From Investment Banking to Startup
Some of the best startup founders are those that leave behind lucrative (and tough-to-get) jobs, like investment banking, management consulting, medicine, prestigious law firms, and BigCo leadership positions. They leave those careers behind with:
- An understanding of what makes BigCos great and how they are organized
- An understanding of their market
- Great business experience in a competitive environment
- Money in their personal account to weather startup storms and potentially invest in their own startup (assuming they’ve lived modestly)
I spent today with a friend that is seriously considering leaving his investment banking job to build his own business. He does not have a tech background and will likely not start a tech business. For instance, he’s contemplating buying a car window shield replacement business from a retiring owner that has 2 stores. The business is easy to value on the basis of cash flow.
He’s considering going into business with a partner. When I asked him why, his main reason was that he wants to have someone else around. The partner does not add any complementary value (i.e. does not fill in any of the gaps of knowledge that my friend does not have). The partner also has a life ambition to move back west at some point. For those reasons, I encouraged my friend to consider doing it alone.
It may be a stretch for him to get enough money to buy the business from the previous owner. I think he’ll be able to figure it out though through a combination of his own money, friends & family money, and a creative buyout plan with the current owner.
What examples have you seen of founders leaving behind lucrative careers to do a startup?