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  • Translator: Michele Gianella Reviewer: Muriel de Meo

  • I try and make anything I do as relevant

  • to the people who are listening to me at that moment,

  • so where are you guys?

  • How many of you are undergrads?

  • Show of hands.

  • Virtually everyone, oh my God.

  • Let's do that again.

  • How many of you are seniors?

  • Juniors?

  • (Cheering)

  • Sophomores?

  • (Cheering)

  • And freshmen?

  • All right. Good stuff.

  • I'm going to talk to you as if you're juniors.

  • I'm just going to land in the middle somewhere.

  • It's all good.

  • So, the theme is going to be the flow of talent.

  • The graphic that kicks us off, if I can get this thing to go -

  • Hey, Mike, where do I point this thing?

  • Sorry.

  • Thank you.

  • Or should I click this thing?

  • This is the graphic we're going to use to kick off the discussion.

  • For those of you who are seniors,

  • this might be more familiar than if you're a freshmen.

  • So what this graphic represents

  • is that it's a lot easier for a young, smart person right now

  • to become a banker, consultant, or lawyer

  • than it is to do just about anything else.

  • I resemble this.

  • I graduated from Brown in '96, and did not know what I wanted to do.

  • So I went to law school, which clarifies absolutely nothing.

  • (Laughter)

  • For those of you who are thinking about law school,

  • you should know that awaits if you do that.

  • (Laughter)

  • I graduated from law school and, not knowing what I wanted to do still,

  • I became an M&A and banking attorney in New York,

  • because that's what you did out of Columbia

  • if you didn't know what to do.

  • I was there for about five months.

  • I went home dispirited that Thanksgiving, to my parents.

  • I said, "You know, Mom and Dad,

  • when I was young, I didn't dream about being the scribe.

  • I dreamt about going in the woods and killing something."

  • They, of course, didn't know what I was talking about.

  • I then went back to my job and said,

  • "You know what, I feel like I'd like to try and build something,

  • but I don't know if I have wherewithal."

  • So I took a week off from work, and then tried to start this company.

  • Made enough of what felt like progress so that I then went and quit my job,

  • and then started a dot-com.

  • This was around 2000.

  • Had its mini rise and maximum fall.

  • We raised about a quarter of a million, got some press,

  • but then the bubble burst.

  • How old were you guys when the bubble burst in 2001?

  • (Audience) Eight.

  • Eight, nine.

  • (Laughter)

  • So, do you guys have any recollection of that time?

  • Maybe your parents watching CNBC, very sad for a little while,

  • or something like that.

  • Anything like that?

  • There are adults among you who remember this stuff.

  • When it burst,

  • it was like a giant hand went through the streets of New York

  • and swept away any company that was not nailed down,

  • including my little outfit.

  • At this point, I'm 25.

  • I've just lost investors about $0.25M.

  • I still own $100,000 in law school debt.

  • My parents are like, "What happened? You used to be smart."

  • (Laughter)

  • At this point, I had been bitten by the bug

  • and said, "You know what, I think I really want to do this.

  • I want to learn how to build a business, a company."

  • I'm going to submit this you.

  • What should young Andrew do now, 25,

  • lying on his floor, looking up at the ceiling?

  • What's the next step?

  • (Audience) Try again?

  • Try again, but how to try again, given that I just raised money and lost,

  • and it's like 2001, 2002 when no one wants to invest in anything?

  • (Audience) Getting them to believe in you.

  • Wow, I don't know what that means.

  • (Laughter)

  • Okay, so I'm going to submit something else to you.

  • Let's say you wanted to become a chef, really bad.

  • What might you do?

  • (Audience) Chef school.

  • Chef school. Another possibility?

  • (Audience) Get a job.

  • Get a job where?

  • (Audience) As a chef at a cafe.

  • Right, you would take your chef knife out,

  • and you would go down on one knee.

  • You would go to someone and say, "Be my master." Right?

  • You'd find someone who's a better chef.

  • So that's what I did: I found an experienced entrepreneur.

  • And I became his lieutenant, his VP of something or other.

  • And so for four years, I supported him

  • as that company raised about seven million dollars

  • and three million in revenue.

  • Then I became the CEO of a company called Manhattan GMAT.

  • Has anyone heard of it?

  • Juniors, seniors, maybe?

  • Manhattan GMAT grew from being a relatively small GMAT boutique

  • to number one in the US over the next five or six years,

  • to the point where we were acquired by The Washington Post in 2009

  • because we were number one in the US.

  • Washington Post owns Kaplan.

  • We were beating the tar out of Kaplan.

  • Kaplan got tired of it, so the CEO calls me and says,

  • "Hey, let's talk."

  • We have a little bidding process, and the company gets acquired.

  • It's one of the reasons I'm very familiar with this particular picture;

  • many of the people my company started in Manhattan GMAT

  • were bankers and consultants

  • who weren't really finding what they were looking for

  • as 20-something year olds,

  • so they would take the GMAT, apply to business school,

  • and then go to business school.

  • So, I'm going to continue with this.

  • Let's take a look at what the actual numbers are.

  • Let's take Harvard's class of 2011.

  • What were the most common things to do out of Harvard a year ago?

  • Shout them out.

  • (Crosstalk)

  • Yes, finance.

  • (Audience) Doctor. A.Y.: Consulting.

  • Law. Not accounting.

  • (Laughter)

  • And the fourth is med school.

  • The question is,

  • what proportion of Harvard students did one of those four things?

  • (Audience responses)

  • All right, so I've got between 40 and 90 percent.

  • And as usual, the wisdom of crowds, the truth is exactly in the middle.

  • It's 65 percent.

  • Then you have the potpourri category, which is a little bit of everything.

  • It's grad school, nonprofits, industry, government, IT, military.

  • Then you have its own line item, Teach for America.

  • 18 percent apply.

  • Four percent actually become Teach for America corps members.

  • Then, undecided;

  • 10 percent went to Europe, and then became consultants.

  • (Laughter)

  • So this is the picture from Harvard, a year ago.

  • Let me get some feedback.

  • It this surprising, unsurprising?

  • Not surprising.

  • Now, I throw the normative question.

  • Is this a good thing, a bad thing, or neutral?

  • (Audience) Bad. Neutral.

  • Wow, that one's fraught, right?

  • Let's keep on going.

  • If you take a look at other top schools, the picture's the same.

  • The picture is the same here at Georgetown.

  • I didn't pull the Georgetown stats, but they're quite similar.

  • You can see that it's not just a Harvard thing.

  • It's really a "any top school" thing.

  • I've spoken at 40 universities around the country,

  • and they all say the same thing.

  • So what does that mean in terms of our country,

  • let's say, "regionally"?

  • If you have half your smart kids

  • becoming bankers, consultants, and lawyers,

  • where are they going to live?

  • (Audience responds)

  • New York, DC, maybe Chicago.

  • (Audience) Boston. A.Y.: Boston.

  • San Francisco, LA, those are the top six.

  • We just listed the top four.

  • So then you have the rest of the country,

  • much of which is struggling with job growth and economic development.

  • One of the things we think this graphic represents

  • is that if you're a smart kid from, let's say, Florida,

  • who comes to Georgetown,

  • the odds of you becoming a banker, consultant, or lawyer

  • and living in New York, Boston, DC are very high.

  • Odds of you going back to Florida,

  • starting a business, creating jobs: very low.

  • You end up with a systematic talent drain on most of the country

  • if they happen to get identified by a national university.

  • This is the picture you end up with.

  • What do you guys think, empirically true?

  • (Audience) Yeah.

  • Absolutely. Wow, all right. We're starting to get something.

  • Good stuff. Why is this the case?

  • Those of you who are freshmen, raise your hands again.

  • How many of you who have your hands up, keep them up,

  • know what management consulting is?

  • (Laughter)

  • So how is it that that world goes from that

  • to, let's say, 20 percent of the class at least applying for consulting jobs

  • and maybe even converting?

  • How does that happen?

  • Seniors, chime in, please?

  • (Audience) Salary.

  • Money's there. What else? Keep going.

  • (Audience) Creating new jobs.

  • Sorry?

  • (Audience) Security.

  • Security, fear.

  • (Laughter)

  • Keep going. Keep going.

  • (Audience) Diligent recruitment.

  • Yes, resources. This is not an accident.

  • People spend money and time

  • educating the market, that is all of you, over your four years.

  • By the time you're a senior, you'll know the names;

  • McKinsey, Bain, BCG, Deloitte, etc.

  • Let's take a look at how this list looks.

  • Prestige, easy to find, progress, seek the next level, opens doors.

  • Money's on the list, gain skills, community;

  • and then there's this last one,

  • which is something pro-social, like change the world.

  • This even applies if you become a banker or consultant,

  • because the theory is, you must become a baller

  • before you can come back and change the world. Right?

  • Then you can come back to the people with loaves of bread.

  • (Laughter)

  • Those of you who are seniors, can I get a - yes, this is accurate?

  • (Audience) Yes.

  • All right, thank you.

  • Now, I usually talk to people who are interested in startups,

  • so this is a little bit overly broad.

  • But let's say you were interested in startups.

  • Show of hands: how many of you are interested in startups?

  • A significant subset.

  • The seniors among you, why is it that it's unlikely

  • you're actually going to go work for a startup when you graduate?

  • Risky.

  • Money.

  • (Audience) Loans.

  • Loans.

  • (Audience) It's scary.

  • It's pretty much the opposite of the last slide. Right?

  • It's like you're not recruited.

  • It's hard to find. There's no structured path.

  • There's no community or peer group.

  • Unclear prospects for training, advancement, or success.

  • No network, idea, money, tech proficiency.

  • But a lot of you really want to, and then you talk about doing it,

  • but first, you want to "learn about business "and then come back.

  • Is this accurate?

  • Am I - ?

  • (Audience responds)

  • It's like I was one of you.