Management Consultants and Tech Startups: The Perfect Match?
More and more often, tech startups are seeking to hire candidates with experience within Management Consultancy. Of the seven offers made by one of Zeren’s key clients in the last 11 months, for example, four of them were extended to candidates currently working as a Management Consultant. Of the remaining three offers to candidates working in other areas, one had experience working in a ‘Big Four’ firm prior to entering the tech world.
On the other side of the coin – and with increasing frequency – more and more Management Consultants are interested in exploring the world of high-growth tech as a potential career move. In a recent outreach to Management Consultants regarding the opportunity to work with a Series-B-funded tech client in Stockholm, the response rate from the candidate pool clocked in at 63%. (For context, an average LinkedIn InMail campaign might generate a response rate of somewhere between 18-25%.)
It seems clear then that there is a mutual attraction between high-growth tech firms and Management Consultants. But, perhaps on face value at least, these careers and working environments might not seem the most obvious of matches. So why is this happening? This becomes clearer when we look at both perspectives individually.
Why do high-growth tech firms want to hire Management Consultants?
- Academic Pedigree:
- The barrier for entry into Management Consultancy is notoriously high. Therefore, it can often be assumed, that a Management Consultant, (particularly one from a top-tier Consultancy), will have an outstanding academic background. They are also likely to have overcome a variety of challenging aptitude tests to secure their current position. Tech firms are keen to hire the best of the best, and academic background is a common litmus test for this.
- Management Consultants will typically work on numerous projects during their time in position. The duration of these projects will range from anything between a couple of days, to half a year or longer, and even if a Consultant is specialised within a certain industry, the types of clients they will be working with will be equally as varied. This means that Consultants are adaptable and much more flexible in their daily work; a dynamism that is invaluable in the agile world of scaling tech companies.
- Typically, Management Consultants will spend a large amount of their time interacting with senior stakeholders of large enterprises, from Heads of Department through to the C-Suite. This exposure not only creates a deep understanding of the way in which senior industry profiles conduct themselves and their business matters, but also the gravitas and the toolbox to manage these relationships and, more importantly, to influence them.
- Skills Toolbox:
- The skills gained through working as a Management Consultant are incredibly valuable to high-growth tech businesses. Naturally, a Management Consultant’s exposure to business strategy makes them strong candidates for strategic Business Development, Operations, and Product roles; nevertheless, there is a growing clamour for Management Consultants in commercial capacities, too. Roles in Key Account Management and Sales within many tech startups – especially Enterprise Software – require skills that many will possess, also. For example, the ability to analyse and tell stories with large data sets, as well as complex problem solving is particularly useful for solutions, or value-based selling of technical products. These commercial roles may not be roles that Management Consultants have necessarily considered as a potential career move, but they can prove extremely successful, fulfilling, and lucrative moves.
Why do Management Consultants want to work in tech startups?
- It is Cool:
- Perhaps this is not necessarily Management-Consultant-specific, but working in a tech startup is cool. Startup life is synonymous with excitement, innovation, and entrepreneurialism. Offices filled with beanbags, company MacBooks, baristas, and ping-pong tables usually spring to mind when someone asks, “What is startup culture?”. On a more practical level though, even if a startup fails, there is a general consensus that you can learn a great deal more in two years of an unsuccessful startup, compared to spending two years in a lower-rung role within a large corporate. Management Consultants tend to have a strong appetite for continual learning and that can be satiated, if not accelerated, at a startup, all the while feeling a great deal cooler than they did in corporate life.
- Progression and Development:
- Whilst Management Consultancy has a clear progression path, it does not necessarily satisfy a Consultant’s desire to progress and develop their career. Though job titles will vary from company to company, the career path usually looks something like “supporting someone else’s projects”, before “leading a team to support someone else’s projects”, and then progressing to “leading projects”, that ultimately culminates in reaching the levels of Director and Partner. For many Consultants, this progression path merely represents a variation of a theme. The core of their work will not change, so their only progression is if, or how many, they will manage. Startups on the other hand, offer a flexibility to progression, which is highly desirable. The opportunities for an individual will change as the business grows, and it is this malleability that is so attractive.
- Accountability and Impact:
- Management Consultants are usually high performers, whether that be academically, professionally, or in extra-curricular pursuits like elite sport or music. Many will have a history of taking accountability and ownership of their excellence within these areas. Perhaps it is unsurprising, therefore, that many grow frustrated at the lack of ownership and, more importantly, the lack of impact in their day-to-day Consultancy work. Due to the very nature of Consulting projects, it is extremely rare that a Consultant will ever see the fruits of their labour being implemented within their clients’ businesses. So, it is extremely common for Management Consultants to seek a role within which they can make a tangible impact, daily. Without seeing this impact, and without having this accountability, Consultancy can very quickly become demoralising, whilst a truly business-critical role within a startup looks even more appealing.
- It is well documented that life as a Management Consultant can be tough: long hours; tight deadlines; unrelenting work. It is also well documented that Management Consultancy is a lucrative career. The trade-off is quite straight forward in this instance. Importantly, though, these impressive packages are usually limited to above-average basic salaries, occasional bonuses, and comprehensive benefits packages. What is lacking, is any ownership or stake within the business. This is where life in a tech startup has a huge magnetism for many Management Consultants. Equity, or Options, within a tech startup is one of the main draws, if not the main draw, for Consultants considering a move. In fact, many would be willing to drop substantially in base salary in return for a stake in the startup they are joining. The financial upside of a possible exit or acquisition is a big motivator, and something that would never be possible in their current roles.
Zeren exists to empower the world’s change makers. We have done so recently by placing numerous Management Consultants into the world’s most innovative businesses.
If your business could benefit from the skill-set a Management Consultant would bring, or if you are a Management Consultant wishing to transition into the world of high-growth tech, please contact a member of the Zeren team.