What a Career Moat Can't Buy

[cedric]

Why career moats are better thought of as a navigation tool in your career.

Originally published 25 May 2021, last updated 26 May 2021.

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This is a companion discussion topic for the original entry at https://commoncog.com/what-career-moat-cant-buy/

[derekleekokfui]

Thanks for following up with this article! This was a problem I had with the career moat series that I couldn’t quite pinpoint and put into words, and this article really covers it. From my perspective, I can’t ever see myself being a specialist to the point that I can build a career moat with it. One of my biggest life values is to be able to experience as much of life as I can before I die. Being a specialist and building a career moat gives me an uncomfortable feeling because it feels like I’ll be shoe-horning myself into a very niche part of the overall life experience. I cannot deny the comfort and happiness that must come with having a career moat, but committing so hard into an area feels very much against my nature. Perhaps this is the FOMO in me speaking. There’s probably a saying out there that says better to be good at one thing than a jack of all trades, or something along those lines. Yet, being a very strong generalist feels much more enjoyable to me. I wish I didn’t have to choose. If I had a magic wand, I would have the time to get so good that I can tackle any problem. Alas, for the short time that we have on this earth.

[jonath]

Does this suggest that career moats should trend toward being entrepreneurial?

I think it was The E-Myth that popularized a distinction between working “in the business” vs. “on the business.”

• Many people dedicate themselves to the former, making themselves irreplaceable to the business at the cost of… well… being irreplaceable. This sounds like John and James.
• The latter involves separating oneself from the day-to-day operation while retaining ownership of the business, thus achieving the freedom to spend time on other things.

I don’t know how John or James could transform their career capital into passive income. They probably would’ve done it already if it made sense for them.

For those of us earlier in our careers, it raises the question of how we should think about separating time invested and income earned. Taylor Pearson argues that the Internet economy makes entrepreneurship the best job security. Of course, transitioning to building a business is unrealistic for many career paths, though it does seem reasonable for more of them in recent years.

[cedric]

@derekleekokfui

One of my biggest life values is to be able to experience as much of life as I can before I die. Being a specialist and building a career moat gives me an uncomfortable feeling because it feels like I’ll be shoe-horning myself into a very niche part of the overall life experience.

I don’t hold this worldview, but I definitely understand where you’re coming from

If I’m honest, something about the ‘specialist vs generalist’ frame has never sat well with me. Both ‘James’ and ‘John’ may work in a specialised environment, but I’m not entirely sure you can call them specialists. John, for instance, has a broad set of skills (oceanography, telecommunications, electrical engineering, physics, demand modelling etc) — and to some degree his skillset is rare purely as a function of the weird, path-dependent set of skills he’s picked up over the years. And James has an even weirder combination of skills (ability to detect if a factory boss is using child labour? Ability to defuse a PR disaster? Ability to navigate corrupt local SEA governments?)

I prefer to think of their roles as ‘they have rare skills that happen to be valued quite highly by the markets/industries they work in’. Whereas the specialist/generalist dichotomy has never seemed as useful. If you ask “what problems can I solve, that is valued by my chosen industry?”, then the next question isn’t “should I become a specialist or a generalist?” but instead “is that skillset sufficiently rare, going forward?” and “can I acquire it?”

And if the answer to that latter question demands that you become a generalist, or a specialist, then so be it!

@jonath I’ve actually tried to stay away from the suggestion that building a career moat demands that you be entrepreneurial.

I happen to be quite startup oriented, and I’ve always planned to start a company. But my whole obsession with career moats is independent of that — it is for the off chance that my startup thing fails, or if — due to life circumstances I have to go back to employment — I’d be able to get a job easily.

I think you can build a career moat and have a wonderful career as an employee. Not everyone wants to be an entrepreneur, nor should they. Different people have different risk tolerances, after all. And I’ve tried very deliberately to talk about career moats from the perspective of an employee for that reason.

@jonath

I don’t know how John or James could transform their career capital into passive income. They probably would’ve done it already if it made sense for them.

They might not need to! Don’t get me wrong — they’re in very good positions in their career, and when they retire, they will live very comfortable lives. I just told their stories to juxtapose their career moats (amazing) with their job satisfaction (meh) — and to make the point that the two are unrelated.

[jonath]

@cedric

I just told their stories to juxtapose their career moats (amazing) with their job satisfaction (meh) — and to make the point that the two are unrelated.

Ah, I overinterpreted the main point. Indeed, job dissatisfaction can be negligible in the grand scheme of things, and life cannot be optimized for everything all the time.

Not everyone wants to be an entrepreneur, nor should they .

“Entrepreneurial Superiority Complex” would be great name for my Twitter feed

While acknowledging that one doesn’t have to be an entrepreneur to develop a career moat, I still think there’s something to be said about career moats being “entrepreneurial”—the implication being that skills that make a good entrepreneur are generally good for navigating one’s career path as well. Then again, the common denominator might just be those who are deliberate about self-improvement.

I should probably revisit earlier Commonplace posts before riffing on that more.

[mgoodrum]

@jonath

I think it was The E-Myth that popularized a distinction between working “in the business” vs. “on the business.”

• Many people dedicate themselves to the former, making themselves irreplaceable to the business at the cost of… well… being irreplaceable. This sounds like John and James.
• The latter involves separating oneself from the day-to-day operation while retaining ownership of the business, thus achieving the freedom to spend time on other things.

I don’t know how John or James could transform their career capital into passive income. They probably would’ve done it already if it made sense for them.

I’ve taken a third path, which is of doing research inside large companies. I don’t really work ‘in the business,’ I function as an internal consultant. The ability to take an outside view while being nominally an insider has been invaluable.

My route to passive income has been indirect: I don’t own a large piece of any of my past employers, but a high savings rate over time has brought me to the point where my investments make more money annually than I do.

I’m all for entrepreneurship, but watched my parents work themselves to exhaustion, bury multiple businesses in sequence, and flirt with bankruptcy, all at a formative age. I took on a bunch of extra debt in college unexpectedly when they defaulted on their part of tuition payments in one particularly bad stretch. So I was risk averse in my 20s and 30s.

Now in my 40s, I’ve got the highest risk tolerance I’ve ever had, motivated by a financial cushion. I expect that by the time I’m 50 I’ll have embarked on at least one venture my 25 year old self would have considered inconceivable.