Investment banking is a high-paying field that can be difficult to get into but is totally worth the effort. New recruits can start making six-figure salaries and professionals with decades of experience who occupy the top positions are making millions of dollars each year.

Becoming an investment banker is a challenging and lengthy undertaking that requires strong determination. To climb the ladder, you must be willing to acquire the right education, skills, experience, and connections.

Before we dive into how to get into investment banking, let’s look at the role of an investment banker:

 

The tittle of an investment banker doesn’t say much about their role. Many individuals who wish to become investment bankers have a vague picture of an investment banker in mind. They think of an investment banker as formally dressed individual who works at Wall Street and receives a handsome salary.

An investment banker is the financial advisor for corporations and government. Investment bankers are the ones behind the launches of Initial Public Offerings (IPOs), mergers and acquisitions, issuing of bonds and raising money for corporations.  Here is an overview of what they do for corporations and governments:

Companies raise capital through selling stocks and bonds with the help of investment bankers. The investment banker decides how the company should raise capital. For example, when launching an IPO, the real challenge for an investment banker is to decide the price of share.

If the price of a share is too high, no one buys it, if it is too low, it would mean leaving money on the table for company. The investment banker shrewdly plans each step of the process including taking care of paperwork with Securities and Exchange Commission (SEC) and marketing the shares or bonds to prospective buyers.

Investments bankers negotiate mergers and acquisitions for corporations. Mergers and acquisitions are very hectic and lengthy legal battles between companies. Investment bankers for both companies in such situations stay put until they receive an offer that is in the best interest of the company they work for.

Investment bankers also buy shares from companies and sell them to individual buyers and institutions to generate a markup profit known as underwriting spread. When they sell shares directly to buyers, they earn commissions on sales.

Companies that do not want to go public, prefer to sell their shares to other companies or fewer investors. Investments bankers have connections with investors and companies that are willing to buy shares. Companies sell shares to such investors or institutions through investment bankers who make the process quick and easy for them.

 

You have the highest chances of getting into investment banking if you are an undergraduate student at a top rank university. If you are someone who has graduated from a community college, has a low-GPA, or is currently working in a different field, than your chances of getting in are a bit lower.

But if you are a 35-year-old cashier at Walmart, wondering if you can get into investment banking to start making more money, you need to take a rational approach to make money not become an investment banker.

Although very few 35- or 40-year-old individuals could do it. Why work so hard to enter investment banking when all you want is to make more money? You can do so by starting your own business, investing in a diverse portfolio or through starting a new side hustle.

To get into investment banking, you must be:

·       Choosing an undergraduate program/ studying at an accounting or finance undergraduate program/ Recent graduate/ Graduated 1-3 years ago

·       Interested in accounting and financial modeling as you’ll be spending most of your time in PowerPoint, Excel and Word as an investment banker

·       Willing to study further, become an internee or gain connections or experience related to the industry

So, in this article, we focus on three types of individuals who want a career in investment banking. 

An undergraduate in first year of college can take this approach to gear themself towards a career in investment banking. In first year of college, you must be able to decide which path you want to take. If you have made up your mind and want to be an investment banker, move to the next step.

You need to start networking in your second year of college to earn internship offers from top investment banks. Networking in second year of college is essential to secure internship positions that you can work at, in your third year of college.

These internships at top investment banks will lead you to a full-time position at one of the banks that you have worked at or at another investment bank based on your experience. Typically, an undergrad student in the U.S who wants a career in investment banking should start networking with bankers ASAP.

Networking with bankers or alumni in investment banking will give you industry insights. For example, top investment bankers might suggest that you hone your valuation skills or financial modelling. Focusing on these skills from your first year in college will prepare you to later complete internships successfully.

Even if you take up internship roles in small PE firms, startup hedge funds, corporate finance, or valuation or accounting firms, you can make a coherent story of your experiences. To land interviews for full-time positions at top investment banks, start networking in advance. Do NOT wait till you graduate.

Fresh graduate is a broad term. It could mean that you just graduated two months ago, or you graduated 1.5 years ago and started working at an auditing firm. Either way, you need to act quickly to increase your chances of getting a career in investment banking.

If you start networking soon and start looking for full-time job positions, you might come across job offers from investment banks looking for fresh graduates. This is because fresh graduates have the highest job turnover rate and investment banking is no piece of cake.

In all respects, investment banking is a very tough field where many people hate their job because they work more than 60 hours a week. When employees quit, there are new job openings. You can jump at such opportunities by quickly handing in an excellent CV that convinces them you and only YOU are the perfect one for the job.

If you have been out of college for a year and gained some experience in a different niche, mold your experience to fit the job criteria. This point is also discussed in detail in ‘Build a Resume’.  

You might have relevant experience like working as a financial analyst for a top bank or in corporate development department of a fortune 500, you can also leverage this experience and an MBA degree to easily make your way into investment banking.

If you have years of unrelated experience in an industry such as technology, healthcare, or any other, you can move into investment banking through getting an MBA and leveraging your experience.

This path is also for those who are wondering how to get into investment banking with a bad GPA?

You need to act fast and start networking as soon as you start your MBA. You should also consider pre-MBA investment banking internships or ‘steppingstone’ role to show you have relevant experience during the interview. 

 

 

 

You cannot reinvent yourself with an MBA but you can surely convince the investment banks that what you were doing before an MBA and the MBA has made you the right person to take a full-time position as investment banker. You’ll need a story that will convince interviewers. MBA and your previous experience should coherently support your transition.

So, if you worked in the tech industry as marketing head, your MBA story and previous experience should reflect how it helped you build connections with high net-worth individuals, understand and empathize with people, cater to their needs and come up with customized strategies for specific groups of people.

People skills are very important in the investment industry to negotiate deals, build connections and for people to trust your financial advice.

To stay ahead of the game, you need to build connections to land interviews and convince the interviewer that you are not just a top candidate but the best one. Your opportunity cost must be high in this situation to persuade the bank you want to work at.

If you worked at a non-profit or at a junior position before getting an MBA, it might become evident to interviewers that you are in it for money. Which makes you no good for the position because the typical investment banking salary attracted you not passion or dedication.

Once you have followed the guide to gain experience and education required to increase your chances of getting in, you need a story. The story is one of the most important parts because during the interview it will compel interviewers to hire you.

A poor story that isn’t coherent or portrays you as someone who is unsure about their career can be a deal breaker. When one of the interviewers asks, ‘Walk me through your resume’ or ‘Why do you think you are the right one for this job?’ You should be able to convince them in a 1- to 2-minute-long story that you are the one.

Your story carries the most importance. The reason you acquired experience or did your MBA was to be able to talk about it in your story during your interview. Depending on how long the interviewers let you to talk about yourself, you can shorten or elongate the story during the interview.

You can prepare a short and long version of your story. Write it down and read it. Let a friend read or teacher read and give you comments.

Also prepare for other questions such as, ‘What are your 3 strengths and 3 weaknesses?’, or questions from CV such as ‘Why your GPA is low?’

When bankers look at your CV, they are looking for following important details:

·       The university you studied at (if it is a top university)

·       Your college GPA

·       Companies you worked at and what was your position

·       Skills (if they are related to accounting financial modeling, etc.)

If you are a fresh graduate, they would want to see the companies you interned at and what you learned.

Now, you have the option to bankify your resume by changing some words and your tittle or skills to increase your chances of getting the job. For instance, if you worked at ABC company as a financial analyst, the ‘financial analysis’ is a broad term.

You can mold it into ‘Financial analyst and advisor to the top management’. This shows that your job is not just sitting on a computer preparing spreadsheets, but you play your part in company’s financial decisions. You work with people, and they listen to you.

Being good at communication and financial analysis is the pre-requisite for every investment banker. And your CV or Resume must reflect that you are not only a great accountant or financial analyst but are also excellent at communication.

Investment bankers stay among the high net-worth individuals. They are the ones who not only build connections with the rich but rich trust them so much that they let investment bankers make their big company decisions.

To achieve that level of trust among the rich community, you need networks, strong communication skills, ethics and goodwill. Rich people have rich friends and business associates. When one happy client talks about you in a meet up, others listen carefully. Increasing your chances of getting more clients.

But way before you start winning clients, you need to win over investment bankers who would interview you. You can learn about their behaviors and psyche by networking through LinkedIn, emails and cold calling.

Putting yourself out there will teach you what you need to know in the next 6 months or two years to land you an investment banking job. Don’t be afraid of rejection or not getting response to your emails. This trial-and-error method will also teach you valuable communication skills that investment bankers need to negotiate billion-dollar deals.

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Connect with Investment bankers and your university’s alumni. Ask them questions you have and advice for getting into investment banking. If you have an uncle, friend or an acquaintance in this field, get help from them. They might also be able to help you land interviews.

The biggest mistake candidates make is going to the interviews unprepared. If you are not preparing to nail your interview, then prepare to fail.

Investment banking jobs are not easy. You must be passionate about becoming an investment banker. If working long hours, dealing with complex situations and challenging work intimidates you, then investment banking is not for you. 

When you walk into the interview hall, you must be confident with a 90 percent chance of getting the job. You must be wondering; How would I know if I have a 90 percent chance? By following this guide and checking out videos here that will answer all your questions about getting into investment banking. Subscribe to the channel to get weekly videos on how to get into investment banking from where you are right now.