The talent updraft
In public-policy terms, I’m a dinosaur.
Large, slow-moving, and up to my haunches in the swamps
I’ve outlived about five generations of the talent updraft — the loss of our best and brightest to other sectors, and other jobs, filched away from the lure of more money.
The talent updraft is an intrinsic feature of working in affordable housing; it’s happened to many, many capable people I know in this business, and usually takes about 5-7 years for someone to move through all four phases:
People in affordable housing go through predictable phases
Phase 1: entry and intimidation. Bright, hard-working, dedicated people come out of college or graduate school, wanting not only to be professionally active but also engaged in work they find relevant.
We’re looking for relevance
Many of them are drawn to affordable housing, because they’re just encountering the apartment market themselves, and rent seems so darned expensive. (This is why, by the way, so many college towns enact rent control; the newly graduated vote, and they vote their self-interest.) Typically they start in government, or non-profit, non-governmental organizations (NGOs), because they want to work for ‘the good guys,’ not those evil landlords.
“I must have my rent; you may go to the soup kitchen or starve”
Affordable housing is a great business for the young graduate: it’s complicated, it’s dynamic, it’s tangible, and it’s impactful. Do good work and people live in better housing or cheaper housing. It gives you a warm feeling.
For myself, my first five years in affordable housing (1976-1980) were completely serendipitous, as I was thrown into the midst of a very nasty recession and a huge workout environment:
“What’s the femur?”
“It’s that bone protruding from his bleeding leg.”
“Oh. How do we put it back where it belongs?”
It’s not supposed to look like that
Along the way, I found out some things about myself:
Very heady stuff — but for the young professional, the first few encounters with the Other Side are terribly intimidating. They’re experienced, they’re polished, they’re faintly supercilious. To the beleaguered young executive, they’re alternatively nice or nasty — whatever works. Though you feel your armor is white, you fear you’re wielding your sword badly.
Phase 2: awakening. After a few years, the young professional has seen a few deals done. He or she has done a few as part of a deal team, or even led one or two. (Government and NGOs are great places to get experience; you get thrown into the fray.) Then he or she notices that — wait a minute! — these deals are really complicated, and they’re risky. And the for-profit people she works with, even if across the table, aren’t the devil incarnate.
Yes, I have places for young people in my organization
They’re smart. They’re hard-working. They’re funny. Many of them care about doing the job right. Sure, they’re better paid and better equipped — really nice laptops, clean and organized offices, not hovels of filing cabinets and crumpled papers.
Coupled with this gradual appreciation of the other side comes disillusion with one’s own side. They’re narrow-minded. When it comes to ’speaking truth to power,’ as the phrase goes, they instead protect their careers and positions. They loaf, or reflexively say No. They are, in short, human beings too, and cynical ones.
Sometimes, the maturing professional realizes, the for-profit guys are right. Sometimes the government is wrong. Sometimes the government’s team leaders have feet of clay. And the private guys get the deals done.
Say, who’s the enemy here? Is anyone the enemy?
Phase 3: rationalization. By now the initial thrill of doing something has worn off, as has the naivete about policy. Transactions are complex, urban development means tradeoffs, and the world is altogether a more challenging place. Meanwhile, a little peer-group separation is occurring — those who went to work in other professions seems to be achieving more.
Rationalization creeps in. Okay, so maybe we don’t make as much money as our friends. So what? The work we do is more important, and it’s less profitable, and it’s harder.
We’re hard pressed to keep up
By the way, all of that is true. Reminiscent of the old joke about Ivy League football players, “we may be small — but we’re slow too,” compared with conventional real estate development, affordable housing is harder to do, on smaller transactions, for less money.
All this can be rationalized, as serving the cause — but then comes the spouse, or the house, or the children, and the executive wonders, Tell me again why I’m doing this?
Phase 4: temptation. Now comes the pitch, in the form of a colleague from the Other Side.
That big deal we were bidding on? The one I told you about? The one that will change the whole neighborhood. We got it.
Wow, congratulations. [Shake of the head.] That’ll really make a difference. What an opportunity!
Actually … we’re so busy over here we really need a capable executive to take charge of it. [Pause to size up the executive.] Would you be interested in working here, as Senior Project Manager?
[Suspiciously] At what salary?
How about 50% more than you’re currently making? — And an incentive bonus, naturally, equal to a percentage of our development fee?
[Looking down at his or her drink.] Let me think about it.
And there it is.
The fruit of the tree of the knowledge of good and evil?
Oh, nonsense, what’s corrupting about pots and pots of money, anyway?
Or the beginnings of maturity?
I can resist anything but temptation. – Oscar Wilde.
I also cannot resist having my picture taken
Either way, temptation is often irresistible, if not at the first offer, then the next. For once a non-profit has nurtured a budding talent, the for-profits will always keep calling.
What are the talent updraft’s consequences? It influences the entire dynamics of the non-profit and NGO sector:
2. The NGO sector is usually thin on talent. Twenty years ago, I described a non-profit developer, whose latest transaction I was syndicating, as “one executive-director elopement away from insolvency.” Even today I see far, far too many non-profits that are similarly thin on talent.
But you can be talented even if you’re thin
3. Non-profits are undermanned in negotiations with for-profits. The for-profit teams are deeper, more experienced, better prepared, better represented, and overall better staffed. The negotiations are unbalanced, with the for-profit side always having better players.
Why do I feel outnumbered?
(The same thing is true of government-to-for-profit negotiations.)
4. Non-profits are vulnerable to exploitation. When the other guys are better players, you can get less than you deserve.
5. First-hand affordable housing experience is a precious commodity. In addition to a talent updraft from non-profits to for-profits, there’s a talent out-draft, where people who learn real estate via affordable housing migrate into the conventional arena. Both phenomena mean that smart people who have long experience in affordable housing are rare.
People like me stand sentry at the
6. You’re always training the next generation. Both non-profits and those who think they’re important to the ecosystem must be constantly reinvesting in training for the next generation of leaders, recognizing that in a non-profit, a generation is only about five years. A non-profit is a for-profit joined at the hip with a charity, and if it wants to compete with for-profits, then its benefactors have to fund its continuous training and turnover costs.
The talent updraft is part of why I founded AHI. There aren’t many of us who make it to this age (in development years, that is) still anchored in affordable housing.
I opened this post saying I was a dinosaur; actually, I’m a coelacanth; old, experienced, and still swimming in the same oceans.
Ugly, but still swimming with the sharks
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