Excel Monkey Decides To Switch It Up

But I Thought I Was Going to be a Portfolio Manager: Becoming a Successful Career Switcher in Business School

One of the biggest pros to coming to business school is the opportunity, so rarely found in “real life,” to break into fields that are difficult to enter from another industry or function area. The degree is a reset button for those of us who’ve decided that what we’ve been doing isn’t, well, doing it for us.

For some people, deciding to press that button was preordained before they even arrived. A friend of mine came from a non-traditional background wanting to switch into consulting, wrote his essay with a target firm in mind, and will be working there next year. For others, like yours truly, it was a decision only arrived at after spending more than a month evaluating the new optionality now afforded to me by my degree.

A bit of background. Prior to business school I was an equity (associate) analyst for a Boston mutual fund with ~$250Bn in assets under management. I had about 3 years of work experience in professional investing, and had covered 5 sectors to date. My decision to come to business school was a combination of knowing that the easiest way to get promoted at my firm would be to come back with a degree from a top business school as well as having hit that “sweet spot” of 4 years of work experience that positioned me well for applications.

When I wrote my applications, I had an extremely clear idea of where I wanted to be in the short- and long-run. In my exact words, from two years ago:

“In the years immediately following my graduation, I want to be working as an equity analyst covering emerging- and frontier-markets, with an eye towards eventually starting and running my own investment firm in Asia.”

It was a rock-solid plan: I came from IM, knew what it took in IM, would graduate from Booth (the best school for all things finance), and wanted to go back and stay in IM. So what changed?

In a word: perspective.

One of the first concepts I learned at Booth, and will probably take with me throughout my life, is that options have value. While my plan was well thought-out, I was essentially destroying part of the value of my business school education by not being open to other professional paths. Moreover, my plans were predicated on my past experiences, constrained by my professional history and not taking advantage of all the options available to me that I was paying two years and a boatload of cash to have.

With that in mind, I took a step back and evaluated if equity research and investment management were fundamentally the best paths for me, digging deeper into three key questions:

What am I good at?

Despite a solid background in quantitative analytics, I had always had more facility with language and the nuances around communicating complex ideas. At my old job, I’d developed two classes of summer interns, spearheading our first formalized summer intern training program in 2011. Unfortunately, since equity research boils down to advising portfolios managers on what to buy, sell, or hold, several of key my strengths were not needed or valued. If I were to generate the highest return on my own human capital, I had to find a career where, hopefully, all my strengths were rewarded.

What do I need (not just want) professionally?

One of the things I absolutely loved in equity research was the opportunity to come in and learn something new every day, whether it was how to read through the corporate boilerplate in an investor presentation, or how value accumulates in the olefins cycle. I needed a workplace that would keep me intellectually engaged. On the other hand, I also needed a workplace where merit and promotion were transparent, and where I could have significant control over my professional mobility. Promotion in equity research, especially from analyst to portfolio manager, tended to be very murky outside of huge shops that had structured programs…and a few bad years, courtesy of the markets, could set you back indefinitely.

Finally, what am I willing to give up?

Another concept from economics that I’ve taken to using in my everyday life is that of opportunity cost, or that the value of an object or an action is what you give up (value of the next-best option). In my case, I was willing to forgo upside on variable compensation above a certain level of total compensation, for upside on human capital accumulation. In regular people speak, I didn’t mind being paid a little less overall immediately after graduation if it meant better training and access to future opportunities later.

The long and short of it is, when life gives you an option, you don’t leave it on the table unless you’ve assessed its worth. In my case, when I took a step back and thought through my career in the lens of someone who wasn’t constrained by irrelevancies like how hard it is to break into investment management (irrelevant to me, since my decision centered around leaving), I discovered a better professional fit for me.

While it’s tremendously dorky, I’ve thought about my career the way I’ve thought about successful companies: what is Linda Inc.’s competitive advantage, and how does Linda Inc. maintain that advantage? With that framework in mind, I decided to leave IM to those who had enough talent, faith, or hubris that they could successfully beat the market over the length of their careers, and become just one of hundreds of career switchers redefining who they thought they were.

 

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