Excerpted from SMART PEOPLE SHOULD BUILD THINGS by Andrew Yang
I believe there's a basic solution to our country's economic and social problems. We need to get our smart people building things (again). They're not really doing it right now. They'd like to. But they're being led down certain paths during and after college and told not to worry, they can figure it out later.
Take me, for instance. I wasn't very enterprising when I graduated from Brown in 1996. I had a general desire to be smart, accomplished, and successful -- whatever that meant. So I went to law school and became a corporate attorney in New York. I figured out I was in the wrong place after a number of months working at the law firm. I left in less than a year and cofounded a dot-com company, Stargiving, which helped raise money for celebrity-affiliated nonprofits. It was extraordinarily difficult. My company failed spectacularly, but I recovered. I went to work for a mobile software company, Crisp Wireless, and then a health care software company, MMF Systems, over the next five years, eventually becoming the CEO of a test-prep company, Manhattan GMAT, in 2006.
I spent five years running Manhattan GMAT, helping young people get into business school. I taught our corporate classes of investment banking analysts and consultants at Goldman Sachs, McKinsey and Company, JPMorgan Chase, Morgan Stanley, and Deloitte, as well as hundreds of individual students over the years. Some were exactly where they wanted to be. But there seemed to be just as many top-notch young people who wondered why they didn't like their jobs more. They sought a higher sense of engagement with their work and their careers. Sometimes they would put words to what they were looking for; they'd say they wanted "something entrepreneurial" or "to be really excited about something."
By the time my company was acquired by Kaplan and its parent, the Washington Post Company, in 2009, I knew a few things. I knew that there were promising startups and growth companies all over the country that needed talent to expand and thrive. I knew firsthand that there was an army of talented, ambitious, somewhat directionless young people who'd love to work for a startup. And I knew that if we could connect these two groups, we'd help everyone: the individuals, the companies, cities and communities around the country, the economy, and society as a whole.
When I was younger, I subscribed to a general view of our educational system that goes something like this: If you study hard and do well in high school, you'll get into a good college. Where you go to college is very important. Then, if you do well in college, perhaps you'll go on to law school or med school, or maybe academia if you're an intellectual sort. In any case, if you're smart and work hard, you'll wind up with a good job.
That "good job," in this scenario, is a job that requires a lot of complex analytical thinking and pays well, like investment banking or management consulting. If a student takes a professional route, becoming a lawyer, doctor, accountant, or dentist, he or she will need additional years of special training to develop professional skills and judgment -- all very attractive to high achievers.
This is our system of training and employment, and it functions very well. Smart, hardworking kids go to good schools and get trained for good jobs. The job market operates with great efficiency, and that is a big reason why our economy is so successful.
There's another view of the current system, though -- that it's a mess. Ambitious college students have no real idea what to do upon graduation, but they're trained to seek the "next level." Many apply to law school, grad school, or even medical school because of a vague notion of status and progress rather than a genuine desire or natural fit. Those who try to do something independently often find themselves frustrated by their lack of rapid advancement, and so default to a more structured path of law school, business school, or graduate school. The concentration in professional services leads our national university graduates to congregate in a handful of metropolitan areas -- primarily New York City, Silicon Valley, Boston, and Washington, DC. Those who become bankers or consultants are highly paid and heavily socialized, yet many become disaffected due to a lack of purpose an unsustainable lifestyle, and some simply discover they don't enjoy their roles. We train thousands more lawyers each year than legal jobs exist for, and hundreds more academics than there are academic jobs. Each path throws off waves of refugees who are often at a loss as to what to do with themselves, only at that point they're in their late twenties, possibly in debt or used to an expensive lifestyle, and trained to do something narrow and specific.
Meanwhile, massive needs in other sectors are not being met. American companies need smart people who can manage, operate, innovate and improve them. And startups and early-stage growth companies are in desperate need of talent in order to create jobs and drive economic progress. The metropolitan areas of Detroit, New Orleans, Baltimore, Philadelphia, Cleveland, Cincinnati, and Las Vegas account for over $1 trillion of US gross domestic product and represent a vastly diverse range of industries. The trajectory of the young growth companies in these cities and others like them will determine the direction of our economy. Detroit alone is our twelfth largest metro region, with over 3.6 million people. Its post-bankruptcy renewal is one of the great projects of this age. Unfortunately, it doesn't have a giant recruitment arm to make the case on college campuses.
Our identification and distribution of talent in the United States has gone from being a historic strength to a critical weakness. We've let the market dictate what our smart kids do, and they're being systematically funneled into obvious, structured paths that don't serve them or the economy terribly well.
The book Smart People Should Build Things makes a basic argument. If year after year we send our top people to financial services, management consulting, and law schools, we'll wind up with the pattern we're already seeing: layers of highly paid professionals working astride faltering companies and industries. But if we send them to startups, we'll get something else. Early-stage companies in energy, retail, biotech, consumer products, health care, transportation, software, media, education, and other industries would have a better chance of innovating and creating value. Even allowing for a certain amount of failure, we'd create hundreds of new companies and tens of thousands of new jobs over time. Our economy and our country would be better off. Our communities' tax bases would go up, shoring up our ability to pay for schools and long-term development. We'd restore our culture of achievement to include value creation, risk and reward and the common good. By solving this one problem, we solve many other problems at the same time.
"Smart People Should Build Things: How to restore our culture of achievement, build a path for entrepreneurs, and create new jobs in America" will be released on February 4th, 2014. Preorder your copy today at SmartPeopleShouldBuildThings.com.
© 2014 Andrew Yang. Reprinted courtesy of Harper Business, an imprint of HarperCollins Publishers.