The following is a guest post by Sliced Investing co-founder, Mike Furlong. He eagerly left Wall Street to launch this start up. Sliced Investing is backed by Y Combinator, Khosla Ventures, TriplePoint Venture Growth, Data Collective, and Carnegie Mellon.
Funny enough, I also left Wall Street so I could focus on Financial Samurai. I spent this past Spring consulting for them as I found their business objective of providing greater access to hedge funds and alternative investments through crowdsourcing highly intriguing.
My first job was a rather humbling one. I worked at a country club where I caddied for super rich bankers and traders. They were living the good life most people just dream about. They had tons of money to own fancy cars, top of the line clubs, luxury watches, designer clothes, and me to wait on them.
Meanwhile I was making minimum wage, lugging their 50-pound bags on my back, and trying to keep a constant smile on my face while sweating like crazy in the summer humidity and blinding sun. I tried to be as accommodating as possible and give them suggestions on which clubs to use, but most of the time they did whatever they wanted to without listening to me.
Lessons Learned On The Green
The experience taught me a lot of things. First, it taught me very quickly that making minimum wage doing manual labor is not an easy way to make a living. Second, it made me money hungry. If those guys could be rich and live the good life, why couldn’t I do the same? And third, it propelled me to take control of my future and build a career path that I’d be proud of.
During my days as a caddie I overheard a lot of conversations amongst the club members trading stock tips between holes, My fascination with financial markets grew as a result and I aspired to one day join them in the upper echelons of Wall Street. Through athletics, academics, and mostly networking I made my way into a good college and eventually into a position as a trader at Citigroup.
Trading Quickly Lost Its Luster
Fast-paced, ruthlessly competitive, full of both risk-taking and ample financial rewards — on the surface Wall Street seemed like the ideal career. However, the longer I spent at Citi the more I witnessed technology rendering certain banking functions irrelevant.
The most obvious function was my own job: trading. As it became increasingly automated, I watched peers lose their jobs to quants with computer science degrees, each of whom could do the work of a half-dozen traders.
Without fully realizing what a good decision it was at the time, I decided to quit my career-track job at Citi and move to San Francisco to start a financial technology company.
I Left Wall Street For A New Beginning
I made the switch for three main reasons:
First, I wanted to be judged on ability, not age.
I always hated being told that I couldn’t do something because I wasn’t old enough. Though I believe trading to be the closest thing to a meritocracy in finance, there was nonetheless a ladder that could only be climbed over a period of many years. In Silicon Valley, technology has democratized value. Age and experience are irrelevant — you can add value if you create.
Second, I wanted to understand risk.
On Wall Street, I had a clear path to success. As long as I performed adequately, I could move up to the next level and eventually make lots of money.
Starting a tech company is the complete opposite. In the beginning, you have nothing. Everyone is skeptical of what you’re trying to do. If I failed, I would have had little to show in terms of outwards accomplishment and returning to the steady big bank career escalator might not have been an option.
Sure, I was taking risks every day at Citi. But it wasn’t my risk. In fact, I had nothing to lose, and everything to gain, which, frankly, is true of most people in finance. I didn’t have skin in the game. But in tech, I’m all in. I’ve learned to understand and appreciate risk in entirely different ways because of it.
Lastly, I wanted to create something real.
There may be no greater satisfaction than to create. To make. Every day I wake up excited to work with a world class team and collaboratively build something genuinely useful that ends up in the hands of real people. Our products are used by our customers every day, and we’re constantly interacting with these users to improve them. Accomplishment for us means empowering someone else – not just making more money.
The Great Migration To Fintech
Of course, I’m not the only one to come to these realizations. I can’t tell you how often traders and bankers ask me how they can break into tech. There’s even a startup in New York dedicated to enabling this transition, Suits to Silicon Alley.
This Great Migration is part of what’s fueling the current groundswell of fintech startups, and should ultimately be to the benefit of consumers. Technology has allowed many core banking functions previously available only to institutions or the super-wealthy to John Q. Public.
For example, P2P pioneer Lending Club offer better interest rates on loans, even to those without stellar credit. Acorns and Even automate the saving habit.
Many of these fintech companies were started by former Wall Streeters who realized the pain points of many consumers and sought to address their needs.
Fintech Is A Welcome Disruption
Finance is inherently a service-based industry. It’s supposed to be about the customer and, at root, keeping people’s money safe. But the public’s trust in banks plummeted during the financial crisis and the Great Recession.
Fintech is helping to breathe new life into finance by bringing trust back through improving transparency, reducing fees, and democratizing investments — each of which can clear the fog of doubt and mistrust over time.
The rise of fintech has enabled a resurgence in traditional finance value propositions: protecting and empowering the individual. When I think about where finance is heading, I am reminded of one of my favorite T.S. Elliot quotes:
“We shall not cease from exploration, and the end of all our exploring will be to arrive where we started and know the place for the first time.”
I’m often asked how it feels to leave finance or why I left Wall Street. I respond by saying that I feel closer to it than I ever have before.
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Update 2021: Unfortunately, Sliced Investing shut down, but Mike is still at it with a new startup.