We Need Young People To Take Risks And Build Inspiring Things
fastcoexist.com
fastcoexist.com
Let's look at a smart young grad's options:
1) Academia - Potentially interesting work. However, grad students are underpaid, overworked indentured servants in a vicious dictatorial status hierarchy (do what the PI says or you're out). Very poor career prospects, guaranteed negative return on time invested. The road to PI is sure to destroy your love of research.
2) Industry - Decent pay but work is extremely mundane. Very few "unicorn" positions which allow freedom for creative roles. No control of hours. Promotion becomes a very serious game of office politics, which can get very nasty.
3) Professions (Law, Med) - Enter at your own risk. Savagely competitive and draconian entrance requirements, incredibly expensive education, inhuman hours, constant stress at every milestone, and a never-ending barrage of standardized tests. However, if you endure, you can start your own practice and potentially have a comfortable life.
4) Entrepreneur - By far the riskiest option. Due to the get rich quick mantra of current investors, social/web/photo apps are the name of the game. Have an idea for a radical new research project with a long term focus? Forget about it. Build and flip is the only game in town. Build an app, get acquired or go go public, make your billions and get out. If it fails, try again, and again, and again....
So, now that we have looked at our options, can we really blame someone for going to work at a hedge fund? I can't. Especially if one is burdened with massive student debt. Ironically, hedge funds and investment banks pay employees much more fairly than any other industry, due to their profit sharing systems (bonuses). Meanwhile, tech industry execs are screaming over how high (!!) engineer salaries are, and are going across the globe to find H1-Bs and changing legislation to push those salaries back down.
If we want everyone to work on world changing projects, we have to set proper incentives. That requires a radically different setup than we have now.
TL;DR: Go to the hedge funds young man. Don't look back. Nothing else makes sense.
> 1) Academia - Potentially interesting work. However, grad students are underpaid, overworked indentured servant in a vicious dictatorial status hierarchy (do what the PI says or you're out). Very poor career prospects, guaranteed negative return on time invested. The road to PI is guaranteed to destroy your love of research.
Potentially interesting work, massive opportunity cost, and starting at the bottom of a ruthlessly competitive advancement pyramid. I love academia, and very much intend to stay in it, but it's not exactly a rational choice.
> 3) Professions (Law, Med) - Enter at your own risk. Savagely competitive and draconian entrance requirements, incredibly expensive education, inhuman hours, constant stress at every milestone, and a never-ending barrage of standardized tests. However, if you endure, you can start your own practice and potentially have a comfortable life.
Bimodal incomes that mean mainly these jobs come with a huge amount of debt for what is, for many people, a comfortable upper middle class lifestyle, but no more than that. You're not going to get rich doing either of these, because your income is capped by the hours you can work. A hedge fund on the other hand, if you're doing your job, is making money all the time.
This is true for a while, but if you're smart about it you could expand your business and hire others in the same profession, and eventually become rich.
I can't reply to your comment, but pretty much yes, I'm sure. Doctors and lawyers are actually the canonical example of lucrative but labor limited professions. And being able to build a practice exponentially is vanishingly uncommon, enough so that no one should bank on it, whereas compounding is a fundamental trait of finance.
For CS, and some parts of math and physics, it's fairly close. For many other fields, even STEM fields, being able to bail out is a much more distant prospect.
There is one negative to hedge funds: they tend to have long hours. But the stereotype is worse than fact; it's generally 9-to-7 (with some fucked-up sweatshops out there that go longer) and the work is interesting enough (usually) that you don't mind it.
Compared to the (accurately stated) ills of the 4 paths you listed, that negative is pretty mild. And you certainly can find hedge funds with reasonable hours: you're just not as likely to become the $5m/year trader working 9-to-6/7. (But you can go into VC and work 9-to-5 making 500k+.)
I'll probably go back to finance in my mid-30s, because it beats being VP/Eng at some dodgy startup not because I want to manage but because it's the only way to justify age-appropriate comp. The problem I run into now is that, after some startup dalliances (and a 6-monther at Google under a psychotic manager) I ended up with a "job hopper" resume. That doesn't hurt you so much in tech, but hedge funds are terrified of IP loss and auto-reject people with "too many" jobs.
If you keep building your tech skills, you can get into a good hedge fund job after a few years. Just treat it the same as interviewing for a good tech job. Hedge funds more selective but also more meritocratic and predictable than Valley firms. The problem in the Valley is that, although it has as many smart people, pound for pound, as Wall Street... the Valley has more stupid people (and fewer smart people) in decision-making roles.
Startups aren't inherently damaging. The problem is that they're volatile and experience constant reorgs. Your job might be totally different in 6 months. Or it might not exist. This leads to a "job hopping" pattern that, from a more conservative finance perspective, makes you look bad. Banks and hedge funds are more stable so it's rare that someone is that unlucky as to have, say, 6 jobs in 5 years through no fault of their own. But it happens all the time in VC-funded startups.
Now, you need a top 10-20% income to live in a decent neighborhood within 30 minutes of a major metropolitan era.
Rather than make quasi-totalitarian statements about "what people should do" in the face of otherwise rational choices, perhaps we should instead wonder about what kinds of government policies have been made (fiscal etc) that put pressure on people to feel they "must" make 100k or else.
If people have greater freedom to accept an opportunity, without fear that the change in pay will lead to a material change in living conditions, then this problem may well solve itself.
A couple of recent surveys were very eye-opening. Salaries seem high compared to the national average in silicon valley, but if you look at compensation in other fields in in high-cost areas like silicon valley, it doesn't appear that software developers have particularly high salaries.
The first survey is from sfgate (the sf chronicle)...
http://blog.sfgate.com/gettowork/2013/12/17/what-the-most-co...
According to this survey, registered nurses in San Francisco earn $112,140 a year. "Software Developers, Applications" workers earn $110,950 a year. System software developers clock in at $112,260 a year. Lawyers earn an average of $165,740 a year.
Software Developers get the best job title on US News And World Report's rankings
http://money.usnews.com/careers/best-jobs/rankings/the-100-b...
But the top jobs in high paid regions tells a similar story. In San Jose, as with San Francisco, Registered Nurses outearn software developers. In San Francisco, dental hygenists earn $106,700 a year, so about 4k a year less than these wildly well paid software developers.
http://money.usnews.com/careers/best-jobs/dental-hygienist/s...
My point here isn't these aren't important fields worthy of good salaries. I'm really glad that nurses and dental hygienists are well paid, they absolutely deserve good compensation. But why do we talk about software developers as if they are this astoundingly well paid group of workers with runaway salaries? It seems that they make fine salaries compared to other well educated workers. More than some, less than others.
I don't see how you can make that happen. His entire trajectory was "making the correct choice" - in which that correct choice was future potential maximizing. Why would he suddenly abandon that track?
In many ways, people in high finance have already "won" in real terms. If he really wants to try his hand at startups, why can't he just jump in as a VC?
Also, consumption as a portion of income decreases as income increases. Their choice is not $150k/year or "never work again". Their choice is close to $Xmil/year or "never work again". $Xmil is far closer to never work again than $150k.
One could also make the argument that many 'older' people also tend have have more disposable income and savings to bootstrap their own ideas, have larger networks of people reach out to for connections, etc, and often may have many of their life stuff behind them (kids, house, etc). Therefore there's many older people who are in a better position to be risky than a young person. The 'risk' factor is all relative, of course, with people at different stages of life.
Benjamin Franklin took risks and made positive contributions throughout his entire life.
They tend to have less energy/motivation due to greater social commitments and have much less capital to gamble (no savings, no assets, no skills to consult on the side with).
This, of course, doesn't mean most young people have to be conservative when they're younger, just the vast majority will take a safe job to establish a career and set a business up when they're older, vastly more capable, with a much larger set of skills and able to take bigger risks.
Unfortunately, the problem with this is that many young people now are stuck with large amounts of student debt, so they have to take the highest paying job they can find right out of college.
So the theory is in my first paragraph, while the reality is much different, in my second paragraph.
I think there might be more conservatism in that someone who's had a successful 35-year career as an engineer and is used to a regular six-figure income may not be particularly inclined to quit his or her job now and start something else. But I think in terms of resources they're often actually less tied down than a 25-year-old who has no savings cushion and has to pay rent— even if the 25-year-old didn't have student debt.
I look at my dad as an example. He's not an engineer, but he makes a 6 figure salary. Once his last kid is out of the house, he'll be 60. Even looking at him now, at 50, I don't think he has the energy to take the risk and start a company. While there may be a few 50-60 year olds with everything needed to start something else, I think the norm goes in the exact opposite direction.
It seems to me that you're implying that young people shouldn't have the right to these things until they contribute to society. I would argue that a real problem we have right now is that people can't figure out how to have families, mortgages, car loans, etc. and contribute to society at the same time. Once we figure that out, then we'll see people taking on more obligations at an earlier age.
I really don't see where I implied young people don't have the right to these things until they contribute to society. While it's fine if the majority continue on a "normal" path through life (college, job, family + house, 401k, etc), we need some young people who are willing to take the risk of not following that path.
I think the headline should be: We Need To Lower The Consequences of Failure
So what are the projects and ideas we can tackle? I myself am in a unique position where I have the time to develop such a project. I'm an experienced J2EE developer with Web Design skills. I'd even be willing to work with others on a worthy project.
I found the article hauntingly accurate, at least for me: a child of well-off parents, not left wanting for anything and with every possibility open to me, but fundamentally risk-averse because of some misplaced sense of responsibility and duty.
I would think that because these people are risk-averse, is why they have the stability that can help form a bedrock for "success". (Disclaimer- I'm biased because I'm risk-averse)
Second, this person ("Cole") is right to take the hedge fund job because it has a far higher chance of making him a founder or VC, in the future, than an engineer position at a startup ever will. When finance people (after a few years) enter the VC-funded tech world, they come in at the top. Seems like a good deal to me.
Silicon Valley doesn't respect its own people. It doesn't respect the people making things. Because of that, it's dead as far as innovation goes, and the death of Silicon Valley has done a lot more damage to society than the mere existence of finance.
How is a more efficient energy grid the ideal? It sounds very status quo to me.
The ideal would be doubling human life expectancy, building massive Elysium-like space stations that orbit the Earth, a guaranteed minimum income for everyone, and stuff like that. It seems like everyone lacks an imagination nowadays. Where are the people who used to invent things like airplanes and such?
Solving those problems is potentially a game changer for carbon emissions, and (if you accept the more dire predictions) the future of humanity.
It is a rare combination to find the ability and the ambition (for something other than just economic gain) to make new, exciting things of real value. You have to have all three. Drive, intellectual and economic means, and vision. With the growing gap between rich and poor (or, in other words, the evaporation of the middle class), it's probably not getting better anytime soon, either.
Drive? Vision? They're far harder to have.