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The Prestige Trap: finance, big tech, and consulting

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Re: The Prestige Trap: finance, big tech, and consulting

#221

Post by username90 »

est31 wrote: post #217
username90 wrote: post #213

Earlier quoted context omitted.

You don't need luck though, even with no stock appreciation at all you make over $300k a year as a senior engineer at Google. The high salaries you see are mostly without extreme stock value changes.

> without extreme stock value changes. That's the point, you don't know whether there will be any. So they are definitely not "as good as cash". Just because they aren't lottery tickets doesn't mean they are equivalent to cash.

You are much more likely to get fired and lose all your income than for the stock to lose that much value, so the difference in risk between stock and cash is therefore minimal.

Edit: Just to clarify, $300k as a senior engineer is without any stock appreciation at all. I made $250k as one step below senior without any stock appreciation at all. My point about significant stock changes is for significant stock changes downwards, meaning if the Google stock somehow lost 50% of their value or something like that.

Re: The Prestige Trap: finance, big tech, and consulting

#222

Post by shuckles »

ativzzz wrote: post #210
shuckles wrote: post #191

Earlier quoted context omitted.

Do you see this industry loosening its expectations for an MBA? That is nearly $1m of opportunity cost to some of the technologists who might be interested in growing a management consulting career.

A good MBA program will help you develop those exact connections the parent comment mentions

My experience has been that it’s a lot more gatekeeping than networking to the extent that I’ve seen banks move away from requiring it.

Re: The Prestige Trap: finance, big tech, and consulting

#223

Post by gnicholas »

scarmig wrote: post #38
andrewmcwatters wrote: post #28

Earlier quoted context omitted.

This isn’t a problem we as Americans need to fix. It fixes itself. For instance, the average Ivy League graduate only makes marginally more money than your public school graduate. By the time you’re making even low 6 figures, the idea of interacting with an Stanford grad who has done nothing of note with their education and makes something comparable to you is quaint. Generally speaking, distribution of US income as…

> the average Ivy League graduate only makes marginally more money than your public school graduate I'm pretty sure that's not true. I doubt there's much of an actual value-add in going to an elite school, but the average incomes of graduates of them are substantially higher than that of random public school graduates. https://www.payscale.com/college-salary-report/bachelors

You are correct that GP's statement is wrong. But research from 2011 showed that this may be largely due the fact that students going into Ivy League schools are more likely to be high achieving in the first place. [1]

> What they found was that two students with similar backgrounds, grades and test scores who applied to the same mix of selective and nonselective schools earned about the same later on, even if the first attended a selective school and the second didn’t. The choice of schools applied to was indicative of ambition which, they argue, is a more powerful driver of success than the school they attend. “The return to college selectivity [is] indistinguishable from zero,” they wrote in 2011.

However, researchers noted that for certain students, going to a more elite school did generate greater returns.

> focusing only on the benefits to the wealthy may miss the full picture. Ms. Dale and Mr. Krueger found that African-American and Hispanic students, and those whose parents didn’t go to college, actually did enjoy an income boost from a selective college, perhaps, the researchers said, owing to networking opportunities they otherwise wouldn’t have had.

1: https://outline.com/wWr2v3

Re: The Prestige Trap: finance, big tech, and consulting

#224

Post by gnicholas »

sgerenser wrote: post #43
whimsicalism wrote: post #34

Earlier quoted context omitted.

> the average Ivy League graduate only makes marginally more money than your public school graduate. Sorry, what? The average Ivy League graduate makes substantially more than your average non-Ivy graduate. I don't even understand what your second sentence is trying to say.

I believe he probably got the statistic mixed up. The average Ivy League graduate does indeed make more than the average non-ivy college graduate. But they make about the same (or are about as successful, can’t remember the exact statistic) as someone who got accepted to an Ivy but went elsewhere.

Cite supporting your statement: https://outline.com/wWr2v3

Re: The Prestige Trap: finance, big tech, and consulting

#225

Post by bertr4nd »

wayoutthere wrote: post #16
notacoward wrote: post #6

I find two things to disagree with in this article. First is the premise that equally high compensation is offered elsewhere in each industry. I don't know about finance or consulting, but at least for FAANG it doesn't seem to be true. Second is the overlooked explanation that it's headroom - not prestige - that accounts for the difference. I'll provide an example that illustrates both points: me. When I went from Re…

I work in consulting, and I’d say the top-end in consulting is still higher and much more of a safe bet. It’s not uncommon for people in consulting to be making $500k-$1m annually by the age of 40. If you’re a partner, compensation can be significantly higher than that; in the $2M-20M range. I think there was a golden era of startups capturing value from the old guard, but that era is largely over IMO. All of those t…

How many people make it to that $2-20MM partner bracket in consulting? That’s VP range at FAANG and while there are only so many VPs they certainly exist.

Re: The Prestige Trap: finance, big tech, and consulting

#226

Post by baxtr »

JayPeaEm wrote: post #142
Gunax wrote: post #111

I don't think a lot of people know what they want. There is just as much guessing as to which job to take as employers have choosing who to hire. Taking the most prestigious or most compensation is the safest bet, given that you don't really know what you want to do other than 'I like coding and interesting problems'. Partly I think that Harvard students have been adapted to seek prestige (else they probably wouldn't…

> I don't think a lot of people know what they want. > Just a lack of other goals for which to substitute. Ding ding. I've mentored students/grads from aforementioned prestigious Universities and most of them just genuinely don't know what they want After a few drinks, many have voiced a fear of there being so many options in life and not knowing which would be more fulfilling for them. Many reach a goal (graduation~…

It seems like today, it’s not about creating opportunities to pursue. Instead value is created by eliminating opportunities.

Re: The Prestige Trap: finance, big tech, and consulting

#227

Post by barry-cotter »

8note wrote: post #141
lumost wrote: post #85

Earlier quoted context omitted.

Monetary success historically flowed to founders, and those off the beaten path. 20 years ago startups provided a strong path to success with friends and family often getting excited when the next hot app/website was something you worked on. It’s difficult to replicate either the social or monetary prestige these days, as monetary rewards flow to VC and known consumer experiences are crowded.

Historically, hasn't monetary success gone to people who inherited the wealth? Monarchs and aristocrats and the like

What historical period are you interested in? Because the aristocracy and monarchs of Europe are not doing great compared to 1915 and they’re doing a lot better than the nobility of any other continent. There have always been the ways to be rich, make it, take it or inherit it. Take it is no longer common in the developed world. For the super rich the top ten of the Forbes Billionaires List has three Waltons. The rest either made their own enormous fortune (6) or grew it out of all recognition.

Re: The Prestige Trap: finance, big tech, and consulting

#228

Post by framecowbird »

This article really resonated with me. I got into a very prestigious university, and then developed an anxiety at each career stage that my next move would less prestigious than my last. It took me a long time to realise this was how I was thinking about the world, and even then the 'prestige anxiety' drove my decision-making.

In the end I finally managed to take a job at a small environmental startup, and then an NGO, and am much happier.

Re: The Prestige Trap: finance, big tech, and consulting

#229

Post by eganp »

formercoder wrote: post #70
notacoward wrote: post #6

I find two things to disagree with in this article. First is the premise that equally high compensation is offered elsewhere in each industry. I don't know about finance or consulting, but at least for FAANG it doesn't seem to be true. Second is the overlooked explanation that it's headroom - not prestige - that accounts for the difference. I'll provide an example that illustrates both points: me. When I went from Re…

I work in finance. The “Goldman discount” is well known. People will accept lower comp for that brand on their resume. Otherwise, the places you can really make the most money are at small private firms without public shareholders. There are so many cash machines out there with very little public scrutiny.

I wish I knew this coming out of school. I think this is also another reason why people prefer prestigious schools. Those who own and operate these cash machines tend to send their children to elite schools.

I can't even begin to count the number of people I've met at Stanford whose parents own "X," where X is a little publicized, privately held business with >$10M in revenues.

Re: The Prestige Trap: finance, big tech, and consulting

#230

Post by eganp »

wayoutthere wrote: post #16
notacoward wrote: post #6

I find two things to disagree with in this article. First is the premise that equally high compensation is offered elsewhere in each industry. I don't know about finance or consulting, but at least for FAANG it doesn't seem to be true. Second is the overlooked explanation that it's headroom - not prestige - that accounts for the difference. I'll provide an example that illustrates both points: me. When I went from Re…

I work in consulting, and I’d say the top-end in consulting is still higher and much more of a safe bet. It’s not uncommon for people in consulting to be making $500k-$1m annually by the age of 40. If you’re a partner, compensation can be significantly higher than that; in the $2M-20M range. I think there was a golden era of startups capturing value from the old guard, but that era is largely over IMO. All of those t…

Ok let's suppose that consulting salaires hit $1M by age 40. What fraction of new hires make senior consultant? Partner?

If your firm is operating on leverage of 20:1, sure you can make $2-20M annually. But, realistically, what are your odds on the margin of making partner 25 years down the road?

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