How important is employer’s ‘brand’ when selecting your first job? Depends on a sector and your career path, but it matters more than you may think – especially in the beginning of your career.
I am often accused of brand-collecting. I worked at McKinsey & Co, Goldman Sachs, and my current private equity employer would fit the bill too. It was not the goal to go after the big brands, but when you have a choice among similar job offers, you may as well go after the best brand.
Employer brand is important for multiple reasons. First, given that the company’s brand is strong, it probably means that it is among the sector leaders and it has done something right to get to its current position. You would thus be able to see how ‘best practice’ should look like, and leverage it in your future career. Second, brands (often) attract top quality people (who are attracted by brand – virtuous cycle) – hence you can learn from the best and establish a valuable network. Third, the combination of training/mobility opportunities, career path progression, job stability, and financial compensation/benefits is likely to be very attractive. Top branded companies often do not pay the top dollar (because they do not need to, versus their less-known peers who need to pay up to attract talent) but the total package of all of the above is usually very competitive.
The biggest benefit of a branded employer for me is the ‘positioning’ in the career market and the opportunities it opens. Even though it is not always fair or rational, recruiting managers and companies use shortcuts. When Goldman Sachs receives more than ten thousand applications for a summer internship (in London only), they are going to go through it by screening for brands (of both previous employers as well as schools). They essentially rely on brands having attracted the top people in the past, so they rely on your previous employer/school doing the first screen for them. The same happens when private equity firms or hedge funds go out to recruit new analysts/associates – they will target the top few investment banks/consultancies. Candidates from other firms may be equally or more qualified, but may not even get the chance to show it at interviews.
I think the importance of brands is particularly important in the beginning of your career. If you start at one of the blue chip firms, future doors will open more easily. As you get more experience and finish your analyst/associate programs, the importance of getting a second or third brand on your resume decreases. People already understand that you were top ranked among your peers and got a high quality training/experience, and will be more interested in what specific experience you bring to the table. From a career perspective, it is thus easier to take some risk by joining/founding a smaller firm, often motivated by more responsibility / higher economic upside, as you would be able to go back to the more mainstream path if you wanted to. Your ability to take risk is thus higher, but it may be offset by your willingness to take it. People become more risk averse over time (esp. after settling down/starting a family) or get too tied up with the ‘golden handcuffs’ of stability and predictability of their existing jobs.
What is the counterargument for focusing on brands? Going after the big brands is the ‘safe’ option. If you join McKinsey & Co or Goldman Sachs, you may be less likely to found the next Apple, or join the next unicorn startup as one of the early employees. And that is true. But if you were attracted to one of the big brands in the first place (with all the pros/cons it entails), a garage startup would unlikely be a real alternative for you anyway. It is also important to keep perspective and not to put brand above everything else – the actual job responsibilities, team fit, or maybe most importantly your personal/moral values. Life is too short.
I am relatively risk averse and chose the ‘branded’ path as the highest probability-weighted path to doing interesting work and becoming financially secure, without taking on too much risk. I suspect it was driven by both my background as well as my personality. But I recognize people’s circumstances and desires are different – and applaud everyone who has the guts to venture off the beaten path and follow their passions.