Lessons from The Greatest Good

I spent my past summer at the Greatest Good, a consulting boutique headed by Steve Levitt and other Chicago economists. I got to work with transaction level data for various companies. It was the first time I had properly played with large datasets and it set me on course to pursue a career in data science.

Being able to squeeze meaning from data is not simply a science, but also a craft.  My summer gave me a first glimpse at what may be useful guiding principles and I wanted to share them with you:

  1. Always browse your raw data to see what’s actually there, you might be surprised. Scatter plot your data and residuals. Use histogram or box-and-whiskers charts to visualize distributions. Summary stats never tell the whole story.

  2. Aggregate data to the right level. Abstract too much and you lose information. Look too closely and you lose the bigger picture.

  3. First build a simple model, then dig further. This makes your time better spent. 

  4. Think really hard about your assumptions. Never forget them. Test your them if possible. Make sure your assumptions don’t weaken your analysis.

  5. Have a story to tell. Don’t just recite numbers. This forces you to think harder about what’s actually going on and it allows you to communicate better

Picking a Startup

 

OnStartups has a good post on questions to ask before joining a startup. As I tried to decide whether to join a startup as my first job out of college, however, I thought that list was incomplete. So here are the 10 questions I asked myself as I approached this career decision:

  1. Are the founders on the same page? Many startups fail because they the founding team falls apart, so it’s a good idea to make sure they’ll stick together when the going gets tough. Find out how the founders know each other. Find out why each of them is doing this startup and see if their goals line up. Ask each of them what they’re vision is and see if they’re on the same page. Find out how they work through disagreements. Find out if they respect each other and understand how each other thinks.

  2. Are the founders willing to give everything to make the startup work? Have the founders been working on this startup full-time? How much time have they put in? What did they give up to pursue this startup? You want to make sure that in tough situations, the founders will have the determination to pull through. Startup success relies heavily on the sheer determination of the founders. If the founders aren’t putting 200% into the startup, why should you?

  3. What is the story behind the idea? How did they identify the market need? How long have they worked on this startup? Have they changed course? If so, why? Do they have a convincing story? Do they really know what they’re talking about? If they tell you they’ve been working on this idea for a year and have iterated in a dozen different ways, great. If they just came up with the idea three weeks ago and are hiring already… it’s time to walk away.

  4. Are there signals that their idea will work? Even though people are often wrong, second opinions are useful when you don’t know a whole lot about the founders or the market. Have they raised money? Do the backers have a track record of investing in successful companies?  Are the founders active members of the startup community and do people respect them? If they have a product, play with it and see if you’re impressed. Ask how much traction they have. Ask about whether their customers come back. Read reviews and comments on Hacker News.

  5. How long will their cash last them?  When I was traveling in Europe last summer, I met a Oxford professor who offered his wisdom to me. He said, “You can’t run a business without cash.” Let me repeat that, “You can’t run a business without cash.” So make sure that the company you join has cash. I don’t mean plans to raise cash. Or conversations with investors. I mean money in the bank. Don’t be afraid to ask: How much money in the bank do they have? What’s their burn rate? How much revenue do they have? If they’re unwilling to tell you at least be frank about their situation, walk away.

  6. Will you get along with the team? If you’re working 12 or even 15 hours a day, you want to make sure that you will get along with the team. Do you respect them? Do you think you’ll be able to learn a lot from them? Do you see yourself becoming close friends with them? Meet them and talk to them. If you’re not sure you would actually enjoy being stuck on an desert island with these folks, think again.

  7. Are you passionate about the idea and the job? By the same token, if you’re working 12 or even 15 hours a day, you want to make sure that you love your job. Find out about the details of your day-to- day work. Ask yourself if you failed in the end, would it still be worth it to have spent 2 or 3 years working on this idea?

  8. What will the startup do for you? In addition to making sure you will be actually useful to the startup, you should make sure that the startup does something for you. Will the startup let you wear multiple hats? Does it allow you to see they things you want to see? Will they give you control and discretion? Will they help you break into the startup community? Will you get to work with the people you want to?

  9. What do you have to lose? Do you have a family to care for? Health problems? Hobbies you don’t want to give up? How important are these things to you? Alternatively, are you disciplined enough to leave time for those other things even with a very demanding job? Like I said, startup jobs are more time-consuming and exhausting than most regular jobs. Make sure you don’t jeopardize the other things in life that are important to you.

  10. How bad can you be burned? Remember, startups fail all the time. So expect to be out of a job. How much money do you have in the bank? Are others dependent on your job security? A startup job doesn’t mean that it’ll be harder find another job. In fact startup experience is highly positive to many employers, especially at other startups. What a startup job means, though, is that you are more likely to end up spending a couple months unemployed and looking for something else to do. If this is a problem, joining a startup may not be for you.

In the end, I decided against joining a startup. But the decision may look completely different for you. Ask yourself these questions, and if you still think working a startup is the right choice for you, go for it and have a blast.

Landing a job at an elite firm

Bryan Caplan summarizes Lauren Rivera’s findings about the recruiting process at elite law firms, investment banks, and management consulting firms. Here’s how you make it:

  1. Go to Harvard or Princeton. Elite firms focus their candidate search at only the most prestigious schools. “Public ivies” such as UMich or Berkeley don’t get nearly as much attention.

  2. Do the right kind of extracurriculars. Be a varsity athlete. Climb Everest. Tour Asia as a concert pianist. Be unique in the right way. Do things that signal work ethic, sociability, and drive.

  3. Maintain a good GPA. Grades matter, but just as a cutoff.

  4. Follow the same path as people who made it. Evaluators have a lot of slack and they tend to recruit people who are similar to themselves.

Now is this system fair? According to Rivera,

Admittance and attendance at a prestigious educational institution is heavily grounded in an individual’s socio-economic background and that of his/her parents (see Bowen & Bok, 1998), partially because of the use of extracurricular activities as a criterion of evaluation. The use of time and resource-intensive extracurricular involvement at college or graduate school by employers, however, has the potential to result in a double filter on socioeconomic status that could significantly disadvantage those candidates who attend super-elite universities but who come from less affluent backgrounds.

Indeed, to impress the elite, you’ve got to look like one. And sadly, this emphasis on extracurriculars achievement is force towards social closure. In the end, the recruiting process ends up serving and perpetuating people who look like the elite. So you want to work for an elite firm? Do as they say: fake it till you make it.

Read Lauren Rivera’s ”Ivies, Extracurriculars, and Exclusion” here. Highly recommended. Also, thanks to Simone Zhang for thoughts!

Advice from my father

A couple days ago, I wrote to my parents to let them know where I’ve decided to work as my first job after college. In response, my father sent me this email about making friends and following one’s passion.

All of it is well worth read. I thought I’d share:

Dear Michael:

Plans are difficult to make and stick with them. So keep an open mind and rely on a few principles to guide your choices.

My life I chose to do things I would enjoy and believed I could do an excellent job; and started from there. This was teaching. This was not necessarily the only thing I could do well and enjoyed, but one started somewhere. I was much less ambitious than what I achieved eventually. If you enjoyed what you do then your clients will return and your career will develop from there.

Make friends at work and outside work. When I started I had colleagues at Chinese University. Outside I had friends discussing social-political issues. So stay active and meet friends and do things together. Join groups and expand out based on what interests you.

Do not keep a firm unchanging opinion of yourself, like I am in production not marketing. The two are not really so far apart and who knows what is your real talent.

While an economist always tell you to focus on your comparative advantage. In reality your comparative advantage grows with what you work on. And this is more guided by what you enjoy doing, and it makes you good at it.

Eventually, what you will achieve is as much guided by what you do and by your friends’ support. So keep eclectic groups of friends around you. Cultivate their friendship and pursue shared interests together.

You should grow inside and outside your job. It will make you an interesting person. Jobs do not define what you do. Always try to make your job do some of the things that you want to do. Shape your job, do not let it shape you. The job that allows you to do these things is a good job. The best employer want you to bring something to the job, not just to deal with the stuff on your desk.

Remembering Grandma Wong

I remember from the fuzzy edges of my distant memory how I always came home to my Grandmother during kindergarten, back when she lived with us in order to care for me. We would spend entire afternoons looking out the window counting the taxis occasionally passed by. On weekends she’d take me to dimsum or Hardees at the mall in ChiFu. We’d play in the arcade together. Sometimes we’d walk through the wet market and wander in the garden. She’d tell me stories about her youth in Shanghai, the communist takeover, and her journey to Hong Kong—this city which was really a foreign place to her. She told me about her life in this new city, her new friends, my grandfather whom I’ve never met, bringing up my father, seeing him leave for the States. She spoke to me in eclectic mix of Shanghainese and Cantonese that few others would probably understand. And I would always listen attentively. During those years in Pokfulam, she was my constant companion. We even had our own language.

When I was in 3rd grade, my family moved away from Pokfulam so that I could be closer to my primary school. Meanwhile, grandma was immersing herself in the life of the Chi Fu community. I’d visit her to hear her stories. She’d visit us and bring new clothes for me to wear, and snacks from St. Anne’s for me to eat. I always looked forward to our visitations, but at same time I began to grow too impatient to just sit around to hear stories. I was discovering a whole new world beyond our friendship and I wanted my own stories to tell.

Eventually, I left for the US to go to school, only returning to see my grandma two or three times a year. And during that time, my grandma’s frame began to shrink. She stopped dying her hair black and it turned a frosty grey. She slipped, fell, and was hospitalized one summer, when I was home from abroad, which began a long process of declining morale. She moved in with us for the past 6 years, and she grew quiet and resigned. When I saw her in June, she was tired and sleeping more than she ever had since I’ve known her. I could not have guessed that June would turn out to be my last time seeing her. I had not yet told her all the stories of my growing up, my adventures, my successes, and my failures while I was gone. She would have loved to hear and I wish I still had the chance.

If there were one thing I’d like my grandmother to be remembered for, it would be her immense love. Though it was not always easy to understand her language, her traditional thinking, and her stubborn personality, she was really full of love. I know this because I’ve experienced it first hand again and again and again. She always wanted the best for her son and her grandchildren. Even as she aged, she always wanted to make we were well fed and happy—even though I was not always there to make she that she was the same. She believed in us and she believed that we would do something good in this world. She was always proud of our accomplishments, however insignificant it may be. I will miss her sorely, but I know that her love has not and will not dim. When there is a chilly evening, and I remember to bring a coat, it will be her loving voice that reminded me. And if I manage to do some good in this world, I will think of the proud smile that she would have carried.

~

Chinese version:

我依稀記得,我小的時候,住在薄扶林,幼稚園放學回家後,嫲嫲總會耐性地陪我做功課。做完後,嫲嫲陪著我,從家中的窗口,數著偶然經過的的士。 我又記得,周末時,嫲嫲帶我到置富去飲茶,之後有時會在商場中流連,有時會到公園散步。嫲嫲最喜歡跟我說故事,說她年青在上海的歡樂歲月,說戰亂和逃難的經歷,她會描述如何安居香港,如何把我的父親撫養成人,送他到外國留學。她用他很重的上海口音,說了很多的故事給我聽。當時,我倆是最好最好的朋友。

當我十歲和妹妹五歲的時候,父母想方便我們上學,決定搬離薄扶林。我們的世界就變了。雖然我們經常回到置富,嫲嫲也常常帶了許多新衣服和零食探我們,但是我們已經不再像從前,我們倆兄妹認識了自己的朋友,有了自己的興趣,不肯整天靜聽嫲嫲說故事。到我十四歲,我到美國留學,妹妹後來也跟著出國留學 ,我們一年只回港2或3次,見嫲嫲的時間也越來越少。

而就在我們成長的同時,嫲嫲的體形開始萎縮,精力不再,她也再不像以前那樣喜歡染髮,髮色變成班白。時間飛逝。我想不到,我和嫲嫲6月相見,妹妹和嫲嫲8月相見,變成了我們的永別。我和妹妹很多成長的經歷,我們對來日的夢想,想跟她一一分享,可惜時機已過。

最可惜的,是我們從來沒有告訴她,她是世界上最好的嫲嫲。儘管她思想傳統,個性執著,她內心充滿無條件的愛。這我們很清楚,因為我們有幸一次,再次及多次感受過。嫲嫲為她的兒孫奉獻一切:辛苦的時候 ,她總是靜靜忍受;年紀老邁時候,她仍然記掛著我們的飲食和快樂。如果天氣寒冷,我會聽到她慈祥的聲音提醒我,要多穿件衣服。如果有一日我有多少成就,我知道掛在她臉上,會是多燦爛的笑容。我和妹妹曦林,會永遠懷念嫲嫲無微不至的愛。