In Homer’s “The Iliad and the Odyssey,” the Sirens would sing seductively to lure sailors to the rocky shores of the island where they would perish. When Odysseus and his men were coming near to the island, he had his men put wax in their ears so they would not hear the Siren’s song, yet he had himself tied to the mast so he could hear the song without being able to act on his impulses.
Odysseus and I might have more in common than I ever thought since I effectively tied myself to the mast back in September…. Amidst the unprecedented turmoil in the financial markets, I managed to secure a full time offer for investment banking from Barclays Capital, one of the few bulge banks left standing. Despite a lucrative offer that would effectively guarantee my annual compensation to exceed three times my pre-business school level, I turned it down months ago. Why? Here is my story….
When I started writing essays for applications to business school, I had a very clear goal to change the way people think about their energy consumption. I wanted to be entrepreneurial, idealistic, and passionate. I wanted my performance to have a significant impact on the company, profitability, and the way that business was conducted. Somehow that took a back seat when I actually got here, despite being involved in so many organizations surrounding entrepreneurship and innovation. When the recruiting season starts, consulting companies and investment banks come to campus in mass force (although this year i-banking recruitment will suffer, as expected). Just as with the song of the Sirens, many people (me included) jump in the water and swim to the perceived safe havens of consulting and Wall Street with the lure of high salaries (and long hours). They bombard you with e-mails and invite you to lavish dinners with current members of their organizations that will sing the beautiful songs of how great it is to be them. They are the first companies to conduct interviews and extend offers that carry the added incentive of not worrying about a continued job search during another semester packed full of commitments. When I found myself with an offer before the second semester even started, I swallowed the bait in one gulp. The economy had already started its slide into oblivion, and I did want to get experience in the field of finance. I have nobody to blame but myself.
Summer started, and I was eager to begin the internship. As an MBA Summer Associate, I really did not expect to be more than a glorified analyst, especially with no previous finance working experience. Then I started to look around me at people in higher positions, and I began to think about a few things. First of all, why did I really need an MBA to be at an investment bank (my opinions here might be somewhat controversial) other than as a screening mechanism for them? Several of the analysts I was working with were amazingly bright people, stuck doing data entry and preparing slides with the attention to detail of someone diagnosed with obsessive compulsive disorder. However, I have to say that Barclays Capital in particular does an excellent job of grooming these analysts to advance to the Associate level and beyond very quickly without the need for an MBA. Second, how long would it be before I could have a real impact? By my estimation, that comes somewhere around the time that you are a more senior Vice President, about five years out of an MBA. At that point, client facing activities dramatically increase and you can really start to build on your business relationships. Third, the same things get done over and over and over….and over. CapitalIQ will get you 95% of the way there, but they still insist on reinventing the wheel, but then they want to check it against CapitalIQ. Somehow the repetition and lack of creativity just did not appeal to me. Now most people would normally complain about the long hours, yet I did not really think that they were that bad. Admittedly I was in New York City without my wife and nothing else to do except work, but it is definitely manageable.
So I have really yet to write about my experience searching for more permanent employment, and I have been getting questions from many people about what I have been doing on that front. The truth is that I am being very patient and very selective at the moment, despite the overall poor economic environment. I only applied for and interviewed with one company through the Career Development Office, and this was for a job in corporate planning at Emerson Electric. It is a fantastic opportunity with a $25B annual revenue company, and I would be working with a small group of people directly for C-level execs on company strategy and growth. Outside of that, I chased down an opportunity to do sales and account management for a startup company that just received funding called Positive Energy. Positive Energy is a natural fit for me since it is in the business of promoting energy efficiency, which I am very passionate about, and they are still in a relatively early stage since they started in the summer of 2007. Outside of this, I am searching for new ideas and looking for entrepreneurial ventures of my own through classmates and the MIT Sloan network. The goal is to do one of three things (in no particular order): 1. start my own company, 2. work for an early stage startup, or 3. corporate entrepreneurship, which I believe is underrated, yet sorely needed at many bigger companies. No matter what, opportunities for top MBA talent are still plentiful, and there is no need to panic.
After talking to many venture capitalists over the last semester, there are a few things that they have consistently reiterated about the current environment.
- Funding is harder to come by as many VCs are conserving capital for later round investments for their existing portfolio companies
- Term sheets are going to have more unfavorable terms for the entrepreneur and lower valuations on the whole
- Business plans are going to have to be more resilient now than ever, and VCs can afford to be more selective
- First time entrepreneurs are going to have to secure friends and family or angel funding before VCs will even touch them - first priority should be getting customers....
That said, I am off to spend the Christmas holiday with my family in Texas before taking off on my adventures through South America in January….
Here are a few good reads concerning cleantech and entrepreneurship, and a couple of these are written by Bill Aulet, one of the senior lecturers in the Entrepreneurship Center and the professor for Energy Ventures, one of the classes I just completed:
http://venturebeat.com/category/cleantech/
http://www.xconomy.com/boston/2007/08/06/whats-wrong-with-energy-investing-part-i/
http://www.xconomy.com/boston/2007/10/15/whats-wrong-with-energy-investing-part-ii/
