essay about investment banking

What Exactly Is an Investment Banker? Essay

Introduction.

Investment bankers are considered dynamic professionals. These individuals thrive in environments that are susceptible to changes. The most important role that an investment banker plays is providing a high level of advice to various clients (Casparie, 2007). The job involves massive financial analysis; therefore, a strong foundation in finance and economics is necessary. Investment bankers are also known as a strategist and have the modicum capacity to produce future events. In addition, investment bankers do planning especially in allocating investment for various investment portfolios. Unlike other professionals, an investment banker is unique and covers different markets which are exclusive to the financial world.

It is common for investment bankers to cover a wide array of tasks. Specifically, investment bankers act as underwriters and agents for corporations and municipalities that issue securities. Moreover, investment bankers maintain both broker and dealer responsibilities. As mentioned earlier, investment bankers provide in-depth analysis of economic and market events and issue valuable advisory reports. Investment bankers perform as a facilitator during corporate events such as mergers, acquisitions, and buyouts. Further, investment bankers aid companies in doing financial restructuring and provide different options to maintain robust operations.

Constant learning is vital to individuals who plan to be involved with investment banking. The entry-level position serves as an orientation that will allow investment bankers to be merged with processes. Investment bankers normally start as analysts or at times associates. Analysts are required to provide financial proposals and familiarize the financial markets. Some companies provide options to analysts to acquire post-graduate education usually in the field of finance and management.

Investment banking provides a wide range of opportunities for its employees. One of the segments that investment bankers can work on is corporate finance. It allows investment bankers to help firms in raising their capital for projects and operations. Investment bankers are tasked to determine the capital requirement of companies. Capital necessities are usually sourced out through stocks, bonds, and retained earnings. Another job option that investment bankers can venture into is facilitating mergers and acquisitions. The role of investment bankers in these situations stretches to the normal advisory service (Beatty and Ritter, 1986). Investment bankers are asked to participate in biddings and negotiations and until the deal is finalized.

It is also possible for investment bankers to work in project finance. This segment is considered the most promising part of investment banking. Project finance involves the pooling of funds from companies and governments to pursue long-term capital projects such as oil exploration. Investment bankers check the viability of projects and the capacity of involved parties to make financial commitments. Structured finance is also another area that expands the career options of investment bankers. Investment bankers do this form of financing to boost the cash flow to investors. It is imperative for investment bankers to create financing vehicles to facilitate cash flow.

Among the job options for investment bankers, it is trading that is mostly preferred. Trading involves the selling of securities and can translate to better earnings for investment bankers. The process of trading necessitates knowledge of financial markets and forecasting abilities (Beatty and Ritter, 1986). Aside from stocks and bonds, there are other financial instruments that can be traded in the market. Foreign exchange trading is a common job as well as derivatives and warrants.

Some investment bankers function mainly as equity researchers. In some investment banks, this is a higher form of responsibility. Equity researchers are adept in the technical side of financial markets. These individuals provide the buy, sell, or hold recommendations to clients. Investment bankers who perform equity research base their decisions on market trends and company fundamentals (Beatty and Ritter, 1986). Because of the growing markets overseas, investment bankers are provided with the opportunity to make international sales. This expansion is evident among investment banks that have established operations in various financial points abroad. Investment bankers have to be skillful in handling language barriers and cultural differences.

Investment bankers with information technology capabilities have opportunities to improve on their craft. At present, financial markets rely on technology to make transactions fast. Because of these several investment bakers with knowledge of computers have learned to design trading software. Such a product is already popular among investors can further improve the careers of investment bankers. Finally, investment bankers can also act as rating analysts. Although it has to be noted that such a line of work provides low revenues for investment bankers. But it is a good start because investment bankers will a good feel at the events that affect financial markets.

The ultimate goal of an investment banker is to be a pillar of financial markets. It is important for investment bankers to shape the economy (Beatty and Ritter, 1986). Contrary to popular belief, being an investment banker is not a limited profession. Financial markets continuously expand and this means that investment bankers will be highly demanded. There are several requirements for an investment banker to be successful. But the most important aspects involve learning and flexibility.

Beatty, R.P. and Ritter, J.R., (1986), Journal of Financial Economics , “Investment banking, reputation, and the underpricing of initial public offerings”

Casparie, Jim, (2007), Entrepreneur.com, “What exactly is an investment banker?” Web.

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Why Investment Banking?

How to answer the question "Why Investment Banking?"

Currently, Adin is an associate at Berkshire Partners, an $16B middle-market private equity fund. Prior to joining Berkshire Partners, Adin worked for just over three years at The  Boston Consulting Group as  an associate and consultant and previously interned for the Federal Reserve Board and the U.S. Senate.

Adin graduated from Yale University, Magna Cum Claude, with a Bachelor of Arts Degree in Economics.

Before deciding to pursue his  MBA , Andy previously spent two years at Credit Suisse in Investment Banking, primarily working on  M&A  and  IPO  transactions. Prior to joining Credit Suisse, Andy was a Business Analyst Intern for  Capital One  and worked as an associate for Cambridge Realty Capital Companies.

Andy graduated from University of Chicago with a Bachelor of Arts in Economics and Statistics and is currently an  MBA  candidate at The University of Chicago Booth School of Business with a concentration in Analytical Finance.

• How NOT To Answer The "Why Investment Banking" Question
• Best Answers To The "Why Investment Banking" Interview Question

Interested In Investment Banking - Breaking In

“Tell us why you want to work in {the industry you are interviewing for}?” is a question that interviews love to throw at their interviewees.

Investment banking recruiters are no different, and you will 100% come across this question or something like it in your quest to break into IB.

Unfortunately, candidates facing this question without looking at online guides like the free one we got here usually screw up big time.

how NOT to answer the “Why investment banking” question

We will look at the wrong answers first and then show you how to answer the question correctly.

Remember, there are many ways to mess up this question. Just like drafting a cover letter, it is better not to try and blow away the interviewer.

Think about it as one of those questions that are more checkboxes where your best outcome is that you don’t mess up any potential offers. This isn’t a “Walk me through your resume” question.

So with that out of the way, let’s look at answers you shouldn’t give, even though they might be the real reason you want to get in.

“I need the money” or something along those lines

Yes, we all know you are attracted to IB because of the money. It is no hidden fact that it pays really well to get into IB. However, bringing up money in an interview is a surefire way to sabotage any chance you had of landing the offer.

There are two reasons why this is a bad answer. 

• Everyone likes to believe they do things for more than money (whether they do or not is up for debate). Naturally, an answer mentioning money could rub your interviewer the wrong way.
• It could signal that you are a flight risk to the firm. In other words, you will leave the moment another firm pays you more since money is your primary objective. Hence, it doesn’t make sense for the firm to hire you since they believe you won’t stick around for long.

Don't answer “I want to move to private equity” or some other exit opportunity

Most IB recruits don’t stay in IB. It is a well-known fact and is backed by data .

IB is well known for its exit opportunities. There is a very high chance you will be bombarded by recruiter calls a few months into your tenure. Private equity, hedge funds, and corporates all have a need for investment banking talent. 

And for the same reasons that talking about money is a no-go, mentioning that banking is a stepping stone to another career shows you won’t stick around for long. So avoid this reason at all costs unless you don’t want an offer.

Don’t mention client interactions. Period. Anyone who's said anything about 'CEOs, executives, clients, management teams, and (cringe) the C-suite' are immediate 'this kid doesn't know what we/he will do here' dings.

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So what is actually the best way to answer this question?

Best Answers to the “Why Investment Banking” interview question

While cookie-cutter responses are safe, sometimes a little more substance is appropriate/appreciated.

An example of a good response is:

I want to work in investment banking because I understand it has a steep learning curve. It will allow me to establish a strong foundation for valuation , Excel modeling skills , and an understanding of the XXX sector. I know the hours will be long, but the time spent understanding and learning about XXX space would allow me to remain in finance over the longer term.

This response does a few things:

You left the interviewer 'bait.' Now they will ask, "Oh really? So what hours do you expect?" So you simply answer 80 low-end and 100+ if a lot is going on.

By mentioning valuation/Excel, you're showing you know what you'll be doing, and you have pitched why it is valuable to have a strong base of skills for a *future* on Wall Street.

Because you never want the interviewer to think you're interested in anything besides banking.

Below are a few examples you could use depending on your specific background.

Law to Investment Banking

I know that I love transactional work, like working in a fast-paced, demanding environment, don't mind long hours, and eventually want to be the one making the deals rather than a lawyer/banker who only facilitates them. Investment banking makes sense because I can develop valuation/pitching/modeling skills.

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Consulting to Investment Banking

If you're interviewing for an entry-level junior role, then your response to this question could be:

While I have gained some great experience working in consulting that translates well to investment banking, I feel that I could learn a more useful technical skill set at an investment bank working on live transactions at [XYZ Firm].

For those trying to get into more senior roles post-MBA, a more appropriate answer would be:

I like long projects and getting to know clients; however, the transactional nature of investment banking is very appealing to me because you see the results of your work much more quickly. Whereas consulting engagements can last for years, especially when implementation is involved, the average investment banking mandate typically lasts for several months, so you are getting exposed to more scenarios, and the learning curve is faster.

Commercial Banking to Investment Banking

Because I look around at 5 pm and see everyone head for the exit, I know I have more to offer and want more out of my career.

It may be cheesy, but it has helped one of our members land a role in IB.

Also, make sure to read up on the latest M&A deals, know how to tackle technical questions, and show an eagerness to break into the industry.

Demonstrate you belong. Given your 'atypical' background, you will have to try that much harder to show you belong compared to your interviewing peers who may already be working at other IBs and looking to lateral.

Asset Management to Investment Banking

Although Asset Management allowed me to analyze companies and financials and make trades based on that analysis, where I really feel that I would excel long term is working more directly with these companies and in transactional work.

You now have a good idea of how to answer the “Why investment banking?” question when it comes up in your interviews.

The above examples illustrate how you could leverage your prior experience to answer the question and appear unique. We recommend that you improvise on the answers, or craft a new one keeping the points in mind.

Are you interviewing for an investment banking role? Our IB interview course has an immense library of questions and proven answers to help you ace that interview.

Additional interview resources

To learn more about interviews and the questions asked, please check out the additional interview resources below:

• Investment Banking Interview Questions and Answers
• Private Equity Interview Questions and Answers
• Equity Research Interview Questions and Answers
• Finance Interview Questions and Answers
• Accounting Interview Questions and Answers

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ESSAY SAUCE

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Essay: Investment Banking

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Do you want to make money out of money? If yes, then the solution is Investment bank. To be precise, Investment bank is nothing but a bank which matches the expectations of people having the capital with people who need the capital. 1

It is a financial intermediary that specializes primarily in selling securities and underwriting the issuance of new equity shares to raise capital funds. This is different from a commercial bank, which specializes in deposits and commercial loans. It assists individuals, corporations, and governments in raising financial capital by underwriting or acting as the client’s agent in the issuance of securities. An investment bank may also assist companies involved in mergers and acquisitions (M&A) and provide ancillary services such as market making, trading of derivatives and equity securities and FICC services (fixed income instruments, currencies, and commodities). Unlike commercial banks and retail banks, investment banks do not take deposits.

When a company or other organization wants to raise funds, it frequently does so by issuing and selling new securities, such as stocks or bonds. An investment bank usually helps in this process by providing expertise and customers to buy the securities. A company does not need to use an investment bank, but it usually does, because it is less costly than trying to issue and sell securities directly to the public.

An investment bank is not a bank in the usual sense. It doesn’t offer bank accounts like savings or recurring ones, nor does it make loans. In simpler terms, it is a bank which helps businesses, governments, and agencies to get financing from investors. The same thing done by regular banks is by way of lending the deposited money of Accountholders. In other words, Investment banks act as a financial intermediary for businesses and other large organizations, connecting the need for money with the source of money. In fact, the term “investment bank” is something of a misnomer. In many cases, helping companies raise capital is just one part of a much bigger operation.

Concept of Investment Banking

The main concept behind which an Investment bank revolves is to match the gap between a need of capital and availability of capital along with again matching the gap between advice seekers(client) and Advice givers(the bank).By and large, Investment banks in India are itself an institution which generates funds either by drawing public funds via the capital market or by way of venture capital or private equity.

Role of an Investment bank

As an advisor

Raising capital

Raising capital is always an important function for any business and so deciding how to raise it becomes very crucial for any company. It is the Investment bank which provides the tailor made solution. At the macro level, investment bank performs the primary function of assisting the capital market in its function of capital intermediation, i.e., the movement of finance from the investors to issuers. The sale of stocks and bonds is one of the primary ways for a company to raise capital. But executing these transactions requires special expertise, from pricing financial instruments in a way that will maximize revenue to navigating regulatory requirements. That’s where an investment bank usually comes into the picture.

Taking into account the current investing climate, the bank will recommend the best way to raise funds. This could entail selling an ownership stake in the company through a stock offer or borrowing from the public through a bond issue. The investment bank also helps to determine the pricing of these instruments. In the case of a stock offering, its financial analysts will look at a variety of different factors – such as earnings potential and the strength of the management team – to estimate how much a share of the company is worth. If the client is offering bonds, the bank will look at prevailing interest rates for similarly rated businesses to figure out how much it will have to compensate borrowers. They also track the market to determine the time of public offering and to explore the best possible way of managing the public assets of businesses. Many a times such a role seems to overlap with that of a private brokerage house.

It is very hard to demarcate a line between the investment banking and other forms of banking in India as all the banks nowadays besides their normal functions also tend to play the role of Investment bank.

Over the decades, investment banks have proved their worth by fulfilling the needs of the finance community and thus have became one of the most vibrant and exciting segment of financial services. In essence, investment banks are a bridge between large enterprises and the investor. Their main roles are to advise businesses and governments on how to meet their financial challenges and to help them procure financing, whether it be from stock offerings, bond issues or derivative products.

Merger or acquisition

The major role played by investment banks is in the field of consultancy. Investment banks also offer advice in a merger or acquisition scenario. For example, if a business is looking to purchase a competitor, the bank can advise its management team on how much the company is worth and how to structure the deal in a way that’s favorable to the buyer.Their main task is to help in organising mergers, helping target companies to develop and implement defensive tactics, helping in valuing the target company, helping in financing mergers and investing in stock of firms which are likely to merge. These M& A services are a huge source of profit for these Investment bankers.

Underwriting stocks and bonds

If an entity decides to raise funds through an equity or debt offering, one or more investment banks will also underwrite the securities. This means the institution buys a certain number of shares – or bonds – at a predetermined price and re-sells them through an exchange.

Other activities

While advising companies and helping them raise money is an important part , most Investment banks perform a number of other functions as well. In fact, most major banks are highly diversified in terms of the services they offer. Some of their other income sources include:

Research – Larger investment banks have large teams that gather information about companies and offer recommendations on whether to buy or sell their stock. They may use these reports internally but can also generate revenue by selling them to hedge funds and mutual fund managers.

Trading and Sales – Most major firms have a trading department that can execute stock and bond transactions on behalf of their clients.

Asset Management – The likes of J.P. Morgan and Goldman Sachs manage huge portfolios for pension funds, foundations and insurance companies through their asset management department. Their experts help select the right mix of stocks, debt instruments, real estate trusts and other investment vehicles to achieve their clients’ unique goals.

Wealth Management – Some of the same banks that perform investment banking functions also cater to everyday investors. Through a team of financial advisors, they help individuals and families save for retirement and other long-term needs.

Securitized Products – These days, companies often pool financial assets – from mortgages to credit card receivables – and sell them off to investors as a fixed-income products. An investment bank will recommend opportunities to “securitize” income streams, assemble the assets and market them to institutional investors.

How it works

Investment bank act as a mediator between companies issuing securities and the buyer individuals or entities. In this respect, Investment banks operate along two main lines: a “buy” side and a “sell” side. “Buy” side operations include services such as securities trading and portfolio management. For eg. suppose an investor wants to purchase 100 shares of company XYZ. They can solicit the services of an investment bank, where a stock broker can place an order and deliver these shares.

“Sell” side activities include underwriting new lines of stock, marketing financial products, and publishing financial research. It involves trading securities for cash or for other securities. For example company XYZ plans to issue new shares of stock in an initial public offering (IPO) XYZ can solicit an Investment bank to underwrite the shares, market and sell them to their clients. This way, the investment bank raises the funds that company XYZ hopes to gain from the issue of the new shares.

Organizational structure

Front office

As far as revenue generation is concerned, it is the Front office of any Investment bank.This front office can be divided between two main areas if Investment banking which involves advising on mergers and acquisitions, as well as a wide array of fund raising strategies and markets which is divided into “sales and trading” (including “structuring”) and “research”.

Middle office

The middle office of the bank includes treasury management, internal controls and internal corporate strategy.

Corporate treasury is primarily responsible for an Investment bank’s funding, capital structure management and liquidity risk monitoring.

Internal control tracks and analyzes the capital flows of the firm, the finance division is the principal adviser to senior management on essential areas such as controlling the firm’s global risk exposure and the profitability and structure of the firm’s various businesses via dedicated trading desk product control teams.

Internal corporate strategy tackling firm management and profit strategy, unlike corporate strategy groups that advise clients, is non-revenue regenerating yet is having a key functional role within investment banks.

Back office

Although many Investment banks use to outsource it, but the back office remains a critical part of the bank involving data-checking trades to ensure their correctness and transacting the required transfers.

Every major Investment bank has considerable amounts of in-house software, created by the technology team, who are also responsible for technical support. Technology has changed considerably in the last few years as more sales and trading desks are using electronic trading. Some trades are initiated by complex algorithms for hedging purposes.

Big foreign players in Indian Investment banking sector –

Many foreign investment banks are set up in India, so the banking sector in India becomes more competitive. Following are list of top investment banks in India.

-ABN-AMRO Bank

-The Bank of New York Mellon

-BNP Paribas Bank

-Deutsche Bank

-JPMorgan Chase Bank

-Goldman Sachs

-Morgan Stanley

List of Top Indian Investment Banks

-Bajaj Capital

-ICICI Securities Ltd

-Kotak Mahindra Capital Company

-SBI Capital Markets

Regulatory Framework for Investment Banking in India2

Investment Banking in India is regulating in its various facets under separate legislations or guidelines issued under statute. The Regulatory powers are also distributed between different regulators depending upon the constitution and status of Investment Bank. Pure investment banks which do not have presence in the lending or banking business are governed primarily by the capital market regulator (SEBI). However, Universal banks and NBFC investment banks are regulated primarily by the RBI in their core business of banking or lending and so far as the investment banking segment is concerned, they are also regulated by SEBI. An overview of the regulatory framework is furnished below:

-At the constitutional level, all invest banking companies incorporated under the Companies Act, 1956 are governed by the provisions of that Act.

-Investment Banks that are incorporated under a separate statute such as the SBI or IDBI are regulated by their respective statute. IDBI is in the process of being converted into a company under the Companies Act.

-Universal Banks that are regulated by the Reserve Bank of India under the RBI Act, 1934 and the Banking Regulation Act which put restrictions on the investment banking exposures to be taken by banks.

-Investment banking companies that are constituted as non-banking financial companies are regulated operationally by the RBI under sections 45H to 45QB of Reserve Bank of India Act, 1934. Under these sections RBI is empowered to issue directions in the areas of resources mobilization, accounts and administrative controls.

-Functionally, different aspects of investment banking are regulated under the Securities and Exchange Board of India Act, 1992 and guidelines and regulations issued there under.

-Investment Banks that are set up in India with foreign direct investment either as joint ventures with Indian partners or as fully owned subsidiaries of the foreign entities are governed in respect of the foreign investment by the Foreign Exchange Management Act, 1999 and the Foreign Exchange Management (Transfer or issue of Security by a person Resident outside India) Regulations, 2000 issued there under as amended from time to time through circulars issued by the RBI.

-Apart from the above specific regulations relating to investment banking, investment banks are also governed by other laws applicable to all other businesses such as – tax law, contract law, property law, local state laws, arbitration law and the other general laws that are applicable in India.

Project Finance3

Project Finance is an age old form of financing high-risk, development-oriented projects and is one of the key focus areas in today’s world because of continuous growth and expansion of the industries at a rapid rate.

It is the financing of long-term infrastructure, industrial projects and public services based upon a non-recourse or limited recourse financial structure where project debt and equity used to finance the project are paid back from the cash flow generated by the project. In other words, it can also be said as a loan structure that relies primarily on the project’s cash flow for repayment, with the project’s assets, rights, and interests held as secondary security or collateral. Project finance is especially attractive to the private sector because they can fund major projects off balance sheet. They are most ordinarily non-recourse loans, which are fortified by the project assets and paid entirely from project cash flow, rather than from the general assets or creditworthiness of the project sponsors, a decision in part braced by financial modeling.

Methods of Project Financing

The various sources of finance can be broadly divided into two categories, viz. equity capital and debt capital (borrowed capital),namely the Share capital ,Term loan, Debenture capital, Commercial banks and Bills discounting. The combination of equity and debt should be judiciously chosen, and it varies according to the nature of the project.

Some other financing are Seed Capital which is an assistance given by way of long term interest free loan. It is provided to small as well as medium scale units promoted by eligible entrepreneurs.Along with this subsidies are also important source of finance, drawn-out by the Central as well as State Government.

Stages in Project Financing

Pre- finance stage

a)Project identification- A Project or Projects selected should be integrated with the Strategic Plan of the Organisation. The project plan should match the goals of the organization. It should be realistic to be implemented.

b) Identifying risk and minimizing- “The right project at the right time at the right place and at the right price”.There should be adequate amount of resources available for the project to be implemented.

c) Technical and Financial feasibility

An organization before starting any new project or expanding an existing one must look into analyzing each and every factor which is essential for the project to be feasible. It must be financially as well as technically feasible.

Financing stage

At financing stage, it includes arrangement of equity/debt/loan; negotiation and syndication of the same ; documentation and checking all the rules and regulations or polices relating to the starting of the project and payment.

Post Financing

Post financing includes monitoring and review of project from time to time ;Project closure which is ending of the project and Repayment and monitoring whereby the amount taken in the form of loan, equity and debt must be repaid back and proper monitoring and control of the project must be carried.

Framework and Guidelines

The borrower may have to get certain statutory and non – statutory clearances essential for the projects like techno economic clearance, pollution, environment and forest clearance, company registrations, financing and land availability/ concessions etc.

The promoter while making the application to the financial institutions records the copies of documents most vital of which are: i) copy of letter of allotment of plot/ sale deed in good turn of the borrower of the plot. ii) Detailed plan of project approved by the local body. iii) Partnership deeds/ articles of association in case of a company.

Venture Capital4

It is a type of capital more in news because of a sudden boom of startups. It is money provided by investors to startup firms and small businesses with perceived long-term growth potential. Venture capital has became very important source of funding for startups because of their non access to capital markets. It is a very high risk capital for the investor, but at the same time has the potential for above-average returns.

Venture capital can also include managerial and technical expertise. Most venture capital comes from a group of wealthy investors, investment banks and other financial institutions that pool such investments or partnerships. One more reason to raise this form of capital is limited operating history of companies which cannot raise funds by issuing debt. Although it is a good source of funds for new beginners but then it allows Venture capitalists to have a say in company decisions, along with their equity share.

It is money that is provided to seed early-stage, emerging growth companies. Venture capital funds invest in companies in exchange for equity in the companies they invest in, which usually have a novel technology or business model in high technology industries, such as biotechnology and IT. The typical venture capital investment occurs after a seed funding round as the first round of institutional capital to fund growth in the interest of generating a return through an eventual exit event, such as an IPO or trade sale of the company.

To obtain venture capital is substantially different from raising debt or a loan. Lenders have a legal right to interest on a loan and repayment of the capital irrespective of the success or failure of a business. Venture capital is invested in exchange for an equity stake in the business. The return of the venture capitalist as a shareholder depends on the growth and profitability of the business. This return is generally earned when the venture capitalist “exits” by selling its shareholdings when the business is sold to another owner.

Since there are no public exchanges listing their securities, private companies meet venture capital firms and other private equity investors in several ways, including warm referrals from the investors’ trusted sources and other business contacts; investor conferences and symposia; and summits where companies pitch directly to investor groups in face-to-face meetings, including a variant known as “Speed Venturing”, which is akin to speed-dating for capital, where the investor decides within 10 minutes whether he wants a follow-up meeting. In addition, some new private online networks are emerging to provide additional opportunities for meeting investors.

This need for high returns makes venture funding an expensive capital source for companies, and most suitable for businesses having large up-front capital requirements, which cannot be financed by cheaper alternatives such as debt. That is most commonly the case for intangible assets such as software, and other intellectual property, whose value is unproven. In turn, this explains why venture capital is most prevalent in the fast-growing technology and life sciences or biotechnology fields.

Role of Venture capitalists

As a Venture capitalists ,they are very selective about their investment.The basic factors to decide an investment are innovative technology, potential for rapid growth, a well-developed business model, and an impressive management team. Of these qualities, funds are most interested in ventures with exceptionally high growth potential, as only such opportunities are likely capable of providing financial returns and a successful exit within the required time frame (typically 3–7 years) that venture capitalists expect.

These investments are illiquid by nature and require the extended time frame to harvest, and so a Venture capitalist should carry out detailed due diligence prior to investment. He is also expected to nurture the companies in which they invest, in order to increase the likelihood of reaching an IPO stage when valuations are favorable. Any beginner company has got four stages for development ie. Idea generation; Start-up; Ramp up and Exit and as a Venture capitalist, he has to assist at all the four stages in the company’s development.

Loan Syndication5

It is a process of involving several different lenders to provide various portions of a loan. Basically it is needed in situations where the project is unusually large or complex and the borrower requires a large sum of capital which cannot be provided by a single lender or it is outside the scope of a lender’s risk exposure levels. For example, the amount of the loan may be too large, the risks too high, the collateral may be in different locations, or the uses of capital may require special expertise to understand and manage it. In these cases, a financial institution may bring other lenders into the deal Thus under Loan syndication, multiple lenders work together to provide the borrower with the required capital , at an appropriate rate agreed upon by all the lenders.

Usually, the loan syndication limits the liability of each lender to its share of the loan interest. In t his way, each lender limits its loan amount to a manageable size, and limits its ris k exposure. Additionally, each lender may have a collateral interest in a unique or specialized asset from the borrower, such as a piece of equipment.

Loan syndications involve a large amount of coordination and negotiation. Typically, loan syndication involve a lead financial institution, or syndicate agent, which organizes and administers the transaction, including repayments, fees, reporting and compliance, and loan monitoring. Often, such transactions require the services of a specialist who syndicates the loan on behalf of the borrower; identifying lenders while negotiating terms and conditions, and even representing the borrower throughout disbursements. .

It can be a useful tool for banks to maintain a balanced portfolio of loan assets among a variety of industries. If one loan is too large, it may overweight the bank’s portfolio. Therefore, banks may pursue a syndication to accommodate a loan and keep its portfolio in balance. At the same time, loan syndications may incur a large expense to the borrower. While the syndication fee is usually financed, the burden of repaying the loan and syndication fee is shouldered ultimately by the borrower. Loan syndication is common in mergers, acquisitions and buyouts, where borrowers often need very large sums of capital to complete a transaction, often more than a single lender is able or willing to provide.

Leveraged Lease6

Leveraged Lease is a lease agreement that is partially financed by the lessor through a third-party financial institution. Under long-term lease , the lessor borrows most of the funds needed to acquire the asset financed from a third party, usually a bank or insurance company. The lessor makes an equity investment equal to, say, 20% of the equipment’s original cost, and borrows the remaining 80% by issuing nonrecourse notes to the lenders, and writes a noncancellable lease for the equipment. The lessor makes an assignment of the lease and lease rental payments to the lender, who is entitled to repossess the asset if the lessee happens to default. A leveraged lease is a true lease for tax purposes, because the lessor, as owner of the asset, is entitled to all of the tax benefits of ownership, including accelerated depreciation write-offs, deduction of interest payments on the bank loan, and the investment credit, if any, for purchase of the asset. Banks write leveraged leases for their own customers through the leasing subsidiary of a bank holding company.

The term may also refer to a lease agreement wherein the lessor, by borrowing funds from a lending institution, finances the purchase of the asset being leased.In a leveraged lease, the lending company holds the title to the leased asset, while the lessor creates the agreement with the lessee and collects the payment. The payments are then passed on to the lender. After the agreement, of a leveraged lease, if the lessee stops making payments to the lessor, then the lessor stops making payments to the financial institution (lender). This allows the lender to repossess the property. The lessor may also have the right to retain the property upon lessee default, as long as the lessor continues making payments to the lender.

Islamic Banking

Islamic banking ,although a new term in India is not a new one globally. The first Islamic bank was founded in Egypt in 1963, and since then, the phenomenon has grown slowly but steadily.7Islamic banking refers to a system of banking based upon the principles of the Sharia (Islamic rulings) which prohibits the payment or acceptance of interest charges (riba) for the lending and accepting of money. Most of the principles of Islamic banking have got global acceptance and are not a completely new one. Islamic finance was practiced predominantly in the Muslim world throughout the Middle ages, fostering trade and business activities. In Spain and the Mediterranean and Baltic States, Islamic merchants became indispensable middlemen for trading activities. It is claimed that many concepts, techniques, and instruments of Islamic finance were later adopted by European financiers and businessmen.

The origin of the modern Islamic bank can be traced back to the very birth of Islam when the Prophet himself acted as an agent for his wife’s trading operations. Islamic partnerships (mudarabah) dominated the business world for centuries and the concept of interest found very little application in day-to-day transactions.

Principles of Islamic banking 8

Prohibition of Interest or Usury

Quran is the source for principles of Islamic finance and the followers of Islam believe them to be the exact words of God as revealed to the Prophet Mohammed. These Islamic principles of finance can be narrowed down to four individual concepts.

According to the first concept, both the charging and the receiving of interest are strictly forbidden. This is commonly known as Riba or Usury. Money, on its own, may not generate profits. When Riba infects an entire economy, it jeopardises the well-being of everyone living in that society. When investors are more concerned with rates of interest and guaranteed returns than they are with the uses to which money is put, the results can only be negative.

Ethical Standards

The second guiding principle for Islamic banking is based on ethical aspects. According to which Muslims have the religious duty to ensure the goodness and wholesomeness of their investment. This is the reason that Islamic investment always considers the kind of business for investing money, its policies, the products and services it provides, and the impact that these have on society and the environment.

Moral and Social Values

The third guiding principle reflects the moral and social values. The Quran has high thoughts for the poor and destitute and Islamic financial institutions are expected to provide special services to those in need. And so, it is not confined to mere charitable donations but also talks about profit-free loans or Al Quard Al Hasan for certain social projects, where an individual,if needs to go to hospital or wants to go to university, is given interest free loan, what is called Quard Al Hasan.

Liability and Business Risk

The final principle is based on the idea of both the parties sharing in the risk and profit of any endeavor. If an Investor wants a return, he must either accept business risk or provide some service such as supplying an asset. If not so, according to Sharia,it is sin on part of investor. The roots of this principle lies in a saying of the Prophet Mohammed that “Profit comes with liability” which simply means that one becomes entitled to profit only when one bears the liability, or risk of loss. By linking profit with the possibility of loss, Islamic law distinguishes lawful profit from all other forms of gain.

Islamic Banking in Kerala

Major issues and constraints in Islamic banking 9

In the straitjacket world of Indian banking, something as fascinating as Islamic Banking is a distant dream. The major issues and constraints involved in Islamic Banking are mentioned herein below:

Deposits with RBI

The conventional banks in India have to maintain deposit account with the RBI over which they get interest and they have to maintain Statutory liquidity ratio as well. Banks have to invest a fixed percent of demand and time liability in instruments for SLR. These instruments are unencumbered securities like government securities, bonds issued by NABARD,. IFCI, SIDBI, NHB, Government approved securities which are interes t based. Since Islamic banks cannot observe conditions as mentioned above they cannot be member of clearing system and cannot issue cheques and therefore they cannot be listed as scheduled bank.

Lender’s in last resort

A conventional bank after taking license by the RBI is a part of the monetary system and it helps deposit generation through acceptance of money. Since these assets in the form of deposits are interest based, Islamic bank cannot hold them. Besides, if Islamic banks have to accept deposits or borrow funds, they have to participate in interest based banking, which is again forbidden. The end result is that the RBI cannot act as the lender in last resort for them because such accommodation by RBI is also interest based.

Inability to maintain capital adequacy

Another constraint for Islamic banks in the conventional banking system is the inability to maintain capital adequacy .Since Islamic bank will have to maintain a fixed percentage of Capital Adequacy Ratio, they will have to raise through equity capital as well as through bonds for 2nd tier capital which goes partly against Shariah

Dealing with mega projects

Conventional banks because of their large scale of operation have the ability to deal with mega projects and are better equipped for long term lending and project appraisals.On other hand ,Islamic banking concentrates more on short-term and medium-term operations because of their structure. Most such banks are ill equipped to handle a big responsibility because of the smallness of their operations.

Priority sector finance

Priority sector finance on micro level cannot be extended to 200 Million borrowers based on Profit Sharing. But this is mandatory requirement and it is interest based.

Legal framework & Tax Procedures

India’s present laws obstruct the establishment of Islamic banking. Under section 5(b) of Banking Regulation Act 1949 it prohibits the operation of banks on a profit-loss basis. Section 8 forbids murabaha, or, the buying, selling, or barter of goods ,Section 9 impedes ijara, or, bars the holding of immovable property for a period greater than seven years and section 21 requires the payment of interest. Since conventional banking system is an interest based system having all the banking products based on interest mechanism, Islamic banking cannot be performed in India under the present legal framework because except current account, no other banking product in India can be modified to meet the conditions of Islamic Banking. Another important consideration is the taxation system. Although interest as well as profit are income, but the former is a passive income, while later is an earned income and there is different tax treatment for both of them. According to principles of Islamic Banking ,it is not possible to comply with the tax procedure.

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What Is Investment Banking?

Understanding investment banking, regulation and investment banking, initial public offering (ipo) underwriting, example of investment banking, the bottom line.

• Investing Basics

Investment Banking: What It Is, What Investment Bankers Do

Julia Kagan is a financial/consumer journalist and former senior editor, personal finance, of Investopedia.

Pete Rathburn is a copy editor and fact-checker with expertise in economics and personal finance and over twenty years of experience in the classroom.

Investment banking is a type of banking that organizes large, complex financial transactions such as mergers or initial public offering (IPO) underwriting. These banks may raise money for companies in a variety of ways, including underwriting the issuance of new securities for a corporation, municipality, or other institution. They may manage a corporation's IPO. Investment banks also provide advice in mergers, acquisitions, and reorganizations.

In essence, investment bankers are experts who have their fingers on the pulse of the current investment climate. They help their clients navigate the complex world of high finance.

Key Takeaways

• Investment banking deals primarily with raising money for companies, governments, and other entities.
• Investment banking activities include underwriting new debt and equity securities for all types of corporations.
• Investment banks will also facilitate mergers and acquisitions, reorganizations, and broker trades for institutions and private investors.
• Investment bankers work with corporations, governments, and other groups. They plan and manage the financial aspects of large projects.
• Investment banks were legally separated from other types of commercial banks in the United States from 1933 to 1999, when the Glass-Steagall Act that segregated them was repealed.

Ellen Lindner / Investopedia

Investment banks underwrite new debt and equity securities for all types of corporations, aid in the sale of securities, and help facilitate  mergers and acquisitions , reorganizations, and broker trades for institutions and private investors. Investment banks also provide guidance to issuers regarding the offering and placement of stock.

Many large investment banking systems are affiliated with or subsidiaries of larger banking institutions, and many have become household names, the largest being Goldman Sachs, Morgan Stanley, JPMorgan Chase, Bank of America Merrill Lynch, and Deutsche Bank.

Broadly speaking, investment banks assist in large, complicated financial transactions. They may provide advice on how much a company is worth and how best to structure a deal if the investment banker's client is considering an acquisition, merger, or sale. Investment banks' activities also may include issuing securities as a means of raising money for the client groups and creating the documentation for the U.S. Securities and Exchange Commission (SEC) necessary for a company to go public.

Investment banks employ investment bankers who help corporations, governments, and other groups plan and manage large projects , saving their clients time and money by identifying risks associated with the project before the client moves forward.

In theory, investment bankers are experts who have their finger on the pulse of the current investing climate, so businesses and institutions turn to investment banks for advice on how best to plan their development, as investment bankers can tailor their recommendations to the present state of economic affairs.

The Glass-Steagall Act was passed in 1933 after the 1929 stock market crash led to massive bank failures. The purpose of the law was to separate commercial and investment banking activities. The mixing of commercial and investment banking activities was considered very risky and may have worsened the 1929 crash. This is because, when the stock market crashed, investors rushed to draw their money from banks to meet margin calls and for other purposes, but some banks were unable to honor these requests because they too had invested their clients' money in the stock market.

Before Glass-Steagall was passed, banks could divert retail depositors' funds into speculative operations such as investing in the equity markets. As such operations became more lucrative, banks took larger and larger speculative positions, eventually putting depositors' funds at risk.

However, the stipulations of the act were considered harsh by some in the financial sector, and Congress eventually repealed the Glass-Steagall Act in 1999. The Gramm-Leach-Bliley Act of 1999 thus eliminated the separation between investment and commercial banks. Since the repeal, most major banks have resumed combined investment and commercial banking operations.

Essentially, investment banks serve as middlemen between a company and investors when the company wants to issue stock or bonds . The investment bank assists with pricing financial instruments to maximize revenue and with navigating regulatory requirements.

Often, when a company holds its IPO, an investment bank will buy all or much of that company's shares directly from the company. Subsequently, as a proxy for the company launching the IPO, the investment bank will sell the shares on the market. This makes things much easier for the company itself, as it effectively contracts out the IPO to the investment bank.

Moreover, the investment bank stands to make a profit, as it will generally price its shares at a markup from what it initially paid for them. In doing so, it also takes on a substantial amount of risk . Although experienced analysts use their expertise to accurately price the stock as best they can, the investment bank can lose money on the deal if it turns out that it has overvalued the stock, as in this case, it will often have to sell the stock for less than it initially paid for it.

Suppose that Pete's Paints Co., a chain supplying paints and other hardware, wants to go public. Pete, the owner, gets in touch with José, an investment banker working for a larger investment banking firm. Pete and José strike a deal wherein José (on behalf of his firm) agrees to buy 100,000 shares of Pete's Paints for the company's IPO at the price of $24 per share, a price at which the investment bank's analysts arrived after careful consideration.

The investment bank pays $2.4 million for the 100,000 shares and, after filing the appropriate paperwork, begins selling the stock for $26 per share. However, the investment bank is unable to sell more than 20% of the shares at this price and is forced to reduce the price to $23 per share to sell the remaining shares.

For the IPO deal with Pete's Paints, then, the investment bank has made $2.36 million [(20,000 × $26) + (80,000 × $23) = $520,000 + $1,840,000 = $2,360,000]. In other words, José's firm has lost $40,000 on the deal because it overvalued Pete's Paints.

Investment banks often will compete with one another to secure IPO projects, which can force them to increase the price they are willing to pay to secure the deal with the company that is going public. If competition is particularly fierce, this can lead to a substantial blow to the investment bank's bottom line .

Most often, however, there will be more than one investment bank underwriting securities in this way, rather than just one. While this means that each investment bank has less to gain, it also means that each one will have reduced risk.

What Do Investment Banks Do?

Broadly speaking, investment banks assist in large, complicated financial transactions . They may provide advice on how much a company is worth and how best to structure a deal if the investment banker's client is considering an acquisition, merger, or sale. Essentially, their services include underwriting new debt and equity securities for all types of corporations, providing aid in the sale of securities, and helping to facilitate mergers and acquisitions, reorganizations, and broker trades for both institutions and private investors. They also may issue securities as a means of raising money for the client groups and create the necessary U.S. Securities and Exchange Commission (SEC) documentation for a company to go public.

What Is the Role of Investment Bankers?

Investment banks employ people who help corporations, governments, and other groups plan and manage large projects, saving their clients time and money by identifying risks associated with the project before the client moves forward. In theory, investment bankers should be experts who have their finger on the pulse of the current investing climate. Businesses and institutions turn to investment banks for advice on how best to plan their development. Investment bankers, using their expertise, tailor their recommendations to the present state of economic affairs.

What Is an Initial Public Offering (IPO)?

An initial public offering (IPO) refers to the process of offering shares of a private corporation to the public in a new stock issuance. Public share issuance allows a company to raise capital from public investors. Companies must meet requirements set by exchanges and the SEC to hold an IPO. Companies hire investment banks to underwrite their IPOs. The underwriters are involved in every aspect of the IPO due diligence, document preparation, filing, marketing, and issuance.

The names of investment banks like Goldman Sachs and Morgan Stanley come up frequently in discussions about the financial market, highlighting the importance of these institutions in the financial world. In general, investment banks assist clients with large and complex financial transactions. This includes underwriting new debt and equity securities, aiding in the sale of securities, and helping to facilitate mergers and acquisitions , reorganizations, and broker trades. Investment banks may help other organizations raise capital by underwriting initial public offerings (IPOs) and creating the documentation required for a company to go public.

J.P. Morgan. " Investment Banking ."

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Why Investment Banking? How To ACE This Interview Question Every Time

If you're new here, please click here to get my FREE 57-page investment banking recruiting guide - plus, get weekly updates so that you can break into investment banking . Thanks for visiting!

“I looked at all the articles on your site but nothing told me WHY I want to get into this industry. Can YOU tell me why I want to be an investment banker? ”

It’s a question you’ll get in EVERY interview.

But it’s also a question where 90% of interviewees give terrible answers, no matter what their background is.

I can’t tell you exactly why you want to do investment banking… but I can tell you what to say in interviews.

So, why investment banking ?

Table of Contents:

The conventional “wisdom” – saying the generic, the real way to answer the why investment banking question, model answer: how an mba-level career changer could respond to why investment banking :, model answer: how a former engineer at undergraduate level could respond to why investment banking :.

• Method 2: “The Slice of Life”
• And Not Just for “Why Investment Banking”

The Hybrid Approach

• Dealing With “Complications”
• So… Why Investment Banking?

Most websites, books, and other resources recommend generic answers:

• You want to learn a lot.
• You’re interested in corporate finance.
• You like a fast-paced environment.
• You’ve always done well in finance/accounting classes.
• You want to work with smart and motivated people.

These answers aren’t “wrong.”

But there is a problem: interviewers have heard them thousands of times and will start dozing off if yours resembles one of the above.

A friend at a bulge bracket bank in Asia said one recent interviewee gave the following answer for his “Why Investment Banking?” question:

“I… just want to learn . Nowhere else would give me the learning opportunity, and I want to learn so much… I’m really interested in learning and investment banking is the best place to learn .”

Uh, so why don’t you just stay in school then?

It’s not about “honesty.”

It’s about being personal .

You can include some of the “generic” points above in your answer, but you shouldn’t limit your answer to those.

Instead, you need to mention something from your background or interests that NOT everyone else can just look up online and regurgitate in interviews.

We’re going to look at 2 ways you can do this: the “Big Picture” method and the “Slice of Life” method .

Method 1: “The Big Picture”

With The Big Picture Method, you answer the Why Investment Banking question by talking about how you started out on another path but shifted your interest to finance over time.

This one works best if you’re:

• A Career Changer (at any level).
• A Non-Finance/Accounting Major.
• Interviewing with an Industry Group.
• Struggling to think of a specific incident that made you interested.

The formula is simple: Background in One Field +Experience in Finance = Long-Term Success .

This is not the “Tell me about yourself” question, so you need to get your points across quickly – take any longer than 30 seconds and you’ll bore the interviewer.

IB Interview Guide

Land investment banking offers with 578+ pages of detailed tutorials, templates and sample answers, quizzes, and 17 Excel-based case studies.

Let’s say you worked at a healthcare policy think tank , started to learn more about the business of healthcare , and then decided to go to business school to re-brand yourself and get into finance.

You would start by mentioning how you were interested in biology/medicine/healthcare originally, and enjoyed the work at the institute at first. But then you had to do a lot of research into healthcare M&A deals, you learned more about business/finance, met a lot of bankers, and you realized you were more interested in that side – in the future you want to advise healthcare companies on business decisions, so healthcare investment banking is the perfect match.

Let’s say you’re coming from a technical background , did a few internships, but then realized you were more interested in business .

Talk about how you did well in your internships, but became more interested in business after speaking with friends in different departments, and how you started following startup news, technology M&A news, and recent deals. You’re interested in being an investor in tech companies one day, so combining your previous background with banking experience would let you do this.

I used a similar story in multiple interviews and it always worked.

You need to modify these examples based on what you’ve done, but the basic formula is simple: Background in One Field + Finance Experience = Success in Achieving Long-Term Goals .

If you don’t know what your “long-term goals” are, just make them up to fit the situation .

Method 2: “The Slice of Life”

With this method, you answer the Why Investment Banking question by explaining how an earlier life event made you interested in business/finance and how your interest developed after that experience.

• A Finance/Accounting/Business Major.
• Coming in with previous finance/banking full-time or internship experience.
• A “Career Changer” but you can point to something specific that prompted the change.

So let’s say you’ve been a finance major since you started university and you don’t have a “career change” to point to. In that case, you need to think about your family, experiences growing up, school, summer camps, and anything else you can think of that can explain how you became interested:

• You saw your parents day-trading when you were younger and started following the markets.
• You went to an event for women in business and met some MDs at banks there, which got you interested.
• Your friend started working at a bank and you toured his office one day and met lots of people there.
• You were in an investment club and won 1st place in a competition by picking stocks no one else even considered.

It doesn’t need to be a unique story: it just needs to be something that not everyone else will say .

And don’t overestimate the competition : I know from interviewing people at “top” schools that 99% of interviewees don’t even get the basics right .

Once you figure out what your “event that made you interested in finance” is, start your answer by stating what it is and then how it led you into your major, internships, and jobs, and how you see banking as your next step to achieve whatever you’re thinking about doing in the long-term, which is hopefully related to business.

There’s nothing “wrong” with saying you want to learn or that you’re interested in corporate finance – but you shouldn’t stop there .

You need to set yourself apart by thinking about your Slice of Life or your Big Picture .

And Not Just for “Why Investment Banking”

You need to use this answer for more than just the “Why investment banking?” questions: you have to use it in your “story” and also when you’re networking , because anyone you contact will ask why you’re interested.

Especially if you’re coming from a non-finance background, figuring out your “reason why” is critical because most peoples’ rationale consists of “I want to make more money!”

You can combine these two methods as well – just make sure your answer is short , because there’s nothing worse than asking this question and having someone ramble for 5 minutes after you’ve lost interest within 30 seconds.

Keep it to a few sentences and explain how your own background or some specific experience makes you a good match for the group you’re interviewing with.

Whatever you do, avoid stating the generic and talking about how you “want to learn.” You need to tie your “reason why” to what you’ve done in the past and what you want to do in the future.

Dealing With “Complications”

There are a few situations where responding to Why Investment Banking isn’t straightforward. For example:

• You’re coming in from an extremely non-traditional background and have changed your career so many times you don’t know where to start.
• You interviewed for banking positions before, but didn’t get any offers and ended up at a bank in a non-investment-banking position – and now you’re interviewing again.
• You did an internship but didn’t get a return offer and now you’re interviewing for full-time positions.

For #1, avoid the temptation to make your story “complicated.” Skip less relevant details and simplify your background so that it’s understandable in 30 seconds.

For #2, if you’re speaking with a bank you’ve interviewed at before, you should emphasize how you’ve learned / improved a lot since your initial interviews and have realized you’re even more interested now after completing your internship.

If it’s a bank you haven’t interviewed with before, say that you only became seriously interested over the summer and don’t mention your previous interviews .

For #3, say that you did well but didn’t like your group and didn’t fit in with the culture. You can’t lie about receiving an offer – but you can position it as being a “lack of cultural fit” rather than you not performing well.

So… Why Investment Banking?

That’s your homework: Go and spend 30 minutes planning out what you’re going to say and which approach you’ll use.

And whatever you do, please don’t use the word “learn” 10 times in your response.

And if you want more help, no two candidates will answer this question in exactly the same way.

If you want professional guidance crafting your answer to this very important question, our friends at Wall Street Mastermind  might be able to help you out.

They’ve worked with over 1,000 students to help them secure high-paying investment banking jobs out of school (and internships while in school), and their coaches include a former Global Head of Recruiting at three different large banks – so you can even run your answers by people who have  led recruiting at the top banks.

They provide personalized, hands-on guidance through the entire networking and interview process – and they have a great track record of results for their clients.

It could be a great fit for you if you’re looking for comprehensive coaching through the entire process.

You can book a free consultation with them to learn more .

About the Author

Brian DeChesare is the Founder of Mergers & Inquisitions and Breaking Into Wall Street . In his spare time, he enjoys lifting weights, running, traveling, obsessively watching TV shows, and defeating Sauron.

Free Exclusive Report: 57-page guide with the action plan you need to break into investment banking - how to tell your story, network, craft a winning resume, and dominate your interviews

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280 thoughts on “ Why Investment Banking? How To ACE This Interview Question Every Time ”

I have a bit of unusual story you can say. I have 5 years of experience in the energy sector. I wanted to do finance so went for MBA. During my time I did an IB internship in a boutique bank but as bank was too small and had team issues I decided to go with big tech offer I got after graduation in 2021. It has been only 4 months but I want to try again with IB as I miss teamwork and financial skills I applied in finance. I am aiming for industrial IB as my background is more aligned. I wanted to ask how would you best frame my story to be more effective? I don’t want to end up going into every part of my journey if that makes sense. Thanks a lot. Ray

I would just frame it by saying that you made a mistake accepting the Big Tech offer and want to work in IB, but at a firm without all the issues you encountered at the boutique. You can’t really “avoid” those parts of your story given the recency.

Makes sense. Thanks a lot

Hey Brian, thanks for responding to every comment so far. Medical student here – do you think is it easier to segue into management consulting at a partner/director level as an experienced hire after a few years of industry experience (as a doctor) or enter the field the traditional way (BBA, work, MBA)? Is it even possible to break into the field? Your response will be appreciated – Best, C

I very much doubt that you could be a doctor for a few years and then just “join” a top consulting firm as a Partner or Director. It doesn’t really work like that – they hire for entry-level roles, and then you move up if you perform well. You’re much better off skipping medical school / medicine / everything else associated with it and going into consulting directly out of university or an MBA program.

Bought the BIWS prep guide for IB an finding it really useful. Just a bit of background – I am ex-buy-side with 4 years experience as a long/short equity analyst. Left the buy-side to do my masters in finance at LBS (MBA equivalent). Struggling with the ‘why IB’ question given the normal transition is from sell-side to buy-side. trying to focus on the advisory angle, but do you have any pointers or tips?

Thanks. For reference, you should ask questions directly on BIWS or via email there because the response time will be faster (I only check comments on this site once per week and it’s just me, vs. several people on BIWS).

I think you would probably need a story about something very specific in your L/S equity role, such as an interesting deal that you couldn’t work on because all you do is follow companies there, and how that motivated you to look into investment banking. And you would need responses to the usual “But you could make more money there!”-type objections (yes, but it’s also less stable, harder to advance at single-manager funds, etc.). But this depends greatly on your background and the experience you have to work with, so feel free to send a more detailed question via the other site.

I am a first-year undergraduate at UCL (target but less competitive than Oxbridge/LSE), studying IT/Business. I have done a L/S Equity HF internship and have won several trading competitions. I am currently applying for IB’s insight week programs. The UK interviews are basically digital ones(hirevue), and I am wondering what shall I respond if the bank ask both “Tell me about yourself” and “Why IB?” Will my story sound repetitive?

Also, I am applying for the S&T. What are my reasons for the job do you think banks will be interested in? I have a genuine interest in the markets and is willing to do a relationship-based business (equity sales). However, are there any other thing that people usually mention when they apply for S&T?

Thanks for your help! Really appreciate your information on the website.

We cover recommendations for your story here: https://mergersandinquisitions.com/walk-me-through-your-resume/

For S&T, you need to focus on specific products you like rather than saying something vague like “I like the stock market.” See: https://mergersandinquisitions.com/sales-and-trading-interview-questions/

Thanks for the great article. I am having trouble answering “Why IB” during the interview.To give you little bit about my background, I go to a target school majoring in Financial Economics with Business Management. I’ve worked at Big 4 accounting firm in Banking & Finance Audit division, small regional boutique IB in NYC, and PE firm (Growth Equity Fund). What would be the best way to tell my story??

I would recommend following one of the templates here: https://mergersandinquisitions.com/walk-me-through-your-resume/

It shouldn’t be too difficult – interested in accounting/finance so you worked at the Big 4, but wanted to work more directly on deals, so you went to the boutique IB firm. Did well there, but didn’t get the deal exposure you wanted, so you went into PE to learn about bigger/more diversified companies. And now you want to work at a larger bank to combine the deal experience you gained at the boutique IB with the bigger companies you experienced at the PE firm.

Good day, I have an interview for a new analyst role, operations for an Investment bank. I have a masters degree in Petroleum engineering and the main question would be, why operation?

I don’t know. Why are you interested in operations? Questions like this baffle me because how do you expect me, some random person the Internet, to know your career motivations and goals?

hi brian, nicole,

my story is basically that I did an asset management internship at a BB but didn’t get a return offer and then proceeded to flunk out of uni. At the time i was not mentally prepared for the internship. I suffered low self esteem and just went through a down period where everything for me was falling apart. after some soul searching and therapy sessions Ive pretty much got over these mental struggles i guess.

ive managed to get back to a semi target uk uni (UCL, studying history politics and economics) and im trying to get another internship second time round but hopefully this time in IBD, Sales or the investing side of asset manegment, basically anything more technical than asset management sales.

Do you think i stand a shot at a second chance, i know its a competitve industry so i highly doubt theres time for sob stories but Ive managed to get back to top 10 uk uni, getting decent grades and have also had some finance/business related work experience since dropping out of uni, including a current job at a top uk wealth advisor.

Yes, just leave out the first internship where you did not do well.

If they ask me to walk through my resume and through that I explain why IB, and they ask me why IB again in a later question, do I just repeat what I said?

They shouldn’t even ask the “Why IB?” question if you have told your story properly…

https://mergersandinquisitions.com/walk-me-through-your-resume/

And if they do ask, it is just the last part of your story.

I hold an MSc in Finance from a target school in London, cleared CFA Level I, and currently studying towards Level II. I have a really solid finance background and ended up in Bloomberg as a Data Analyst out of my Master. I have been there for 2 years now and I am bored as hell doing operational stuff. I feel like my brain is shrinking and miss the intellectual stimuli that for example I had when working with my peers during my Postgrad in London. I truly want to shift to Investment Banking, and to the say of my peers working at organisations like UBS, SocGen, and others, I do not miss the profile. After hundreds of tries I was able to secure an Assessment Centre at JP Morgan (unsuccessful), and was waiting for another AC the last Autumn at RBC, but the positions got filled up quickly. Probably you will ask yourself why I did not do internships of sort etc. I was studying English during summer holidays in between terms and never had guidance whatsoever. I come from a very rural background and I strongly believe this is what made me hungry with ambitions. Yet I do not understand, what am I missing?

Thank you for your answer

It’s tough to say because I don’t know your previous work experience, but my guess is that the lack of internships hurt you most. If you’ve already been working for 2 years, you might have to consider an MBA at this point. Or, go to a Big 4 firm or an independent valuation firm, or something else that is closer to IB and move in from there.

Thank you for your response. I have done an Internship in a Real Estate Investment Management Firm in London for a month, where I analysed a fund’s performance. The results were used to present to clients their superior returns. The same company liked me and sent me to Milan where I participated in the creation of a new real estate fund for which our company was the vehicle. Here I have done everything in just a bit more than a month: I operated financial models, I liaised with due diligence advisers and debt providers, I heavily helped in the due diligence process, did reporting for clients and management, and regularly attended the TAC (Transaction Advisory Committee), taking notes, preparing the minutes, and where I was also asked for my opinion. I really felt valued, they offered me a contract although they knew since I joined I would be taking a Graduate position at Bloomberg in London. At Bloomberg my main task was of data entry for new Corporates and Financials issuances. I did learn a lot, but after 6-months that learning curve just stopped altogether. I moved to another team maintaining Structured Products (fixed income securities with embedded options). I moved from interacting with DCM desks, to interact with Sales and Trading professionals. In all this you also interact a lot with back office (Mumbai, Chennai, etc…), probably the most frustrating part of my job. For someone who has never interacted with back office the way I do, saying that it is really hard to speak basic finance with them, may sounds arrogant. Currently I am leading a team of 7 analysts looking at client inquiries on yield and spread analysis. Our goal is to build a library with dynamic financial models that can be used to quickly match discrepancies to that client receive timely explanations. As an example, the ASW and the Z-spread are off although they should be close. I would need to investigate the issue. It may be a data issue, a script issue, or simply the client is doing some mistakes. Whatever that maybe the bottom line is that if I would not understand about financial modelling and finance, I would not certainly be able to do such a thing.

I tried to summarise more or less everything, but I am sure your expertise will see far through those lines.

I appreciate you coming back to me. Matt

I think you should go for non-IB front office roles: Real estate, lending, credit funds, etc. They are easier to get and you would have a much higher chance with your background.

What if they ask why IB and not Private Equity/Equity Research etc.? Can I say that 1-I can probably learn more by being an Investment Banker because the job is more demanding and 2-for Private Equity it can take from 5 to 7 years to see the results of your work while in M&A for example you wait less?

Please see:

https://mergersandinquisitions.com/buy-side-to-investment-banking/

Hey Brian, i’ve ran into a bit of a problem with the “why investment banking” question. My story revolves around how I began university in Kinesiology, but transferred into after working a couple years at BMO (Just as an administrative clerk). But recently as I was networking, the individual stumped me with “why not consulting?” I had no idea what to say and i’m worried about that response coming up again in an interview. Any suggestions?

Because you want to work on deals, do more financial than operational work, and actually see the firsthand impact of your work.

Hi Brian/ Team,

Thanks for the post. I am currently working in Asset Management and I am being interviewed to move to M&A for the same company. I am having trouble coming with a good story, What do you guys think of the following? Is it convincing?

First : I have always had a passion for corporate finance and the markets. My current job requires me to follow current events and I always see myself more interested on M&A deals since they are linked directly or indirectly to everything we do.

Second: I explain how I am really good at my job but that I need a bigger challenge and that this division is going to allow me to leverage the skills that I am already comfortable with and expand my technical knowledge. After more than a year learning about the business and meeting with different people (name of people). I believe M&A is the best place for me, where I will be able to add value from day one, since I have already working for the firm and I know the culture very well, I am really good at dealing with clients (internal and external), managing people’s expectations, I am very comfortable working under pressure, I don’t mind doing long hours and to be honest for me is a matter of doing something that I will enjoy.

You need to cite some specific deals you’ve followed, how you learned about deals in your current role, and how you’ve taken steps to learn the technical side on your own. Your reasons are too vague right now unless you can get more specific about your interest in M&A. Talk about M&A deals like a sports fan talks about football games.

Hope you are doing well. I am an Electrical Engineer who graduated with a Bachelor’s In Electrical Engineering from a SUNY Stony Brook, NY in 2015. I have been working at an engineering firm ever since graduation, and over the span of time, I have exposed to the business side of the company I work for, and also met few investment bankers via peer networking that reinforced my interest in IB or PE. But I am very much lost about how to break into the industry given my academic background, and also the fact that I do not have an Undergraduate Degree from a top Target Schools for Financial Companies.

So, currently I am self-studying for GMAT. But I know I MUST score over 740+ in GMAT if I have to get into any decent MBA, if I am not wrong. But I am not sure if shooting for Fall 2017 admission would be feasible or make me a better candidate for admission into a top MBA program given that by 2017, I would have accrued around 2 years of post-graduation work experience. Moreover, I was a part-time senior Supervisor at an event management company in NYC for 3.5 years during college. I heard good business schools normally do not give admission to any candidate with less than 3 years of work experience.

So I am very confused what to do, and if I have to wait until Fall 2018 to get into a good MBA program, and also if it will look good if I pursue technical profession before I join MBA and then switch to IB/PE?

I will be grateful and obliged if you can help me with proper guidance so that I do not fall behind and resolve my mid-career dilemma to have a clear plan to work on. You elaborate and thoughtful message will be much appreciated. Thank you for your time and consideration.

Respectfully,

To get into IB at this stage, you’ll almost certainly need an MBA along with a pre-MBA internship at some type of finance firm.

It’s better to have 3 years of work experience when you enroll in business school and to spend the extra year doing something a bit more business-related at your company, and then to get the pre-MBA internship right before the MBA program begins.

I did an internship as corporate banking role. I was wondering if i can say I want to do Ib because I did some DCF and comps in this internship, and I realzied I love doing financial modeling, and wanted to get mor exposures to some bigger deals to polish my modelling skills?

That can be part of your reasoning, but it’s not good enough for the entire reason. You have to act like you were interested in deals from the start, got some exposure in corporate banking, and then wanted to change X or work on more Y, so you now want to do IB (where X or Y equals more varied or complex deals, for example).

Thanks for your prompt reply.

What about I say this:

1. I have been very interested in deals. I will check deal news like M&A, IPOs on a regular basis and did some research on them.

2. Then I interned as a summer corporate banking analyst, where I was responsible for writing credit memos and performing enterprise valuation models for our clients(in case they default and cannot pay us back so we can sell the client companies).

3. Then I realized I love financial modeling, and have done very well in the valuation work for this internship.

4. So I wanted to move from working on credit analysis to purely doing financial modelings, as a way to better analyze deals.

I bought your online tutorials for networking, and they were VERY helpful!! Looking forward to your new articles!!

I would say that’s still not great reasoning. You should say that you liked the analysis in corporate banking, but you wanted to work on more varied and complex deals, and complete the entire *process* for those deals, which is what attracts you to investment banking. So you want to combine your modeling, credit analysis, and deal skills to work in IB and advise a broader set of companies on different deal types.

I am hoping to schedule a meeting with an evercore MD (informal meeting) and would like to turn it into an informal interview or at least leverage it to get an interview. I studied in the UK, just graduated with a first class in computer science, and have done 2 HF internships (one being the best in my country). However, I’m afraid that after hearing my story and looking at my CV, he may think that I’m simply looking for exit opps.

What do you think is the best way for me to spin my internships into a good story towards IB?

Btw, I have purchased your BIWS course and do you think studying the accounting interview module will be sufficient? (I think it’s module 3 or 4 of the fundamentals course)

The best way to position yourself is to say that your plan all along was investment banking, and that the other internships have just served to move you closer to investment banking. Say that you became more interested in deals during the HF internships.

Studying the accounting modules will probably not be sufficient, because you’ll get questions on valuation, DCF analysis, M&A, and more. Please see the quick start guide to the course.

I meet with a Director with one Investment Banking firm. Told him about my interest in investment banking. He asked me where do i see my self in 10 years and i replied that in 10 year i see myself starting my own investment banking firm after gaining the required experience. He then went ahead and asked me why? I told him because I have a strong passion for investment banking and also to be relevant.

Then he told me to think about the why(i.e why i want to start my own investment banking firm in 10 year) question again and get back to him within a week.

Please, how best can I answer and give him the best reply.

Best regards.

Um… well, what makes you interested in investment banking? Why do you actually want to do it? “Passion” for something is too vague. What *specific* deals or client types do you want to work with? What personal experiences have led you to the conclusion that you want to work with those deals or clients?

I am currently working in oil and gas sector from past 1.5 years and i have had a Bachelors degree in engineering. I want to switch my profile to finance, So I thought of pursuing MBA in finance. But What should be my response to this question of pursuing finance, a switch from my technical field, at the interview session ?

I’d just say that you’ve got interested in finance because of XYZ reason, which is why you decided to change your profile.

I know the “walk me through your resume” is typically 1-3 minutes. How long would you recommend the “why investment banking answer be”? I am currently clocking in at 1.5 mins.

Yes I may even keep it to below 1 minute.

There’s one question that I feel that always holds me back in interviews: “why did you choose this university?” I get this question alot simply because I graduated from a fairly low ranked univeristy in the UK, around 80 in the league table. I never could convincingly justify this question. The reasons for attending this uni were simply because it was my local uni and the most financially convenient for me given that my parents are first generation immigrants – I didn’t come from a privileged background. Although I did have the grades to attend a reputable uni, I made the best of what I had and ultimately graduated first place in my year group.

Now given my context how would you best answer “why this uni?” I don’t want to sound like I’m looking for too much sympathy etc.

Many thanks in advance,

I would just say that you had a good financial incentive to attend because of the deal they gave you, and given your family situation, you were not able to afford a higher-priced school. You did have the grades to get into a better-known school, but did not want to take on the amount of debt required when you made the decision. Make it more about the business trade-off, not sympathy.

Hi, I’m mighty impressed with the info you’ve put up here. I graduated with a Bachelors in Information Technology in 2009 (from an average grade college in India) and very early moved to Big 4 in 2010. I focus on Technology Risks, Process Reviews and Compliance related services. Banking clients and Invement management Outsourcing providrs form one of the arctors we provide services to that are relevant to Finance. I have about 5 years in the domain peppered with an active lifestyle outside work. I’m really keen on breaking into that rarified space of banking/ finance that is PE/ IB. Would really appreciate suggestion and a broad roadmap. I have lived/ worked abroad extensively – about 40% of 5 years

Thanks !! Puneet

Your best bet is to make an internal transfer to the TAS group at the Big 4 firm or the internal bank there, and then leverage that experience to get into a pure-play bank or other finance firm. This article may be helpful with the transition to TAS: https://mergersandinquisitions.com/big-4-transaction-advisory-services-corporate-development-financial-institution/

Thanks Brian !!

Your reply is really helpful in giving me a starting point. Right now, I’m a Year1 Manager with the Big 4 firm I spoke about. I have just broken into the mid-management. Making an internal move to TAS would be really difficult because a. No finance academic knowledge. b. Fit – it’s easier to move when you’re an analyst than a manager. Now, personally, I wouldn’t mind going at an Analyst/ associate level, but the partners will have issues – No one wants a manager in a practice leave and join another as an associate. Do you think retooling with an MBA would make sense ? If MBA is the way forward, Do you suggest I spend a few months (before I join my MBA) with a Broking/ Trading/ Interning at a smaller India based equity fund – basically anything that boosts my credentials in finance ? Would really love to have your thoughts on this. Also, is there a paid service where I can have a mentor to direct me.

I know that’s a lot of questions in a post…so thanks in advance !!

Best Puneet

Yes retooling with an MBA can potentially help you, but only at a top school: https://mergersandinquisitions.com/mba-masters-programs/ Yes I’d suggest you spend a few months pre-MBA at a fund to broaden your exposure. We are not 100% sure of paid services for mentors.

Thanks Nicole, appreciate the advice

Hello Nicole / Brian

I have a telephone interview next week for a mid-market boutique in London (this is my first ever interview over the phone).

I just want to find out some of the etiquettes when answering and ending the call? Do you think its a good idea to begin like this….”Before we begin, I would like to take this opportunity to thank you for considering me etc.”?

Can you give me some tips on how to begin/end the conversation? I’d like to know of anything that I could say that will differentiate me, show my enthusiasm and perhaps leave a lasting impression on the interviewer?

Many thanks,

Al, I’d just keep it short. Thanks for calling is a good start. And to end the conversation, just end it naturally – thanks for taking the time to speak with me. I’m very interested in this opportunity and I look forward to joining the firm. I think its easier to impress the caller throughout the conversation (perhaps the first 10 minutes) and the tone of your voice matters a lot (shows enthusiasm etc). In terms of exactly what to say, it’s hard to say here because it varies according to the person and the interviewer.

Hi Brian / Nicole,

I’m currently applying for a ECM internship at a well-known boutique as no M&A vacancies are available at the moment. My intention is to get my foot in the door and hopefully switch to their M&A team (should this be possible) once I finish this internship. However in my app, I wrote something along the lines of “I want to go into ECM because I see myself in an advisory role, but also very much interested in working closely with the markets… and ECM combines the two etc. Would it be at all possible to make a strong water-tight case to move to M&A (a purely advisory role) as I would be contradicting myself in the app / interview?

Keep up the good work!

If you’re applying for an ECM role what you wrote is fine. I’m not sure if I understand your last question. No, you’ll need to choose between ECM + M&A – which one is your top choice? And then craft your story from there.

Thanks for the great content on this site. I am currently a junior and spent my sophomore summer at a regional commercial bank. How can I use this to explain why I want investment banking? My initial thoughts were that I wanted to work with companies on a larger scale and in a more challenging environment, but corporate banking also fits that bill. I could also say that I want to advise companies on M&A, but that would only be specific to M&A (I’m also targeting other industry and product groups). Any advice would be much appreciated. Thanks in advance for your help.

Just say that during your summer, you’ve work on XYZ project/met with XYZ bankers and you realized that IB is more suitable for you given (i.e. faster paced, more deal oriented environment, etc)

If I said I’m interested in banking b/c it can give me the skills to strategically learn how to select stocks/ help me reach my LT goal in becoming an investor, does that seem like I’m more interested in investing than banking?

Yes. This answer is more suitable for buy-side/research roles.

Hi there, This is Ankit from India.I just finished My Bachelor of Engineering (in Mechanical Engineering), I got interested in financial sector in my final Year. I did some online courses and read some economics books to gain more Knowledge, I’m eager to learn more.My question is shall I do an MBA(finance) or look for some internship or Job, problem is I cant find any because of my technical background. Any Suggestions ?

Yes an MBA from target school may help you retool yourself

I’m not a finance major and am planning to go with the “big picture” method. I was wondering if you could give me advice on how to build a more polished story from my current situation.

I’m currently a rising junior and I’ve interned at an embassy, a law firm and am currently interning at a boutique-ish firm in IBD, specifically M&A. Previously, I was interested in law, but gradually gained more interest in finance because it was related to what I had experienced at the law firm (corporate law). Currently I don’t have a LOT of knowledge on the field of finance, but am taking online courses to learn more about it. I want to somehow convery through my story that I enjoy how IB helps bring together results that are “greater than myself,” in a concrete manner. Additionally, I enjoy using the critical skills in valuing companies and trying to finding the best combination of maximizing that value through M&A by studying the industry.

Is this inappropriate in fully illustrating my interest? If so, how could I spin it?

Once again, thank you so much and I look forward to your advice!

Very quickly – if you don’t have lots of knowledge on finance, you need to gain that knowledge and talk about why you’re interested in banking. We don’t review stories on our comments forum here in fairness to BIWS customers. In your case, please read https://mergersandinquisitions.com/why-investment-banking/

I just received a phone interview with a bulge bracket through an employee reference.

I worked for a mining company for the past year in their project finance department. I am right now in the process of preparing an answer for Why IB; here is what I am thinking of focusing on:

1) I know that it doesn’t separate us from other candidates when we talk about how we love being busy, challenged and perform better under pressure. But I have a personal story behind: My father grew up in an orphanage, and his achievements inspire me the most, and I look up to him. He has come a very long way, and I want to achieve at least as much as he did for my children. In a career path within IB, the sky is the limit which excites me very much.

2) Focusing on why I want to leave project finance even though I like projects- the bottom line is deal flow. The deal flow within the company that I worked for was very low. Although, I tried to fill my free time by reading about different industries and build valuation models on my own, the amount of real work I do is very minimal. As a recent graduate, I want to obtain as much hands-on experience as possible, because this will determine the shape of my career path, in which I seek endless opportunities.

Please tell me if you have any advice.

Sure I think what you wrote sounds reasonable. If you can add in that you’ve spoken with bankers (any experience with IB), that may make your pitch better.

I was wondering if I can contact you by email so that I could send you my one pager professional project and get your opinion on how to formulate it as a 60-second short answer for the “tell me about yourself” question.

P.S. I just signed up for the interview guide on Breaking Into Wall-street which might help me with that too.

Regards, Makram

Hi M&I,

I am an undergrad at a non-target Canadian university and I have an interview coming up at a top 3 Canadian IB for a summer analyst role. Prior to that, my internship experience have been at a large Canadian P&C Insurer as a payments and reconciliation intern, and a public utilities company in internal control/risk management. As they don’t have much to do with finance, I have gotten involved with my school’s investment club as a portfolio manager and won a stock competition but I really do want to to pursue a career in the capital markets. I cold-called boutiques and applied to major IBs the previous year but failed to land any offers. I feel the interviewer may wonder why I didn’t secure any capital markets-related role prior to this as some of my competition would most likely have done.

Can you kindly provide any tips how to spin it in a more positive light?

Much appreciated, thanks!

I’d focus on spinning what you did that was interesting that summer. You can then talk about how your experience over the summer made you more interested in IB (perhaps you met someone in the industry) and what you love about IB, and why you want to be in IB in the long run. I’d also make it sound so straight forward that working at the insurance company was the logical decision at that time.

I had a degree in Physics 13 years ago and worked in retail banking for about 7years. I decided to leave the bank and did a professional course in Accounting. When I finished I started working in a small accounting firm but will like to switch into investment banking since that has always been my interest. How do you think I can link all that up.

I would take a look at some of these stories: https://mergersandinquisitions.com/case-studies-reader-success-stories/ And go to the “From the Big 4” category.

Hi, I’m struggling a bit with the question why Investment Banking versus why Sales and Trading. I’ve applied to both types of internships because I know some bulge brackets combine the two positions in a rotational summer analyst program, but I still want to make sure I can correctly answer the questions why IB instead of S&T and vice versa?

Perhaps you’re more interested in the deal-oriented culture of IB. You prefer working with corporates vs. just the markets. You are driven by executing deals versus trading

Thanks Nicole! And what would be a good reason why someone would prefer S&T instead of IB?

They prefer the markets, investing, and dealing with institutional investors

My undergrad program is in Finance, I had internship with a mid-market IB in China in my second year summer. But after that, I didn’t put too much time on IB, I did internship with pwc,united nation, and a commercial bank in Toronto. Now i’m doing Master of finance in Oxford, and trying to break into IB, how should I round up my story? Is there a good way to explain why I only did a internship with IB on my second year, and then diverted to other areas? Thank you!

Yes perhaps you wanted to try something else out but you realize that you wanted to go back to IB given its faster pace and deal-oriented environment.

I want to be a INVESTMENT BANKER so guide me where should i start. I had done computer science engineering last year. Also, let me know whether i should do MBA in dual specialization Banking & Finance or PGDM in finance or MBA in Finance only?

I don’t think it makes a big difference to be honest… https://mergersandinquisitions.com/mba-investment-banking-recruiting-process/

Hi, thanks for this great posting! I am now pursuing a Bachelor Degree of Arts in English in China, as well as a Dual Degree in Finance. How can I use my art background in English in answering the why IB question? It’s not like other majors such as IT or healthcare that have a specific industry to focus on. Is it weird if I say that I would like to combine my expertise in English and my interest in finance? Please help me on this.

You may want to talk about your finance spark – what got you interested in finance, and how your communication skills can be valuable for financial firms.

This is gold, thank you very much!

I was rejected recently for student work experience/internship at Merrill Lynch but I have another opportunity next year, and I’m determined to get in with the help of your blog. Thank you.

I’m doing a bachelor in accounting at a second-tier school, what can I do in my first year to put myself in a better position for year 2 BB summer internships?

Will doing a summer internship at a local financial management firm ( http://www.nobleapex.com/catalog/index.php?language=en ) beneficial at all?

I’m starting to network but don’t know how I should follow-up with contacts. Please help! Thank you so much :)

Since you’re only in your first year, yes this internship will be helpful. In your junior year however, what’ll really be useful is experience with an IB.

To follow up, please refer to https://mergersandinquisitions.com/investment-banking-networking/ https://mergersandinquisitions.com/turn-cold-calls-warm-follow-up-alumni-conversations/ https://mergersandinquisitions.com/investment-banking-informational-interview/

How should I best answer the short term and long term career goals in investment banking summer internship interview?

Please see below for a basic guideline you can use. You’ll have to craft an answer based on your own personal experiences to make it more personal. In the short term I am interested in learning specific skill sets so I can assist seniors to pitch to clients and advise clients on their financing efforts. In the long-term I’m excited about getting the opportunity to start bringing in deals.

Sorry Nicole, forgive me. typed Brian in error.

I majored in Banking in undergrad and now work for a commercial bank in Zimbabwe. I am applying to top business schools in the US for the Fall 2013 entry. I will have 5 years experience on matriculation( one in treasury at Barclays; two in Microfinance and the other two in retail banking at Ecobank Zimbabwe. I would like to get into investment banking and will leverage on business school to do that.

I am not sure of how I can craft my story on the ‘why IB’ question. Do you have any leads.

I was doing very well in Microfinance. I crafted new products and worked on project appraisal for the start-up. I however left to try out banking when I got offered a job as a Relationship Manager at the bank.

I really want to venture into investment banking. Please help on how his kind of background fits IB.

You should ask yourself what draws you to banking first. You can always say that after taking several classes in bschool (assuming you get in) & meeting various contacts in the industry, you realize you have a passion in banking given [why you’re interested in banking and why you prefer banking over microfinance]

Difficult for me to help on comments page. Hope you get the gist of what I’m saying

If i have previous banking internship experience is it ok to point to a past deal that solidified my interest? Or should I even explain before that why banking?

Sure. It works

I just finished an internship this summer at a merchant bank this summer, so now I have finance experience to put on my resume so I can apply bigger firms in the IB position. My prior experience is all retail such as grocery and clothing stores, which has nothing to do with IB. Should I still put them on my resume to show I have been active and busy while being a student? Or should I just put my summer internship experience on there?

You might still want to list your experience in retail briefly. List your impact and what you did there. I’d focus on your summer experience though

I’ve been reading this great website for quite a while, but its my first post. I wish i read this site a few years ago. Ok, so in short, i just turned 27, have a us bachelor economics degree and a master in management degree from a prestigious european school, i started my own company and its not doing bad, but its in a really bad market (my home country which is pretty poor). So my question is can i still try and break into IB, and do I have a chance for an MBA even if i dont have work ex with major companies. Thank you so much

Can be challenging if you don’t have prior IB experience!

I think I understand the differences in the functioning and purpose of the different divisions at a bulge bracket, but what kinds of differences in day to day work, lifestyle, atmosphere, pay, etc. are there between investment banking, investment management, securities, etc.? Are some easier to get into from a more quantitative background vs. liberal arts? You can apply to more than one for internships, is it okay to do this/are there some that go together? Thank you!

Yes, some roles like structuring/trading are more quantitative and requires one to be able to calculate numbers on the spot. Some like sales in S&T/marketing in AM are more qualitative. You might be interested in http://www.goldmansachs.com/careers/choose-your-path/find-your-place/index.html Yes, it is ok though you might want to do some research on your own and figure out which divisions suit you most

Great article. I was an undergraduate psychology major, then worked for a real estate company as a project manager in an emerging market for 3 years and was recently accepted to a top MBA program in the US. I am looking to break into IB, specifically real estate investment banking. My long-term career goals are to provide developers in emerging markets with financing options as well as advise real estate companies on business decisions. Is that a good long -term goal? And how would I link working in a developed country such as the US to a goal I have that is related to emerging markets?

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Hi i am doing an Honers degree in International Business Management and i want to get into investment Banking. are there any recommended courses post grad or other that i should apply for?

Get into a top tier target MBA program

I am not sure about my answer for this question: I usually start out by saying IB is my personal fit because I am a competitive person. Then I explain that I am studying 5 class, work for 2 internship and 2 part time job. I love being busy and under pressure. Then I tie back to IBD that “I know in IBD there is always competition to close deal, to pitching ideas to client” and “with me, Investment Banking is a personal fit” Do you think that sounds personal enough? Is that a little bit cliche’

That sounds cliche and no it doesn’t sound personal enough. I think you should “personalize the spark” a bit. Maybe tell a story that attracted you to IB or something…

Thank you! I actually add on 2 others reason that I like the transaction business (curious abt strategy behind the deals,etc) and learning opportunities. But I want to show that it’s a personal fit for me. I had a Banking experience before and realized that I thrive in a fast paced, multi-task,pressured environment where I have lots of responsibilities. Do you think that sounds better? Should I spend 10-20sec to tell my banking experience to personalize it? Thanks!

If you had banking experience before, yes, definitely talk about it and use that to set yourself apart.

Sure. Personalizing it would help.

i came into my undergraduate as a business economics major, got a wealth management internship with merrill lynch through a contact, but then didnt make the gpa requirements to make it into the actual major to take upper division classes, so i ended up graduating with a degree in european studies. ive taken a few trips to germany and spain and taught math there, so i told interviewers that i switched majors after coming back because i was so interested in understand my cultural background. i took 2 years off after undergrad and tutored, and now im in a m.s. accounting program. im having a hard time connecting my european studies BACK to a grad degree in accounting/related field to banking). did i even spin my unrelated major correctly in the first place? any help would be really appreciated. thanks!

I don’t quite understand how you switched from European studies to MS Accounting either. You would know better than I do why you decide to get a grad degree

well after i graduated with european studies, i was still interested in finance, but more so who actually makes sure the numbers people play with are correct (auditing). so i took some time off and took classes in accounting because thats what i wanted to do. i ended up applying to a m.s. in accounting in order to finish up my the required courses to sit for my cpa. after getting into the program, i now have an interest in ib. im having trouble tying all of my switches in interests together in order to show the interviewer a logical reason im truely interested in ib. i would have a total of 4 sparks: 1. wealth management, 2. studying european studies, 3. accounting, 4. ib? is having 4 sparks in my life too much? i feel like i need to explain all my changes in interests, in order to make my “story” believable. please help.

You should explain why IB clearly and focus. You should focus on your why IB/finance spark

how should i frame my response if they ask why the change of interests so much?

I think you’d know better than I do because its your story. Difficult for me to help you on the comments page.

I am currently a sophomore majoring in economics. I have never had a banking or even business internship, however I am interested in applying for an internship position at an IB firm this summer. I have never worked before and do not have much of a resume to speak of. What should I say as my reasons for wanting to go into the field of investment banking.

You should ask yourself why you want to get into IB. We can’t help you if you don’t have the answer to it

Where can I learn how about the technical questions they will ask me, I have a good amount of time to become a wizard at these technical questions (years) so how should I go about learning the content that they could possibly ask me?

http://breakingintowallstreet.com/biws/

Great article, this site is one of my favorites on this internet. I wanted to ask what your prediction for investment banking will be going into the future. I am currently a high school senior interested in finance and was wondering, once I get out of undergrad, will there still be as much money and opportunity in investment banking (or I guess finance in general) as there is now or do you think it will diminish in the coming years?

It will always exist because companies always need to buy, sell, and raise capital. Trading is more likely to suffer than banking because regulations there have gotten stricter. Average pay will come down, but you will still make more than in any other field (unless you start your own company and are mega-successful).

How much will it help if an MD is helping me A LOT (i.e. setting up a visit to the office, giving me contacts, etc)? Do I still have a chance coming from a non/semi-target? I even got a call from HR because of him.

Yes. It helps a lot. Now forget about the fact that you came from a non-target and focus on your interviews!

like the question above, can you clarify little more about how I should approach “walk me through your resume” versus “why investment banking?”

Also, do they ask BOTH walk me through your resume and why investment during the interview or do they just ask one question?

Yes. Both – even if the questions are not framed that way because you have to address why IB and why you’re there interviewing

Walk me through your resume – your experience, what you’ve been through (education, internships, work experience, etc), why you made the choices you made Why IB – Why are you interviewing for this job in IB? What makes you so eager to get into IB?

For some reason your method for “Why Investment Banking” is very similar to the method for “Your Story in 5 steps”

What are the main differences in the way I should answer those two questions?

They are quite similar. The main difference is that with the “Why Investment Banking?” question, you don’t spend as much time explaining your spark and growing interest, and it’s a shorter response overall.

I am reading, my first year, Investment and Financial Risk Management at Cass Business School in London. I have attended a number of networking events and talks. In particular the events organised by Women in Business Society and the UK India Trade Event, gave me greater motivation to become active in the industry. I’ve always had an interest in political and economic world events, finance allows me to focus that broad interest to study and predict what will happen next in the markets as a result of these events.

What do you think of this? it is honest and genuinely does reflect my feeling about wanting to go into finance, however I am worried this isn’t what employers are looking for.

I’d suggest you to get an internship in finance to boost your chances.

A couple of questions regarding phone interview:

1) Since I was working in relevant field before (PE in summer), What kind of questions would I be expected regarding my previous internship? Would they go really deep into it?

2) For phone interview, would the interviewer ask me every single job experience, or he/she would focus only on the finance-related internship?

1. https://mergersandinquisitions.com/private-equity-interviews/

2. It depends. Perhaps he/she will focus on finance-related internships but he/she cld also touch upon your previous roles in other industries too

1) Since this one will be an IB interview, will it still be the same format as the link you provided with me?

2) My internship was mostly focused on research and didn’t involve much about modeling, what would be a good response if the interviewer asked why didn’t I do much modeling?

3) And in terms of phone interview, will they be around 30 minutes as well?

1. More info on IB interviews: https://mergersandinquisitions.com/investment-banking-interview-questions-and-answers/ 2. Say you’ve had some sort of exposure to modelling and demonstrate your knowledge of it. I’m sure you’ve been exposed to some sort of modeling/quant work in research. However, if you don’t know something, admit it. And don’t focus on your weakness, emphasize your strengths in interviews; impress them 3. Yes. Longer/shorter depends on your chemistry w interviewer

I am planning to write “I met this friend in a finance club and since he worked in boutique investment banks before, he really got me interested about banking because of the fast-paced environment and excitement of working on various deals.” — Is that considered a “good response” for “Why investment banking? If not, what could I do to improve/make it sound better?

You may want to be a bit more specific because “fast-paced environment and excitement of working on various deals” sounds generic. You’ve got to address the why IB over other divisions. If you want specific guidance on how to make your case sound better, perhaps you could check out our resume & CL editing/coaching services https://mergersandinquisitions.com/investment-banking-resume-review/

How is this not different from “tell me about yourself”? If an interviewer asks me “tell me about yourself”, do you add this “why banking” at the end?

Just to be more clear, isn’t this question the same as Step 5 of “Tell me about yourself”? So when I am answering the 1st question should I add the answer to this question in or should I wait for the interviewer to ask “why M&A/banking” and then answer?

Thanks once again!!

Go w the flow. When timing is appropriate talk about why banking. But don’t blabber on. Pls refer to previous answer I posted

Tell him/her your background. Talk 20 secs. Wait for him/her to ask you more questions. Then talk..then lead to why you’re interviewing (why banking)

Hi, so I am interviewing again this year. I would take your advice to say I have completed investment banking internship and are more interested in joining them. My question is if they ask why did I fail last year, is it ok to explain like this, I applied on the last day before deadline, or I was not well prepared for the interview? Does it sound I was not serious with them? Thanks!

No. Come up with a better reason – spin a story at a positive light

I networked with an analyst and he asked me some technical questions on the spot, and I couldn’t answer most of them since I have not started preparing for the technical questions–does that mean I have no chance with the firm at all?

I wouldn’t say so because I wasn’t there though chances might be slim if you couldn’t impress him. But then again, an analyst doesn’t have much say in the hiring process. If you can get someone w the hiring power to like you, you will increase your chances significantly

So would you recommend me to continue networking with more senior level people in the firm? Or practice the technical (which is what should be done anyways) and then “impress” him later.

Yes continue networking & practise the technical at the same time

Hi, I have been working in healthcare industry (In pharmaceuticals,operations- SALES and Marketing)for 14 years. Currently,I am at middle level management. I intend to do a MBA from an international school and am interested in getting into investment banking in the healthcare industry. The desire is driven by my basic strengths – analytical, strategic and learner. Am interested to get into M&A’s in Healthcare industry / strategy. Request your opinion on this shift at this point of my career.

https://mergersandinquisitions.com/industry-specific-interviews/ should help when you land an interview. To land an interview, network extensively during your MBA

I was interning at a PE firm before and now would like to try ibd for a summer internship. What would be some good responses if they ask “Why would you move PE to IB?” Can I say that, being on the sell-side is more challenging and I definitely enjoy working under pressure?

More transaction-based in an IB & more deal exposure. No, because working on buy-side can just be as challenging.

Thanks for the response! And what would be a good answer when they ask “Why IB over S&T?”

Moreover, do you think is a good idea to network with as many people as possible with one firm, since some of them might be the ones who interview me?

IB = want to learn more about how M&A process works, understand how to value companies, be involved in due diligence process S&T = market driven; very fast paced; not project oriented like IB

Yes. And other firms too.

In terms of networking, I met this MD in person a couple months ago, and we had a good chat, but after a while I tried to set up another coffee chat with him, which he did agree and forwarded to his assistant to arrange it but his assistant never did, and afterward whenever I tried to e-mail him, he never replied back.Since now is recruiting season, do you think is a good idea for me to call him up?

2nd question, I know normally you need a good reason to follow-up with the connections, but what would be a good reason or excuse to follow-up with them? And I guess since it’s recruiting season now, I should try to stay in touch with them at least once in every 2 months?

Yes. Just follow up. They know you want a job, no need to sugar coat it.

Hi, I’m currently pursuing my Bachelors degree in Electronics and Telecommunication (Penultimate year) in Bangalore, India. I’m planning on switching to finance or consulting at some point in the future. So, basically I should do an MBA after working for a few years? Are there any internships I could do before though? I get only about 4-6 weeks in Summer and a month during Christmas. Most of the companies I looked up offer an internship for a minimum 8-10 week period. Will this be a problem? And should I concentrate on my field now or try for training/internships in Finance (Which I have no knowledge about at the moment)?

Yes I’d suggest you to network with people in finance to see if they can make an exception for you so you can intern for a month. If you know you want to be in finance, focus on finding internships in finance so you have a better idea of what working in finance is like–this will allow you to better make decisions down the line

Hi, I’m a B-tech(EEE) with an MBA.I have nearly 1 year experience in a trading firm.What are opportunities for me to get into investment banking jobs???

Gain some modelling experience. Get an internship w a bank. Try to understand what IB is about and why you want to get into banking. Network extensively. Otherwise, your chances are low.

hi, i belong more to the second category–econ major, boutique ibanking internship in the summer, now going for full time recruiting. i know what it is that started my interest in ibanking, but the problem is that i don’t know what i want to do in the long term. what do you recommend that i say then? thanks!

It is not a problem that you don’t know what you want to do in the long term – it is common; no one really knows.

Just focus on the story of what got you interested in banking (spin it right) and what you think you can learn from being in banking (maybe the modelling skills, the magnitude of exposure to corporate clients which other companies can’t provide you, the caliber of the people you will be working with, etc). In terms of the LT goals, you might not have an idea of what it is you want to do, but try to visualize what it is you are trying to achieve in the LT (Hopefully sth business related; I’m sure you can come up with something) and link that w banking.

could i just say that i’m not quite sure what i want to do in the long term, but i know that it will be something finance-related, so banking will… blahblah?

Don’t say you are not quite sure of what you want to do because that will not come across as “attractive” to interviewers. Just think of a concrete story that attracted you to banking. If they press what you want to do in the LT, make up something that you actually somewhat believe in – maybe you envision urself climbing the ladders, eventually helping banks originate clients, etc

You probably won’t be able to answer this in time, because my interview is tomorrow. Anyways, I am a graduate student in public policy, with an internship in management consulting, project finance, and currently as a federal employee researching financial regulations. I am interviewing for an analyst position at a middle market Ibank.

I’m wondering if you have any general tips for someone with my sort of background.

That’s an interesting background. All you need to do now is craft your “story” to demonstrate why you want to be in finance.

Just to add to that: Say that you wanted to do consulting to learn more about business, but realized you liked finance more and so you wanted to apply your pub policy background to project finance.

But working there, you realized you were more interested in companies on a larger scale, which drew you to i-banking – in the meantime you’ve been researching financial regulations to gain further background knowledge which may help you in IB.

hi, i read ur article..and it’s really helpful…i am an engineer and is interested to work in bank as a probationary officer. recently was interviewed in a bank…they put the usual question why u did engineering if u want to join a bank…. i answered that engineering has developed my analytical skills…i can handle numeric data well and m looking forward for an administrative job…but seeing there expression they weren’t satisfied…by my ans…. i really don’t have a story…for my intrest towards banking…..can you help me to put up my answer in a more precise way???

https://mergersandinquisitions.com/getting-a-finance-job-from-engineering/

Hi, I was in an interview not too long ago and I got asked a very tough question. The lady interviewing me asked me “How I felt about the financial companies and the recent public backlash against them”. What is the correct way to answer that?

Incredible site, entertaining and very informative. I’m about to be a senior at a target school with a pretty impressive resume… for a consultant. Two consulting internships, specialized workshops, clubs – ready for an MBB run. I applied to a few banks last year (and, miraculously, did walk away with one internship offer despite zero finance knowledge), but went with my consulting one instead. Now I’ve come to the realization that I seem far better suited for banking (for real resons, not models and bottles) and don’t know how to spin my consulting-centric resume. I’d love to get your input when you have a moment.

Thanks, Chris

https://mergersandinquisitions.com/consulting-to-investment-banking/

my real reason is to assist the client with an multi-billionaire M&A or IPO and together make an impact on the industry n make it to the news headline. Is that too little? I am 22 looking for an internship and really dont have any family members in the field of finance or any good stories too add.

sure sounds fine

How diffcult is it for a CA fresher to get into investment banking?

Depends on the school you go to and how much you network…

I wish I had come to this site earlier!!! I am going to be a senior at a target school and I had applied to about 15 banking internships and only got one interview which I didn’t get an offer for. I am doing a wealth management internship at a BB right now and I am majoring in Statistics and Economics. I have a very high GPA, above 3.9 and have taken a good number of “quant” classes, ie (stochastic processes, linear modeling, time series, etc). The problem I am having right now is how I sell myself. I am legitimately interested in I-banking, not like some people who are only for the money. Do you know how an interviewer might see my background and what you suggest is the most important thing I focus on right now in going after a full-time analyst position? Thank you so much, really wish you had a donate link!!

Yeah I would focus on how wealth management was good to get you exposed but you wanted something higher-profile; skip the quant classes as that will make you look even rose.

By higher-profile, do you mean like “I wanted something that involved researching and advising for larger clients, i.e. institutions?”

Also, sorry but what do you mean by even rose? Thanks for the kind help, I am planning on buying your kit soon!

Meant “even worse,” typo. Yes, higher profile = advising bigger clients on much bigger deals.

Hi, one final question, my friend was asked “so why exactly do you “like” advising for larger companies. What would be a good response to that? He was interviewing at Goldman for Superday and he said he believed that his BS answer to this was the biggest reason he didn’t get an offer.

Say that it lets you explore more complex issues that you wouldn’t learn about on smaller deals… on smaller deals people tend to get paranoid/stupid about tiny issues that don’t matter, whereas on larger ones you get to learn about things like integration, cross-border M&A law, etc. that you don’t get exposed to on local ones.

Thanks Brian! Your articles are really helpful and they give me a lot to think about. I am a rising sophomore at a pretty good college and currently having an intership in a hegdge fund company. My question is, I know i am interested in M&A but a lot of my past experiences are trading/equity research related. If the interviewer asks me why investment banking, I don’t know exactly how to tell my story from those trading/equity research experience. Can you give me some advice? Thanks !

Just say you thought trading would be more interesting but over time realized you like working on longer-term projects and getting to play a role in what entire companies are doing

Great articles. I’m currently at my engineering related internship, (only a freshman transitioning to a sophomore so I took whatever I could get). I’ve been interested in Finance and Investment banking for a while now, and when I get back to school, I’m going to change my major back to Finance, and apply to the school’s business program and honors college. The thing is though, I go to UMass Amherst. I know it’s not the greatest school, so I was wondering what my chances are of landing a solid investment banking internship next summer/studying abroad junior year and staying for the summer for an international experience in ibanking? Anything I should do to help my case?

Thanks for any help, again, I love your articles, I need to seriously get back to work at this internship haha.

Also, should I try and transfer to a better school after my sophmore year?

Sorry, last one haha. Will going to an “average” undergrad school hurt me a lot from getting into a top MBA program?

Somewhat but not as much as it hurts you getting into banking

It will be pretty tough coming from there, you would have to go to a boutique and/or network a ton (see the case studies under Recruiting)

Thank you for the great article.

I am a final semester engineering undergraduate (expected to graduate in July) from University of New South Wales. I have developed keen interest in joining IB.

I have a 3.9/4 GPA and held various leadership position in curricular activities. However, I do not have any finance related industry internship.

What do you think is my chance of breaking into IB with my current background (I am aiming Australia and Asia due to my personal background) and I would really appreciate any advice in terms of securing a graduate position in one of the bulge bracket banks.

ps: I have read your article on engineers breaking into IB.

You have a chance, mostly because fewer people do internships in Australia. In other regions it would be nearly impossible with no finance-related internships. If you look at the case studies under the Recruiting page at the top you’ll see some interview with readers in similar positions.

Thank you for your input.

Nice article, thanks.

I recently graduated from a top undergrad B school and did an ibanking internship at a boutique in NYC. However, I decided to pass on their offer or try to move to a bigger bank and instead took a consulting position at a start-up consulting firm. Now I’m thinking, though, that I should have stayed in banking.

How hard do you think it will be to get back into banking with this background?

Harder than it would have been had you stayed at the boutique bank, from consulting it’s tough outside the top 3 firms

Great article, thank you for putting all the info on.

I am a final year undergraduate student from a top Australia university. I have a 3.8+ GPA and past internship in a big four accounting firm (doing auditing work). I am now interning at morningstar (equity data team). But I really want to get into investment banking or sales & trading.

I will graduate by the end of this year, so I will participate into the upcoming graduate recruitment in fall.

Could you please suggest how much chance I can get into either IB or S&T? Which one do you think better for me to apply later?

forgot to mention, I am looking for the opportunities in Asia, like Hongkong, Singapore and mainland China

IB is easier if you’ve done auditing as they look for different qualities… good comparison here https://mergersandinquisitions.com/sales-and-trading-vs-investment-banking/

Great article, I am not sure if my story however would cut it… I think that while it is genuine, I feel it might come across as a bit thin?

Basically I want to get into investment banking because I love business, and I enjoy reading about too many different industries to actually pick one to work for in particular… so I figured that investment banking gives me exposure to many different industries, as well as being able to perform the role of finance which I find interesting (valuation etc.)

Thats my primary reason, however I dont know if it will cut it with the interviewer. My father used to be the director of the retail loans division for one of the top 4 banks in Australia and ran the short term money market operations in the same bank at one point. Through this I gained an insight into the banking world and loved his crazy stories about the ridiculous hours and awesome things that happened whilst he was working in these positions.

Should I use this in my ‘story’ for interviewers instead, or perhaps combine the two? It seems as a more tangible link to interest rather than a embedded interest that I have developed over my time in university.

Awesome site by the way, I have been trawling it the past week or so gleaning every single piece of information I can get from it!

I think your family connection is the stronger story here, so I would combine these or just go with that one

I have 2 stories. This is for associate level.

1)Story: My dad is a banker. He was an EVP and Secretary to the Board of Directors at his bank. So there was a banking ‘atmosphere’ in my house and I always had an interest in finance and followed business news. I chose engineering in undergrad as I loved fiddling around with gadgets. I worked in engineering for a few years to understand the industry and now I want to do banking in Diversified Industries (my current field of work). I knew I wanted to be a BFL (like my dad) hence I am here sitting in front of you interviewing for associate positions.

What actually happened: I knew I wanted to become a BFL like my dad. So I decided to take a “regular” job and enjoy my early 20s and not become a banking analyst and work 100hrs/week(I knew I entering at associate level was better for BFL). So if I mention my dad will I across as unoriginal and uncreative who follows the herd (in this case my dad)? Or would it be good as they know I have a ‘background’ in finance and am actually committed to the field and won’t jump off to PE or HF?

2) Use the template your provided in your article on how to break into investment banking as an engineer and not mention my family angle and instead use some other “spark” like an informational interview with alumni or case competition etc and just pretend that I had never heard of banking before in my life?

Thanks so much for your time and help!

I am not sure about the US, but in my country I have seen associates jumping off to PE/HF, hence I mentioned it.

You can still use that story, the family angle isn’t necessarily bad. If you don’t have another good reason just use that story.

Thank you very much for the article.

My academic backgrand is a mess, I’ve always wanted to consult with someone because I’m planning to work in the Investment Banking industry. Could you please give me some advice if you don’t mind to read the long story?

I started my A levels in 2003 and was accepted by Oxford University conditioned on two ‘A’s at my final A level exams, so I dropped the third A level subject and got only 2 completed A levels with ‘A’s then started to study at Oxford in 2005. That’s when and where I became an alcoholic and committed an eating disorder… I didn’t take the problems that serious at the time as I thought I was just unhappy and trying to avoid studying. So I blamed myself badly, the more I felt guilty the worse I performed at uni and the serious I suffered from the problems. I got kicked out from Oxford after the first year in 2006. I had to take a year out and take another A level subject as there’s no good university would accept a student with only two completed A levels. I re-started at another relatively good university in 2007 and changed the subject from Physics to Computing. But I was still having the problems with food and alcohol, which had had strongly affected my daily life. In 2008, I got kicked out from uni again.. Then I went to a rehab and have been seeing a doctor to treat the problems while studying Finance at another university. The reason I chose to study Finance at the beginning was that only this Finance course at University C accepted me without asking any explanation of why I left the other two universities. I have been recovering well and started to feel that I can study as how I used to. (ps I was a really good student and very hard-working before becoming an alcoholic…) Although I didn’t know anything about finance before, I found Finance is most interesting subject I’ve ever studied, and I’ve visited many banks in the City and talked to many bankers recently. I have to say that I love what they do and I want to be one of them… I read an article on this website, it’s about if you are not a graduate from a top university, it is a good choice to take a Master’s degree at one the top business schools. I’ll do what you suggested. I’m planning to do a Masters at LSE after I graduate in 2012 and I believe I can make it.

Now, the problem is I will be 27 when I start to work. Firstly, I don’t know if I will be too old to become an analyst. I remember you mentioned in one of the articles that the banks tend to hire people below the age of 26 as analysts… Secondly, I cannot explain what happend to me in the past. I don’t think they will consider suffering from eating disorder is an acceptable excuse of getting kicked out from uni twice and also, honestly, I don’t want to tell them that I had those problems. I need an explanation. The banks are going to know which schools I’ve attended to after GCSEs…Could you please give me some advice? Can I make up an excuse based on the truth but without mentioning I was an alcoholic and had to make myself throw up everyday? I’m sure I can control myself now and concentrate on studying and working well, but how can I make them believe it?

https://mergersandinquisitions.com/age-investment-banking/ Um I would just tell them a story that says you had problems in the past but have now completely recovered and will be fine going forward, don’t go into details or they will start to doubt everything you say.

Thank you very much for your reply.

Can I just say it’s for the money, to be honest?

Nope, sorry

HAHAHHAHAHAHHAHAHAHA

Thank you for this website – I really find the information I have read so far very valuable. I graduated from an undergraduate business school this past May with a degree in Finance, a 3.7 GPA, and several interesting extracurriculars. My school is non-ivy league, but is in the top 10 business schools in the nation. I interned in private wealth management last summer at JP Morgan and ended up taking the wrong path after graduation, accepting an offer in consulting instead because I was wary of signing a 3-year contract without being 100% sure what I wanted (I am currently not under contract.) I really want to get into asset/portfolio management or investment banking at a bulge bracket — am I at a huge disadvantage considering I have already graduated?

I have performed excellently on my current job, have really good SAT scores (2190), and am a CFA candidate. My interest, hunger, and skills are definitely there, but I’m nervous that my only option is applying online next fall for the following summer and that people don’t even read these applications, but without campus recruiting I feel it is my only option.

Any suggestions on how to break into the field as a new graduate, but still not the traditional entry-level candidate? (I actually want to apply to an entry-level position to be trained properly in the industry)

Thanks for your help.

Depends where the consulting offer is. If it’s at MBB you can still move into banking at this stage. https://mergersandinquisitions.com/consulting-to-investment-banking/

Hi Brian, This is a great site. I was wondering If i can brake into IB with 2:1 bachelors degree in International business from an average university, but with not much experience. I did vacation work in sales and marketing, also in recruitment consultancy and work for three years in respected bar and restaurant while in University. im 25 years old and highly interested in IB, do you think i still have a chance to brake into investment banking?

also thank you for this site. very helpful

It’s tough with that background because others will have lots of finance experience – you’d need to get equivalent experience or go to business school.

This is a great site. Not just for investment banking but for interviewing and recruiting in general. Thanks for this resource. I’ve been reading a lot of your material on interviewing essentials, especially the “how to get into banking from accounting” and I feel like I’ve crafted a good genuine story that is unique. I’ve struggled through the job market and I’m still here however I lack experience. Right now I am in a masters program for accounting and I studied math and econ undergrad at a top school. I had a “gap” year where I was taking prereqs in order to get into a masters program. My story is hard to tell because it seems as though I am focused on a career in accounting, but I have always been interested in finance. In the beginning my interest stemmed more from the glamour of investment banking without really knowing what it was all about. My interest has matured greatly over the past year and a half. I’ve grown up around entrepreneurial minds and naturally I took an interest in VC/PE. I realized how critical it is for business to have services that advise them on capital raising and expansion. My skill-set and interests are perfectly in line with invest banking and I know this is what I want to do now. My story also involves the, “why investment banking question?” so what happens if I tell my story and they ask me, “why do you want to be a banker? why now?” when I’ve already answered it in my story?

Also, my undergrad gpa is crummy and not reflective of my abilities which is my fault. I feel as though I’ve proven myself post=grad though by excelling in all of my accounting and finance classes. I’m not sure this will be enough. I do have an extensive alumni network in top banks though. Do you think I have a fighting chance?

Loving all the material. Thanks again. Happy Holidays.

Just answer it again and go into more detail. GPA depends on how bad it was but if it was above 3.0 or so you still have a shot with networking.

Thanks for the helpful article. For answering “Why IB?” you recommend talking about personal experiences, such as how your parents traded, and you started following the market – but I am having a hard time learning how to spin that to why IB. Wouldn’t that make you more interested in S&T or AM – something that deals with the markets?

Thanks in advance for your insight.

The point is to show how you became interested in finance, broadly speaking, and then became more interested in IB after that initial “spark.”

I am an engineering student but began interested in corporate finance from end of second year. However, I only managed to get an internship in GS ops. I am now looking for full-time in corporate finance. How should I better position myself in answering this question?

Also, another typical question is when i answered I am interested in corporate side of banking, they will ask me why not consulting? You have any insight on answering this?

Thanks in advance, Hao

https://mergersandinquisitions.com/getting-a-finance-job-from-engineering/ Why not consulting, because you want to look at higher-level issues and make more of an impact… consultants’ recommendations rarely get implemented. https://mergersandinquisitions.com/consulting-to-investment-banking/

Dear Brain,

1. I am a student at a target university with a 3.5 cumulative GPA Do you think this is enough to get into any of the bulge bracket banks? I’ve heard you need at least a 3.7.

2. I often it’s difficult to talk to people you met after an informational interview and before you ask them for help for recruiting. Is emailing about things happening in their industry good?

1. 3.5 is fine

2. https://mergersandinquisitions.com/investment-banking-informational-interview/

Hi Brian, my internship was an internal auditing position in a small manufacturing company. I wonder how I could link my working experience to my interest in investment banking during the interview. By the way, if I am applying for an operations analyst (back office), will I be asked similar technical questions as I would get for a sales/trading analyst (like concepts related to CAPM/DCF/IPO)? Thanks!

Usually back office interviews are less technical but you could still get those types of questions. For linking your interest just talk about how you got exposed to deals or M&A activity or partnerships or something like that while working at the manufacturing company.

Hi Brain, I need your suggestion on landed a job on wall street as a financial analyst first. I am 28 yrs, old and I graduated from a non ivy league college with a 2.99 GPA. I got a bachelors in business management and a minor in finance. I currently do a Master’s In Organizational Leadership. I did a financial modeling course last yr with the Analyst Exchange it cost me about $2,500. I still feel I need some more skills. What is the best program you guys have that I should take? What are some books that I should read? I have a 3month goal to land this career job. Can you help me please.

Don’t waste time or money on courses – with 6 years of experience, a 3.0 GPA and a non-ivy league school you have no chance of breaking in right now. Either do a top MBA program if you can get in or forget about banking and do trading at a small prop trading firm instead.

Hi Brian- I’m an economics major and only know I want to do something related to business in the future. So will saying I want to be an advisor to companies sound a bit off? And saying that means I can’t use the ‘I’m not sure…” route in the where do you see yourself in years anymore right? Thanks!

I think that’s fine. You can just say you don’t know exactly which companies you will be advising etc.

Could you provide some advice for the situation i’m currently in? I’m 19 this year and has been in architecture for almost 2 years. I found out about IB few months ago doing research for an investment challenge game, and am deeply interested in it.

I’m planning to take A levels next year, and then a Bachelor at a target school. If all goes well, I’d graduate at 24, or 25. Will I be too old to be an analyst?

Another path that I have in mind is to take up a foundation course, which will lead to a University of London External Programme, graduate around 23, or 24 then going for Master’s at target schools. Do graduating one or a couple years earlier matter a lot in IB?

Answered in the other thread where you asked… age is fine, either option works but you really need to focus on getting finance work experience.

Do you mean finance work experience as in internship, or real proper job experience?

Internships if you haven’t graduated

Thanks for your awesome posts, I think I have covered almost all of them and they definitely give the best insights I’ve heard into the ibanking world. I am a rising junior in a top ten college, for my experiences I have been doing nonprofit and several marketing internships in the past and right now I am trying to figure out how to tell recruiters that I am interested in ibanking after not so much finance experience. I am trying to figure out how in my interview I could say how I have apply the skills that I learned in marketing to ibanking, do you have any suggestions of skills that recruiters would especially like from marketing? Thanks so much!!

Tell them you know how to manage clients, set expectations, and pitch companies’ products… which are transferrable to banking because you’re also managing clients, pitching, and so on

Yep I’ll definitely try to get personal with the question. But what exactly about businesses that we learn in I-Banking? I can back up the corporate finance part, but still haven’t figured out how to respond if, for example, they ask what you hope to learn about businesses by being an IBanking analyst.

You learn how management teams think through decisions, plan strategy, and decide how to use financing and acquisitions to build their businesses.

Hey Brian- Is it ok to say you wanna do i-banking because it gives you exposure to corporate finance and the fundamentals of business given my interests in doing business in the future? I’m not really sure about the business part because from what I have been told, analysts don’t get much exposure to the details of operating business or how it really works whether being in M&A or specific industry groups. But you still work on big business transactions, so what would be the correct way to phrase this?

You can say that but it sounds kind of generic – better to get something more personal if you can. I might not say “fundamentals of business” for the reasons you stated, you really don’t learn about the operations of real companies that much.

Great site!

I was wondering would internship experience at the World Bank be looked upon positively by investment banks? I will be working in the Transportation division in Beijing, China

Better than something non-finance-related, but not as good as IB/PE/HF and so on.

Hi, I read your The Banker Blueprint. In your example of expressing the career goal, you said “I want to go into venture capital and doing investment banking is the perfect way to get there”. I need to ask you if it is safe to say you want to get to point B and using point A as a step, as in my career class in school I was taught to express long-term commitment to a position. Now I have an interview for a risk reporting position in a bank, can I tell the interviewer that I want to eventually do risk management and I see this risk reporting role a great way to get there (as through which I can learn the work knowledge about the risk)?

It is safe to say that if you’re going for analyst-level positions, for associate level you want to be more committed.

Hi, I read your <>. In your example of expressing the career goal, you said “I want to go into venture capital and doing investment banking is the perfect way to get there”. I need to ask you if it is safe to say you want to get to point B and using point A as a step, as in my career class in school I was taught to express long-term commitment to a position. Now I have an interview for a risk reporting position in a bank, can I tell the interviewer that I want to eventually do risk management and I see this risk reporting role a great way to get there (as through which I can learn the work knowledge about the risk)?

Hey, I’ve been reading here for a while, since i understood that i wanna do I-banking … Im a smart software guy with excellent personal skills and very good with math …

Do i need an MBA to go into IB or there’s ANY chance someone will accept me as-is and let me learn/develop while working (my ass off, i know) ?

Depends how long you’ve been working. Over 2-3 years and an MBA is your best bet.

Over 7 years of software development and lots of client facing time …

Guess the MBA is my next step then.

I am using your template to apply to sales & trading – I have been trading my own account for a couple of months now and wanted to mention this, where is the best place, how much should I say?

You could say that in your rationale for how you got interested in trading – either mention it in the beginning when you’re explaining why, or say it at the end right before you conclude and remind them why you’re there.

Probably best to do that in the covering letter then? Also – do you think it would be ok to mention freelance ‘work’ in the work and leadership section? I code trading systems and technical indicators on a freelance basis, but again wasn’t sure whether this is legitimate ‘work’?

Thanks for your time.

No one reads cover letters. :) Freelance work is fine to mention, but if it’s programming I would not highlight it too much.

Coming from a liberal arts school with no quantitative background, I feel like I’ve been completely tanking at my first month of work. My associate constantly reprimands me, and because I was put immediately on a deal, I feel like I’ve had no time to even learn that everything needs to be formatted, even for internal calculations, or little things like checking for updated stock prices. How do I make sure my reputation doesn’t get completely shot and that I’m not fired before Christmas?

Talk to someone who knows what’s going on (i.e. 2nd/3rd year analyst) and figure out all their tricks and how they learned the ropes.

Brian, what are your thoughts on Teach For America straight out of undergrad? Would a program like this help with finance/consulting/b-school/corporate recruiting? Thanks.

It’s a good program, but it’s always tougher to get into those fields if you’ve already graduated… it has a solid alumni network and it might be good for business school, but it’s still going to be tougher to get into competitive fields afterward.

I’m currently a sophomore at a non-target and will be transferring to a target school starting next fall. My question is, is it really that important to have a sophomore year summer internship? I do fully plan on having a junior year BB IBD internship, however, I probably can’t get a relevant finance related internship sophomore year. Would not having a PWM internship or a “typical” sophomore summer internship really look bad and put me at a disadvantage vs. others that did have sophomore internships; when it comes to junior year internships and eventually FT recruiting?

Thanks for your continued help!!

You’re at a disadvantage but you can still get an internship the next year.

Do you think it is a bad idea to take an offer at Citi or BofA considering their financial situation? How much better is it to go to GS or MS?

If those are your only options, I would take them. But if you have offers at any other banks the others are probably better.

At what age to bankers typically start doing their MBA in order to move into PE?

You don’t need an MBA to do PE. Most bankers move in after 2 years, though some do so later than that.

So how many years into their PE Career do they decide to to do their MBA?

MBA is not necessary for PE. In fact, most bankers who transition in don’t have an MBA… they might go to back to school a few years afterward, but it’s not necessary.

I think the real underlying lesson here is that if you can’t think of an honestl and good answer to “Why Investment Banking?” that truly comes from your personal experiences and inclinations, then you should probably consider another career.

For those who are truly serious about IB and their respective career paths following an analyst stint (or those truly serious about an IB career for incoming associates) would not have much of a problem with this question.

So, the only real answer to “Why Investment Banking?”, imho, is to do some serious soul-searching until you can pinpoint exactly why.

I totally agree with Sofia.

According to current situation on global market = downturn + threat that France and Germany will convince England to reduce/vanish bonuses for Ibankers, I think, now it’s better to go into MC. Why? 1.salary of analyst: 60000 + 0-10000 bonus in both industries the same. 2. MC works less hard than IB, right? 3. MC get perks as points on loyalty programs so after getting retired will travel&sleep in hotel for free 4. better exit opportunities which in today’s world, when everything changes so dynamically, constitutes definitely great advantage. but still 5. MC not as prestigious as IB – well, IMHO

I’d still do IB even if it was 50k-70k with no bonus.

Bankers still make more than consultants, even in a downturn.

While “the hours” in consulting are not as long on paper, you travel almost every week and that gets very tiring. No matter how cool it sounds at first, living out of a hotel and getting on multiple flights each week gets old very fast.

As far as exit opportunities, you could argue it gives you a broader set but honestly you’re at a big disadvantage if you want to get into finance from consulting.

Is 24 too old to be an analyst?? Can you give me a rough percentage of ppl who are 20-22 and 23-25? Thanks!

It’s not too old, I know people who got in older than that. Don’t know exact percentages but basically no one is under 22.

Could you provide some advice for the situation i’m currently in? I’m 19 this year and has been in architecture for almost 2 years. I found out about IB few months ago doing research for an investment challenge game, and am deeply interested in it.

I’m planning to take A levels next year, and then a Bachelor. If all goes well, I’d graduate at 24, or 25. Will I be too old to be an analyst?

Another path that I have in mind is to take up a foundation course, which will lead to a University of London External Programme, graduate around 23, or 24 then going for Master’s at target schools.

https://mergersandinquisitions.com/age-investment-banking/

Those plans are both fine; you really need to get finance-related work experience though.

How do you ensure that you will get asked this question on its own? I know you’re supposed to talk about your “story”, touch upon past experience, and how this led you to banking. So I feel like you have to mention a little about why you’re there interviewing for investment banking – but if you do, you risk that they may not ask it specifically on its own and then you don’t get a chance to fully explain why banking.

Also, if you’ve had an interest in business for a while, and majored in Finance, shouldn’t you talk more specifically about why banking (as opposed to S&T for example) – and in banking you gain a more diverse skill-set and learn more about the industry than any other job? Thanks again.

There’s no way to “ensure” that you’ll get this question – sometimes they’ll ask explicitly, and sometimes they won’t. You definitely need to touch on this in your story though – and I would remind them at the end once again why you’re there and how it’s connected to your future.

I would not mention why banking vs. S&T because then it makes them think that you might be interested in other fields – focus on the “why banking” rather than “Why it’s better than other alternatives.”

I understand we shouldn’t talk much about the alternative but I was asked this very question: why ib and not consulting? What would I say then?

Good question.

I’d try to relate a personal story to why I want to do banking (this builds rapport). I’d say that I’m more interested in understanding how to execute M&A deals/IPO processes/pick stocks (depends on which group(s) you’re interviewing for) vs helping companies improve their performance in consulting. Also say that you think IB produces more “tangible results” – bankers typically make far more of an impact than consultants. True, some transactions fall apart, but when they happen you get a new public company or a new conglomerate. By contrast, you never know if the recommendations consultants make will be implemented

EXCELLENT answer! Thank you very much!

Dang! This article is one day too late. I was asked exactly the same question at an interview with a boutique yesterday. My background is on the buy side (asset management) and I also just got through my CFA Level I. So they pointedly asked me why I was interviewing for Investment Banking at all. I don’t think I made the cut. This would have helped so much.

Oh, BTW, whoever has not bought Brian’s Interview Questions book should go and do so NOW. All the technical questions I was asked was straight out of that book. If only I had paid more attention to those fit questions…

Well, thanks for the endorsement.

Yeah you have to be prepared for this question in any interview, even if it’s not for banking – but hopefully you have a better idea now.

which book were you talking about? Brian’s Interview Questions book? do you have the full title of that book?

Off topic comment but after thinking a long time about what I want to do after banking I realized I would like to go into S&T. Any idea on how to position myself when contacting recruiters? I realize it will be harder to break in but definitely what i want to do after, any advice is much appreciated.

(to the poster above Public finance does not = PE and HF. You are raising money via bonds IE: Muni bonds for a road, so its all capital raising, might be useful transition into an ECM role at a bank but PE / HF will not like it as much as it is 1. not related to the market and 2. no modeling experience. Still better than not being in IB though)

Hmm, you need to focus on your interest in the markets and any evidence of trading / personal portfolios etc. that you have. Say you learned a lot in banking and did well, but realized you’re more interested in following the market and the news each day rather than the long-term projects you get in banking.

Does this relate to all aspects of investment banking including the public finance group at BB firms? Also, can you shed some light on the PF group? Is it actually investment banking? Are there similar exit opps to PE or VC or HF? Does it help for b school? thanks brian!

Yes, it applies to other groups but of course you need to modify it somewhat based on the group. I don’t know too much about the PF group but most people would not consider it “investment banking” – you can still move elsewhere afterward, but it’s not the same as banking. May help for b-school, but most people think it’s a notch below banking.

PF is placed in IBD at most firms, however, it is not very similar in nature to regular investment banking due to the nature of the types of projects financed.

PF is placed in IBD at most firms, however, it is not very similar in nature to regular investment banking due to the public nature of projects financed.

Great article again Brian.

You mentioned that for an engineering, you can use the background in tech + interest in finance = success in becoming a tech investor

But how about if you are interviewing with a generalist group or some group that is not tech related? Do you just change the tech investor portion into something else?

Thanks a bunch.

I think we talked about this before, but yeah I would just say something like, “I’m interested in learning about a different industry and either being an investor there or starting a company there one day” and mention how your technical background gave you the analytical skills necessary to do it.

Thanks for this site, I have found it extremely helpful.

I got into an early MBA program at a top 3 bschool right out of undergrad, and the program requires me to work for 2-3 years. I currently work a corporate job and I was hoping to leverage the prestige for a better pre-MBA job.

I have no banking experience but I have done some corporate finance and some consulting type stuff.

I was wondering how someone would view the early MBA thing, does it help me at all?

It may help a bit but usually they only care if you’ve actually completed the program. It’s still worth mentioning but I don’t know that the program itself will help that much.

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Ace Your Investment Banking Interview

The BIWS Interview Guide gives you everything you need to ace your Investment Banking Interview, even if you only have a few days to prepare.

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Intel for Aspiring Investment Bankers

Emily Z., 17 and a rising senior at Naperville Central High School in Illinois, is intrigued by the idea of becoming an investment banker. She got the opportunity this summer to step inside the financial services industry during a visit to Morgan Stanley in New York City. Zhen shares the day's discoveries in an essay for Wharton Global Youth. … Read More

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Emily Z., 17, is a rising senior at Naperville Central High School in Naperville, Ill. Emily spent part of her summer participating in Wharton’s Leadership in the Business World (LBW) program. In this essay, she shares her newfound knowledge of investment banking – from inside the midtown Manhattan hub of Morgan Stanley, a financial services firm that operates in 42 countries and has more than 60,000 employees. 

As the daughter of a Citibank mortgage consultant and a realtor, I have had many a dinner-table conversation about the housing market and the state of the economy . There’s nothing like chatting about fixed-year mortgages and the loan application process over chicken and peas. As a result, though, I can’t help but be fascinated by finance and wonder what a career in this field might be like. I first heard of investment banking when my older brother interned at a small firm a few summers ago. His experience helped me to understand that investment banking is a financial service that helps companies acquire funds, by offering advice on business strategies like buying other companies and publicly trading stock . I wanted to learn more, and this summer I got the opportunity when I visited Morgan Stanley in Manhattan, one of the largest investment banking firms in the world. Here’s my story…

My seat on the 41 st floor of Morgan Stanley headquarters in New Your City reveals two valuable perspectives: A spectacular view of the New York City skyline and insight into what it means to be an investment banker . Ben Frost, Morgan Stanley’s managing director of mergers & acquisitions (M&A), says that an investment bank is an institution that raises equity, capital, and debt for individuals and companies. In its simplest form, an investment bank tries to marry folks who have capital with folks who need it. “My job [in mergers and acquisitions] is to work with large companies when they are buying or selling companies and then help them through the process to reach their desired results,” Frost notes. “What I enjoy most is the ability to interact with senior management [from] different businesses and help them through decisions that are important to their company and to their future.”

Before college, Frost was an aspiring lawyer. Undergraduate studies at Wharton fostered his interest in finance, and after he graduated, he worked for a small, boutique investment bank for three years before returning to Wharton to get his Master’s in Business Administration ( MBA ). Soon after, he joined Morgan Stanley. “I read a book called Barbarians at the Gate [in high school] about the takeover of RJR Nabisco by KKR [Kohlberg Kravis Roberts, a private equity firm],” says Frost. “It was the first time I knew what investment banking was. When I got to Wharton, a lot of people around me were thinking about investment banking, and I decided to think about it as well. I did a summer internship in the M&A department of a French bank after my junior year and loved it. I knew then that it was something I wanted to do.”

Frost believes that the people who truly enjoy investment banking are those who love sales and love people. He points out that while lawyers come up with problems, investment bankers come up with solutions, so problem solving is key. “Most of my peers have more diversity in their careers; most have tried some different careers in the finance world,” Frost says. “I found what I wanted to do on my first try and stuck with it.”

Frost and other newer Morgan Stanley employees helped me discover some useful investment banking intel. Here are a few highlights:

• Investment banking involves a range of finance career options, from working with private equity, which is a source of investment capital, to researching commodities, including marketable goods like gold and oil.
• Investment bankers don’t have a typical day. Their work involves different clients, different situations and different tasks. Common responsibilities include interacting with clients on the phone or in-person, making Excel models and spreadsheets, analyzing quantitative information and preparing PowerPoint presentations.
• The trading floor is teeming with activity. It is a great open space with rows and rows of desks separated into cubicles. Employees have at least three computer monitors with charts, graphs, and data and seem engrossed in their work. Employees from all different divisions work together in the same area.
• Compared to most careers, investment banking involves long hours. The hours often depend on how busy the day is, but often a working day starts early and can sometimes end after midnight.
• In terms of career advancement, the traditional career path is three years as an analyst, three years as an associate, three years as a vice president, three years as an executive director, and ultimately on to the top position of a managing director.
• The average starting salary for employees with bachelor’s degrees can range from $100,000 to $150,000 after bonuses. Employees at major investment banking firms in New York City are paid a salary of $75,000 a year, but also earn a $15,000 to $20,000 signing bonus plus performance bonuses ranging from $20,000 to $40,000.

Frost encourages high school students who are interested in finance to gain exposure to different careers through summer internships and talking with family and friends in finance about what they do. This can help you figure out what you like, as well as what you don’t like. For example, after his freshman year in college, Frost spent a summer working for the New York Stock Exchange . He soon realized that life as a trader wasn’t for him. Given the broad spectrum of careers in finance, he advises teens to try every career they may be interested in before making a decision. In the end, the job you enjoy will be the most gratifying. “Do what you want to do,” he advises. “Don’t just chase the highest-paying job.”

After my visit, I’m more intrigued than ever by investment banking. I love math, solving problems and thinking critically, and to be able to do these while helping clients really appeals to me. The long hours? Not so excited about that. I think an internship and more exposure to investment banking in college will help me figure out whether or not I want to pursue it as a career. For now, I am keeping my options open.

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Duke Daytime MBA Student Blog

Why investment banking.

Published December 20, 2016

Like many of my Fuqua classmates, my career objectives diverged from what I wrote in my admissions essays.

When I applied to the dual JD/MBA program in September 2014, only a few months into getting my Master in Accounting at The University of North Carolina, I was leaning more towards consulting, with a few other options on my radar—investment banking, tax law and ‘startup law.’ Fortunately, Fuqua’s MBA program doesn’t lock you into recruiting for a specific sector, and as it turns out, was a great platform to break into investment banking.

Exploring My Career Options

When I decided to complete the first year of my JD/MBA at the law school , it gave me additional time to figure out what career I did (and didn’t) want to pursue. So I spoke with former and present practitioners about the highs and lows of their job, took relevant elective courses to rule out the areas of law that didn’t interest me, and focused exclusively on recruiting through the business school before I even started my MBA.

I also attended the inaugural Poets & Quants Pre-MBA Networking Festival in New York City, where I visited the offices of several bulge bracket banks, picked the brains of bankers and bank HR reps, and came to the conclusion that banking was a better fit than consulting. To be sure I knew what I was getting myself into, I spent my summer reading several (favorable and unfavorable) books on investment banking.

Preparing for Recruiting

As I am sure any Fuqua student would tell you, preparation for on-campus recruiting starts and accelerates in the blink of an eye, just after orientation in July. To narrow my search, I got a deep dive into different sectors during the Career Management Center’s Career Intensive days in late August, participated in both the Consulting Club’s and the Finance Club’s Symposia in early September, and then met with bank representatives at company presentations almost every evening from late September until fall break. I spent most of fall break in New York, participating in the Finance Club’s Week on Wall Street networking receptions, followed by personally organized informational and behavioral interviews. November through early January is when final round interviews take place. I’ll travel to New York and meet with the banks where I’ve gained the most traction, prepare for technical interviews, and hopefully, attend invite-only events as they narrow down their candidate lists.

One question that you’ll be asked during the interview process is why you’re interested in this particular career. My answers are:

• I want a fast-paced, ever-changing work environment, unlike the slow-paced state legislature and somewhat monotonous corporate in-house legal departments I worked in previously.
• I want an environment like what I experienced at Duke—working alongside and learning from equally bright and driven colleagues.
• I have an insatiable appetite for learning in general, but more importantly the business world and certain industries.
• I want to utilize my law and accounting degrees, in conjunction with my MBA.

While much of this rationale could apply to “Why consulting?” or “Why Biglaw?,” I believe that my other graduate degrees fall more in line with the banking industry, and I like that an associate’s day is far less typical, more social, and looks at the big picture.

If you want to recruit for investment banking but are undecided which MBA program will give you the best background, I’ll tell you that:

• Fuqua is a target school for all of the bulge bracket banks and an increasing number of boutiques.
• Bankers tell us that Fuqua interns and associates tend to demonstrate better than average teamwork and communication skills, which are key to an investment banker’s success.
• A smaller percentage of Fuqua students pursue investment banking than at many peer schools so the competition is less and students have more opportunities to stand out.
• Fuqua’s team culture extends to the whole banking recruiting process, with candidates sharing advice, information, and practice interviewing with one another at every stage.

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How To Write Harvard HBS Essay With Examples

Harvard Business School’s MBA is one of the most well-known, acclaimed professional degrees in the world. When applying to HBS is a competitive next step in your education and career, every aspect of your application deserves careful deliberation and preparation, especially your HBS essay. 

The application essay requires even more thought because Harvard Business School views essays as a real-time representation of who you are (besides the interview and statement of purpose ), professionally and personally. This blog will take you through a step-by-step process so you’ll know exactly how to write the Harvard Business School essay.  

Hopefully, it will also help invigorate your pride in your own story, for Harvard Business School will be more likely to see your potential if you demonstrate that you see it too.

Harvard Business School Essay Prompts

The Harvard Business School essay is just one component of a complete MBA application, but it certainly has its own considerations. So, it is important that you take time to consider the essay separately from the rest of the documents and information in your application. The essay prompt is as follows:

As we review your application, what more would you like us to know as we consider your candidacy for the Harvard Business School MBA program?

This essay question is particularly challenging for many applicants due to its vague nature.  The other potentially unexpected kicker to this prompt: there is no word limit. Regarding the length of your essay, the Harvard Business School webpage suggests that you “use your best judgment, and try to be clear… and concise.” 

We’ll discuss how to best work on this deliverable later in the blog, as it is an important factor in the overall presentation of your writing. 

Unless you have an exceedingly in-depth resume, the essay is definitely going to be the most personal aspect of your application. The essay is your chance to use your own words to describe yourself, your values, and your insights. 

It will be the most significant signal to the admissions committee as to how your background has influenced you and how HBS would fit well into your future.

How to Write Harvard Business School Essay in 6 Steps

Organization is key to ensuring quality in your HBS essay. It’s important to order tasks in an accomplishable, reasonable way where each goal is clear and manageable. 

Exploring blogs about MBA essay writing is one way to get ideas flowing. To help wrap your head around organizing your essay-writing efforts, here are some beginning-to-end steps for the creation of your HBS essay:

• Self-Reflection
• Decide on the Right Story and Its Theme
• Write an Outline
• Start Your Essay Carefully and Deliberately 
• Draft Your Essay and Revise
• Get an Outside Perspective ‍

1. Self-Reflection

Start the process of HBS essay writing with something as equally fundamental as it is simple: thought. Consider the role that the essay will play in your application and how to make the essay benefit your goal of getting into Harvard Business School. 

There are two sides to useful self-reflection regarding a goal like a Harvard MBA.

First, think purposefully about your career goals and tie them to an MBA at Harvard Business School. Ask yourself, how would a Harvard MBA help you get to where you want to go, professionally? What would you most like to gain from your time studying at HBS? 

Thinking about these things and then including them in your essay will demonstrate to the admissions committee that you have a clear trajectory for your MBA experience and your career. 

Additionally, revealing these considerations in your essay will speak to your confidence in your aspirations and in your decision to apply for Harvard Business School, which will likewise be attractive to the admissions committee.

The other side to a useful introspection would be considering what you as a student would contribute to Harvard and to its MBA program. A US News article about successful MBA essays encourages you to highlight what you would contribute to the HBS MBA program, so that you come across as a useful addition instead of simply a “taker.” 

If you were in the admissions committee's shoes, what would be the most enticing aspects of your past education, your experiences , and your personality. Essentially, you should think, specifically and without judgment, about what your biggest strengths as an applicant are, realistically. 

Knowing this will help you, both consciously and subconsciously, weave your most compelling characteristics into your essay so that the admissions committee gets to know your best side. ‍

2. Decide on the Right Story and Its Theme

You absolutely do not want to use your essay as a canvas on which to dump information about yourself. Harvard is not interested in reading an essay that expands on your entire resume or simply describes you. Tell a story! 

Elucidate on an impactful experience or explain a significant lesson you’ve learned. You’ll probably either overflow with abounding exciting examples to choose from, or you’ll struggle to find even one compelling anecdote. 

Don’t worry if you sit in this situation for a while; after all, you’ll ultimately still need to decide on just one topic, whether that means whittling down your options or sifting through your past to isolate that one perfect story. 

Once you finally do settle on that one excellent, fascinating subject that excites you enough to write about, you should also deliberate about what you intend your themes and tones to be. What would the ideal takeaway(s) be for a reader of your essay? 

Additionally, and this is annoyingly subjective, so apologies; how do you want to sound ? You should have a picture of how your essay will present your information, and you should have a picture of how your essay will present you . 

The admissions committee will use the essay to try to imagine you and the role you’d play at Harvard , so keep in mind how they would do this with the essay you write. ‍

3. Write an Outline

This step is fairly straightforward. Take the most important points of your topic, and put them in an order that would flow well as you write. Make sure, as you lay these points out, that they align with each other coherently and that they reflect your intended theme. 

From there, write out some thoughts on how best to integrate each point into a complete essay. You might want to explicitly write out which details are most crucial to each part of your story or subject. For example, let's say your compelling story about a transformative internship abroad begins by explaining what you were doing before it. 

Then, intuitively, you’d have to include details about where you were at this stage of the story and whether you were working, studying, traveling, etc. Put this information in your outline, so you know that you don’t leave things out and lose your reader. ‍

4. Start Your Essay Carefully and Deliberately

The way you begin your essay is quite important and will in many ways determine how the rest of your essay will shape out. First things first, make sure you feel good about your first sentence. 

Just like the opening scene of a movie, the first statement or two of your HBS essay will introduce your writing style and general tone to the admissions committee readers. Consistency always improves readability, and consistency starts with your opening sentence. 

Try to make the first couple sentences intriguing to garner some interest right from the get-go.

From the first sentence, ensure you’re keeping to your tone, at least peripherally. We can all agree a shift in tone tends to break the flow of good writing, and to have that break early on in your essay might throw the admissions committee off. 

The more sentences you write in a consistent tone and manner, the easier it will be to continue to write in holding with them. Because you’re trying to tell one, coherent story, the reader will be most interested if your writing follows an intuitive flow of ideas.

5. Draft Your Essay and Revise

From this last point, try as best you can to find a steady pace, and begin expanding on your outline. The nice part of this step is that you don’t have to get carried away with wording, sentence structure, or length. Again, focus on including all the relevant details and continue matching your tone. 

Try to write at a reasonable rate for decent chunks of time instead of writing intermittently while giving in to distractions. The more consecutively you write each sentence and paragraph, the better they’ll run together when someone’s reading them.

The reason you’ve already prepared an outline, and plan to edit throughout the rest of your writing process, is to make your first attempt at writing the essay as easy as it can be. 

Mistakes and breaks in your thinking can easily be caught by careful reading after the fact, so capitalize on inspiration when it hits and simply get your first draft onto the page. When writing an important, personal essay like this one, it also serves you well to keep boosting your confidence. 

If you fixate on word choice and how your writing is sounding, you’ll be more likely to break up the flow of your statements and make reading your essay feel choppy. You are telling your own story, and the point of the essay is for the admissions committee to get a better idea of your personality and character, so take pride in the fact that you’re unambiguously the best writer for this subject. ‍

6. Get an Outside Perspective‍

Once you’ve written the entirety of your essay and edited it carefully and precisely, get some extra peace of mind by having one or two other people read your essay. The more insightful and writing-experienced your readers of choice are, the more you’ll benefit from their critiques and opinions. 

The crucial part of this step is to get thoughts from someone unattached to your writing. As fervently and specifically as you may edit your own essay, you’ll always struggle to distance yourself from your emotional attachment to certain phrases, details, or even words. It’s ok. Every writer goes through this with the things they write. Trust us.

This other person allows you to hear a perspective from someone who read every sentence as how it sounded, not how it was intended. In this way, they fill the shoes of the admissions committee, but at a stage where you can still make changes to your essay. 

Don’t take criticisms personally; it's better to hear them now than to be at their mercy after submitting your application. 

No, you don’t need to force yourself to accept every change proposed by your reader(s). The point of an outside perspective is not to find a qualified editor and let them rewrite an essay about something important to you. 

This step is more useful just in reinvigorating your own thoughts about your paper because, in the late stages of your essay writing, it's much easier to get bogged down with the same considerations and forget the bigger things you’re trying to say to the admissions committee.

3 Successful Harvard Business School Essay Examples That Worked

Here are successful Harvard Business School essay examples to give you an idea of what to write. 

Sample Essay #1

“Start again,” my mother would demand after tossing my less-than-perfect homework into the trash. As a kid, I was taught that ‘work is finished when it’s not just your best work, but the best.’ Most kids would resent a parent for this, but I didn’t: my mom practiced the same rigor with her own work. She had to—a Latin immigrant with only a high school degree in 1980s [City] was held to a higher standard, especially one fighting to change both the media’s and corporations’ impressions about Latinx consumers.

I have applied this doctrine of “do better, be better” throughout my life, focusing on improving my own communities, be it through offering students a taste of food around the world with a college underground pop-up kitchen or planning a [Latinx event] as a conference chair. Last year gave me the chance to continue to work on being an inclusive leader in the Black/Latinx (B/LX) community as a ‘white-passing’ individual. Ultimately, however, these concerns were unimportant when given the opportunity to improve things now for the B/LX community. My new work projects helped me confront leaders I felt had not supported teams during the summer’s tragedies. I learned how feedback framed as suggestions could have powerful consequences. In fact, one of my managers actually came to me for advice on how to engage his peers in order to help his local community use pooled funds from [consulting group].

These experiences have helped me refine my long-term aspirations. Though I would still like to build on my mother’s legacy of a community-minded entrepreneur, I dream of founding my own venture capital fund. I want to alter the face of business by empowering young, diverse entrepreneurs who will bring novel approaches to lingering problems from past generations. Rather than improve my community only through projects supporting others’ priorities, I intend to be an active participant, building an incubator for entrepreneurs of color to eliminate barriers that maintain inequality such as urban food insecurity and underfunded education systems.

HBS will immerse me in the rapidly evolving entrepreneurial environment, helping me to understand process and practice creating ideas as both a founder and funder. On campus, I intend to be an active participant in HBS’ Anti-Racism goals, fighting to bring equity and inclusion with the same passion I have brought to my office and B/LX network. After graduating, I plan to continue engaging with HBS, either by working with student-run investment groups (like IVP’s Steve Harrick and the students behind the inclusion-focused Phoenix Fund) or working with professors to influence HBS’ future (like alumni Lulu Curiel and Eric Calderon, who helped develop a case study with Professor Alvarez to improve Latinx representation in MBA programs). Internalizing the case-method and the hands-on experiences acquired in my two years on-campus will embolden me to disrupt the status quo, both from the grassroots and executive levels.

What Made It Successful 

So, what works well in this thoughtful, personal HBS application essay? Starting with the introduction, the anecdote that this writer starts their essay with grabs attention through the strict rigor that their mother required for them growing up. 

Again, the key to the first few statements of an application essay lies in their ability to compel the reader to read on. An excellent introduction. will ensure  reading your essay is  a pleasure instead of a chore. 

Further on in this essay example, the reader understands where the applicant's motivation for equality and fair representation stems from, and this theme persists throughout the piece. It’s through demonstrating strong points like these that the reader reaches a higher empathy for the writer, which never hurts when applying to Harvard Business School. 

We also gain appreciation for the leadership skills of the writer due to their clear descriptions of past examples. Crucially, do not just hear how these examples played out, but what lessons the writer learned from them that they continue to apply. 

Finally, the essay’s conclusion cites both short-term and long-term goals for the writer's schooling and career, and this section feels very specifically written for HBS. 

Including references to Harvard Business School and its alumni, as done in this example, shows the admissions committee that your efforts in writing this essay are totally aimed at getting into HBS’s MBA, and that you’ve thought hard enough about the decision to do in-depth research.

Sample Essay #2

Our life experiences shape our skills, perspective and help define our paths. Reflecting on my personal and professional journey, I would like to share three lessons which have strongly shaped my journey and outlook.

My first lesson is about people. I feel fortunate to have understood the enormous potential in empathizing and collaborating with individuals to achieve community success, organizational targets and personal goals.

Perhaps due to my father’s frequent job transfers, I grew-up as a reticent, lone worker, shying away from forging long-lasting relationships. While excelling academically, I skipped participating in anything at school that required dependence on other people. It was only at my undergraduate institution, [University] that I really started building relationships with my hostel-mates and exploring the various opportunities [University] offered.

However, soon dark realities came to the forefront when a final-year student committed suicide while my close friend, [Name], got sucked into a vortex of depression due to his poor academic performance. Deeply shaken, I resolved to address mental-health issues on campus and joined the Institute Counseling Service, comprising student volunteers, faculty and professional counselors who sought to provide emotional and academic help to students.

Driven to make a difference, I led 240 student volunteers, strengthened our mentorship program to identify students in need of professional help and organized Orientation Programs. To dispel the stigma associated with mental-health and build trust, we increased the approachability of counsellors by initiating hostel visits and collaborated with NGOs to use theatre and generate awareness. I personally mentored students and it was heartwarming to create an environment in which people were able to discuss their personal issues freely with me. While I gained friends for life, I realized there is no greater happiness than witnessing one’s mentee overcome difficulties and be successful! Listening to varied personal experiences inculcated empathy and fostered ability to forge strong interpersonal connections.

This experience stayed with me during my professional journey with [Consumer Goods Company]. Just out of college, I had to navigate union strikes, reconcile socio-political contexts and motivate 600+ unskilled workers, several years my senior to transform the quality performance of an $800M factory in a small town. Leveraging interpersonal skills, I understood employee concerns and created an experiential training program. Listening to them, educating them, sharing success and owning failures together, I immersed myself in the workforce environment, instilling a culture of innovation and change. Our efforts reaped dividends as we eliminated all consumer complaints and achieved the best-ever performance in quality metrics, securing [Consumer Goods Company] market-share and launching 24 premium product variants. Thus, I learnt to drive organizational change by harnessing people’s potential.

My second life lesson is about values. I feel long-term success can only be achieved if one has the character to stand by one’s principles during testing times.

At age-5, I recall accompanying my mother to court hearings to witness a long-drawn trial involving my father. Overtime, I understood how my father had been slapped with a fake harassment case because he refused to accept a bribe for professional favors. Standing by his principles, he was later acquitted emerging as my inspiration and teaching me values of honesty and integrity.

After 17 years, these values were tested. Early-on in my role as Quality Manager of [Consumer Goods Company] plant, consumer complaints for a particular defect inflicted 10% market-share losses in [Big City]. On probing, I realized that we had overlooked an important data trend during manufacturing that could have averted the disaster. While corporate auditors were preparing a report attributing the occurrence of defect to chance, I presented the true picture, taking full responsibility. It was a difficult decision as our factory had already lost credibility prior to my joining. Our General Manager intervened to manage the crisis and while recognizing my ethics and courage, placed faith on my ability to redeem myself.

Motivated to prove myself, I worked incessantly with my team, ensuring that I drive systemic changes and build a culture of continuous improvement. Within one-year, we achieved benchmark performances, restoring faith in the unit/team. During our annual performance review, our unit was appreciated for data-integrity, reinforcing my belief in my value system.

The third lesson is about impact. I believe true success is achieved when people are guided by a desire to create sustainable impact and make a positive difference in society.

During a factory-visit, I engaged with our CEO, and advocated driving growth by monetizing [Consumer Goods Company] distribution network to service regional firms/startups. Intrigued, he inducted me into his office in the Trade Marketing and Distribution function in a strategic role, a move unheard for any non-MBA engineer. Initially, I engaged with product entrepreneurs to offer them [Consumer Goods Company] distribution for scaling-up. One case was [Company], a [City]-based startup that innovated on cost-effective sanitary napkins. We are helping them reach 60M consumers in [Country], a country where 75% women resort to unhygienic alternatives. Curious to understand their success, I engaged with the founder, [Name]. I realized [Name] was driven by a desire to positively impact the lives of rural women and this motivated him to innovate continuously.

Reflecting on this conversation, I identified how [Consumer Products Company] could play a larger role in adding to consumer-value and go beyond giving distribution access to CPG startups. If tech leaders such as Google, Microsoft could incubate technology startups, we needed to explore similar models in the CPG space. I formulated a strategic investor model to incubate and eventually acquire CPG startups, a first for an Indian CPG firm, and pitched it to senior leadership. They appreciated my vision of synergizing with startups, providing [Consumer Products Company] marketing expertise and product development insights to encourage product innovation, thereby creating an inorganic growth roadmap for [Consumer Products Company] vision of achieving $15B by 2030.

These lessons provide the foundation to succeed and define my professional ambitions. Going forward, I envision energizing the [Country] CPG startup ecosystem, stimulating innovation and strengthening symbiotic relationships with Corporations to deliver high social-impact products, creating sustainable value for 1.2B Indian consumers. While my experiences have created the primer, I see Harvard as the perfect catalyst to transform me into a change leader. Building on my life lessons, I can’t wait to engage with classmates who bring with them a wealth of global experiences and stories!

Sample Essay #3

I remember my hands trembling as I clenched the scissors, and my mother’s gorgeous locks fell to the ground − I was six years old. Compelled to quit her studies after marriage, my mother resumed her masters in [course] after ten stifling years. With my father’s solitary income going into tuition for my mother, sister and me, a proper haircut was a wasteful luxury. My parents shielded us from their struggles, but the gravity of our situation hit home as I cut my mother’s hair.

When my mother finally cleared her examinations, I expected things to change. Instead, she declined lucrative offers to join public-services, catering to marginalized populations through [country’s] public healthcare system. My parents unwavering desire to lead a life of meaning, fuelled my own. Over the course of my journey, I have carved my own path to making a difference – one of spreading my ideas and impact, beyond what I could accomplish alone. I would like to share how three transformative experiences, starting over a decade ago, have progressively shaped this lifelong approach.

At 13, I was devastated to see my sister’s tiny frame shake violently as she coughed from asthma. What affected me most was learning that we had all contributed to these respiratory problems, by making [city] the most polluted city in the world.

I refused to remain a silent spectator and started an environment club, [club], at school. Digging-up compost pits and conducting tree-plantation drives, our team explored every opportunity to make our premises greener. The efforts of our small 10-member team indicated to me the potential to spur larger change by motivating all 1500 students to step-up. Our idea to achieve this, by integrating environmental-awareness within our curriculum, was dismissed by the administration for lack of resources. Undeterred, I started writing applications to garner financial support, and within months, led our team to the first place in a national competition. The $15K we won infused both resources and enthusiasm to implement our eco-friendly curriculum.

Juggling my graduation-examinations and endless hours of organizing activities for the entire school, we grew [club] five-fold. Students stepped-up to expand our efforts, from transitioning our school to using solar energy to organizing large-scale zero-waste campaigns. ‘Exponential’ was no longer just a graph I studied, I could tangibly see my impact multiplying by mobilising individuals around me.

Eager to replicate our success beyond school, I initiated environmental workshops for children from urban-slums in [city].

“Boys don’t need to save money for dowry, do they not have to conserve environmental resources either?” asked 11-year old [name]. Half-way into my first workshop, my analogy of saving money to explain the concept of conserving environmental resources, had derailed my session-plan.

Having witnessed the consequences of gender-disparity in my own childhood I started my non-profit [non-profit], during college, to promote holistic life-skills education to uproot such evils. I was happiest spending weekends in community-centres and public-classrooms, with my team of student-volunteers, conducting activity-based workshops for hundreds of children. I vividly remember when, beaming with pride, [name] told me that she had saved enough money to buy her house. She not only grasped complex concepts of banking and savings, but acknowledged herself as a financially-independent female – albeit in a game of Monopoly!

By graduation, we grew to a 20-member team and reached 1,000+ children. However, once I moved to join Investment-Banking, our student-volunteer model disintegrated and fundraising for a full-time team seemed impossible. While struggling to sustain momentum, I saw a class-teacher enthusiastically taking initiative to support our program, during a workshop. Watching her, it struck me that scaling-up [non-profit] was not the only way to further impact.

‍ "Over the course of my journey, I have carved my own path to making a difference – one of spreading my ideas and impact, beyond what I could accomplish alone."

Restructuring our workshops into a comprehensive curriculum, we showcased it to the state academic department. Winning their support, we trained 100 public-school teachers and principals to deliver the program. Within two years, these teachers extended our program to 10,000 children and even co-opted their colleagues. Their efforts reaffirmed my conviction that enabling change-agents at a systemic-level could accelerate impact at scale.

To steer my journey in this direction, I decided to quit my investment-banking job in [country] and return to [country]. Forgoing the financial comfort I was finally providing my family weighed on me, but I chose to follow my heart. I joined [foundation], a philanthropy focused on driving systemic change to tangibly impact India’s education landscape.

Innovative, low-cost teaching-aids developed by [company], my [foundation] portfolio-organisation, drastically improved learning for children in rural classrooms. However, their low-monetization potential generated minimal funder interest, threatening their existence. Their question, “How will we serve these children, when we can barely stay afloat?” echoed my own struggles at [non-profit].

Collaborating with the [state] government, I helped [company] reduce costs through subsidies and extend their program to 40,000 students. I was leading large-scale projects with public systems at [foundation], but I realized that empowering social-enterprises such as [company] to drive systemic change could create ripple-effects throughout the ecosystem.

My ten-year-old self wouldn't believe just how far I have come – my hands no longer shake when I take decisive actions, whose outcomes I cannot always predict.

Today, non-profit social-enterprises in India fail to reach their potential, owing to lack of financial and strategic support - the largest remains 1/100th the size of its global peers. So, I took on the mandate to launch an Accelerator within [non-profit], to ensure this support, even though this meant leaving my team and starting out alone. My path was uphill, given [non-profit’s] strategic shift towards working directly with governments − the initiative was peripheral for every decision, be it budget-allocations or team-building.

The eagerness of portfolio-organizations in leveraging every support opportunity kept me going. Months of co-creating monetization strategies and facilitating government meetings paid off, in one instance, enabling immense expansion for the portfolio-organization to reach 800,000 children. Such successes helped evangelize our potential and we are now raising an independent fund to support 30 entrepreneurs to help transform education for 5M children.

My ten-year-old self wouldn’t believe just how far I have come – my hands no longer shake when I take decisive actions, whose outcomes I cannot always predict. Striving to continually widen my impact has helped me progress from empowering school-students to supporting social-entrepreneurs, towards enabling an entire ecosystem of social change-makers.

Battling one constant challenge throughout, that of inadequate resources, has highlighted how social-finance could be the ‘driving-force’ towards my goal. Most importantly, I have learnt that beyond individual efforts, by spearheading thought-leadership and global alliances, I can mobilize the entire ecosystem, catalyzing robust social-investment markets in India.

My friend [name] described how assimilating diverse perspectives through the case-method at HBS helped him understand nuances of business across cultures, while the vibrant community provided access to global networks. HBS equipped him to launch and grow his company across eight emerging economies, through partnerships with local entrepreneurs. Similarly, I am convinced that the ideas, experiences and relationships built at HBS will help me realize my vision where every [club], [non-profit] and [company] can go on to create the change it aspires to.

Mistakes to Avoid in Your Harvard Business Essay

1. Show Don’t Tell

If you use your essay to outright explain what you’re trying to show the admissions committee about yourself, you run a much higher risk of losing readability and taking your application from an opportunity to a plea. Instead, demonstrate your takeaways, your best qualities, through your story and its examples. 

The reader is far more likely to be compelled by the conclusions of your essay if they feel like they came to them themselves. By not explicitly explaining the point of your essay, you come across more sure in the topic you’ve chosen and its ability to reveal the point. ‍

2. Avoid Lackluster Anecdotes

Your essay will be bolstered or weakened by the intrinsic quality of the experiences about which you write. Only include anecdotes that you’d be just as comfortable and confident about retelling to dinner guests or friends at a bar. 

Obviously, the formality of those situations and the Harvard Business School MBA application differ starkly, but the gist of this statement is that if you’d feel awkward telling a story to your friends, it’d be hard to make it sound good for an unseen admissions committee reader. 

If it’s a story you’ll enjoy writing about, it’ll stand a better chance of being enjoyable to read. ‍

3. Don’t Narrate – Craft a Compelling Story

Ensure your topic flows seamlessly through relevant experiences and lessons. Establishing clear cause-and-effect relationships among different events not only maintains the reader's interest but also justifies each inclusion in your essay. While coherence is essential, be cautious not to force connections between unrelated experiences or anecdotes; instead, strive for a well-integrated narrative with a cohesive beginning-to-end structure."

4. Don’t Do This Yourself

Utilize guides and blog posts about the undertaking of applying to an MBA program, getting as specific to Harvard Business School as you can. 

Reviewing a concise guide about applying to Harvard Business School can be the best way to ensure that your application is sound, not just for any MBA program, but for Harvard Business School’s MBA.

 Many resources, like Final Application Reviews, will focus heavily on your essay, but will also provide insight on every aspect of your application so you feel best about your attempt.

If you still have questions about the HBS essay, check out these frequently asked questions. 

1. How Can I Best Edit My Essay?

To best edit your essay, focus on refining syntax, word choice, and common mistakes in MBA application essays. Research prevalent errors, specifically addressing them to catch the admissions committee's attention. Utilize tools like Grammarly for a comprehensive review, increasing the likelihood of submitting an error-free essay.

2. How Long Should My Essay Be If There's No Word Limit?

In the absence of a specified word limit, aim for conciseness while conveying your message effectively. Generally, one to three pages or around 500-1000 words is a reasonable guideline, allowing you to present a comprehensive narrative without unnecessary information.

3. Is the Essay Portion Different If I’m Reapplying?

No, if you're reapplying to Harvard Business School, the essay portion remains the same as for first-time applicants. There is no distinct essay prompt for reapplicants.

4. Can I Use the Same Essay If I’m Reapplying?

HBS does not explicitly prohibit this, but, intuitively, it’s probably a better idea to write a new essay. You would have no way of knowing that your essay and the topic you chose played no role in your initial rejection. 

5. Are There Bad Topics to Write About?‍

Yes, some topics are best avoided in your essay. Steer clear of overly controversial or sensitive subjects and refrain from solely highlighting academic or professional achievements unless they contribute to a broader, more personal theme. 

Also, avoid repeating stories already addressed in recommendation letters to provide the admissions committee with new insights. Choose an original and unique topic that reflects your character, emphasizing its personal significance. 

If you struggle to justify your topic's importance, consider opting for a more compelling subject for your essay.

6. Can I Over-Edit My Essay?

Excessive editing can make your writing sound stiff and fragmented. The concept of "over-editing" suggests a misuse of time better spent on other tasks. It's challenging to determine the perfect editing point, but if changes result in minimal, unclear differences, you may be over-editing. 

Recognizing this, it's advisable to ease back on editing efforts, especially if changes are made simply because they come to mind.

Conclusion‍

Harvard Business School's MBA program is highly competitive, and the HBS essay is your chance to stand out. Choose a topic that excites you and reveals your unique experiences. Use organizational resources and time management for effective essay development. 

Simplify the process with outlined steps, ensuring authenticity and enthusiasm. Maintain confidence in your chosen topic and writing style for a more assured essay. This is an opportunity to showcase why you're applying to Harvard Business School, so approach it with confidence and purpose.

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We provide the first comprehensive analysis of the properties of investment recommendations generated by “Robo-Analysts,” which are human-analyst-assisted computer programs conducting automated research analysis. Our results indicate that Robo-Analyst recommendations differ from those produced by traditional “human” research analysts across several important dimensions. First, Robo-Analysts produce a more balanced distribution of buy, hold, and sell recommendations than do human analysts and are less likely to recommend “glamour” stocks and firms with prospective investment banking business. Second, automation allows Robo-Analysts to revise their recommendations more frequently than human analysts and incorporate information from complex periodic filings. Third, while Robo-Analysts’ recommendations exhibit weak short-window return reactions, they have long-term investment value. Specifically, portfolios formed based on the buy recommendations of Robo-Analysts significantly outperform those of human analysts. Overall, our results suggest that automation in the sell-side research industry can benefit investors.

10. Teil: Rahmenbedingungen des Investment Banking

The prospect of investment banking and arbitration in the space economy.

Morgan Stanley estimates that the global space industry could generate revenues of more than $1 trillion or more by 2040, up from over $400 billion currently. Do declining launch costs, technological advancements and a rising interest in the public sector make space the next trillion-dollar economy? The dynamics of the space sector has led wall street analysts to forecast that the space industry could become the next trillion-dollar industry by 2040. As of January 2018, the global space economy grew more than 8%, generating $414.75 billion in space activities.With unmanned scientific exploration, high levels of private funding advancement in technology the implications of investment for a more accessible, low cost into outer space is significant, with potential opportunities for improvement of the resources in space for profit-making and expansion of business concerns, the expanding interest of public sector migrate into the shift from private finding to public and herald the entrance of traditional finance There are fortunes and resources in the space economy which aids the activities of humans, as well as the bold exploration of countries to expand research and understand the limits use and the extent to the use in the space economy.This paper seeks to explore the prospects of investment banking activities in the growing space economy, seeing the growing development of exchange-traded funds already being explored in the space economy and the new regulations allowing Wall Street to do Venture Capital which expands the exploration of capital and buttresses the objective of raising capital by a major player, Space X which raised about $44 Billion and so grows the prospect of more banking activity. Furthermore, the possibilities that are inherent in the eventual proliferation of investment banking activities in the space industry will be addressed. In attempting to do justice to such a lofty idea, the universal need for funding in the world of business will be examined as a representation of the intersection between banking interests and space interests. The interplay of factors such as risk and understanding of business processes in the dynamics of any relationship between investment banking and the space industry will also be examined. The purpose of such analysis will be to afford an understanding of the role that investment banking has to play in the space industry, as an over text to the elements and characteristics of space activities that define the rate of the growth of the influence and applicability of investment banking to the peculiar needs and unique concerns associated with the pursuit of profitable business in the space economy. Lastly, this paper looks to give an account of the evolution of Space Dispute Arbitration, and how the existing legal mechanisms in force for directing arbitral awards have evolved in scope and flexibility since the first satellite launch. In general, and as a statement of fundamental purpose, this paper will attempt to provide a wide and sufficiently detailed representation of what the space industry is, the dynamics of space arbitration and how its resultant economic sector functions, in order to hypothesize on the part that investment banking has to play in its growth and in the maximization of its resultant profits for all shareholders involved.”

ENSURING STABLE ECONOMIC DEVELOPMENT THROUGH THE EFFICIENT FUNCTIONING OF THE BANKING SECTOR

Abstract. The article explores ways to ensure stable economic development through the efficient functioning of the banking sector. The concept of stable development and efficiency of the banking system is revealed. The key principles of macroprudential and microprudential policy are analyzed and the main advantages of each of them are determined. The tools for implementing macroprudential policy to ensure sustainable economic development are described. The peculiarities of the application of rating assessment, the role of state-owned banks and investment banking as the most optimal measures to ensure economic development are outlined. Promising digital technologies in the banking system, which have a long-term strategic nature of development, are presented.             It is confirmed that the development of the country’s economy depends on many factors of the internal organization of the microeconomic environment. Among the aspects of qualitatively increasing the competitiveness of the national economy, an important component is the emphasis on the policy of strengthening the efficiency of the market sector. The infrastructure of the market and financial sector consists of instruments of financial influence, as well as additional comprehensive measures aimed at creating a multi-channel system of various institutions and institutions, a structured real financial services sector given the overall stability of the banking system. The quality and efficiency of the financial sector can be determined, in particular, by the indicators of the peculiarities of the creation of market goods and services, which create an opportunity to create market relations at optimal prices. We concluded that the last important factor for the prospect of sustainable economic development through the efficient functioning of the banking system is the use of digital technologies, because the world is rapidly transitioning from traditional to digital economy, so the banking system must be transformed into modern realities using current innovative technologies. . Keywords: stable economic development, banking system, investment banking, rating assessment, macroprudential policy. JEL Classification O16, O29, G21 Formulas: 0; fig.: 0; tabl.: 7; bibl.: 12.

Perspectives on Corporate, Social, and Employee Purpose among Investment Bankers: A Qualitative Research Study

There are increasing calls to re-establish the role and responsibility of banks towards society to repair trust and enhance financial stability. Through in-depth interviews with senior investment bankers, this study asks what bankers themselves think about the corporate (i.e. the industry’s core business), social (i.e. its moral responsibilities to wider society), and employee (i.e. bankers’ own feelings of purposefulness) purposes of the investment banking industry. Existing research tells us that there are significant reciprocal benefits to organisations, employees, and society at large when the three are aligned. The study’s findings suggest that while there have been important shifts in corporate and social purposes over time, bankers remain sceptical about their banks’ underlying motives and this has resulted in multiple disconnects. Perhaps surprising, the study finds that meaningful work that is also socially focused is something that investment bankers are seeking in some way. These insights should prompt banks to ensure that social purposes reflect and align with their corporate purposes; to move beyond rhetoric and virtue-signalling to action; and to help employees identify their contribution to it all.

Female leaders as ‘Superwomen’: Post-global financial crisis media framing of women and leadership in investment banking in UK print media 2014–2016

Analysis of the contribution of information technology in investments.

This research paper is made with the view of analyzing the contributions of technology in investment sector. Furthermore it tries to answer the big questions like whether technology help to get higher returns from the investments in the stock market? or what is next in investing? or what is the role of technology in investment banking?.

The Role of Investor Protections on the Value of Investment Banking Relationships: International Evidence

On the regulation of investment banking in russia.

Analytical documents of the Bank of Russia and financial statements of large Russian banks indicate the growth in incomes from operations with securities within the gross share of revenues of commercial banks. In the world, there are cases of excessive activity of commercial banks in the security market (the Great Depression of 1929–1933 in the USA, default on state treasury bills in Russia on the 17th August 1998), which led to negative consequences for bank clients. The author analyzed peculiarities of investment transactions conducted by commercial banks in Russia. The author gives recommendations to reduce financial risks for the commercial banks’ customers and promote the attractiveness of the investment banking products. The author’s concept of regulation of banking activity in Russia consists of two directions: regulation of classical banking (income from lending operations exceeds income from operations in the securities market) and regulation of investment banking (the predominance of investment operations). The author justifies the necessity of the introduction of mandatory insurance of funds invested in equity securities of Russian issuers admitted to circulation on the Moscow Stock Exchange in the event of bankruptcy of issuers. The paper critically evaluates the recommendation of the Bank of Russia that professional participants in the securities market should not offer complex investment products to unqualified investors as this restricts the application of derivative securities for hedging financial risks. The author suggests the requirements for the equity capital of professional participants of the securities market and the methodology for calculating the equity capital separately for classical and investment banks.

A Study and Analysis of Investment Banking and Regional Development Among European Economy

Investment banks are financial intermediaries that specialize in the sale of securities and the issuance and underwriting of new shares to raise capital financing. Investment banking is a special segment of banking that assists individuals or organizations to raise capital in the main market. In the tea market, new securities are issued and act on behalf of customers, thus playing an important role in the secondary market. Investment banks undertake new debt or equity securities for all types of businesses, support the sale of securities, and facilitate mergers and acquisitions by institutional and individual investors. Investment banking organizations act as intermediaries between investors and capital markets. Investment banks are becoming important in European capital markets due to many factors including the perception of investment banks among investors and the various other functions implemented by investment banks. The research paper aims to show the role of investment banks in the current scenario. This study is descriptive in nature and uses auxiliary data. The study reveals the growth, development, function and role of investment banking in the European economy. The main objective of this investigation is to clarify how investment banks play a role in increasing a country’s resources and economic growth. It analyzes the various functions performed by investment banks. Investment banks connect the people who sell securities with their investors. Investment banks add liquidity to the market. Investment banks promote savings and investment and eliminate capital shortages. Mobilize small, scattered savings in the community so you can invest in productive businesses. He concluded that the role of investment banks in economic development is important.

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Sample Harvard Stanford MBA essays: Written by ChatGPT, reviewed by humans

Partly out of curiosity and largely to evaluate its impact on our own future , we asked ChatGPT to do what many have already started asking – write sample MBA essays for Harvard Business School, Stanford GSB and other top business schools.

In an earlier post, we covered how to (and not to) write an MBA Application Essay using ChatGPT .

While that was the entrée, think of this as the main dish. We have now tried to take specific examples, given the AI model as much data as one could, and then attempted to ‘objectively’ assess if it could give humans (with admission consulting experience) a run for their money.

And it should be no surprise to you, the reader, as to what our ongoing hypothesis was here. But with that as a disclaimer, we have tried to be as objective here as possible.  

Stanford and Harvard MBA essay prompts to get examples from ChatGPT

At MBA Crystal Ball, we’ve had a lot of fun over the years tackling the ‘What matters most to you, and why?” question that Stanford GSB has been posing for several years now.

It is also among the trickiest in the MBA application world (together with the openly worded HBS question).  

The methodology

We started with the basic questions and kept increasing the complexity as well as the data that was provided.

To prompts such as – how can I write a good essay for this and do you have a template , ChatGPT humbly accepts it doesn’t have a template but then, goes on to list a 5-part structure:

  It also gives 6 tips such as being authentic, focusing on one or two things and so on.

The tips are nothing new and apply universally, available on any number of sites, including ours, from where ChatGPT inputs would’ve been sourced.

The structure however comes under scanner up front.

In many cases, you don’t have to necessarily spell out what matters to you in what may be construed as pedantic and forced manner (I’ll explain that in a minute).

The MBA essay structure ChatGPT suggests is pretty similar irrespective of when you ask it to regenerate the response – in other words, if you follow it, the essay risks looking like a clone of many others right up front.

Next, we asked for an example and this is how it went.

[Note: For the sake of brevity, we’ve used representational samples of MBA essays written by ChatGPT, as opposed to the full output.]

From a young age, I loved exploring the woods behind my house, playing in the creek, and watching the stars at night.

As I got older, my passion for nature only grew stronger, and I began to realize that protecting the environment was what mattered most to me.

  Many may marvel at how legible and real it feels. Sure. But then again, remember that making basic sense isn’t what gets you through. A vast majority of humans can do that.

When you’re writing Harvard and Stanford MBA essays, you’ll need to bring in much more than these examples.

What ChatGPT generated is as generic as it gets – right from the scenery it tries to evoke an answer, the example couldn’t be further from sounding as to what a ‘real’ person would say.

We also asked it for a sample on HBS essay prompt, “ As we review your application, what more would you like us to know as we consider your candidacy for the Harvard Business School MBA program? ” and this is a small sample of what it came up with.

Growing up in a small town in rural America, I always felt a strong connection to nature. From a young age, I loved exploring the woods behind my house, playing in the creek, and watching the stars at night. As I got older, my passion for nature only grew stronger, and I began to realize that protecting the environment was what mattered most to me.

  This feels derivative of the Stanford MBA essay sample and retains the same generic feel.

Here’s another interesting observation we made. What ChatGPT gave us has an eerie similarity to what it generated for Poets&Quants for over a month back.

  Deja vu?

There may be thousands of applicants getting ‘inspired’ by the same examples with similar wording. Keep this in mind if you plan to use sample MBA essays of HBS, Stanford et al.

We didn’t stop there though. Taking things a notch higher, we then fed a candidate’s resume details as well as a lot of information that we ask as part of our process, into the model. We then requested it for a response. Here’s what we got (personal information masked)

Growing up, I learned the importance of this approach thanks to my father, who challenged me to develop a value proposition for everything I wanted in life.

While I initially resented the delayed gratification that came with this process, it instilled in me a desire to make choices that were well-informed and aligned with my values.

As I entered adulthood, this approach proved invaluable, particularly as a woman in a society that often creates a glass ceiling for women.

When I decided to pursue mechanical engineering despite concerns from others about my ability to land a core engineering job, I did my research, talked to successful women in the field, and ultimately became the first person in my university to land a core engineering job.

Now, I mentor other women in the XYZ program and help them interview for internships at my company.

  The tool follows the GIGO principle (Garbage In Garbage Out). So what you feed it will influence the output it generates.

The example above sounds more real. This is because most of these were the Stanford applicant’s words that we picked up from the rough draft and structure shared while working with us.

So, what’s wrong with this? Notice the use of clichés (like holistic perspective ). It continues to move around the periphery, without hitting the nail on its head.

Reading this, one gets the impression that this is an interesting person, but doesn’t quite get it.

But it can be a good starting point, right? Wrong.

After hours of brainstorming to discover what makes the candidate click, this is what eventually resulted in an admit from the toughest school in the world to get into.

She had won the book for being her XYZ university’s gold-medalist. Despite her academic promise, she never pursued international research opportunities offered to her; it was “unseemly” for a woman to work alone in another country. History repeated itself across generations in my family.

My grandmother studied medicine. My mother is the only person in our family with a master’s degree. My aunt was a national-level swimmer with Olympic potential.

All talented women, but none allowed to professionally explore their potential. I grew up listening to their stories of would-be triumphs and many regrets.

But the picture they painted for me was one of hope and dreams, giving me courage to break the prejudices of a conservative society that had shackled their dreams.

Not without a hint of vengeance, I vowed to never let my life be dictated by my gender.

The first real test of this vow was while deciding my undergrad major.

  Of course, there was much more hard-hitting content in the essay. But what we’ve shared should give you an idea of how different her submitted essay was compared to the examples we got from ChatGPT.

If the candidate had followed the rigid structure or the first draft proposed by ChatGPT, the above version would never had come out.

Even before the ChatGPT era, we’ve been cautioning candidates against reading up sample MBA essays or asking for one. They do nothing but to bias you that there is a right answer out there. There isn’t.

In the words of ChatGPT, you have to be authentic. And without an interactive back and forth, without the right dosage of art and creativity thrown in for good measure, the current system is likely to make you biased.

Let’s see what the online tool does with the HBS prompt now. This time, showing how it ends. Here’s the sample Harvard MBA essay generated by ChatGPT.

In pursuing an MBA at Harvard Business School, I hope to further develop my skills in leadership, problem-solving, and collaboration. With a passion for creating value and making informed decisions, I am confident that I can contribute to the HBS community and bring a unique perspective to class discussions and projects. Thank you for considering my candidacy.

  The first sentence is quite a mouthful without giving away much of real substance. The Why HBS piece is a boilerplate response that is just sheer waste of space. Compared to how we helped the applicant end it.

I love creating “value propositions” and I believe that I can really refine my strategy building skills at HBS, especially over the strategy classes in Term 2. In addition, the field immersions would also help me try out my decision making frameworks on real life projects.

I believe this exposure, coupled with a stint in consulting and my background in engineering will enable me to pursue my goal of becoming a well-rounded strategy leader in a technology enterprise, who is able to create the right “value propositions” for the company and help women look beyond the questions that our society continuously throws at them!

  As humans, it’s hard for us to leave something that’s already there (in this case, say a first draft from ChatGPT) and start from scratch. Its after all an art.

Many argue as to why are these essays required, for they are not going to become artists. But that’s not correct. For becoming a business leader is no less than art where you have to balance conflicting priorities, and not just think objectively, but humanly and manage emotions too.

In essence, play with the AI model but if you are serious about your applications, stay authentic and avoid the temptation to take the easy route. The route won’t lead anywhere.

Living and breathing humans are better at understanding pain, euphoria and other emotions that go into making a good MBA essay. And with experience it gets better. We have a few of those seasoned mentors in our team, who can help you with your MBA applications.

Play around with ChatGPT till you figure out what it can and cannot do. And then drop us an email for the serious application work: info [at] mbacrystalball [dot] com

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How to Break Into Investment Banking–What to Do From Freshman to Senior Year

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How to Break Into Investment Banking–What to Do From Freshman to Senior Year was originally published on Leland .

To get into the highly competitive field of investment banking nowadays, you have to start preparing very early in your collegiate career. It can be difficult to know what you should be doing and when. Recruiting for internships and full-time roles is only happening earlier and earlier. At this point, to get a coveted summer analyst internship for your junior year, you’ll go through the interview process in your sophomore year, and will need to have a resume that can land you that interview.

In this article, we’ll provide an overview of the industry and roles and then guide you through the steps to an investment banking career. Of course, there are other ways to get into this industry, this is just one of the more traditional paths.

What is Investment Banking?

Investment banking is a special segment of banking operations that involves raising capital and providing financial consultancy services to individuals and organizations. Some of the services investment banks offer include proprietary trading, mergers and acquisitions, equity and debt capital raising, leveraged financing, restructuring aid, bond insuring, and IPO issuance.

To put it simply, investment banks are financial intermediaries and aid their clients with large and complex financial transactions.

Why is Investment Banking a Popular Career Path for Students?

There are a plethora of reasons why so many students want to get into investment banking but the two most common ones are high levels of compensation and great exit opportunities. For example, first-year analysts make an average of $170,000 to $190,000 a year, including base salary and the year-end bonus. This is much higher than almost all other entry-level positions in other industries.

Relatedly, students who aspire to work in other areas of finance like hedge funds, asset management, fintech, private equity, venture capital, etc. will get a ton of relevant experience and earn the prestige that comes with working at a large bank. It’s often a lot easier to get one of these roles after already having investment banking experience than trying to go directly from undergrad.

The Different Types of Investment Banks and What They Do

Bulge bracket.

Though there are a few different ways to classify investment banks, one of the most common is to do so by size. In this way, there are bulge bracket, middle-market, and boutique banks. Bulge bracket banks are the largest, international banks, for example, Goldman Sachs, Deutsche Bank, and JP Morgan. These firms’ clients include major, Fortune 500 companies and they work on deals that are valued from the hundreds of millions to billions of dollars. Bulge bracket banks offer the full suite of investment banking services, from financing to asset management, M&A, restructuring, etc. Some bulge bracket banks have middle-market branches that are sometimes integrated into the larger firm, and sometimes not.

Middle-Market

Middle-market banks are as the name implies: somewhere between bulge bracket and boutique banks. They offer most or all of the same services that bulge brackets do but work on deals that are typically valued at less than what bulge brackets handle, usually in the low to mid-millions, because they have fewer capital market capabilities. Some middle-market banks do specialize in a sector, industry, or location. For example, Lincoln International specializes in advisory services and financings, Houlihan Lokey in M&A, and Baird in equity research and institutional sales/trading.

Boutique banks are often split into two subcategories: regional boutique banks and elite boutique banks. Elite boutique banks are the most similar to bulge bracket banks in that they deal with enormous transactions, often valued at over $1 billion; however, they differ in that they usually focus on a few specific services. Examples of elite boutique banks include Lazard, Qatalyst Partners, Moelis & Co., Evercore, and Centerview.

Regional boutique banks are smaller than the others and deal in lower-cost transactions. They’re called “regional” because they work with a variety of clients within a geographic area. Some specialize in certain services while others work across different areas. Robert W. Baird, William Blair & Co., and Brown Brothers Harriman are a few of the more prominent regional investment banks.

For more info on this career path, read:

• What Do Investment Banks Actually Do?
• How to Prepare for a Career in Investment Banking
• Wealth Management vs. Investment Banking: Key Differences and Career Prospects
• The Top 10 Investment Banks

Investment Banking Roles + Career Paths

Most aspiring investment bankers will start with a summer internship in their junior year that translates into a full-time role upon graduation. The hierarchy from there is pretty straightforward.

Analyst to Associate

The entry-level position is that of an Analyst, followed by Associate. Usually, you work as an analyst for two to three years and then as an associate for three to four years. The average compensation for an Analyst is $150K to $200K, including base salary and bonuses. For an Associate, that increases to $250K to $400K. Of course, this varies widely depending on the type of bank, educational background, location, and other factors.

Analysts are sometimes referred to as “monkeys” because they are doing a lot of the grunt work required by these banks, such as maintaining important Excel spreadsheets, tracking transactions, managing data, keeping track of important documents, and supporting those in more senior roles. Associates have slightly more responsibility. They supervise Analysts, handle more complex financial models, and increasingly interact with clients. Associates are usually recruited after they graduate from an MBA program or are promoted from Analyst.

Associate to Vice President/Senior Vice President

After three to four years, Associates are then promoted to Vice President. VPs are the middlemen between the Directors and the Analysts/Associates, they take direction and then run projects. They’ll also interact a lot more with clients, eventually getting to the point where they build their own relationships with and win new clients. Those at the Vice President level are typically looking to advance within investment banking as it can be difficult to pivot into a new industry at this point. After VP, there is Senior Vice President, which involves much of the same but with a much greater emphasis on attracting new clients and business. Depending on the bank, Senior VP may be the same position as Director. Total compensation usually ranges from $500-800K, including bonuses.

Senior Vice President/Director to Managing Director

The step after Senior VP is Managing Director. The gap between these two positions is much greater than the others as there are far fewer MDs than VPs. Managing Directors spend the bulk of their time building relationships and trying to get new clients. On certain deals, they may step in and help with terms and negotiations, though they’ll spend most of their time meeting with potential and current clients. Managing Director is pretty much the highest level that you can reach, other than CEO. Including bonuses, MDs make anywhere from the upper hundreds of thousands to several millions of dollars.

How to Get Into Investment Banking

Now, let’s dive into how to actually land a role in investment banking, starting with freshman year in college. We’ve divided the progression by each year at university, but naturally, this will differ depending on individual, unique circumstances.

Freshman Year

Freshman year is the time to lay the foundation for an internship offer. The most important thing to think about is demonstrating a story for why you want to go into investment banking, and figuring out whether you want to pursue it in the first place. If you’re set on it, make sure that you’re showing interest in finance early and often. Here are a couple of things we recommend doing throughout your freshman year.

Join relevant extracurriculars

A lot of universities have a ton of resources for aspiring investment bankers through interesting clubs, an extensive alumni network, and tools to build technical skills. If your school has a business fraternity, this is also a great place to start. You’ll learn the finance “lingo” and meet peers interested in similar fields. Leadership experience in these clubs looks great on resumes so be active and take on responsibility where you can to prepare for a future leadership role.

If your school doesn’t have clubs that are interesting or relevant, start your own or join an intercollegiate one. Companies like Bloomberg also sometimes have on-campus representatives that you can sign up to be. Whatever you choose to do, remember the point of doing so, namely, meeting others aspiring to or actually in the industry, building your resume, and getting access to tools and resources.

Network, network, network

Start expanding your connections early , it will make a big difference as you advance. Most investment banks will only interview those who come through a referral. By growing your network, you’re increasing the chance that you’ll have someone to refer you, or, have high-performing contacts that you can refer. Talk to juniors and seniors about their experience recruiting at different banks as well as analysts and others who are early in their careers.

If your school hosts formal networking events with banks, attend, even if they’re targeted toward upperclassmen. Have an elevator pitch and go to learn and make connections. Preparing thoughtful questions beforehand will help you leave a positive impression on the recruiters. Also, don’t forget to sign in as the firms usually track who attends their events.

Immerse yourself in the industry

Start learning by reading the financial news, listening to podcasts, and subscribing to newsletters. Most universities provide free access to the Wall Street Journal, Bloomberg, or the Financial Times through the library and just a couple of minutes a day will help you stay up to date on market trends.

Read The Best Investment Banking Newsletters & Podcasts to Subscribe To .

Start learning technical skills

As interviews for internships start the following year, you’ll want to begin learning the skills required for technical interviews during your freshman year. At the intern level, this includes valuation, basic modeling, and basic accounting, as well as proficiency in Microsoft Excel and PowerPoint. Taking relevant courses will help, though you’ll need to balance them with general education requirements.

For more info on technical interviews, read The 20 Most Frequently Asked Investment Banking Technical Interview Questions .

Make the most of your summers

Even the summer after your freshman year, make sure that you’re making the most of your time. A great resume will land you an interview, but interesting stories will help you make a lasting impression. Find projects that you’re passionate about and that fit into your larger story. This means that you do not need to do something that’s directly related to finance. In fact, underclassmen summers are a great time to explore other interests. Some investment banks now offer Sophomore Summer Analyst positions, a few of which funnel directly into junior summer positions. As there are fewer people vying for these spots than for junior-year roles, this can be a great way to get in early. Examples of this include the Investment Banking Sophomore Summer Analyst Programs at Bank of America Securities and Morgan Stanley .

Get good grades

Investment banks do care whether you perform well in school. Start strong by getting good grades in your freshman year. There is usually a minimum cutoff for interviews and the higher your GPA, the less likely you’ll land below the threshold.

Though these things will help you get ahead, remember that school is about more than preparing for a single career path. Take time to explore your passions and take interesting courses. These firms want humans, not robots.

Sophomore Year

Preparation usually gets more intense during the sophomore year because that is when recruiting truly begins. Much of it, however, is an extension of the freshman-year to-do’s. Continue to take relevant courses and do well in them, network with peers and industry professionals, learn through podcasts/newsletters and the news, stay active and aspire to leadership positions in clubs, and build technical skills.

There are several additions to this list for sophomores, though, mostly in regard to preparing for interviews. First, you’ll want to polish your resume. Investment banking resumes should be no more than one page and have a specific format (Times New Roman, 10-12 pt. font, etc.). You’ll also want to make sure that the bullet points you have are relevant and impactful. One way to get a great resume is to work one-on-one with a Leland IB coach . Or, drop your email below and we’ll send you our resume guide , complete with templates and sample resumes from investment banking professionals at bulge bracket banks.

Second, you’ll want to increase your networking and technical skill efforts by specifically targeting recruiting prep. Ask upperclassmen to practice technical and behavioral interviews with you, and leverage them to grow your connections with those who already have offers. If you’re at a non-target school, make sure you’re networking widely, including with those who are at target schools or recruit at target schools in your region. Go for coffee chats, formal networking events, information sessions, etc., and don’t forget to send a follow-up, thank-you note after! Also, if there is someone with a similar path/background, consider asking them if they’d be your mentor. Mentors are a very powerful way to build a relationship and learn from someone who you admire.

Here are a couple of other resources you may find helpful on investment banking interview prep:

• How to Answer the “Why Investment Banking?” Interview Question
• How to Nail the Second Most Common Investment Banking Interview Question (“Why This Firm?”)
• A Guide to the Investment Banking Interview: Tips From an Expert

If you qualify as a diverse candidate, then consider applying to different banks’ DEI programs. Many top firms offer an accelerated program specifically for women, people of color, and other underrepresented groups in investment banking in an attempt to foster more diversity. These programs come with perks like trips to the firms, scholarships, increased facetime with recruiters, and more. Examples of these include Bank of America’s GBAM Scholarship of Distinction, JP Morgan’s Advancing Black Pathways Fellowship, Jefferies’ Diversity Symposium, and Morgan Stanley’s Fisher Scholarship Program.

The last thing you’ll do in your sophomore year is start to interview, depending on the firm/role! Right now, interviews for all summer analyst positions happen anywhere from winter/spring semester of sophomore year to the early fall of junior year. For the most up-to-date information, stay in contact with recruiters at your specific school.

Investment Banking Summer Analyst (2024) Program Deadlines

Here are the upcoming application deadlines for some of the top banks in the US. These dates will give you a rough idea of the different firms’ timelines, but remember that most, if not all, positions will be filled by people who have a reference. Networking is the key here and will get you in the door if you do it well.

• JP Morgan Chase & Co. : Applications close September 16, 2023
• Bank of America : Applications open June 1 – September 16, 2023
• Morgan Stanley : Applications close September 1, 2023 (rolling applications, apply as early as you can)
• Goldman Sachs : Some programs open March 15 and others August 15 (rolling applications)
• Citigroup : Application open now
• HSBC : Applications open now through May 31, 2023
• Barclays : Applications open now
• Credit Suisse : Applications close September 1, 2023
• Deutsche Bank also offers Analyst Programs for Fixed Income and Currencies and Corporate Finance Capital Markets
• UBS : Applications are open now until May 1, 2023

Junior Year

For the traditional path, by junior year you’ll have an internship secured for the following summer, be in your major and taking far fewer Gen. Ed. courses, and start to take on leadership positions in your clubs/business fraternities. You’ll also have a good resume, a broad network of connections, and increasing technical skills. To land a full-time position after graduation, junior year should be spent ensuring a successful internship. Summer Analyst Programs are, after all, basically long, extended interviews.

Here are a couple of things to make sure that you’re doing in the year leading up to your internship.

• Stay current on the market and financial news – Continue reading The Financial Times, The Wall Street Journal , and whatever newsletters/podcasts you subscribe to. Also, read the annual reports of companies that are interesting to you or in your industries.
• Prepare for hard work – Do whatever you need to do mentally to get ready for excruciatingly long work hours. Though it’s gotten better in recent years after public pressure following the death of an analyst who worked for three days straight, you’ll still work far longer days than your typical 9-to-5. Expect 75 to 80-hour work weeks.
• Improve your PowerPoint and Excel skills – You won’t be required to do the same level of work as a full-time Analyst, but still learn the basics of financial modeling if you haven’t done so already.
• Reach out to last season’s Summer Analysts (who are this year’s full-time Analysts) and ask about their experiences – What worked for them? What didn’t? Why do they think that they got return offers? What specific things do they think you should do to stand out? The best way to learn is to hear from people who actually went through the program themselves.

In the summer, you’re off to be a Summer Analyst! In preparing beforehand, you’ll be able to go into the internship confident and ready. Be available and proactive in helping those above you. In every task, go above and beyond. You also want to pass what’s known as the “Beer Test.” In other words, would your coworkers want to go out for a beer with you? Or, would they be able to survive a long-haul flight with you? The point of this question is to measure cultural fit. You don’t have to be best friends with your colleagues, but you do need to be able to get along with them.

Senior Year

If you were given a return offer to come back to the bank the following year as a full-time Analyst, congratulations! Investment banking is an incredibly competitive industry, especially at the bulge bracket level, and it requires a ton of grit and determination.

Though you’ve secured the offer, continue aiming for good grades. This will help you later on if you decide to apply for an MBA program and also demonstrates continued academic success. If you’re fairly sure that you want to attend business school, consider applying for deferred MBA programs. Every M7 program now offers a form of this–you apply as a senior in college and are able to defer your matriculation for three to five years. During that time, you can pursue what you wish without having to worry about working full-time and trying to pull together an application. It’s also cheaper as almost every school waives the application fee. For more info on these programs, head to The Top 10 Deferred MBA Programs in the US–and How to Get In .

What To Do If You Didn’t Receive an Investment Banking Return Offer

If you completed the Summer Analyst Program and didn’t receive a full-time return offer, it’s not the end of the world. The right course of action will somewhat depend on why the offer wasn’t extended. For example, if the market isn’t performing well, then other firms aren’t likely to be hiring either; if it was the fit, then another bank could possibly be even better.

There are a few different routes you could take to secure a full-time offer somewhere else. Firstly, try a different firm. Use contacts at other banks to determine where there might be capacity and try to land an interview. Also, consider going to a smaller bank–regional or even elite boutique banks might appreciate the experience that you’d bring.

Secondly, extend graduation by a year. In doing so, you’d have the chance to go through the Summer Analyst Program again. Consider the pros and cons of this choice carefully. With tuition, this may cost more than it’s worth.

Lastly, consider an adjacent role. There are plenty of high-paying roles within the general industry of finance that aren’t in investment banking. Through clubs and other extracurriculars, you likely already have contacts in these areas that you can leverage to learn about interviews and the demands of the job. If you’re passionate about investment banking, you can either try to get in laterally or pivot post-business school.

Break Into Investment Banking With the Help of an Expert

Investment banking is a notoriously difficult job but one that comes with high rewards, both monetarily and in terms of future opportunities. By following the steps we’ve outlined above, you’ll give yourself the best chance possible of securing a Summer Analyst position and then a full-time offer.

To supplement this information, however, we highly recommend working one-on-one with an investment banking coach. They’ll be able to help you with interview prep, technical skills, resume review, networking strategy, and much more. Plus, it will all be customized to your specific background and goals. Here are a couple of our most popular and highest-rated coaches, browse all of them here . We’ve also got coaches for other top industries like v enture capital , private equity , and management consulting .