Wall Street’s Frantic Push to Hire Coders10.31.2016 By John D'Antona Editor, Traders Magazine
(this story originally appeared on Bloomberg)
For almost five years, Gregory Furlong worked 50-hour weeks as a shipping clerk at a Best Buy two miles from his childhood home in Wilmington, Delaware. It was a kind of employment purgatory for a computer obsessive who tinkers with motherboards in his free time.
So last year, Furlong, 30, enrolled in a three-month coding boot camp that uses HackerRank, a web platform that trains and grades people on writing computer code. After earning a top ranking for Java developers globally, Furlong was hired by JPMorgan Chase & Co. in December for its two-year technology training program.
This is Wall Street’s new tech meritocracy. Financial institutions traditionally coveted graduates from Stanford and other big-name schools and people already working in Silicon Valley. But that system tends to overlook good programmers from other schools or gifted dropouts, according to recruiters. And besides, banks need to fill so many programming jobs that elite schools can’t possibly pump out enough candidates.
“This is purely about skill,” said 28-year-old Vivek Ravisankar, a HackerRank co-founder who used to work for Amazon.com Inc. “Most really good programmers learn on their own and just continue to build their skills. Probably the really good programmers are college dropouts.”
The service is part of a broader trend among U.S. corporations to bring data rigor into recruitment, instead of relying only on resumes and interviews. Those methods have been known to perpetuate biases and aren’t always predictive of on-the-job success. Goldman Sachs Group Inc. said in June it was overhauling the way it hires junior staff, using resume-screening software and replacing campus interviews with video submissions that are scored.
“Finding people through alternate channels, we weren’t doing that five years ago,” said Michael Zbranak, a managing director in JPMorgan’s global technology division. “Now we absolutely do it, because we’ve seen it work.”
There are at least 500,000 technology workers at banks globally, and about 10 percent of them have to be replaced annually due to attrition, according to Chris Skinner, a London-based technology consultant to financial firms. JPMorgan, with more than 40,000 technology workers, hires thousands annually just to replace those who depart.
HackerRank is free for coders and makes money from fees from corporate clients. Users perform challenges and watch video tutorials to sharpen their skills in specific coding languages such as Java; solving harder problems results in higher rankings. They can also join contests set up by employers with challenges related to jobs they want to fill.
Goldman Sachs, BlackRock Inc., and hedge fund Two Sigma are among HackerRank clients, as is Bloomberg LP, the parent of Bloomberg News. Finance firms aren’t the only ones who need help finding coders. Other clients include retailer Wal-Mart Stores Inc. and medical products maker Stryker Corp.
BlackRock uses HackerRank to evaluate each of the several hundred programmers hired annually to work on improvements to its critical Aladdin software, the investment and risk-management platform that handles $15 trillion in assets.
“The old way of doing things is you cast a wide net, you get a bunch of resumes, you start screening through the resumes manually, and you hope the person looking at them is doing a good job,” said Sunil Dalal, chief operating officer of the Aladdin product group. “There’s a lot left to luck.”
Programmers are especially ripe for merit hiring. They usually can’t show recruiters the code they created for past employers because of proprietary reasons, so in the past they’ve been judged solely by their resumes, Ravisankar said. The opaqueness of that talent market in turn created bidding wars for graduates from schools like Stanford or top tech firms, discounting coders from elsewhere, he said.
Ravisankar and Hari Karunanidhi, a former IBM Corp. engineer, started HackerRank four years ago. Working in India, the pair struggled with two failed business plans until they landed on using algorithms to evaluate programmers’ code.
In 2012, they were accepted into Silicon Valley startup incubator Y Combinator, and soon clients included West Coast technology firms Twitter Inc., Yelp Inc. and Dropbox Inc. The firm, which has a million users globally, has raised almost $28 million in funding.
“Things have changed so much,” Furlong said. “There’s much more opportunity for people to break through and change their lives.”