Fintechs entice MBA graduates away from banking and consulting
In the past, most MBA graduates have chosen to become consultants in professional services firms or to work in banking after completing their education. However, this trend is changing.
With fintechs on the rise, students find them appealing; they are able to work in a fast-moving, innovative environment and see the results of their efforts - something they can’t often experience in the world of consulting.
Many fintech founders are business school alumni, and as the fintechs look to grow and expand, they are looking to hire highly qualified business school graduates.
A report published in 2015 by Goldman Sachs revealed that approximately $4.7 trillion in revenues generated by financial services are at risk due to fintechs, as they are gradually taking over the marketplace.
According to IE Director of Talent and Careers, Irina Zilbergleyt, graduates are attracted to fintech because their decisions are given importance and they feel like vital members of the team. She also stated that this trend is leading to competition between fintech and investment banks and consultancies.
Nutmeg Founder, Nick Hungerford, completed his MBA in the US and returned to the UK to start his company. He stated that out of a workforce of 78, eight are MBA graduates, including the chief marketing officer and two product managers.
Hungerford stated that professionals in the UK are not very familiar with the equity model of remuneration and prefer getting cash payments and bonuses. However, this is not the case with MBA graduates, who have a thorough understanding of the model and realise that equity is more valuable than a fixed salary.