For the typical Harvard student, tech is better paying than consulting unless you are an extraordinarily successful consultant.

> It’s not uncommon for people in consulting to be making $500k-$1m annually by the age of 40

This is not "uncommon" in FANG either (just take a look at the salary charts), and if anything can be reached earlier.

> there was a golden era of startups capturing value from the old guard, but that era is largely over IMO

If I could take a bet against this, I would. That value capture is only going to increase.

5 year EV is much lower in tech than finance for Harvard grads. I'm not sure ab consulting.

Consulting and tech have similar starting salaries, but consider finance/hedge fund engineer starting tc is about 3-4x tech for top 3 grads rn.

I would contend that 5 year EV is probably higher in tech than across all of finance unless you manage to get into only the MOST exclusive megafunds (Hellman-Friedman, Silver Lake, Bain Cap, or Apollo, as most are coming in as associates in 200-300k range) or exclusive HFs (Viking, Citadel, Elliot) and even then, you're usually on a 2 year contract or up-or-out plans. The HFs will need to see you perform well to get anything more than base and your bonus (the chunk of how you get comped) will be at the discretion of your manager anyway.

> 5 year EV is much lower in tech than finance for Harvard grads. I'm not sure ab consulting.

Based on what? This is not true in my experience, unless you're comparing finance tech to FANG tech, in which case it is true. Moreover, at Harvard, some segment of those who go into finance are "connected" with higher paying finance jobs due to their parents/etc.

Consulting salaries are lower (sometimes substantially) than tech starting salaries.

Yeah, tech has a starting salary advantage but FAANG just doesn't compare on the upside. What's the top 10% of FAANG outcomes (for Harvard grads) after 5 years? 500k, maybe? The jump to MD in finance makes 1M+ something like 10-20% of outcomes (for Harvard grads) after 10 years. I'd be very surprised if it were that common in tech (over the next 10 years, I know that it was better in the 2000s). I think quickest to MD at Goldman was 4 years.

Top 10% of FAANG is, what, around 30K-40K in raw numbers? What's the top 10% in Big Finance? I'd bet it's far lower number compared to that. So it's not apples to apples comparison. If you compare what top 10,000 FAANG engineers make 10 years into their careers vs what top 10,000 finance folks make 10 years into theirs, I'm pretty sure FAANG will come out ahead.

(for Harvard grads) is the important part there.

Is it because they have ‘Harvard’ on their resumes or is it that Harvard still admits mostly some of the smartest and most driven people in the country? Ie could a person who is in the top 2% of a flagship state school keep up with the top 10% Harvard grad or is that name on their resume forever going to hold them back?

> could a person who is in the top 2% of a flagship state school keep up with the top 10% Harvard grad or is that name on their resume forever going to hold them back?

If it's a good flagship, absolutely can keep up.

But finance is up and out. The typical Harvard student in finance is not making that much, even 5 years out. I know plenty of them.

I needed to rewrite this. I mean something like if I select an individual, uniformly at random, after conditioning on industry and Harvard degree I would expect the salaries of most of the individuals in both industries to be about the same. However, I think tech is closer to a normal distribution and finance is heavy-tailed around tech's mean.

If you do something like conditioning on a CS degree, finance probably mops the floor w/ tech.

> If I could take a bet against this, I would

Can't you, by starting or (much less favorably) joining a startup?

Betting on technology capturing value in general over "jack-of-all-trades" consultancy vs. betting on one particular startup capturing value.

However, isn't quality of life as a junior hire in both finance and consulting much worse than in tech? Every Goldman or McKinsey hire I know was worked like a dog for their first ten years, while at a FAANG you can generally work 9-5 and still have a pretty successful career.

I started comparing the (expected) hourly salaries precisely for this problem: somebody earning twice your salary stops being relevant once you know they work three times the hours.

Obviously there are other components as well (how much you travel, being on call...), but that already captures a lot of what's commonly missing in salary discussions.

It is not uncommon for people in technology to be making $500k-$1m annually by 30, and the lifestyle is much better if you have outside commitments.

It's extremely uncommon, actually, outside of FAANG. I wouldn't say it's uncommon in FAANG, but it also isn't commonplace enough to be completely unremarkable.

You’re making a big bet on equity appreciation though. That’s how the vast majority of very highly paid folks in tech make their money. The consulting jobs pay it in cash.

It's not worth the hit to quality of life, in my opinion. It's much easier to plan trips or visit with my friends in tech than the ones in finance. Live to work vs work to live scenario.

The consulting total income figures quoted by the person I was responding to almost certainly include a large bonus which I'd guess is correlated with, if not as volatile as, large cap tech equity returns.

FANG equities don't require making any "bets". They're as good as cash.

FANG equities won't dissolve into thin air from one day to another unlike startup equities, and you get hard RSUs instead of options from an "option pool" that's arbitrarily diluted, but do you know how many percent your FANG equity will increase in value by the time it's vested? That's the bet you are doing. It's not a rigged bet, plenty of people were quite happy this year by the TINA craze buyers pushing tech stock, but it's still a bet.

You don't need luck though, even with no stock appreciation at all you make over $300k a year as a senior engineer at Google. The high salaries you see are mostly without extreme stock value changes.

> without extreme stock value changes.

That's the point, you don't know whether there will be any. So they are definitely not "as good as cash". Just because they aren't lottery tickets doesn't mean they are equivalent to cash.

You are much more likely to get fired and lose all your income than for the stock to lose that much value, so the difference in risk between stock and cash is therefore minimal.

Edit: Just to clarify, $300k as a senior engineer is without any stock appreciation at all. I made $250k as one step below senior without any stock appreciation at all. My point about significant stock changes is for significant stock changes downwards, meaning if the Google stock somehow lost 50% of their value or something like that.

> My point about significant stock changes is for significant stock changes downwards

My point was a more holistic view. It's great that there is a 95% chance that your stock RSUs will increase. But if there is a 90% chance that within 3 years it's a 15% increase or more, you should rather use the 15% increased figure for calculation instead. And then the risk is much higher because it's not just stock not going down, but stock not going up as quickly as it did before.

But I use the 0% figure, so it is how much the company paid and not how much I get. If you count stock appreciation then a simple senior engineer can make 400-500k or more, but people don't really count that.

IDK for me personally that's the metric I'd use when comparing jobs/careers. From your statements alone, it can mean hundreds of thousands of dollars in difference. That's not something to gloss over.

Right, my point is that if you count it as 0% it is significantly better than money, and even with it at 0% the money is still extremely good.

Not sure what you mean by that. Anyways, if given the choice, I think I'd prefer GAFAM for the lower burnout risk alone. Comp is definitely more than enough, and likely higher than what you'd get in finance. I'm getting offtopic but if I start a company and it fails and I have a burnout then I feel like I've done a meaningful journey. If on the other hand I join a company where tons of people burn out then I burn out... that's just stupidity :).

Are you assuming you make L6 IC/Manager by 30? Realistic, but not everyone does it.

The type of person who makes partner at Bain / BCG / McKinsey or their botique equivalents can definitely have that kind of trajectory in a technology company.

Consulting in particular really depends on the company. The big 4 will grind you to the bone, but boutiques often pay better and have much more reasonable expectations of time commitment. I don’t see consulting ever going back to the weekly travel model, and during the pandemic I work maybe 30 hours a week while pulling in the salary I do. Most of my work involves going to meetings, understanding complex business architecture and providing advice around niche topics while working within the politics of a various org. Pulling in a salary+bonus in this range with very little risk on my part.

How would a software engineer/previously small startup 'CTO' get into consulting like this?

I know this is gonna sound corny, but apply for jobs at any of the big 4 to learn the industry, and after a couple years you’ll know the companies you want to work for and have connections through co-workers who have left. Consulting is all about politics and connections, so thinking those aren’t directly correlated to wealth is naive.

Do you see this industry loosening its expectations for an MBA? That is nearly $1m of opportunity cost to some of the technologists who might be interested in growing a management consulting career.

I wouldn't say an MBA is a requirement, but to advance beyond an associate / consultant level you do need a good general understanding of finance, marketing and ops. There's definitely an inflection point where you become more of an expert in your clients' business than any specific technology. Eventually your skills trend towards sales and the business of consulting (staffing projects, managing margin, building capabilities) but that's not much different than the kind of leadership roles (estimating, hiring, mentoring, speaking at conferences, etc.) that senior ICs have to do to make that kind of money.

A good MBA program will help you develop those exact connections the parent comment mentions

My experience has been that it’s a lot more gatekeeping than networking to the extent that I’ve seen banks move away from requiring it.

As with anything, it is what you make of it. HN has a stereotype of MBA students that doesn't always hold up to the real world (though not all stereotypes are wrong).

Help me understand why MBA graduates placing into technology companies as, eg, PMs see little leveling benefits for their efforts versus graduates from the same schools placing at consulting firms? Is the network really that much more essential to a consulting career than a PM career? And is the hours-adjusted total income of a consulting career that much better for wealth building than an extra million bucks pre-tax at age 30?

> Is the network really that much more essential to a consulting career than a PM career?

Yes. I sell projects to my former classmates all the time, and if I ever find myself out of a job, I could have a half dozen interviews within a month. The network is absolutely amazing if you go to one of the top 20 or so schools and have some people skills. You can't really make use of the network if you're a PM.

> And is the hours-adjusted total income of a consulting career that much better for wealth building than an extra million bucks pre-tax at age 30?

Lifetime income for a partner at a consulting company can easily top $30 million -- with the benefit of being able to blow the escape hatch and land in a VP role in industry if you burn out on the consulting work.

How much of this compensation is equity appreciation? Is it realistic to expect this 10 years from now?

Not like interest rates can get lower or search could get less competitive.

I also work in consulting and think it's a bad comparison. At the top levels of consulting most of your job and a good portion of your comp are tied up in sales/profitability, and client/account management with a pretty crappy lifestyle and work/life balance to match. It's significantly more grueling and less of a "coast to riches" path by far than big tech, although you're right that take-home comp can definitely be higher if the aforementioned job type is up your alley.

How many people make it to that $2-20MM partner bracket in consulting? That’s VP range at FAANG and while there are only so many VPs they certainly exist.

Somewhere in the 10% range if you stick with it. Plenty of folks leave to director / VP level roles in industry before they make it though -- the job of a partner isn't one that everyone enjoys.

Ok let's suppose that consulting salaires hit $1M by age 40. What fraction of new hires make senior consultant? Partner?

If your firm is operating on leverage of 20:1, sure you can make $2-20M annually. But, realistically, what are your odds on the margin of making partner 25 years down the road?

What's the stress level like to get there? WLB?