Computer Science vs. Finance

Earlier this week, a family friend who just wrapped up his first year in college approached me for some advice. He, like most of us, was trying to figure out what do with his life and was stressing about picking his college major and career path.

“What do I do? What do I do focus on? I like computer science a lot but I also like finance because it seems so practical. If I don’t pick the right major now, I’ll get distracted, won’t get a good job and I might end up a failure!”

Sounds dramatic? It was – but we’ve all been there. Rather than get into how I calmed his nerves, I wanted to share the highlights of our conversation – choosing between computer science and finance.

The Case for Computer Science

Computer science is pure. You start with logical primitives (and, or, not, etc.) and work towards creating expressions that model complex situations and decisions. It’s the closest thing to our actual lives – we’re composed of fundamental particles that form our sense of self. Just listen to lecture 1 from this class at MIT on Gödel, Escher, Bach or read about Huffman Coding, an elegant algorithm used for lossless data compression. No other discipline gives you this.

Programming is a skill. After studying CS, a common route is to become a programmer. And programming is not unlike a sport – the more time you spend on it, the better you become. Every incremental hour is more enjoyable and efficient than the last. Furthermore, your code is re-usable – not just by you. One example is Git, written by Linus Torvalds, which has set the standard for version control and is used across the industry.

Solving actual, meaningful problems that will impact the world. Advances in computing have allowed humans to perform remarkable feats of technology and create systems that we would have otherwise deemed impossible. This ranges from code breaking (e.g., Alan Turing in WWII) to building the search engine to cryptocurrencies. CS is moving the world forward – that sounds a lot more exciting than building Excel models and pitch books for 100 hours every week.

Innovation is rewarded. If you’re good, that’s all that matters. There isn’t politicking or a never ending rat race to get noticed. It’s all about your code. A small company called ITA software blew the hyper-competitive airfare search industry wide open by writing an incredible piece of code in Lisp. They got bought by Google, for $700 million. Good engineers and computer scientists are compensated extremely well. It’s no coincidence that most of the wealth that has been created over the past 20 years is centered in Silicon Valley.

You’re part of a community. Programmers tend to be thoughtful and kind people. That’s my personal experience at least. It’s programmers who brought you Reddit. It’s programmers who worked together to create Bitcoin. It’s a collaborative community that engages itself in a meaningful way to solve complex problems and is driven by more than just a desire to get wealthy.

The Case for Finance

Finance is a meritocracy. Kunal Shah made partner at Goldman Sachs when he was only 32. Kunal is a brainiac and majored in math at Cambridge. And now he is getting paid for his results – which is very tangible. To be clear, Kunal is not getting paid because he wrote a few lines of code for a widget that nobody ever uses.

You become an analytical and problem solving monster. Building on your sound finance skills, you go through a rigorous training program at large investment banks. In those training programs, you not only learn how to break down a problem into its component solutions, but also learn how to perfectly alter margins and use different fonts so that your presentations are so manicured you’d think you stepped out of a nail salon.

Surrounded by senior decision makers. In investment banking and private equity, you’re surrounded by senior decision makers and have exposure to the highest levels of management. Expectations are high and people can turn into zombies because they are getting their asses kicked in on a nightly basis. But this is the price a young person pays for “models and bottles”, right?

You can get paid. Speaking of models and bottles, majoring in finance and working at a hedge fund or private equity firm gives you access to a treasure chest of cash. First-year investment banking analysts make upwards $140,000 while second-year investment banking analysts make more than $160,000 (with bonus). What does a 21 year old do with a $70,000 check? Unspeakable things. Not good for them, but it’s great for the restaurants and clubs in New York.

Exit opportunities galore. So, you successfully finished your apprenticeship and now it’s time to move on. What are you going to do? Well, you could sign up for another year or you could jump ship to a private equity or hedge fund. But the expectation after two years is for you to leave and go to business school. Remember, that if you don’t get into Harvard or Stanford b-school you’re deemed utterly worthless.

Two Very Different Perspectives

This debate has come up often. Why did you choose either (or neither) path and why do you believe it was the right decision for you?

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