Harvard MBAs are abandoning Wall Street in favor of the sweet promise of Silicon Valley’s enviable work life balance and the dream of becoming a billionaire in a few years.

Harvard MBAs are abandoning Wall Street in favor of the sweet promise of Silicon Valley’s enviable work life balance and the dream of becoming a billionaire in a few years. Photo: Giuseppe Milo | FlickrCC.

After graduating from business school, the traditional path for most MBAs leads to Wall Street. The first year there, working in investment banking is often a grueling experience. Ninety-hour weeks are common. New employees work on pitch books and try to get them perfect. They spend hours reviewing spreadsheets and making presentations.

At Harvard Business School, Baker Scholar is the designation give to only the top 5% of graduating MBAs. Leaders in the financial industry, such as Alex Crisses, have been Baker Scholars. Palmers Scholars, from Wharton, must also be in the top 5% of their class. Stanford University denotes the highest achieving MBAs as Arjay Miller Scholars. And these students, the best and the brightest, are no longer attracted to investment banking.

Wall Street firms are slow to innovate when it comes to corporate culture change. But that kind of change is what MBA students expect, having been exposed to it while they’re in school. The choices they’re given on Wall Street don’t connect with what they studied. Instead of heading for Wall Street, these outstanding academics are starting their careers in Silicon Valley.

Only 4% of Harvard’s graduating class in 2015 was interested in working for an investment bank. And out of the 46 students in the top 5%, the Baker Scholars, only one of them was actually interested in pursuing banking as a career, reported Business Insider.

Many MBAs join a firm at the vice president or associate level and often have professional experience prior to their MBAs as financial analysts. Their memories of hard work and little reward make them wary of returning to a career path that offers little in the way of business innovation or the lucrative potential posed by a startup.

A recent MBA graduate from Harvard, Kiran Gandhi, says that “people used to brag and say, ‘Oh yeah, 21-hour days, seven days a week for eight months,’ that was a badge of honor. Now, in Silicon Valley, these graduates compete over how easy their work life is…the humble brag is now, ‘Oh yeah, I work 9 to 5, I get paid a ton of money, and I have a great life.’ It’s green juice from vats in the office and amazing organic iced coffee cold-brewed — the quality of life.”

Startups in Silicon Valley are creating billionaires every year. If the investment banking industry hopes to attract the best and the brightest graduates, they will have to innovate their industry or be ready to accept the second best.

 

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