on eBay)?

4) Do you have the right team?

5) Do you have a way to market your product?

6) Will your market position be defensible 10-20 years into the future?

7) Have you identified a unique opportunity others don't see?

The vast, vast, vast majority of start-ups fail. I can't tell you how many absurdly idiotic ideas I've seen people pour their money into (and get their moronic companies paraded and lauded on their university's website!). If you can't answer most of the above 7 questions affirmatively then don't waste your time doing the start-up.

BTW, I forgot where I read the stat, but the average age of Silicone Valley start-up (co-)founders is somewhere around 34, which means most start-up founders have 12 years of post-college experience. Having real, actual industry experience makes you much more likely to succeed. Mark Zuckerberg and others like him are major outliers, and Zuckerberg had advisors who were already start-up billionaires.

Apr 9, 2017

"Can you create a breakthrough technology instead of just an incremental improvement upon current technology".

This is moronic and hypocritical considering Thiel is making huge money off Facebook and Lyft. Facebook is an improved Myspace, and Lyft is a copycat of Uber.

Jan 5, 2018
jackdonaghy26:

"Can you create a breakthrough technology instead of just an incremental improvement upon current technology".

This is moronic and hypocritical considering Thiel is making huge money off Facebook and Lyft. Facebook is an improved Myspace, and Lyft is a copycat of Uber.

Disagree. Facebook was a much, much better platform than Myspace in 2005 and fundamentally different. Regardless, Thiel doesn't say you have to have all 7 dimensions met perfectly, but a majority of them met.

Apr 7, 2017

The fact that you're asking this question makes me think you're too risk averse (and sensitive to other's perception of you) to be an entrepreneur. Furthermore, the fact that you came to a IB focused site to ask this question clearly indicates that you just wanted to be talked out of the taking the much more painful path (building a business).

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Apr 5, 2017

I wouldn't agree with that. For beginners, coming form a non-target/low-income environment, there is a HUGE lack of guidance. The first time I met a financial professional I thought they worked on Wall St simply because they worked in NY. This was literally less than a year ago. I did not even know what investment banking was at the time. I had never met an entrepreneur besides the Paki dude at the corner convenience shop.

Since then I have made some major progress but I still have much to learn. I have gone out of my way to learn more about IB and entrepreneurship. I ask this because I have never been exposed to it up until 8 months ago. Yea, I know clearly not enough time. I'm not expecting to have my life turned around by simply being on WSO, but it is beneficial to see what others think about this based on experience/knowledge.

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Apr 7, 2017

1) Came from a non-target & low-income environment myself, so I understand the lack of guidance. The OP doesn't seem to lack information about the nature of IB. WSO is clearly a resource I used and I can't say enough for it, in the context of learning about IB.

2) The OP is asking a different question, which is 'how do I go about deciding between a low probability, high payout option and an incredibly low probability, incredibly high payout option'. That's a personal decision that depends on 1) his personal level of risk aversion and 2) the quality of his idea. Since we obviously can't know either (the former because we don't know him, the latter because he's unwilling to provide any information about the idea) , it seems like a reasonable conclusion to assume that he's using this post as a means to rationalize the decision he's already made.

Bring on the monkey shit Dr. Dres

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Apr 7, 2017

I would take the steady job over the entrepreneur job. How I see it is that the experience you gain from being in the steady job will only help you with your entrepreneur job later. I'd hate to tell someone not to be an entrepreneur, because your idea might really be the next Vine, but know that the odds are not in your favor.

********"Babies don't cost money, they MAKE money." - Jerri Blank********

Apr 9, 2017

It's never too late to become an entrepreneur but there's only a very short window for you to "break into wall street" (Undergrad or MBA). Plus imo ib is definitely not a bad first job to have and adds credibility to your future pitching if you do decide to become an entrepreneur.

Apr 10, 2017

I'll (drunkly) chip in with my experience:

First, I come from a rather different background: you could say my parents had entrepreneurial experience, although not in the start-up sense, and there is more of a safety net in case everything goes to shit. Nevertheless, I've tended to be independent and not let this be a major factor in my decision-making (interestingly, my parents complained about this independence a couple times). Now more to the point...

I had to start a company as part of a business school class where most of the work and feedback came from a group of proven angel investors ($B net worth and so on). This was a project that showed some promise with a somewhat complicated business model but decent early traction with an international reach a very decent scalability potential. Nevertheless, I chose the safe route (consulting at MBB, in my case). Why? I simply did not believe in it enough. After some time I can sort of see the cracks from the start, but it becomes increasingly obvious as you:

  • Start cold calling/meeting potential clients/suppliers and realize how much of this shit you will have to go through, as they will most likely tell you that they do not need/trust you
  • Run your financials and realize how much lower your salary will be for the coming years (which will be an upside scenario anyway; in my case we were talking about a ~3.5x factor)
  • Start seeing issues with your teammates (in our case we were too similar even though we had different backgrounds)

Personally, I am pretty sure I will end up there eventually, but I know it won't happen before I find an idea behind which I am ready to throw my entire weight. If you are already feeling this urge, then I would not advise against running with it.

Apr 12, 2017

I had a BB banking offer I turned down a few years ago due to an interest in entrepreneurship and startups. First gen college grad from a non target, blah, blah, etc.

While you're still able to shop an offer around (if you're at this stage), I recommend checking out opportunities at mid stage startups (post series A or B) with a seasoned founder at the helm and programs like Venture For America. Good for the resume and in your area of interest.

The most ideal way to go about this in my mind is to be technical and just start building whatever it is you're considering. With technical skills and a product to show for it, you're very unlikely to starve or have a hard time getting a decent gig if things don't work out with your company. A quality accelerator like Y Combinator or Techstars will go a long way for your network and resume too.

Banking isn't going to make you a better entrepreneur. And it's not going to open up the world to you. It's a good job that leads to other good jobs in finance and F500s. Whichever route you take, it's going to narrow things for you. The good thing is you'll still be young enough to make a change if you deem it necessary.

A variable you may not be considering but should be prioritized is your mental health. It's really easy to underestimate just how important this is, but burnout is a very real thing. Both banking and entrepreneurship are really hard to do well if your head's not in the game all the way. There's a real emotional toll to sustaining effort over time. And you're more likely to excel at something you actually enjoy. Most college seniors aren't thinking about mental health because they haven't been smacked down by the drudgery of adult life yet. Rest assured that the smackdown is coming and that it's going to hurt. I'm willing to bet most recent grads with big ambitions don't make it past this stage, and that's not always a bad thing. Some realize they just didn't want whatever it is they were pursuing all that much: look at all the banking analysts that decide to go for more of a lifestyle gig after their stints. Others have all the passion sucked out of them, or never allowed themselves to reasonably pursue something that genuinely interested them, and I can tell you now that's a losing recipe if you're seeking an extraordinary outcome in any way.

"Higher education is the place where people who had big plans in high school get stuck in fierce rivalries with equally smart peers over conventional careers like management consulting and investment banking"- Peter Thiel

Consider the source and take that quote with a grain of salt. He's been very lucky in his career and has vested financial interests in smart people foregoing finance for startups. But he's not wrong. Also consider that mainstream Silicon Valley is the new Wall Street. Same super ambitious, visionless kids with an appetite for money and prestige. If you love finance, go to Wall Street. If you love tech, check out Silicon Valley. If you're interested in something else, try it out. You seem thoughtful, so I'm sure you'll use your faculties of logic and reason in pursuit of whatever it is you desire. Godspeed.

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Jan 5, 2018

Peter Thiel is right, but as my post outlines, Thiel also outlines the type of businesses that venture capital firms are interested in investing in.

Apr 16, 2017

Old-- but still relevant. Risk vs. Reward
http://www.leveragedsellout.com/2014/02/the-book-o...

Apr 17, 2017

I have the same dilemma. Your idea probably isn't as feasible as you think.

Work two years in IB, understand how to recognize companies with real value and develop an eye for the market(s) that warrants your attention.

At least that my plan.

Starting at Morgan in June.

Good luck Dr. Dres

Apr 5, 2017

Update: I went for IB. Start full time next summer at a BB. Happy with my decision