Wall Street Banks and Private Equity Firms Compete for Young Talent

We could debate the many reasons for this fact, but suffice to say that there is A: a lot of money riding on getting such stories printed, and B: not enough time in the day or money to pay journalists to do the real work.

This plays out in a couple ways. The most common form is where the PR firm is also representing a company that advertises in the outlet. The New York Times writing about suits was probably printed on a page next to an ad for Macy's. The editorial guys are not complicit, but it's become common for sales to make "intros" to editors at parties and such. It's gross, but common.

Another way it plays out is that we get some amazing, long article with in-depth journalism that's just the best thing you've ever read. Then no one reads it because it's really long and doesn't have pretty pictures, so compared to the story linked next to it on the front page, it's basically a one or two day blip in the system, then it's forgotten. Meanwhile, that other story with a title like "Docker will revolutionize datacenters," or "Google Glass User Assaulted," are getting the same number of hits, and they took about 10 seconds to write, so as a journalist, it can be a bit frustrating to be beholden to "hits," rather than to "quality."

Which, frankly, is what most journos are dealing with. Most outlets want quantity over quality. That means the writers tend not to understand what they're writing about, but rather, they're just flying over and giving a scouting report in a vain attempt to be first.

The Wire got this soooo right in season 5. Beat reporters need to cover their beats. The smaller the beat, the better they should be able to cover it. If you have one reporter on programming only, you can really get the pulse of the industry, rather than just having your tech reporter check in every 3 months.

Journalism remains broken, with many examples of great work being ignored in favor of "10 reasons Beiber is made of plastic, and what types of plastic those would be if he were made of them," stuff. How are we going to write about people places and events when those people places and events are writing about themselves for free.

I think one interesting thing that the article left out is that the situation has actually changed a fair amount in the last decade. Around, say, 2002-2006, second year banking associates (and sometimes management consultants) interviewed in the spring (~18 months into their banking job) for PE jobs starting that fall - around 3-4 months early. This seems pretty normal.

But an arms race started, and in 2006-2007, interviews were happening in January. In 2008, headhunters joked that soon they'd be interviewing candidates a few months after they started, and then that's exactly what happened. The next year, they started in December, then October or November, and they continued to go earlier until the current state where they interview after 6 months on the job for a new job 15-18 months away.

So, it's worth noting how much it changed in a fairly short time frame. I think this must have to do with the number of PE firms that exist now compared to 2000 - back then, there was no point to interview early because no one else would swoop in and get your candidate.

Also funny is that it's all somewhat based on a notion that all candidates vary on one dimension of "quality," that the "best" candidates will be gone if your firm doesn't try to snap them up now, and furthermore, that you'll be able to figure out who the "best" candidates are at that stage.

It's a classic coordination failure - even given how silly that premise is, and even though the resulting situation is so obviously crazy to all involved, it continues to occur, because that's how the incentives line up.

What's also interesting is that there's no clear way to change things. Coordination failures are often fixed by governments, when the situation is important enough (this hardly qualifies). College admissions solves this by tacitly agreeing to have everyone apply the same time every year. Of course, some colleges tried to beat this with "early decision" and "early action," which conceivably could have continued like this did (with applications starting in junior year, etc.). But it seems there's some combination of respect for the process, decorum, etc., that prevented it. Plus, once a group of the "top" schools decided to eliminate the early decision/action process, the decision stuck (for a while at least - it appears to have come back) . In that case, there was a fairly agreed upon list of "top schools" that could set the terms, given most students would be willing to wait and apply there. But with PE firms, most candidates would be willing to take a job with a middle market fund (and make a looot of money) rather than gamble on a bigger fund (assuming those are more desirable, which isn't always the case). I suppose that things could change if banks got stricter around things (as they're trying to), or if all PE firms could agree (if that's even legal...?), but it's not an easy solve.

Of course, no one will be throwing a pity party for anyone involved. The banks, PE firms, candidates, and headhunters will all be fine. Still, it's a funny situation to watch, in a "how can that really be happening?!" sort of way.

This is not a comment on what you're saying (I don't think you're far off) but it's pretty disturbing a reflection on tech that executive roles in our companies are what finance people fail into.

Most tech management and VC is failed finance/business guys who failed down into those roles, not programmers who worked their way up the ranks. The latter almost never happens, to tell the truth.

Eh, maybe, but you could just get everyone to apply and make the same decisions. Now you've got brand and people give you money...

It's intentionally a ludicrous amount to suggest that they're Just. That. Good. to all their potential clients. But we can't all be payed three times going wage, can we?