Career Trauma in Tech & Finance
I was laid off in 2010.
As far as layoffs go, I was fortunate. My employer, a boutique investment bank, handled the process with fairness. They let me keep the handful of M&A clients that I had brought in, which became invaluable in starting a new firm. The layoff itself was less painful than it could have been since I had already endured a humbling string of broken deals over the preceding 18 months. I was primed for it.
For the career-oriented like so many of us in tech & finance, it can be very difficult to process major career setbacks. Significant sources of self-worth and internal validation can become unmoored, even vaporized.
Even if they aren’t being laid off, many tech founders & VCs are experiencing a similar sort of psychological career trauma. While “trauma” is a strong word, I think it’s an appropriate description for the experiences of many.
To realize that most of one’s net worth is gone, or that it was never there in the first place. To realize that one’s career accomplishments might not, actually, be accomplishments. To feel the consistent stream of career progress of recent years suddenly stop & reverse course. Every individual will experience this differently, but, on balance, this is a brutal experience.1
I write this for two reasons. One, this is a “note to self” to remind myself to practice empathy and understanding for those in the industry who are suffering today. Two, I think the psychological dimension of a popped bubble has a few counterintuitive consequences in how the “new normal” in tech emerges over the next year or two:
It will take time - citing the 5 stages of grief might seem overly dramatic, but I think it’s an apt model for career-centric people who deal with precipitous falls in career status & achievement. It could easily take a few years for many to reconcile what has happened.
Many will consume medicine slowly - from the outside, the need for layoffs & mark-downs and other major remedial actions might seem obvious. From the inside, the psychological tumult will tend to produce avoidance behaviors.2 This is exacerbated by bubble-era valuation marks which provide grounds for plausible deniability.
It IS a great time to start something - I’ve seen some VCs mocked lately for saying that “now is a great time to start a company.” These VCs are right and this is a major reason why. Determined founders who embark on a startup now will be in a position to blow by the struggling, over-funded startups that populate many market segments.
Of course, most tech workers have amazingly comfortable lives. But the pain of mental health challenges is real, regardless of material circumstance.