My thoughts on one year in banking...
As some of you may know from prior posts, I decided to take an offer with a small PE fund, and chose to forgo my second year as an analyst. I figured I would give my overall thoughts to prospective monkeys...
First, I think IB is highly overrated. I can't believe how naive I was in school thinking 80+hrs a week was feasible...its not. Although I would say I averaged 85 hrs a week (don't believe people who tell you its over 100...those are certain weeks, but not the norm) throughout the year, the other aspects of your life get shot down. Luckily our group would allow us to go workout and then come back to work.
I hear a lot of kids getting excited about "models and bottles". Although it is alot of fun to pick up air-head art student/models (without alot of work), I often chose sleep. What I mean is on Fridays, when we usually left the office by 8:30 or so, I would just go to bed. Sounds really lame but I never fully adjusted to the lack of sleep that IB analysts get.
Probably the most common reason ppl go into IB is the money. I went in for the money, but luckily I enjoy finance. My bonus this year was $45k (apparantly this is from the '2nd tier bucket?'). Sounds like a large sum of money for a kid in his early twenties. It's really not. Not when you account for the cost of living here in NY and the luxuries you give up (i.e. car, life, etc). Make sure you at least enjoy finance, or you will be miserable.
Overall, I enjoyed the 'prestige' of working in the M&A group of a US BB bank. I think I enjoyed it more bc of what other people thought of it. I hated the mundane tasks that I was asked to do, and the face time that I had to put in.
I guess if I could go back in time, I probably wouldn't have changed anything (bc I am moving to PE finally), but I think a career in management consulting would probably have been a better time.
I hope I get my life back... even in christmas time, I only got to go home for 2 days, Including weekends and holidays, I took 34 days off last year, which means I was in the office the other 331. Good luck to all of you who aspire to be a well-paid slave.
Good luck bro. But perhaps, your reasons for going into PE are just as naive as your reasons for going into banking. The worst may not be over yet.
Maybe you are right. I wish I had more balls, like a couple of my buddies from Cornell that started their own businesses, and are doing pretty well. Maybe after I save up some money, I'll get out of the financial services industry.
As for the question of whether or not I would do it again? Probably. I mean, all of my econ professors really push Ibanking as if it is the only worthwile profession coming out of school. Like I mentioned before, I think I would have gone into management consulting M/B/B if I had to do it over again.
I think PE will be nice though. They gave me guidance that the hours were 60-65hrs per week, and that they value 'work-life balance'... I guess we will see.
Now I'm starting to understand some of your animosity towards me. I'm not slamming you, so please don't take it that way.
You are very lucky (and honest with yourself) to have discovered this defect in your personality so early in life. You can so easily fix it. Did you take this career path because that's what was expected of you? Trust me, if you have this attitude now you're on the right track and you should get out as soon as you put some money together.
The difference between you and your friends that started their own company is narrower than you think. They have days when they wish they'd taken the safe path and done what you did. Yeah, the hours suck and the job is pretty menial, but it would be nice to have a steady paycheck, they think to themselves. The difference is that, while you would trade places with them in a heartbeat, they wouldn't trade places with you for all the tea in China.
To succeed in investment banking, you have to be a follower. If you have the smallest spark of leadership or entrepreneurial drive in you (and I suspect by this post that you do), take a risk and go do something else as soon as you can.
Take it from someone who has been where you are and yet you have no respect for: 40 years old, 5'9" 230 pounds, full head of hair (though several of you think I'm balding for some reason), been laid more by accident than you're ever likely to be on purpose. You owe it to yourself to live a satisfying life. Use the Street as an ATM machine and then get the fuck out.
Make a horse race of this PE gig and then go do whatever you were meant to do.
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Cool story bro
SA in PE right now, nothing's really different except for the hours and location(if your PE frim is not in NY)
If you could go back 1 year would you do it all over again?
Pedal,
Cant comment on your background but I would disagree. As a disclaimer I have never worked in banking but have friends who have and still do and have worked with bankers of all levels for the past 4 years. The general responsibilities and facetime required are vastly different. I know very few PE guys who are in the office more than 60 hours a week. That is not to say that additional time is not spent working outside the office (i.e. modeling, conf. calls, etc.). PE is driven more on a deliverables basis (project deadlines) whereas banking is driven by constantly having to be available for your clients at all hours. I find the work in PE (relative to what the banker work product looks like) to be more intellectually challenging, interesting and fulfilling. The PE cycle is robust (from preliminary due diligence to operating the porftolio company to preparing for an exit) and very rarely gets dull.
In retrospect, I think completing a 2 year analyst stint is beneficial for a variety of reasons both as a rite of passage and as an incredible learning experience crammed into a short period of time. I think the OP made a good decision and i dont think many of the people on the board realize the many sacrifices required to work in banking (i.e. social life, gf, health, family, etc.)
WELCOME TO THE BUYSIDE WHERE ALL THE REAL MONEY IS!!!!
We create deadlines for Bankers to meet because if we can't meet the bid deadline, lets be serious, it gets pushed back... HA!
JBS: Did you start right off in PE? If not, what's your background?
Dude PE analysts easily average 70, sometimes 80 or 90. Lifestyle doesnt get much better right away.
Well written. But didn't you get pissed at me when I pointed out the wage slavery?
The WSO Guide to Understanding TARP
I totally agree with a lot of what was said above. The key is to truly enjoy what you are doing, or you will not make it into a top bucket - guaranteed.
Well written, a perspective from a "real" person not some finance zombie. But its just like everything: nothing is really as great as it seems (at least initially). My Dad was a Naval Academy grad back in the 60's, and my grandpa who was Marine in WWII feed him a tone of BS about how there was nothing better in the US than being a Marine, which the Academy only reinforced. He got in after he graduated and was extremely let down from what it was hyped up to be, he hated it. But, now he says that he really only remembers the good parts of it. I feel banking has the same effect, everything in hindsight is better.
Do you know anyone who truly enjoys banking? The hours, the lifestyle, the work, etc.?
MoneyKingdom - MBB sucks. Maybe not significantly less/more than banking but in the same range. And you get paid much less. The grass is always greener.
MoneyKingdom, thanks for sharing. Could you throw in more number-based "stats" like this one: "34 days off last year, which means I was in the office the other 331."? Some ideas: *Hours during the busiest/worst period *All-nighters/month *How often did you sleep less than 4 hours?
Thank You :)
I would say the worst week was 125 or 130 hours. I literally slept in the office for 2 days straight. This was bc the moron MD's from the industry groups would pitch the most outrageous things bc volume was down, so we had to model ideas that made absolutely no sense.
I have never pulled an all nighter. I always sleep at least 2 or 3 hours, or else I literally cannot function. Some of the other analysts pull all-nighters but then I have to fix their little fucking errors bc they were basically zombies when they imput something.
I would say you sleep less than 4 hours maybe once a week or once every other week.
Hope this helps.
And all true. But none of them required going $150,000+ in debt for a degree when you could have picked up the same life lessons for nothing at any entry level job.
I'm not trying to diminish the value of education here. But if all you're looking for in a job is something that will enable you to get a better job somewhere down the line, why spend the money?
Nothing equates to success except success. Not education, not a great job, not fantastic networking skills, etc... They're all tools that can help, but there is no guarantor of success. Nor should there be.
Most of you went to college and took a Street job to eliminate the risk in your life. The job sucks, but it's a steady paycheck. And people think you're cool (or at least did until last year).
But if what you're after is true success, and not the mind-numbing alumni functions that affirm your position as the biggest follower in a group of followers, you have to get some skin in the game. And that means you might fail.
And the real leaders wouldn't have it any other way.
I'm not trying to be a dick here. But if you really believe that "Don't fuck up" and "Cover your ass" are tenets of success in the real world, you really belong working for someone else. Entrepreneurs fuck up and go broke at an astonishing rate.
Guys, please don't get me wrong. There is absolutely nothing wrong with spending your life working for someone else. The vast majority of the human race does it with little complaint.
All I'm saying is that, if you think you're meant for something better, throw away the playbook you've been handed and take your shot. Chances are, you won't amount to shit. But at least you won't have to wonder 20-30 years from now what might have been.
The WSO Guide to Understanding TARP
Edmundo - why would people think you are balding based on an internet forum lol? Anyways, I wonder if the hours and stress of IB has to do with the fact that the majority of the 22-24 year olds I work with need to start looking at Bosley or something.
MoneyKingdom - thanks for your thoughts, kick ass in PE, take control of a portfolio company and then dominate.
MoneyKingdom has mentioned it, and a couple other guys have said it too. No idea where it comes from. I guess it's just the schlumpy George Costanza image I somehow portray.
The WSO Guide to Understanding TARP
Edmundo, I could have sworn you said you were bald at some point. If not, then my mistake. Thanks for the prior advice.
MoneyKingdom,
Thanks for sharing your thoughts on your year. I definitely agree with everything you said, minus the part about "don't believe anyone who says its more than 100 hours/week." You've got to realize you were an analyst in one of the worst M&A markets we've seen in a long time. Sure, this doesn't mean the hours are much better, but from July 2007 to July 2008 100hr weeks was clearly the norm. The difference is that during that time period we were working on a ton of deals and they were all getting done. This made the job a heck of a lot more exciting and meant as an analyst you were building a much stronger skillset. Don't get me wrong, I still think it's an incredibly overhyped experience and you spend a lot of time doing mundane tasks, but it wasn't the absolute misery that 2009 has been.
Best of luck with your Private Equity job. After going through PE interviews, I realized that the experience at PE firms vary vastly. Some shops are absolute sweatshops that do tons of transactions with a "buy and build through acquisition" approach. Others make a select few acquisitions and focus on growing the company through operational improvements. Hopefully you're heading to a PE firm that fits your style and doesn't work you too hard.
And finally: I believe entrepreneurship is the right opportunity for a very, very, very small handful of people. If you need someone else to tell you to start your own company, you should not be starting your own company. I am very happy I went through my two years as an analyst and would not trade places with an entrepreneur. Like ALL jobs, there are perks and there are downsides.
~~~~~~~~~~~ CompBanker
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