Goldman Sachs Recasts Its Reputation to Woo Tech Talent | Hacker News Reader

Goldman Sachs Recasts Its Reputation to Woo Tech Talent

dealbook.nytimes.com

34 pointscarlchenet70 comments

I would think that the applicant pool would be limited to those who hadn't heard of (what they did to) Sergey Aleynikov.

http://en.m.wikipedia.org/wiki/Sergey_Aleynikov .

really interesting link thans, I always knew Erlang was a dangerous language ;)

Why? I don't intended to copy my code from my employer's machines to personal servers just before I leave, do you?

Nope, but if I did, I would expect my employer to use civil means to deal with it. Not launch a multi-year, multi-jurisdiction criminal vendetta against me.

The incident certainly gives me pause about working for them...

Good. Because if you do by any chance you will spend many, many years in prison. You like that part too, right?

I don't think he cares, because as he says, he's not about to accept a job offer for $1.15 million at a rival firm then copy encrypted code out before he leaves.

The guy was making $400k/year and taking his software to another firm where he was going to make well over $1m a year. Perhaps there was a good reason the company was so aggressive?

of course, great! Go work for them! Some people just love to be treated badly and that's why companies like GS still exist. Why to be treated nice and have higher salary when you can be treated like shit, earn 90k in NYC and end up in jail for many years for copying files around. Just join them!

When you take something that's not yours, it's called stealing, and this will get you in trouble with many companies. A good company will not want you to bring your code because they might be libel. For example, Netscape had to rewrite their browser when UIUC threatened to sue them for using the Mosaic code. It's not just a Wall Street issue.

Except that Goldman didn't just "threaten to sue" Alyenikov. They called their pals down at the prosecutor's office, fed them a profusely exaggerated description of what he did -- and had him thrown in jail.

The guy was ... taking his software to another firm where he was going to make well over $1m a year.

That's the takeaway Goldman would like you to have -- that he was "making off with the crown jewels." Unfortunately, it was basically a concoction: turns out the code he took was quite innocuous, and offered no special business advantage.

Yet out of either incompetence or vindictiveness, Goldman proffered the line that he had taken the "crown jewels". And that he should be hauled to jail, and have his reputation ruined and his marriage destroyed for it.

I don't know the importance of the code he stole. Can you post links? You're just providing your opinion. All I know for sure is that a very smart programmer who worked at a firm where he knew his systems were monitored, felt the need to take the code with him to his next job. He did try to cover his tracks, right? Seems like a lot of effort and risk for "innocuous code".

You're just providing your opinion.

Umm, no. It was the opinion of the court that ordered his conviction reversed, as well as of the court that rejected the appeal to have his charged re-tried. From WP:

On June 20, 2014, upon reviewing the evidence, Justice Ronald Zweibel published a 71-page opinion in which the court ruled that F.B.I. “did not have probable cause to arrest defendant, let alone search him or his home.” The arrest was “illegal,” and Mr. Aleynikov’s “Fourth Amendment rights were violated as a result of a mistake of law.”

Really now -- it's not too hard to find information about important events (before simply making up facts about them), these days. You should give it a try sometime.

That says nothing about the importance of the code. The arrest was illegal because the FBI didn't follow proper procedures (getting warrants, etc), not because of his innocence or lack of thereof, which wasn't decided upon.

His innocence "wasn't decided upon"?

Per the 2012 appellate court decision that freed him, "his conduct did not constitute an offense under either statute" for which he was charged. It's hard to find a clearer statement of innocence than that -- which is why the judge ordered that his conviction be reversed, and that he be immediately released.

His innocence "wasn't decided upon"?

I meant on the court order you mentioned.

You're confusing the issues. The 2012 decision was a federal court, the 2014 decision was a NY State court, where he was charged under a different law. The two are unrelated.

In a related note, the only reason he was freed in 2012 was because the system from where he copied the code wasn't developed for interstate and/or international purposes - it had nothing to do with the code being unimportant.

That was considered an oversight of the law, and Congress in response of his appeal has since changed it, so had he done the same now, he wouldn't have been released.

I meant on the court order you mentioned.

Maybe you should choose your words more carefully, then.

While that is true generally, I don't agree in this particular case; I think context made it clear.

Furthermore, it's factually true - he hasn't been ruled innocent (or rather, not guilty) of the crimes he is accused as of 2014, which are not the same as those from 2012.

The State's charges may not have been withdrawn, but their case has been demolished beyond recognition. The important point is that (after 5 years, and considerable expense) the claims that Goldman put out before the public about this guy just haven't been substantiated, and most likely never will be at this point.

And what I said stands. The rules are well-defined and easy to follow. The guy knew he was doing something wrong. In general when committing a white-collar crime, better consider where you're doing it. Building a git repo and sneaking it out of the company could lead to a lot of pain.

But hey, if you're an honest person, maybe you'll be a good fit.

By the way, I'm not arguing for/against what happened to him once he crossed the line. I'm merely pointing out that he did knowingly cross a legal line, which as we know can get quite messy.

The guy knew he was doing something wrong.

It seems you don't quite understand how our justice system actually works. We don't just put people in jail because we feel that they "did something wrong." We have to prove that their conduct violated specific statutes. The courts found that in Alyenikov's case, it did not. Not only that: even as alleged, it did not violate the statutes under which he was accused.

I'm arguing that he knowingly committed a crime and you're arguing that the actions and punishment were too severe. Not sure how we're going to come together on that one. My only advice is don't commit the crime in the first place l because it might turn out to be more than you bargained for.

Also, please follow up with the others who are correcting you. You seem to be confusing the facts.

https://news.ycombinator.com/item?id=8609023

That's why its best if you use links for references in your claims. It's really starting to sound like some guy committed white-collar crime and got off on a technicality.

I'm arguing that he knowingly committed a crime and you're arguing that the actions and punishment were too severe. Not sure how we're going to come together on that one.

No, I'm just pointing out to you that the courts found that he did not commit a crime, and that the FBI acted too aggressively. What you do with that information is up to you. We certainly don't have to be on the same page about it.

He did try to cover his tracks, right? Seems like a lot of effort and risk for "innocuous code".

No, he did not try to "cover his tracks". He was clearing his bash history because it also had his password. I'm not a Linux guy so I don't know details.

That's my recollection from the original VF article, yes. And yes, his explanation was perfectly plausible. If I were in charge of loss prevention at GS, I'd be more worried about folks who don't clear their shell history when sensitive passwords are used.

All emails in Banks are monitored for people sending code now. I personally know of people that have been sacked for sending code to a personal email address.

The point is that he was overzealously prosecuted for it. You might want to do some reading about the case; it was really quite awful and unfair, what happened to him.

A little background from reading "Flash Boys":

Goldman uses open source code but then strips off the open source license and replaces it with their own - thus changing open source code into "proprietary" Goldman Sacks code.

Sergey was not allowed to submit his open source code fixes back to the o.s. repositories because once G.S. violates the O.S. copy write, it is now magically "proprietary".

In order to keep his fixes he was sending himself code that contained modified/improved/fixed open source - along with actual G.S. proprietary code.

G.S. system was a "ball of rubber bands". Sergey was going to a new job where he would make a completely different system and had no use for Goldman's code.

The cop investigating this was unfamiliar with software For example; he thought that Sergey's use of (the source control app) "subversion" was obviously something um subversive. He basically believed everything that G.S. told him.

This (from another source) describes some of these items:

http://cryptonomics.org/2013/09/08/goldman-sachs-v-russian-p...

What the cop believed sounds irrelevant; he went to court and was convicted (and the later acquittance was on a technicality).

The question of G.S. violating the OSS copyright is also not clear; usually, you can only violate copyright if you distribute software without a license. I'm not sure if removing the license on internal copies is legal, but no OS license I know of - not even the GPL - required them to share the changes back. I don't see any wrongdoing by GS part vis-a-vis OSS licenses, and as an employee, it wasn't his choice to make.

Do I think the law is harsh? Yes. Would I do the same as GS? Certainly not.

But as far as I'm concerned, he's conduct was in clear violation of the trust put on him as an employee (as he admitted), and it wouldn't influence my decision to join GS.

The two stats from this article that scream "avoid a tech career at Goldman" to me:

  - total tech employees: 25% (8k/32k)

  - total software engineers among new partner class: 7.7% (6/78)

This is true, but I'd also say that even if part of the 25% you can still get a £100k+ salary.

Here are my unsolicited 2 cents on why not to work on Wall Street:

Solve real problems.

Don't be a second class citizen (e.g. if the firm is financial, software engineers aren't going to be CEO and that says something).

Make sure you have upside. Don't work in a job where your function is to maintain some legacy system and if it breaks its as if you lost the firm millions but if its running smoothly no one cares.

You should replace 'Wall Street' with bulge bracket firm. There are a lot of financial tech companies where engineers make much more than traders, vps or sales and are not treated as second class citizens.

That is good advice in any industry and is not any more prevalent on Wall Street than it is anywhere else in tech.

A lot of startups aren't exactly solving "real problems" either, you know. And startupland has its own stratification, hierarchies, and pretensions -- not too mention great unwashed masses of second-class citizens: those who came to the party late and missed their chance at a meaningful equity stake and/or a fluffy job title, etc.

Don't work in a job where your function is to maintain some legacy system and if it breaks its as if you lost the firm millions but if its running smoothly no one cares.

Good advice. But at the end of the day, a lot of these ad exchanges, dating apps, half-baked recommender systems etc that most startup engineers get to work on just aren't all that different, in spirit, than the sprawling back-office order processing systems that most financial programmers get to work on (save for the comparatively minor fact that that they might be in badly-written PHP or JS as opposed to badly-written Perl or C).

There are plenty of pour souls in both camps, toiling away in the bowels of other people's messes -- while those responsible for creating those messes have long since made their millions, and moved on to greener pastures.

Something that must also be quite important for graduates is that when working for Amazon or Google, you are among the most important type of employees for the company. What you do really matters to the business, and you can hope to be rewarded in consequence.

Some might get the impression that when working for GS, as long as you're not a trader or such, you'll only be writing code next to the millionaires making money with it.

Speaking from the trenches here.

Banking, especially non-consumer banking (i.e. IB, prop trading operations, etc) is divided intro three tiers: front, middle and back office.

Front office are the people directly dealing with "clients" (or better "counterparties") and get shitloads of money and an aura of being business savvy and knowing where it's at. Basically it's sales, trading and some higher-tier management. Contrary to what one might think based on the "Wall Street" films, these people don't need to be smart or sophisticated. I know quite a bit of traders, who only finished high school.

Mid office are the people who do the actual nitty-gritty work, that one would actually associate with a working banking institution: research, risk oversight (in Europe mostly known as risk control), legal, compliance, marketing, accounting, ALM, etc. They usually earn OK, but nowhere near what front office makes.

Back office are the people who are there for the infrastructure. Transaction banking, for example (i.e. making sure that your transactions are settled correctly, that money is wired to direct recipients, etc.) Tech is in most banks a back office thing (especially if we are not talking about algo trading). They earn shit.

I'm involved in quant finance, so I hoped, that I would see a culture shift after 2008-2013 from get-rich-quick-with-other-peoples-money schemes to a more serious business culture, but that is not the case. I honestly don't believe that Goldie can change its culture so quickly.

> Speaking from the trenches here. [...] Tech is in most banks a back office thing (especially if we are not talking about algo trading). They earn shit.

You are in the wrong trench, my friend. High performing developers and systems folks are extraordinarily well compensated at the higher end banks and hedge funds.

When people change jobs, it's usually for another job in financial services, largely because most technology companies cannot even begin to touch the total compensation for such a person.

You have to have a thick skin a mate of mine got told by a big swinging dick in the city "I have a pair of shoes that cost more than your entire wardrobe"

Given yesterday's Amazon scandalous news, along with all other tech scandals (e.g. Condoleezza Rice at DropBox, no-poaching agreements), it's disingenuous to claim that only happens in finance.

two different things: corruption and illegal activities happen all the time in the Corporate America. Finance, Tech, Auto, you name it. That's one thing and that's where (I believe) your comment is coming from.

Second thing: you will have much harder time becoming manager, doing important work, becoming CEO, etc in company that is not directly in your field. It gets worse. The Companies tend to get rid of employees who are not their "main line of business" in the economic downturns. In other words: your job as a developer or IT engineer at a large bank or hedge fund can (and will!) be outsourced easily if needed. They are not an IT company! They could care less about agile or not using Ruby or Java or Perl. They are financial insitution. You are there to make their infrastructure work. If not you then someone else. If nobody else, then India. You are not their core business. They have you as a nice to have extra because times are good, extra cash is there and someone thought it might be a good idea to do it in-house. On the other hand Google, Facebook, MS, etc -- they live and breathe technology. Your Manager won't be a dude who doesn't care about technology. You won't be treated as the proverbial "fifth wheel in a car". You are the core business here. On the other hand, here is the place, where employees running books can be outsourced at a CEO grim. Let ATP or someone take care of that crap!

I can't believe talented computer scientists would go to GS to waste their time building great stuff for a company that will put them to jail for many years if they put some of the HFT source code on the public server.

I don't think Google or Facebook would ever do that. The same way GS would never try so hard to jail their traders for inside trading.

Totaly agree with you but certianly in the city its a lot more overt. I know that more staid companies like publishers look down on thier technical staff as does the Pricipal civl service.

I think that is changing as well now. Although tech people don't get paid as much as traders, traders fully realise that their success depends on technology. It's not considered an imposition like it was 15-20 years ago. I'm dealing with FX traders now, and with Treasury Traders in a previous role, and although their standards are high, they pretty much all behave in a friendly and professional manner.

I'm not in tech. :)

Also, comparing bulge bracket and higher end hedge funds with most tech companies isn't entirely fair. Are you sure you aren't in M&A? :d

I've heard the financial industry is still quite top-down on decisions and software architecture. A do-what-they-told-you kind of environment, where technical people are seen as nerds and laughed at behind their backs.

You've mostly heard correctly. With the difference, that most tech people who are officially hired as techs by banks aren't very good. Good tech people are usually recruited by rebellious front and mid office desks.

Depends on the system. If it's a brand new one there will usually be a set of global firm standards that should be followe (i.e. Oracle, Linux, Java or whatever) but you can follow a process to get an exception. It's not great but as banks have 3,000+ systems of various types they need to keep some control of the technology stacks in use.

IT is still back office, but in the last couple of jobs where I have dealt with the Front Office directly no-one laughs at you. They can't do their job without technology.

When I left college, I joined a big bank and eventually made the jump to a startup. Here's why:

- I spent my first of two years as an applications developer and didn't push more than 20 lines of code into production. My days were wasted with planning meetings and release management. I spent more time in excel spreadsheets than anything else.

- In my second year, I worked on a new product. Things seemed much more interesting, but something was still missing. I cover a lot of that in my blog post about my transition from a big bank to a startup. https://atjonesblog.wordpress.com/2014/03/27/my-transition-t...

- In the article, it is mentioned that Goldman works on problems in machine learning, data mining, and cloud computing. I'm sure this is 100% accurate, but what they fail to mention is these interesting projects are usually strictly for PhDs or engineers with decades of experience.

- As a technologist in a bank, you're a second-class citizen. The executives may say things like, "we're not a bank, we're a tech company!", but I saw no actions to back up the statements. Majority of the recognition goes to the bankers, ignoring the infrastructure laid by the tech and operations side of the business.

After all that, I'd say I had a decent experience, but I don't think I would have missed much by jumping straight into a tech company.

>>> As a technologist in a bank, you're a second-class citizen

I believe that's the case in the majority of companies, where software is not the primary product.

Sounds like the article is only really about Wallstreet's reputation. What about Goldman Sachs' own specific reputation for screwing their own customers? I mean, suppose I want to be proud of what I do? Then what place is there for me in Goldman Sachs?

Could you provide more info on Goldman screwing their customers? Among traders their general reputation is pretty good.

"Why I'm Leaving Goldman Sachs" - http://www.nytimes.com/2012/03/14/opinion/why-i-am-leaving-g...

How Goldman screwed its IPO clients - http://www.nytimes.com/2013/03/10/opinion/sunday/nocera-rigg...

Graduates are very attractive to them - no need to pay a proper bonus. If you are in states opting for a large tech company instead is a no-brainer IMHO.

If someone is making the decision based on pay I'm fairly certain that Goldman Sachs, and financial firms in general pay better than most tech companies in SV. Heck 4 of the bigger companies in tech have all but admitted that they are guilty of colluding to keep salaries artificially low.

http://www.cnet.com/news/apple-google-appeal-settlement-reje...

Someone correct me if I'm wrong, but I'm pretty sure starting salaries at GS and other banks are around $80-90k + a small bonus (10-20%?). Not bad, but definitely less than Google, Facebook, Microsoft, Amazon, and other major tech companies. So if you're a software engineer going for the money, GS isn't really the place to be.

> So if you're a software engineer going for the money, GS isn't really the place to be.

Over the long term, financial services wins. The compensation curve is much steeper than most tech firms.

GS in particular pays crap wages according to salar.ly.

That's because you're looking at the wrong job title. For experienced engineers look at Vice President and Senior Vice President.

I'm well aware of the "everybody's a VP" system at Goldman. Those are the titles I'm looking at.

Do the stats include bonus? If you're a Goldman VP then your salary might be mediocre but your bonus will be significant

Salar.ly gets it's data from foreign worker visa applications how representative of the wider work force can that possibly be?

Different work atmosphere though

I basically doubled my salary by moving from finance to software. And the job is much more interesting, my coworkers are smarter, people appreciate my work, and the food is free. (There are also fringe benefits, like finding things that annoy you about your desktop and submitting a patch to the OS that day.)

I find investment banking very interesting work, from the software side, but the market doesn't really care about software. You're always a "cost center", never a revenue center. Also you have to use Outlook, which I find unenjoyable.

I think that has changed with the rise of algorithmic trading it's the software making the money and they advertise 150k+ salaries in job listings I've come across in that industry.

Tech companies on the other hand seem to pay an average of $125k which seems to be the bare minimum you would need to survive in the bay area. Free food is great but if you figure out the value of it it is probably worth $5k per year tops.

Algo trading is a vanishingly small segment of the finance industry & a very small part of what an ibank like GS does. I don't have references to back this up, but I wouldn't be surprised if they have single derivatives deals that are more profitable than their entire HFT operation. Like most big deals the "sales" side makes the money in those.

Well so far extracting money from dumb customers is still an excellent business to be in. eg charging $47m for a spreadsheet with a $100m error [1] or helping Libya invest its money in trades that soon became worthless[2]. It is hard to make money like that from trading alone with such low risk.

But Goldman can see the writing on the wall, and now has 25% of its staff in tech, because the markets are changing fast. Stupid people will still make up much of the revenue stream for a long time though, and large companies that like to pay large sums.

[1] http://blogs.wsj.com/moneybeat/2014/10/16/spreadsheet-mistak...

[2] http://www.theguardian.com/business/2014/oct/06/goldman-sach...

Earlier this year Goldman Sachs Chairman and CEO Lloyd Blankfein spoke to Michael Bloomberg, founder and majority owner of Bloomberg LP, the parent company of Bloomberg News, on technology and the financial industry.

http://www.businessweek.com/videos/2014-06-03/blankfein-bloo...

I could not belive my eyes when I have learned about GS Collections library for Java [https://github.com/goldmansachs/gs-collections]. Very nice piece of open source code with a very good documentation.

I had to double check if I am looking at the right place...

"They were fighting against perceptions of Wall Street as boring and regulation-bound "

I really don't think this is the perception people have of Wall Street that is keeping them from working there... Part of me feels that I would be destroying lives of millions of people when the next crash inevitably comes...

And how do you feel about exploiting service workers? Blowing up foreigners? Exploiting sick people? Selling people's demographics? Automating low skilled workers out of the workforce?

It is pretty easy to find the dark side of any profit generating job in software.

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