Investment Banking - Career Question 2

Hello gents,

I posted a topic regarding a possible career in IB post-MBA in the future, and the general concensus seemed to be that coming out with an MBA with no IB experience would prove finding an IB job very difficult (I was hoping to possibly work 5-6 years in my current industry, get my MBA, then possibly transfer to IB).

Considering some research I have done, etc. I have decided it may be best to get experience with an IB asap if I want to pursue a career in an IB in the future (after my MBA). My question is this:

I studied international business and marketing, graduated from a decent school and studied quite hard. I got a great job straight out of school (in the in the Bay Area) and am getting paid very well for it. I have been here for 6 months and did several internships whilst in college in the entertainment/marketing fields. If I want to switch to IB in the near future, do you think it would be best to finish up 6 more months here (so I have somewhat solid work experience) or should I simply apply now? I would like to give this job a little more of a 'chance,' but if I do decide to definitely switch careers, will my experience simply have been a waste? Will they even care where I worked if it wasn't in finance?

I took finance classes but don't remember the material to a t, yet I still have an interest in the subject. How difficult do you think it might be to "switch industries" for someone in my situation, as I don't have any IB experience?

I realize this may be a difficult/absurd question, but any advice on the matter would be much appreciated. Cheers!

I think it would be difficult for you to enter investment banking if you don't know about accounting AND finance. It used to be that some banks were open to hiring someone with non-analytical background, e.g. history or philosophy, and then train them through the 6-8 week boot camp, but this no longer happens (as far as I know). So there are two options for you:

1) You continue at your job for another six months. In the meantime, you take accounting and finance classes at a local university extension. Make sure you do well. You can then try to apply to some investment banks.

2) Apply to business school now. That's what b-school's good for: changing careers. As I wrote in response to your first question on the topic, it doesn't make sense to postpone b-school too long if you know which industry you want to end up at. Especially in investment banking, you'll be considered for entry level position along with all other MBA students. No bank will hire you for anything other than a first year associate position out of b-school, even if you were an investment banking analyst before.

If I were you, I'd choose 2). I'd take the GMAT, make sure I get a score >700. I'd work ****** off so I become really good and knowledgeable in my industry, and get great recommendations from my employers. Banks would be interested in hiring you for their industry groups. Tech is always a huge sector in IBD, so if you can demonstrate that you know a lot about your industry, and combine that with a solid top MBA, you should have a decent shot at getting into a good bank. Also the type of quantitative/analytical training you get at a good bschool beats that at a local extension school. Remember that investment banking is hugely competitive, expecially for career changers, so you really should try to get into bschools that are historically known to be 'feeders' into the industry (Wharton, HBS, Chicago, Columbia).

Thanks for answering in both posts darkoak (and apologies for seeming like a twit for asking a ridiculous amount of questions!).

In regards to business school: the caliber of schools I would like to attend essentially require a minimum amount of work experience that I don't have yet (I only have a year or so); people who are accepted into Wharton and the like have an average of 5-7 years of work experience....I don't think I could get into a good program just yet.

As I mentioned, I did take finance classes, as well as several accounting classes as a business major. I have been thinking of getting some books to freshen up on the subject. Do you think with the classes I took as well as with some studying, it would help getting through interviews and getting started? Or do some banks essentially require you to take a "test" to prove your knowledge?

Any advice on IB's hiring process? Such as what time of the year they usually hire the bulk of their first year analysts (other than the summer of graduation)?

Thanks again for your advice, it is much appreciated.

Originally Posted by Englandmj7

Click to expand...

Thanks for answering in both posts darkoak (and apologies for seeming like a twit for asking a ridiculous amount of questions!). In regards to business school: the caliber of schools I would like to attend essentially require a minimum amount of work experience that I don't have yet (I only have a year or so); people who are accepted into Wharton and the like have an average of 5-7 years of work experience....I don't think I could get into a good program just yet. As I mentioned, I did take finance classes, as well as several accounting classes as a business major. I have been thinking of getting some books to freshen up on the subject. Do you think with the classes I took as well as with some studying, it would help getting through interviews and getting started? Or do some banks essentially require you to take a "test" to prove your knowledge? Any advice on IB's hiring process? Such as what time of the year they usually hire the bulk of their first year analysts (other than the summer of graduation)? Thanks again for your advice, it is much appreciated.
I won't say it's impossible for you to get into an investment banking job immediately, but it will very difficult. Your competition will be undergrads that took very specific courseloads from top five programs specifically to get into IBanking. Getting an MBA will certainly help, if as darkoak said, you are able to get into a top five program, because most IBanking firms only recruit from very specific business schools. Also as far as the undergrad side goes, keep in mind that a lot of Ibanking firms are still hiring non-business majors with quant backgrounds. I went into Ibanking as an undergrad with an engineering background from MIT, and many of my classmates were taking jobs in the field as well with a variety of quant majors. I have to ask a fairly simple question though. I know you addressed this in your other thread about the topic, but do you really dislike your job? If you have a good job and are getting well-paid, is it worth the expense, effort, and uncertainity to switch to a completely different field? Career changing is nice, and a lot of MBAs are pursuing those degrees for that purpose, but keep in mind that many career changers are taking substantial paycuts for the luxury of switching majors. A classmate of mine was an engagement manager for a well-known consulting firm and ended up taking a 50% paycut to switch to marketing... Clearly that's atypical but the point remains...

^^

I do actually like my job and I am getting paid well for someone with my experience (which is not very much at <2 years). The problem with it, however, is that it is a music job at a major tech. company and there is no set path that one can take in terms of promotions, etc. In fact, in the sect I am in (mobile content) there is nothing exactly that one can aspire to be other than a project manager, account manager, etc. and I am not really interested in those positions in the long run. Afterall, it is a very new industry.

I went to school in LA and was in awe of the entertainment industry when I first started working in it, but now I realize that I want a job which is competitive, challenging and has a structure to it. I also want to be in an industry that has a strong international presence and can offer travel and possibly expatration. I realize that this is not at all guaranteed in IB, but I feel that I could have a better chance of working abroad than if I stay with music......not to mention that I will know what I am working towards, even if it does take my whole life and millions of hours (analyst -> associate -> VP -> maybe managing director); I like the structure in IB.

Originally Posted by Englandmj7

Click to expand...

^^

I do actually like my job and I am getting paid well for someone with my experience (which is not very much at <2 years). The problem with it, however, is that it is a music job at a major tech. company and there is no set path that one can take in terms of promotions, etc. In fact, in the sect I am in (mobile content) there is nothing exactly that one can aspire to be other than a project manager, account manager, etc. and I am not really interested in those positions in the long run. Afterall, it is a very new industry.

I went to school in LA and was in awe of the entertainment industry when I first started working in it, but now I realize that I want a job which is competitive, challenging and has a structure to it. I also want to be in an industry that has a strong international presence and can offer travel and possibly expatration. I realize that this is not at all guaranteed in IB, but I feel that I could have a better chance of working abroad than if I stay with music......not to mention that I will know what I am working towards, even if it does take my whole life and millions of hours (analyst -> associate -> VP -> maybe managing director); I like the structure in IB.

To be honest, if you want to work abroad, you may want to consider consulting, which would be a much easier career path to get into, and is very structured as well.

You can definitely get an IB job if you get your MBA from a top 10ish school. BTW, there's no minimum work requirements... trust me on this (I'm a current MBA student at a top school)

As for your present situation, it will be very difficult to get an IB job, since firms are actively recruiting at their target schools. You might be able to get into a small, unknown firm, but imo, there's no point in doing that.

Originally Posted by Englandmj7

Click to expand...

Thanks for answering in both posts darkoak (and apologies for seeming like a twit for asking a ridiculous amount of questions!).

In regards to business school: the caliber of schools I would like to attend essentially require a minimum amount of work experience that I don't have yet (I only have a year or so); people who are accepted into Wharton and the like have an average of 5-7 years of work experience....I don't think I could get into a good program just yet.

As I mentioned, I did take finance classes, as well as several accounting classes as a business major. I have been thinking of getting some books to freshen up on the subject. Do you think with the classes I took as well as with some studying, it would help getting through interviews and getting started? Or do some banks essentially require you to take a "test" to prove your knowledge?

Any advice on IB's hiring process? Such as what time of the year they usually hire the bulk of their first year analysts (other than the summer of graduation)?

Thanks again for your advice, it is much appreciated.

Most of the top bschools are actually realizing that they are missing out on the "rising stars" and are starting to admit people with 1-2 year work experience (sometimes even straight outta college), because they figured that the really good ones may be concerned that they wouldn't get in to a good school because the average age was getting higher plus their opportunity cost would be so much higher had they have to wait 5-6 years before applying. Hence, average matriculants' age is starting to trend down. This is especially true if you're a woman--schools realize that it would be difficult for a woman to leave a VP level job to go to school, when at that time they'd rather have babies instead.

So what I'm saying is, don't worry about average age. Average means 50% of the students are actually lower than average. And the trend is in your favor. The important thing is to show that you have accomplished something in your current industry (as reflected in recommendations and essays), have a good reason why you want to switch (as reflected in essays), and (they less work experience you have) good (great) grades and GMAT. I need to reemphasize the last point. The "younger" you are, the more important grades and GMAT become.

In terms of getting into an investment bank from a different industry, the odds are not in your favor. Most banks typically start recruiting at their target schools around Sept-Oct, and most seniors get their offers before winter break. If a bank need to fill a spot immediately before the analyst class start in July-August, they'd rather poach from another bank or from a less prestigious but quantitative profession such as accounting or consulting. Why, again because those professions train their younger employees in similar analytical skills and presentation skills. Unless you have great connections that can open doors for you, it's very unlikely you'll get a job as a lateral analyst coming from music industry. Coming from outside an "analytical" function or industry, you'll be met with intense skepticism and disrespect by the analyst recruiting team.

So, keeping in mind drizzzt's very insightful comment of "why you do you even want to switch now", the best way for you to go into IBD is to go to a top bschool. Dont' bother going to a school not in the Top 10--waste of money & bulge bracket banks don't even bother recruiting there. Remember, it's a huge commitment. You'll be spending upwards of $150K in tuition/books/living expenses and even more opportunity cost, and in the end you may not even get that dream job at Goldman Sachs (yes, it's that competitive). But at least you'll make some friends and learn something new in bschool.

Originally Posted by darkoak

Click to expand...

Most of the top bschools are actually realizing that they are missing out on the "rising stars" and are starting to admit people with 1-2 year work experience (sometimes even straight outta college), because they figured that the really good ones may be concerned that they wouldn't get in to a good school because the average age was getting higher plus their opportunity cost would be so much higher had they have to wait 5-6 years before applying. Hence, average matriculants' age is starting to trend down. This is especially true if you're a woman--schools realize that it would be difficult for a woman to leave a VP level job to go to school, when at that time they'd rather have babies instead.

So what I'm saying is, don't worry about average age. Average means 50% of the students are actually lower than average. And the trend is in your favor. The important thing is to show that you have accomplished something in your current industry (as reflected in recommendations and essays), have a good reason why you want to switch (as reflected in essays), and (they less work experience you have) good (great) grades and GMAT. I need to reemphasize the last point. The "younger" you are, the more important grades and GMAT become.

In terms of getting into an investment bank from a different industry, the odds are not in your favor. Most banks typically start recruiting at their target schools around Sept-Oct, and most seniors get their offers before winter break. If a bank need to fill a spot immediately before the analyst class start in July-August, they'd rather poach from another bank or from a less prestigious but quantitative profession such as accounting or consulting. Why, again because those professions train their younger employees in similar analytical skills and presentation skills. Unless you have great connections that can open doors for you, it's very unlikely you'll get a job as a lateral analyst coming from music industry. Coming from outside an "analytical" function or industry, you'll be met with intense skepticism and disrespect by the analyst recruiting team.

So, keeping in mind drizzzt's very insightful comment of "why you do you even want to switch now", the best way for you to go into IBD is to go to a top bschool. Dont' bother going to a school not in the Top 10--waste of money & bulge bracket banks don't even bother recruiting there. Remember, it's a huge commitment. You'll be spending upwards of $150K in tuition/books/living expenses and even more opportunity cost, and in the end you may not even get that dream job at Goldman Sachs (yes, it's that competitive). But at least you'll make some friends and learn something new in bschool.


Well said!

Originally Posted by darkoak

Click to expand...

Most of the top bschools are actually realizing that they are missing out on the "rising stars" and are starting to admit people with 1-2 year work experience (sometimes even straight outta college), because they figured that the really good ones may be concerned that they wouldn't get in to a good school because the average age was getting higher plus their opportunity cost would be so much higher had they have to wait 5-6 years before applying. Hence, average matriculants' age is starting to trend down. This is especially true if you're a woman--schools realize that it would be difficult for a woman to leave a VP level job to go to school, when at that time they'd rather have babies instead. So what I'm saying is, don't worry about average age. Average means 50% of the students are actually lower than average. And the trend is in your favor. The important thing is to show that you have accomplished something in your current industry (as reflected in recommendations and essays), have a good reason why you want to switch (as reflected in essays), and (they less work experience you have) good (great) grades and GMAT. I need to reemphasize the last point. The "younger" you are, the more important grades and GMAT become. In terms of getting into an investment bank from a different industry, the odds are not in your favor. Most banks typically start recruiting at their target schools around Sept-Oct, and most seniors get their offers before winter break. If a bank need to fill a spot immediately before the analyst class start in July-August, they'd rather poach from another bank or from a less prestigious but quantitative profession such as accounting or consulting. Why, again because those professions train their younger employees in similar analytical skills and presentation skills. Unless you have great connections that can open doors for you, it's very unlikely you'll get a job as a lateral analyst coming from music industry. Coming from outside an "analytical" function or industry, you'll be met with intense skepticism and disrespect by the analyst recruiting team. So, keeping in mind drizzzt's very insightful comment of "why you do you even want to switch now", the best way for you to go into IBD is to go to a top bschool. Dont' bother going to a school not in the Top 10--waste of money & bulge bracket banks don't even bother recruiting there. Remember, it's a huge commitment. You'll be spending upwards of $150K in tuition/books/living expenses and even more opportunity cost, and in the end you may not even get that dream job at Goldman Sachs (yes, it's that competitive). But at least you'll make some friends and learn something new in bschool.
Very good points. The only comment I have is that if the OPs real intention is looking to work abroad, IB might not be the best place, not to say it isn't a great career choice compensation-wise. Also, it may potentially not be the best in terms of lifestyle choices, although consulting isn't great in that aspect as well. GMAT/GPA is quite important, as darkoak said earlier, you really need a 700+ to be competitive at a top ten school...of course, the other things are important as well. There are lots of people with 750+ that aren't at top schools. I had an applicant for a marketing manager position that had a 790 GMAT that was a UC Irvine MBA.

I have decided it may be best to get experience with an IB asap if I want to pursue a career in an IB in the future (after my MBA).

Click to expand...

Here's a different view: why not go into consulting then get an MBA then IB?

That worked well for some of my colleagues in strategy consulting. The thing is that one can learn the finance easily but strategy is a bit broader and great for creativity in setting up deals, presenting to clients, and overall client relationship management. One of my buddies from McKinsey is a top Eurobanker doing FIG M&A.

Originally Posted by Artisan Fan

Click to expand...

Here's a different view: why not go into consulting then get an MBA then IB?

That worked well for some of my colleagues in strategy consulting. The thing is that one can learn the finance easily but strategy is a bit broader and great for creativity in setting up deals, presenting to clients, and overall client relationship management. One of my buddies from McKinsey is a top Eurobanker doing FIG M&A.

Easier said than done.

Originally Posted by Artisan Fan

Click to expand...

Here's a different view: why not go into consulting then get an MBA then IB? That worked well for some of my colleagues in strategy consulting. The thing is that one can learn the finance easily but strategy is a bit broader and great for creativity in setting up deals, presenting to clients, and overall client relationship management. One of my buddies from McKinsey is a top Eurobanker doing FIG M&A.
That's going to be challenging for a number of reasons. First of all, Mckinsey hires business analysts out of undergrad, and it's unlikely you'll be considered for one of these jobs w/o graduating from a top 5 school or having special qualifications. Secondly, certainly its possible to go to Mckinsey as an associate from a top five MBA program, but that's still very competitive and you need something to differentiate yourself from the competition. Same is true for Bain, BCG, and the ilk. Finally, it's unlikely you'll be able to transition to IB except from the top tier of consulting firms. I think consulting with other firms, not necessarily top tier, may be a good option, though, and certainly if you get into a top school you'll have a shot to get into a top consulting firm although in my experience it's difficult without connections or special skills.

Does anyone here work for an IB that wouldn't mind if I asked you a few questions via pm? I don't really want to steal this thread but I am a junior at a decently ranked undergraduate school, and would just like to talk about preparing for interviews and such to get an internship at one of the big banks this year.

Finally, it's unlikely you'll be able to transition to IB except from the top tier of consulting firms.

Click to expand...

Well I have seen several cases where this has occured and it has been quite successful. I guess my point is to focus on developing a broad array of skills.

I got into McKinsey as an experienced hire from investment banking as a VP so I know both professions well. My view is that consulting is a richer experience for a young person although banking can pay better there is a more intense lifestyle tradeoff.