Jesus Christ, I found you by sheer happenstance ! and please, write more, I'll read them all. So much of what you said, reminds me of, how one has to balance illiquidity with depth and love for what you do ... constantly ! corporate jungle has its own rules, and at times, the more specific your application area gets, the more you move away from - showing other potential employers that you can apply first principles to other things as well
The median Asian Tiger parent pushes kids (including grownup kids) to pursue career liquidity, because highly legible and competed-for achievements are the best token of bragging currency in tiger parenting parent circles.
Not a bad bet at least to start, not least because highly legible achievements makes you reliably employable. But if you truly believe in your own excellence, you need to scare your parents a little and turn down the FANNG offer to pursue the “illiquid” path tailored towards you.
The same is for many dating market optimization problems. There are the obvious (legible/liquid) personal attributes that you can and should improve, like becoming more witty, communicative, and rich, and maintaining a healthy weight. But if you have high standards you might need to physically relocate to the market that best suits your niche (high supply Swiss hunks love low supply Asian twinks) or network explicitly for matchmaking purposes.
Ultimately I think young people should build a mixture of liquid and illiquid capital suitable to their risk tolerance.
Interestingly, it’s been argued that when an entire society (of Tiger Parent) competes for the same career and dating liquidity you end up with a high-pressure low-fertility society like South Korea, because parents feel like they need to give every last advantage to their one child, if they have children at all. Otherwise the child cannot compete.
Yeah I’m not sure what the magnitude of this effect is but it seems more than plausible. I didn’t mention this but one problem with these liquid paths is that they’re much more likely to be zero sum.
So well said. The world has changed and this kind of thinking needs to be explicit for people coming into the job market. And we need lots of concrete examples of what a managed investment in an illiquid path looks like. At a high level this is probably 75% overlapped with strong long-term networking, where you can't predict exactly how you'll add value for each other in future but you believe in the relationship. At a deeper level there is doubtless a framework for this management, involving proactive testing of whether it's turning out to have value for others.
Excellent write-up Vaishnav and I'd love to read more! I can attest to some of the observations through personal experience. I started my career with a liquid path, transitioned to illiquid, and went back to liquid through sheer luck; this last move was critical for recovering some market value for my experience but still remains far lower than what my peers make given they stuck to liquid paths throughout and because it's hard for employers to put a price on the skills coming through the non-traditional move halfway in my career.
However in terms of eventual overall gains, my attempt at a non-traditional path in between my career will allow for more riskier bets down the road and hopefully one of them will pay off substantially.
It's probably best to stick to the liquid path until you're confident of your long-term employability. Maybe then take a non-traditional route and in the event of failure, make your way back less scathed.
Not sure how I stumbled up on this piece, but it's very useful framing to consider the balance between a conventional vs. unconventional career.
Too often, people want to have it all... a conventional career + some magical upside they'll never achieve. Or they want an unconventional career + clarity in rewards/status.
Thank you so much for this article! Gave me some much needed clarity for my own paths. Fresh out of college last year, I had chased and dabbled in a bunch of illiquid roles looking to gain everything you mentioned about, hoping to "stack" all these experiences for something bigger down the line, but I wasn't able to derive the expected value I hoped they would (reasons as mentioned in this same article). A liquid role is something that seems beneficial at my current stage of career now
However, analogy to Financial markets seems flawed - Financial markets provide a liquidity premium and not an illiquidity premium.
For a same company - if its liquid (publicly listed with good trading volumes), an investor will pay higher (due to lower risk of getting stuck with investment) than a non-liquid company, all else equal.
I would expect that to work out in human capital market too (employers taking risk on a more offbeat profile and hence may pay lower)
Jesus Christ, I found you by sheer happenstance ! and please, write more, I'll read them all. So much of what you said, reminds me of, how one has to balance illiquidity with depth and love for what you do ... constantly ! corporate jungle has its own rules, and at times, the more specific your application area gets, the more you move away from - showing other potential employers that you can apply first principles to other things as well
Thanks so much. Just wrote the sequel today - here you go - https://www.optimaloutliers.com/p/volatility-laundering-how-to-tell
SO good. Thanks for taking the time to write this, Vaishnav.
Thank you Rahul !
The median Asian Tiger parent pushes kids (including grownup kids) to pursue career liquidity, because highly legible and competed-for achievements are the best token of bragging currency in tiger parenting parent circles.
Not a bad bet at least to start, not least because highly legible achievements makes you reliably employable. But if you truly believe in your own excellence, you need to scare your parents a little and turn down the FANNG offer to pursue the “illiquid” path tailored towards you.
The same is for many dating market optimization problems. There are the obvious (legible/liquid) personal attributes that you can and should improve, like becoming more witty, communicative, and rich, and maintaining a healthy weight. But if you have high standards you might need to physically relocate to the market that best suits your niche (high supply Swiss hunks love low supply Asian twinks) or network explicitly for matchmaking purposes.
Ultimately I think young people should build a mixture of liquid and illiquid capital suitable to their risk tolerance.
Interestingly, it’s been argued that when an entire society (of Tiger Parent) competes for the same career and dating liquidity you end up with a high-pressure low-fertility society like South Korea, because parents feel like they need to give every last advantage to their one child, if they have children at all. Otherwise the child cannot compete.
Yeah I’m not sure what the magnitude of this effect is but it seems more than plausible. I didn’t mention this but one problem with these liquid paths is that they’re much more likely to be zero sum.
So well said. The world has changed and this kind of thinking needs to be explicit for people coming into the job market. And we need lots of concrete examples of what a managed investment in an illiquid path looks like. At a high level this is probably 75% overlapped with strong long-term networking, where you can't predict exactly how you'll add value for each other in future but you believe in the relationship. At a deeper level there is doubtless a framework for this management, involving proactive testing of whether it's turning out to have value for others.
Excellent write-up Vaishnav and I'd love to read more! I can attest to some of the observations through personal experience. I started my career with a liquid path, transitioned to illiquid, and went back to liquid through sheer luck; this last move was critical for recovering some market value for my experience but still remains far lower than what my peers make given they stuck to liquid paths throughout and because it's hard for employers to put a price on the skills coming through the non-traditional move halfway in my career.
However in terms of eventual overall gains, my attempt at a non-traditional path in between my career will allow for more riskier bets down the road and hopefully one of them will pay off substantially.
It's probably best to stick to the liquid path until you're confident of your long-term employability. Maybe then take a non-traditional route and in the event of failure, make your way back less scathed.
Actually curious to hear about this -- can you share more about the field(s) and transition process?
Not sure how I stumbled up on this piece, but it's very useful framing to consider the balance between a conventional vs. unconventional career.
Too often, people want to have it all... a conventional career + some magical upside they'll never achieve. Or they want an unconventional career + clarity in rewards/status.
(P.S. has some similar themes to my writing on leverage: https://newsletter.thewayofwork.com/p/career-leverage)
"In financial markets, illiquid assets often command a premium - investors accept lower liquidity for the prospect of higher returns"
Illiquid assets require a discount. They provide higher return because you can buy them cheaper than the equivalent-but-liquid asset.
If it holds for careers, it would bolster the case for hiring illiquid candidates, but not for being one.
Right this is what I have been thinking as I read this as well.
It does seem to be a primary downside for illiquidity unless one really has high conviction
Thank you so much for this article! Gave me some much needed clarity for my own paths. Fresh out of college last year, I had chased and dabbled in a bunch of illiquid roles looking to gain everything you mentioned about, hoping to "stack" all these experiences for something bigger down the line, but I wasn't able to derive the expected value I hoped they would (reasons as mentioned in this same article). A liquid role is something that seems beneficial at my current stage of career now
This is ‘Drop the Mic 🎤’ content mate. Fantastic 👊
Very interesting point of view. Thanks for writing this. I didn't know it when I made this, but I was offering simple tips for the illiquid to get the attention of hiring managers.https://www.linkedin.com/pulse/how-write-cover-letter-wont-break-hiring-managers-live-joe-donatelli
Thank you for your writing! It sounds like a different angle in the discussion about generalist vs. specialist path :)
**Excellent** post. Bravo.
Very interesting idea. Great post
Good write up and interesting concept to explore!
However, analogy to Financial markets seems flawed - Financial markets provide a liquidity premium and not an illiquidity premium.
For a same company - if its liquid (publicly listed with good trading volumes), an investor will pay higher (due to lower risk of getting stuck with investment) than a non-liquid company, all else equal.
I would expect that to work out in human capital market too (employers taking risk on a more offbeat profile and hence may pay lower)