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Wall Street Oasis » Blogs » DM123's blog
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How did investment banking culture end up this way?
 

DM123's picture
DM123
      CF
 
(Baboon, 132
 
Points)
 on 12/23/12 at 6:30pm
thinking

In general, I’ve always blindly accepted investment banking culture. The rules, the interview process, the face time, the mistreatment of younger employees. It never really bothered me…

That said, I am currently reading a fantastic book called “In the Plex: How Google Thinks, Works, and Shapes Our Lives” by Steven Levy. If you read this book, you will find out that Google has a similar elite culture associated with its workforce. Google only hires individuals from top schools with outstanding GPAs. As well, Google is notorious for extremely difficult interview questions. The company brags that it hires the best of the best… does that sound familiar?

But as you keep reading, you’ll notice a drastic difference between Google and the investment banks. Google is proud to let employees dress anyway they please. Employees are given every creature comfort imaginable including free food (with an in-house chief), massive gym and yoga center, etc. You even have access to a free car if you need to run an errand and butler service in case you prefer that someone else run your errand for you! The list of perks is endless.

Google also implemented a rule where employees can spend one day per week working on a “fun side project” of their choice. Believe it or not, Google News was created via one of these side projects! The employee can pick any project he wants without requiring approval from his managers.

Lastly, employees are trusted and treated with respect at a very young age. Believe it or not, the product manager overseeing the launch of GMAIL was just 22 at the time! Can you imagine being in charge of the most successful email program of all time at the age of 22?

Suffice it to say that Google’s stock price has significantly outperformed just about any index or stock in the North America (please don’t be a smart *$#* and write a comment below about the one or two companies that you found which outperformed Google since 2004…).

So I ask the following question: is it possible that the financial services industry hasn’t been as successful or innovative this past decade because banks hire top talent but subsequently force these bright, energetic, creative, ambitious individuals to focus on face time, dry-cleaned suits, and overpriced ties instead of actually maximizing their full potential?

See my other WSO blog posts
  • investment banking culture
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Comments

hot1590's picture

What kind of creativity can

hot1590
     
 
(Senior Baboon, 220
 
Points)
 on 12/23/12 at 7:03pm

What kind of creativity can banking analysts bring forth? Maybe a new application like Excel but exclusive for banking. Or a chemical formula for colon that instantly attracts all the CEO's.

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In reply to hot1590
PFY15's picture

hot1590: What kind of

PFY15
     
 
(Senior Chimp, 18
 
Points)
 on 12/23/12 at 7:06pm
hot1590:

What kind of creativity can banking analysts bring forth? Maybe a new application like Excel but exclusive for banking. Or a chemical formula for colon that instantly attracts all the CEO's.

The problem: exhibit B

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tkid3400's picture

lol, I'm pretty sure that

tkid3400
     
 
(Senior Baboon, 199
 
Points)
 on 12/23/12 at 7:08pm

lol, I'm pretty sure that google employees don't have a one track mind trying to get rich and burning out while tryin g. the google employees might actually like their jobs despite the $$$$$

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DM123's picture

tkid3400: Just to be

DM123
      CF
 
(Baboon, 132
 
Points)
 on 12/23/12 at 7:13pm

tkid3400: Just to be accurate, I wouldn't say "despite the $$$$$$"...... google employees who joined early on made serious coin because of their stock options...

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marcellus_wallace's picture

Why do you think Google's

marcellus_wallace
      ST
 
 
(King Kong, 1,643
 
Points)
 on 12/23/12 at 11:13pm

Why do you think Google's culture would fit or succeed in finance? Finance is built on a hierarchy and every emperor needs an army of really smart, hard working peons to help sustain their empire. You become the emperor by killing other emperors.

Google may be looking for entrepreneurs and outside the box thinkers, investment banking is looking for the best highest paid corporate slave one could buy or mold.

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iwa1409's picture

Obviously you asked about IB

iwa1409
     
 
(Monkey, 40
 
Points)
 on 12/24/12 at 12:34am

Obviously you asked about IB but looking at finance more generally, some of the top prop shops have cultures similar to this...although you probably aren't going to get a butler service anytime soon.

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peyo212's picture

Yeah why do prop shops have

peyo212
     
 
(Senior Monkey, 82
 
Points)
 on 12/24/12 at 1:49am

Yeah why do prop shops have this "Google" culture then? They're also in finance, people are also after money...

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In reply to balladechina212
asiamoney's picture

balladechina212: Yeah why do

asiamoney
     
 
(King Kong, 1,122
 
Points)
 on 12/24/12 at 7:03am
balladechina212:

Yeah why do prop shops have this "Google" culture then? They're also in finance, people are also after money...

They aren't client facing, they work for themselves so no need to maintain any particular outward appearance.

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seabird's picture

IB's are full of high

seabird
      PE
 
(King Kong, 1,558
 
Points)
 on 12/24/12 at 8:47am

IB's are full of high functioning sociopaths; what would you expect from a culture that promotes them over all others? Besides, google actually likes their employees, and their employees arent expected to fit in the same sort of mold that IBers are.

“...all truth passes through three stages. First, it is ridiculed. Second, it is violently opposed. Third, it is accepted as being self-evident.”

- Schopenhauer

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WSRenaissanceMan's picture

IB is a sales job in the end.

WSRenaissanceMan
      IB
 
(Baboon, 113
 
Points)
 on 12/24/12 at 10:12am

IB is a sales job in the end. These software developers you speak of, never see a client. And they can thank Steve Jobs for the laid back attitude of Sillicon Valley. Analyst/Associate Bankers are being prepped to land deals with CEOs and CFOs once they are VP/Director/MDs.

BTW I love my $1,000+ suits! And if you don't like face time, feel free to find a back office job and die lonely and poor in your cubicle.

Make opportunities. Not excuses.

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mmoldo02's picture

I think it's mostly a style

mmoldo02
      IB
 
(Monkey, 52
 
Points)
 on 12/24/12 at 2:57pm

I think it's mostly a style issue. For IT, the more unkept an IT person looks, the more credit he / she gets. While in IBD it's the exact opposite, you get credit for looking immaculate and exceptionally well-dressed. It's a completely different culture. I think it's mostly the image you are selling. When people think IT they think: geeks, socially inadequate, completely clueless about anything regarding the real world except for IT. When they think IBD they think: someone really smart and amazing in every way, including in social skills and appearance. So it's a reputation every IBD person has to uphold. The standard is just set a lot higher. For example you'd get people afraid to go to an IT interview NOT wearing jeans because they're afraid if they don't dress down they won't get the job. While in IBD if you turn on wearing jeans and it's not casual Friday or something you get kicked out. :D But if you have 25-40 years of solid performance in investment banking or finance you can wear whatever you want. Though at that point you're probably brainwashed enough to constantly wear suits.I don't think there's anything anyone can do to change IB culture. The rules are set by the people winning the game right now.

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<em>Mod note: make sure to see the great comment below by CompBanker</em> I come from a small town where nobody had ever heard of consulting or IB. I was fortunate enough to attend a top target college (a good Ivy) and land a gig in IB at a BB/EB. I'm starting full time this...
Finance Culture - Personalities
<strong>Background</strong> I randomly discovered WSO nearly seven years ago just weeks after I secured a FT MM IB position. The website was extremely nascent at the time with only a few thousand registered users. The majority of the users were college students with only a handful...
How WSO has enhanced my IB/PE career
<em>Mod note: <strong><a href="http://www.wallstreetoasis.com/faq/what-are-the-best-qa-threads-and-interviews-with-top-finance-professionals-on-wso ">Click here</a></strong> to see all of our q&a's and interviews</em><P> I figured I...
Open for Questions - Equities in Dallas
After over one year in the making, the <strong><a href="http://www.wallstreetoasis.com/2013-wso-compensation-report-full">2013 WSO Compensation Report</a></strong> is here! Access to the FULL 108 page 2013 WSO Compensation Report is <strong>100%...
2013 WSO Compensation Report has Arrived
Where do i even start..I learned so much from this forum. The brutally honest opinions, sincere willingness to help, the technical information and random tips on everything has been absolutely crucial for me landing this offer. Coming from a non-target I didnt get that 3rd year SA position at...
Thank you WSO! Got my FT Offer! ADVICE NEEDED
When I first started as a PE analyst, I constantly struggled with judging the amount of time I should spend on reviewing sourced deals. How much time is enough to really get a handle on the company’s revenue streams? How granular do I need my analysis to be on industry threats? With this...
Misguided Efforts: A Cautionary Tale
Fellow Primates, We are looking for 1-2 students on each campus to help WSO in its sales efforts to student clubs/career centers, and overall promotion at your school both online and on the ground. Below is a description of the position and benefits...thanks in advance for your help! <a...
WSO is Looking for Campus Reps For Summer/Fall 2013 (and beyond)
Many of the questions that have come in surround recruiting for front office Wall Street careers from a non-target so we’ll start with some ideas for recruiting, move on to interviewing, preparing for the job and finally long-term career management advice. Before we begin, it has been...
Stand Out as a Non-Target: Recruiting (Part 1 of 4)
Any Asset Management people here who could give me some insights on it, such as the nature of the work, the pay, the hours, the potential for career advancement, ect? I was looking into IB before but I've decided that I would rather pursue a career that's more intellectually...
Asset Management a better choice than Investment Banking?
<img src="//img.pandawhale.com/48721-Sexually-Oblivious-Female-Meme-Ze2w.png" alt="Sexually Oblivious Female Meme - Favorite Position? I would like to be a CEO.">
If you could be the richest person in the world with your dream job only as a public virgin forever would you do it?
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