What types of problems are you attracted to? An excerpt from the premium newsletter, letter #56.

Inside and Outside, Wall Street, New York, NY

During a recent talk at Dogpatch Labs NYC, Jonathan Teo of General Catalyst mentioned something that struck me, in response to a question to how startups in NYC can compete against Wall Street in hiring top developers:

Let Wall Street have them.

The rationale: really good developers only care about 2 things: who they work with, and what problems they get to work on.

Wall Street will get some quality developers, but the great ones won’t get pulled into Wall Street, because their value structures don’t mesh: monetary compensation isn’t enough to attract the best of the best developers, because the challenge simply isn’t there. Startups are competitive to Wall Street to the developers that matter.

It’s a refrain I’ve often heard about engineers; why don’t we hear the same about MBAs, marketers, or finance professionals? Why aren’t business professionals attracted to the challenge of business the same way engineers are attracted to the challenge of technology?

I would argue that business professionals are attracted to challenges in the same way, but it’s a challenge of a different sort: their “problems they get to work on” come at the size and scale most startups can’t offer. And that’s why it doesn’t make sense for startups to hire most MBAs, CFOs, VPs: the challenges they’re attracted to, and the challenges they are attuned to tackling, simply aren’t prevalent in most startups.

Most.

But if you build businesses with those challenges, they will come.