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Outflanked, Not Outspent: The Real Story of Recruiting for Tech vs Wall St in NYC

You've heard the arguments before--Wall Street sucks up all the best talent in NYC and that's why its so tough to recruit here.  They've been able to outspend on any good candidate and that's also why things have eased up lately--because the financial industry just isn't what it was and the jobs aren't there anymore.  It's also why there's a fear that when the economy turns, so will Wall Street, and so will the giant sucking sound from the south (of Manhattan).

Contrary to what a lot of others believe, I just don’t buy it.

If it happens, it's not going to be because we were outspent--that's for sure.  It's because, as a community, we've been outflanked.  It's not about money, but about information and process.

You see, financial recruiting in New York City is machine--a machine that creates a lot of noise and whose gears start churning as early as sophomore year of college.  Smart local students see friends doing internships, hear reps at career days, and get slotted into career tracks very early on.  That provides clarity and de-risks the next few years of earning potential.  That's what students are trying to do—take the uncertainty out of the equation, not maximize.  In hindsight, we realize that, if you’re ever going to take a chance on something, you do it early when your burn is low and you have no responsibilities—but the college process doesn’t really do a good job producing risk takers.  They’re worried about student loans (which you can’t default out of anyway, and you can just pay off over a longer period of time if you really wanted to), pressure from parents, not having to move back home, etc.  They’re not looking to build a career yet.  They’re just looking for a j-o-b and for years, finance was just the easiest, no brainer way to get it. 

I didn’t take a job in finance because they were willing to pay me more than tech companies were—no tech companies recruited me and I didn’t even know they were in my backyard.  I didn’t have any visibility into what a career in startups would look like, how to get started, etc—just wasn’t even looking for them.  Yet, I was very interested in the tech industry.  I started a business newspaper at my college and my first article back in February 1998 was on AOL.  I even recruited Kara Swisher to come speak at Fordham.  Still, I had no idea NYC tech even existed and I suspect that’s still the case for the majority of students today—although that’s changing with efforts like HackNY, Tech@NYU and Blue Venture Community.

That's why students don't take sales positions.  Maybe more so than any other track, sales is an area where enterprising young people can carve out a pretty sweet living without a ton of experience.  Yet, you just don't see college students itching to jump into sales careers.  That's because sales is something they simply don't know very much about.  There are no sales classes at school and the few sales jobs they do get recruited for are low end cold calling gigs.  It’s also why anyone winds up in book publishing at all.  The only conceivable reason why any student would graduate now and say they want to go into publishing is because they know that’s what other people did and they’re aware of it’s existence as a pursuit.  Other than that, you get severely underpaid for the work that you do and it’s an industry rotting from the inside out. 

It's largely the same in tech.  I can't tell you how often I talk to computer science students in local schools and it's news to them that there's a local tech community and they could potentially go work at a startup.  When you don’t know that these jobs exist at the end of the academic rainbow, you also don’t do much to prepare for them by picking up extra skills you need along the way.  If a Fordham computer science student knew that by picking up a little Ruby or Python over the summer, they’d pretty much be guaranteed with a cool local startup at a good pay, I think they’d be doing that in droves.  It’s important that it starts in college, too.  If you don’t enlighten these

The problem is that the community is too fragmented.  When you’re competing for mindshare with just a handful of huge banks, consulting firms, and accounting firms who hire tons of people a year, even a company as “big” as Gilt is just going to get lost in the shuffle—hiring a tiny fraction of the number of people that PWC does every year.

I’ll bet you that financial firms have similar difficulty trying to find talent on the west coast—because a student going to school out there simply doesn’t see that as much of an option.  They have friends going to work for tech companies and startups.  It’s part of the culture there due to its popularity, not something fundamentally different about the nature of the talent there.  It’s also not simply because Facebook can outbid for someone who would otherwise work at the San Francisco office of a management consulting firm.  It’s just seen as what everyone else is doing and they have a lot of insight into the careers of people who work at startups—what the positions are, that their careers turn out ok and even potentially very successful.

So how can you change this?

I think you need to facilitate change on both sides.  As a community, perhaps there are ways to approach schools as a unified front—both through recruiting, teaching, and garnering more participation of students in the local tech community.  At the same time, you need to identify the point people at schools who are in front of these studends everyday.  Do their comp sci teachers know about the tech community?  Do they participate in it?  Do the career counselors know to put them in the direction of startups?  Perhaps instead of Geeks on a Plane, we should have a Geeks on Campus tour of the local colleges.  Let’s set a goal that 10%, than 15%, than who knows how many of local school graduates not only wind up in the innovation community, but with the kind of skills they need to be useful.  What would a startup training syllabus look like?  How can we affect what CS students are learning?  What business skills need to be taught that they aren’t currently getting…   how about marketing, product management, etc?

Until we attack the issue at the roots with information, you’re just going to have more and more talent fall into the funnel of other industries here—not because of money, but because those funnels are known, appear less risky, and provide transparency as to where you might end up.  Tech recruiting in NYC is a solvable information problem.

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