I work at an investment bank in NYC after working for a few startups in the internet and enterprise software space.

Maybe I got lucky with the group I ended up with, but I don't wear a suit to work (and actually like dressing "business casual") and technology certainly rules the day here (large distributed systems executing millions of orders a day with sub-millisecond latencies, etc).

Sure there's more bureaucracy but it's hardly "Office Space" and I'll trade that for 2-3 times the salary any day (with no cap... there are developers here making $500k/year)

The bigger problem is that Hedge Funds develop an expensive lifestyle. Expensive lifestyles are hard to change.

Entry-level hedge fund salaries are similar to technology salaries, and perhaps a little bit lower. Bonuses are very high, but these vary from year to year and shouldn't be taken for granted (not to say that people don't).

I made this change. I'm 26 and have no kids. My girlfriend's in school but will be able to support both of us when she's out. It's mildly annoying not to have a maid and nice vacations right now, but working on interesting problems is more important than having those comforts, which are disposable for now (you don't need help until you have kids, really). Then again, I can also still afford basic necessities; if I couldn't, I'd have to go back to Wall Street.

The major problem in New York is that rent is ridiculous. Most "lifestyle" factors (vacations, alcohol) are flexible and can be deferred for a few years, but rent is non-negotiable. If it stays this high, the city will bleed talent too fast to reach "critical mass". You want the freshly unemployed quants (although quants are among the last to be let go) to stick around in the city for 6 months, not move back in with their parents because of New York rent.

Regarding lifestyle expenses, any guess as to where top traders spend most of their leisure income? Gambling. I never thought I'd meet people smarter than me who find "games" like Roulette and Craps to be interesting and worth playing (because I'm a game designer and a Euro-snob who'd rather play Tigris than Poker) but I have. This is because it's visceral and not intellectual-- people with the "gambling gene" make great traders but I wouldn't want one as a co-founder (long digression omitted).

I'm going to bet on the Midwest as the startup hub of the 2010s. There are a lot of brilliant graduates of schools like Chicago, Northwestern, Carleton, Michigan, and Grinnell whose graduates (for geographic reasons) are not nearly as likely to go to Wall Street (or Silicon Valley) as their coastal counterparts. Most of them go into graduate school, seeing that as the best option for them, because often it is. Wall Street under-recruits the Midwest, and there aren't a lot of cutting-edge companies out there-- yet. If you want to hire talent on the cheap, buy a set of winter clothes and head out to the Great Lakes region.

Betting on the midwest in the same breath as looking down on Roulette and Craps? Are you sure you're not a gambling man? Having grown up in the midwest, let me tell you that beyond the fact that it's cold (it is), except for Chicago, it's rather desolate and depressing. Even Chicago is pretty miserable in the winter. I know dozens of entrepreneurs from Illinois and Indiana who moved to SF as soon as they graduated university.

I'm fairly certain nobody has ever attend Berkeley or Stanford and said "Oooh I can't wait to move to Cleveland when I graduate!"

I read that as a stand-in for "Wall St", probably also because my friends usually go for Goldman now, but hedge funds are definitely where all the action is at.

The technological problems that you work on in a hedge fund are less interesting than those you do in a startup. On the other hand, making actual money has benefits.

I don't know, I disagree that they're not solving really interesting problems. My first jobs out of college were at hedge funds, pretty much by accident, and I got the chance to work with a ton of really smart people -- many of whom were math or engineering PhDs -- in a very challenging environment.

One two-person team I got to work with was doing something resembling stat-arb, and was pushing about $250 million of trades in the last 10 minutes of the market. Beyond getting to be hands on with some crazy math, building a system to make that happen isn't exactly trivial.

Fair point. At a quant hedge fund, you do get to work with some awesome people, and you learn a lot from after-work conversations.

Are they less interesting? It's not obvious to me.

Hedge fund work tends to be more quantitative than most startup work, and tends to focus on different issues (less UI, latency vs scaling, minimizing transaction costs vs minimizing EC2 costs). Having looked at both hedge funds and startups, I'd say the work can be interesting at both.

To make a completely loaded comparison, I think programming a computer to beat the market is much more interesting than building a facebook/twitter "me too" site.

To make a less loaded comparison, I also find algorithmic trading more interesting (as a technical problem) than connecting $LOCAL_SELLER to $LOCAL_BUYER in $LOCAL_MARKET, or solving the problem of crappy restaurant websites (both of which I think are great business models).