What banker careers really look like: schools and promotion rates
Hi guys. Answering your questions on career path to start with; also giving some initial generalities about what undergrad schools I'm seeing. The full cut of undergrad/b-school and exit opps data is on the way. Reminder: this is longitudinal career data from a sample set of several hundred bankers in bulge bracket IBD at all levels.
First, just eyeballing it, here are the surprises in terms of undergrad schools:
Yale and Princeton each place more analysts than Harvard. And where the fuck is Stanford? I see almost no Stanford undergrads. Maybe they don't know that IBD exists... or maybe bulge brackets are a turnoff when they've got so much VC around the corner.
Near the head of the pack are Penn/Wharton (no surprise), NYU (small surprise) and Georgetown (slightly odd, but not a huge surprise)
Michigan, Northwestern, Columbia, Dartmouth killing it, no surprises.
Canada also killing it. Yes, I lumped all Canadian schools together specifically in the hopes of being as offensive and US-centric as possible. If you don't like it, go gather your own data and crunch it Canadian-style, eh?
Slight surprise: Vanderbilt, Illinois, Texas, Boston College, UCLA represented more strongly than I would have thought.
Also, random state schools are all very small by themselves, but added together they make up more than 20% of the sample.
And now some data on longitudinal career paths based on where you start:
Career path of an associate starting in BB IBD:
~75% make it to VP in BB.
That 75% breaks down as follows: ~60% make it to VP at the same firm; the remaining ~15% exit to another BB before making VP
That 75% also breaks down as follows: roughly 65% stay IBD, roughly 10% jump to some sort of asset management or similar at the same general comp/prestige level. That 10% is split pretty evenly between same firm and different firm.
Roughly a third of those who make it to VP in BB churn out before director.
~25% make it to VP at a smaller firm or in a role not at the same level of comp/prestige.
Roughly half of these churn out before director.
My takeaway: 75% of IBD associates make it, and the remainder go somewhere else and try to reinvent themselves.
Career path of a VP in BB IBD:
~60% make it to director in BB IBD; nearly all of these do so at the same firm.
That 60% breaks down as follows: a little more than 50% make it to MD while the remaining 10% churn out before MD.
~10% make it to director level at either a smaller IB firm or in some other role, like asset management and consulting. Data's not perfect on how many of them make it to MD because there are too many blanks, but just eyeballing it, it looks like half to me.
~30% don't make it to director level anywhere. Qualitative note: this is by far the most depressing chunk of the whole data set. These poor bastards are too old to relaunch their careers and too young to have made their fuck-you money yet. The stories are not pretty. Percent that open muffin and/or cupcake shops: 0% (in this sample)
My takeaway: 60% of IBD VPs make it. As for the rest, the floor's the limit.
Career path of a director in BB:
~70% make it to MD in BB IBD. Roughly half of these exit the firm and roughly half stay at the same firm.
~10% make it to the MD level in some new function or role. Roughly half of these exit the firm and roughly half stay at the same firm.
~20% churn out (or somehow stay in one place for quite a few years) without making it to MD.
My takeaway: 70% of IBD directors make it. Those who don't still do pretty well.
Career path of an MD in BB:
Looks like roughly a 7.7% churnout rate per year
Average age of those who churn: 48 (WTF? This does not match my experience.)
Average age of those who stay: 45
My takeaway: Stop believing this game ends at 65, regardless of how many 60-year-old MDs you know. You see them because they're still here; you don't see the ones that didn't make the cut. You, personally, are lucky if you make it to 50.
Fun facts:
Total exits in 2008 were 3x the total exits in 2006, and 5x the total exits in 2010.
Those who exited to roles I'd call equal tended to do so either before the financial crisis, or in 2010 and later. Fewer moved from BB to BB in 2007, 2008, and 2009.
Those who churned out tended to do so before or during the crisis. Churnout rates are much lower from 2010 onwards. In some cases, they're even lower than pre-crisis churnout rates.
What the fuck is a churnout?
When someone doesn't make the cut in banking, it's not an instantaneous process. They take a succession of roles (often at progressively smaller or worse firms, or in less "intense" functions) without seeing much (if any) career progression. This process can take years, and in some cases can be reversed. And of course, it's possible that these people actually planned to do this: that their career plan all along was to start in BB IBD and then gradually go to smaller places with less dealflow while never getting any promotions, even though they could have started at the smaller places if that had been their goal. I'm not judging. All I'm saying is, I had to call this kind of exit something, and churnout sounded better than flameout.
Does the VP set include or exclude the associates that made it to VP?
It excludes them. This is longitudinal, so those that entered the data set at VP are treated as a different population from those that entered the data set at associate.
I have a question about how you collected/crunched the data. Feel free to shoot me questions about methodology, but understand that there are some details I can't give. The methodology isn't perfectly random, but you'll have to take my word that it's strong enough to support the conclusions I'm drawing.
To my knowledge this is the first time a data set of this size and quality has ever been put out there, and I'm doing it for two reasons:
First, to give back a little.
Second, and more importantly, to replace the usual WSO conjecture with real data, hopefully saving working professionals some time so we can get back to talking about ass and titties.
Comments
Yeah , I can attest that IB
Yeah , I can attest that IB is not looked upon as favorably at Stanford. I think most of "those kids" who get finance internships freshman year , and then try to weasel their way up the ranks - the kind of people that look awesome on paper and then are almost insufferable to speak to - tend to stay away from California and congregate at Wharton , Princeton and Harvard (I think in that order).
As far as VC goes , I've hardly ever heard of anyone getting into Sequioa or Kleiner Perkins right out of undergrad. I think the main reason for depressed IB hiring is 1) All the Startups that are recruiting in the area and 2) All the quant trading places that also recruit there (at least for Stanford CS).
That being said , its always possible to crash a GSB recruiting event.
OK maybe Im reading this
OK maybe Im reading this wrong but am i correct to say that 75% of associates make VP and 60% of VPs make MD so therefore 45% of associates end up as MDs? That sounds way way too high to me....so much so that i must be reading it wrong. I have less experience with bankers but for every associate I see come into sales and trading i'd say less then 10% end up as MDs. I must have missed something.
GS: Yeah , I can attest that
Yeah , I can attest that IB is not looked upon as favorably at Stanford. I think most of "those kids" who get finance internships freshman year , and then try to weasel their way up the ranks - the kind of people that look awesome on paper and then are almost insufferable to speak to - tend to stay away from California and congregate at Wharton , Princeton and Harvard (I think in that order).
As far as VC goes , I've hardly ever heard of anyone getting into Sequioa or Kleiner Perkins right out of undergrad. I think the main reason for depressed IB hiring is 1) All the Startups that are recruiting in the area and 2) All the quant trading places that also recruit there (at least for Stanford CS).
That being said , its always possible to crash a GSB recruiting event.
That story may make sense on the surface, but upon closer inspection the truth becomes clear: Stanford kids clearly don't possess the vast intellectual capacity required to spread comps, format documents, and make inconsequential language changes at the last minute.
See my WSO Blog
Damn. Looks like a lot of
Damn. Looks like a lot of extra work, THANKS!
Suck my black ****.
DontMakeMeShortYou: GS: Yea
Yeah , I can attest that IB is not looked upon as favorably at Stanford. I think most of "those kids" who get finance internships freshman year , and then try to weasel their way up the ranks - the kind of people that look awesome on paper and then are almost insufferable to speak to - tend to stay away from California and congregate at Wharton , Princeton and Harvard (I think in that order).
As far as VC goes , I've hardly ever heard of anyone getting into Sequioa or Kleiner Perkins right out of undergrad. I think the main reason for depressed IB hiring is 1) All the Startups that are recruiting in the area and 2) All the quant trading places that also recruit there (at least for Stanford CS).
That being said , its always possible to crash a GSB recruiting event.
That story may make sense on the surface, but upon closer inspection the truth becomes clear: Stanford kids clearly don't possess the vast intellectual capacity required to spread comps, format documents, and make inconsequential language changes at the last minute.
and they get spoiled from all that sunlight and arent used to spending 80+ hrs a week in a dark hole
You have to play the game to find out why you're playing the game.
Going
Yeah , I can attest that IB is not looked upon as favorably at Stanford. I think most of "those kids" who get finance internships freshman year , and then try to weasel their way up the ranks - the kind of people that look awesome on paper and then are almost insufferable to speak to - tend to stay away from California and congregate at Wharton , Princeton and Harvard (I think in that order).
As far as VC goes , I've hardly ever heard of anyone getting into Sequioa or Kleiner Perkins right out of undergrad. I think the main reason for depressed IB hiring is 1) All the Startups that are recruiting in the area and 2) All the quant trading places that also recruit there (at least for Stanford CS).
That being said , its always possible to crash a GSB recruiting event.
That story may make sense on the surface, but upon closer inspection the truth becomes clear: Stanford kids clearly don't possess the vast intellectual capacity required to spread comps, format documents, and make inconsequential language changes at the last minute.
and they get spoiled from all that sunlight and arent used to spending 80+ hrs a week in a dark hole
They make awful hedge fund analysts too... how can you be objective in such a laid back, happy environment? They're useless. Utterly fucking useless.
See my WSO Blog
bankerella: saving working
saving working professionals some time so we can get back to talking about ass and titties.
Ok, thanks. Let's get back to it.
I'm a lover, not a fighter, but I'm also a fighter, so don't get any ideas.
My WSO Blog
Bondarb: OK maybe Im reading
OK maybe Im reading this wrong but am i correct to say that 75% of associates make VP and 60% of VPs make MD so therefore 45% of associates end up as MDs? That sounds way way too high to me....so much so that i must be reading it wrong. I have less experience with bankers but for every associate I see come into sales and trading i'd say less then 10% end up as MDs. I must have missed something.
Yep. Did you read this:
Does the VP set include or exclude the associates that made it to VP?
It excludes them. This is longitudinal, so those that entered the data set at VP are treated as a different population from those that entered the data set at associate.
1: Remember that there's a good bit of flux in mid-career as people start having to eat what they kill. VP is both a common entry point and exit point.
2: They are two completely separate longitudinal populations, with different dates of birth, entry, and so forth.
3: I mention above that 75% of the associate population making it to VP includes those who go to some sort of asset management or similar at a similar level of compensation and prestige.
There's no data on how many associates make MD for a very good reason: going from associate to MD requires 10-15 years of promotions, and all of those who entered the data set at associate did so within the past decade. So they generally haven't had enough time to get there yet.
See my other WSO blog posts
Why would anyone at Stanford
Why would anyone at Stanford try to get into Finance? I obviously don't go to Stanford (definitely wish I did), but aren't they supposed to starting the next big thing in tech or working for Google/Facebook. Can't imagine them doing something lowly like Finance.
And Bankrella, you are awesome! I hated your posts before, but now I respect you a lot. We all can learn a lot from you, and any guy would be lucky to have a woman as smart and sassy as you.
JamesHetfield: Why would
Why would anyone at Stanford try to get into Finance? I obviously don't go to Stanford (definitely wish I did), but aren't they supposed to starting the next big thing in tech or working for Google/Facebook. Can't imagine them doing something lowly like Finance.
And Bankrella, you are awesome! I hated your posts before, but now I respect you a lot. We all can learn a lot from you, and any guy would be lucky to have a woman as smart and sassy as you.
I agree on Stanford. Finance just doesn't seem to be a focus at the undergrad level.
As for the rest: thanks. But if I were you, I'd brush up on the ol' suck-up skills a little. Gotta slide it in all terse and man-like without overselling; the harder you sell it, the harder it is to buy.
See my other WSO blog posts
Where's Cornell?
Where's Cornell?
Cool - thanks for the post
Cool - thanks for the post
"If you want to succeed in this life, you need to understand that duty comes before rights and that responsibility precedes opportunity."
sycophant 101: don't use
sycophant 101: don't use intensifiers...they're very ineffective
You have to play the game to find out why you're playing the game.
Is that data collected from
Is that data collected from an aggregate of the BBs or just the the ones employed in NYC. Also about Stanford, those kids have no reason to do Ibanking when they can work for Google. Facebook for 80k+ a year with free everything (food, gym, beer, etc) and work 40-50 hours a week. $$/hr at those tech companies be like 2-3x higher than banking right now and those giant tech companies also carry some "prestige" on the resumes.
Where's Duke, MIT, Cornell
Where's Duke, MIT, Cornell and Brown ? I always thought Duke was a top target for BB IBD.
Where Berkeley at? Also, I've
ladubs111: Is that data
See my other WSO blog posts
Who goes into IBD at the VP
bortz911: Who goes into IBD
See my other WSO blog posts
Good work bankerella. Thanks.
"A man generally has two reasons for doing anything. One that sounds good, and the real one." - J.P. Morgan
Interesting and great work.
solb22: Interesting and great
See my other WSO blog posts
Hey Bankerella, i was
Way too much bold going on
Is this data for NY only
SB for increasing my degree's
Leadership can be defined in two words: "Follow Me"
Why dont you just list the
Georgetown placing so well
double
(No subject)
I hate victims who respect their executioners
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monyet: Why dont you just
Some real life data from my
Going
Operating Systems was a
Can we get a picture of
Solid post. I agree with some
finance is the science of goal architecture.
No Berkeley?
Which Indian schools do you