What is it like to work in IBD at Goldman Sachs?

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From Quora, the OP asked the following question:

What is it like to work in IBD at Goldman Sachs?

An anonymous poster provides the following answer:

I can only speak to the analyst experience. There's a partner who detailed his experience on this site as well - I recommend you read that for a description of what the higher-ups go through.

Goldman Sachs: What is it like to be a partner at Goldman Sachs?

As for me, I worked at Goldman Sachs in investment banking for a bit before running off to the buy-side. I did not leave because I disliked GS, but it was just what everyone did.

200 West Street, Goldman Sachs World Headquarters

Looking back on it, I am thankful that I did my time with Goldman Sachs and, if I had to repeat everything, I would do it again without hesitation. The things you learn in investment banking extend far beyond simple corporate valuation or financial modeling. The life skills you learn are invaluable, for better or for worse.

#1: The Hours & Compensation

Hours are just as bad as everybody says. Nobody's kidding when they say that bankers (analysts at least) work on average 80-90 hours per week, with many of those weeks extending to 100+. It takes a certain mentality to get through this okay, but once you're used to the hours it no longer is something you detest. Sure, sometimes it absolutely sucks (friends down in the city, you can't hang out because you have to work), but for the most part you stop fighting against it because it's a futile battle. I adopted the mentality of "my life is all about work from now until the end of my analyst gig" and it was okay from then on.

I guess, for me, what also helped me get me through it all was knowing there was a light at the end of the tunnel, and opportunities to escape into a much better, more rewarding life. I also knew that many of my friends worked less than I but earned far less and had to worry about serious financial constraints. While I didn't earn that much, I had car service at night and a dinner allowance that I occasionally used to buy the next day's lunch as well - as a result, outside of rent I didn't have many expenses.

I'm not going to cite figures for compensation, but it was generous. However, while many people say bankers are seriously overpaid, I'd say that's a phenomenon reserved for people in higher positions. Analysts tend to view year-end bonuses as 'accrued compensation,' or salary we claw back because we worked so many hours through the year. GS had three buckets (high performers, average guys, poor performers) which made competition within the analyst class pretty well-defined. That undermined the spirit of teamwork that management tries to instill within all of us, but it was not a big enough deal to cause any real friction between analysts.

#2: Culture and Work

While I have had brief stints at other banks (internships for the most part) I would say that Goldman's culture is the best out of the bulge brackets (the biggest banks like Bank of America Merrill Lynch or J.P. Morgan), but it does not stack up to the culture that is touted by "elite boutique" firms (e.g. Blackstone Advisory, Centerview Partners), where analysts are expected to stay for the long run.

Goldman recently abandoned the two-year analyst program model that has become so prevalent on Wall Street, instead trying to convince new talent to commit to investment banking for the long run. This may change the mentality of incoming analyst classes for the better, and hopefully the culture will improve from there. It will likely take some time though.

Knowing that your stint will be over in a few years and that you will eventually leave is a strange expectation when entering a job. I guess it felt like just another internship for me - two years of torture followed by the promise of a buyside job and a lot of money. As a result, analysts are worked very hard and  forced to put in very long hours and do a lot of work, as detailed earlier.

However, investment banking is not all bad. The work I did, while mostly mundane or useless, can sometimes prove to be very interesting. The people I worked with were extraordinary, and many of them can be considered the best in the world at what they do. VPs and MDs typically have their own offices, the vast majority of which have open door policies, meaning they are more than willing to talk to you at any time. People outside of your group - complete strangers - would be happy to sit down and talk if you schedule a meeting with them.

Everybody is nice, down-to-earth, and focused on work. It can sometimes be a very high pressure environment to work in, especially when there are a large amount of deliverables that need to be completed in a short amount of time. People are more than willing to help if you ask, and very understanding of any problems that may come up. However, it is by no means a light atmosphere, and many people sit staring at the screen with headphones in, focused entirely on work. There is little friendly chatter and most conversations center on work-related subjects. That may be different in other groups - my group was quite focused though.

Something that our managers stressed very heavily was to not make the same mistake twice, and to escalate all questions - they'd rather you ask a stupid question than make a stupid mistake. Errors aren't treated lightly, and so investment banking is not for those who have low attention to detail. Pitch decks go through hundreds of revisions before they pass quality standards, with fixes ranging from trivial things like formatting to critical changes like altering model inputs or output pages.

Goldman's perks are okay - car service, late-night dinner compensation, etc. Lunch and breakfast can be expensive when bought in the cafeteria, and the free coffee is disgusting.

Overall I would recommend Goldman as a springboard into something else, but not a place to stay indefinitely. Perhaps entering as an associate could yield different results, but I cannot imagine going through many more years of the brutality that a job in banking entails.

While it may seem like an obvious choice for some to take the 100 hr/wk, high-paying finance job over the 40 hr/wk low-paying job after graduation, very few do not feel pangs of regret as they're a year and a half into the banking stint, standing over the ruins of failed relationships (it's impossible to date as an analyst, don't even try) staring at piles of work to finish.

It's hard to truly appreciate what an opportunity it really is until after you've moved on.

I hope this helps. Comment below if you have any questions. Best of luck!

https://www.quora.com/What-is-it-like-to-work-in-I...

Comments (35)

May 30, 2013

Good read.

May 30, 2013

BTW the Partner/MD link is also a good read (although there are a few people hating on him)

May 30, 2013
idragmazda:

BTW the Partner/MD link is also a good read (although there are a few people hating on him)

Typical haters against that otherwise honest post by the Partner/MD.

May 30, 2013

Appreciated the partner/MD link immensely. Far more enlightening a read (we all know what the analyst stint is like) and really enjoyable to see his interaction with the comment section.

May 30, 2013

I did not leave because I disliked GS, but it was just what everyone did.

Since last Fall GS is trying to put a stop to it.

May 30, 2013
Financier4Hire:

I did not leave because I disliked GS, but it was just what everyone did.

Since last Fall GS is trying to put a stop to it.

Which he acknowledges as a potential fix to the culture issue there. Juniors have always griped that senior people never take the time to invest in younger employees, but seniors have (rightly so) the mentality that none of the juniors will be there in a couple years. Have heard a lot of griping about the effects this has on recruiting, am really interested to see how the buy-side responds (will funds buy out analyst bonuses that are now sacrificed when they leave the firm in June).

May 30, 2013

For IB? Probably.

May 30, 2013

Blackstone, McKinsey and Carlyle are pretty good too.

May 30, 2013

dont forget lazard

May 30, 2013

Astronaut?

May 30, 2013

Blackstone.

May 30, 2013
xistguru:

Astronaut?

I've never said this in my life but... LOL

May 30, 2013

work environment rocks.

May 30, 2013
olemungu:

work environment rocks.

Not anymore.. A $150 Bn company can only keep the "startup-esque" work environment for so long. Eventually, the bureaucracy kicks in.

May 30, 2013

P/E at a big name shop or working on a prop trading desk at a BB is a MUCH better job out of ugrad than goldman ibanking

yes goldman is good, but it really is not the holy grail of the finance world

May 30, 2013

Goldman is not really the best possible finance job. Sticking with the IB realm (so excluding prop trading desks), working for Blackstone PE or Silver Lake PE (or another of the PE megafunds; I just know those 2 recruit undergrads) right out of undergrad is much better. After all, these PE jobs are the jobs that most Goldman banking analysts want to get after their 2 years at Goldman.

That being said, getting into a PE megafund right out of undergrad is really difficult. You need to be at a top target that the PE firm recruits at (most just go to Harvard and Wharton), have a sky high GPA, and you (generally) need to have done a banking internship at a top bank (GS, MS, Laz, GHL). These firms each take like 1-2 Wharton undergrads only.

So other than that, Goldman is probably one of the best jobs to have out of undergrad. I'd tie it only with Lazard or Blackstone M&A (maybe Morgan Stanley too).

May 30, 2013

I'd add UBS LA and also Citadel

May 30, 2013

Yeah definitely UBS LA (unless more people start leaving the office). As for Citadel - it appaently has like 30% yearly turnover and they fired 50% of their analyst class before they started (due to bad returns) a few years ago. Not exactly a place I'd want to be..

May 30, 2013

why lazard?
arguments?

May 30, 2013
student22:

why lazard?
arguments?

duh...

do a search on this forum

May 30, 2013

You're right about the turnover/horrible work environment, but still comp is best at entry-level (85k + bonus, i think)

May 30, 2013

lazard (and also GHL) is one of the most selective banks on the street -- they have to be, they have a much smaller analyst class. harder to slip by the cracks like you can with some of the BBs. its been my experience that they know who they want and go after them hard.

also, arguably you get a better experience as an analyst because there are fewer associate/VPs in the middle. more responsibility, but of course with that comes more accountability.

i would say if you're choosing between lazard/GHL and GS/MS, it would be more of a culture/work environment issue than the quality of the bank...

May 30, 2013
phosho:

lazard (and also GHL) is one of the most selective banks on the street -- they have to be, they have a much smaller analyst class. harder to slip by the cracks like you can with some of the BBs. its been my experience that they know who they want and go after them hard.

also, arguably you get a better experience as an analyst because there are fewer associate/VPs in the middle. more responsibility, but of course with that comes more accountability.

i would say if you're choosing between lazard/GHL and GS/MS, it would be more of a culture/work environment issue than the quality of the bank...

Ya one of hte few posts I completely agree with. I'd take that to the point of saying its like that with any of the top groups mentioned. CS sponsors, ubs la, evercore perhaps etc.

May 30, 2013

I go to a semi-target and a kid is going to work for Lazard public finance. he seriously is one of the most annoying and dumbest people I ve met. the questions he asks in upper level econ classes show the erudition of a high schooler

May 30, 2013
Salam Shpekov:

I go to a semi-target and a kid is going to work for Lazard public finance. he seriously is one of the most annoying and dumbest people I ve met. the questions he asks in upper level econ classes show the erudition of a high schooler

Lazard public finance sucks. Public finance at most banks is much easier to get into than investment banking. When people talk about the prestige of Lazard / how great the firm is, they're talking about it's investment banking practice (Lazard asset management is also solid, but they don't hire undergrads).

May 30, 2013

only guy I know at lazard lied on his resume...not exactly a prime candidate

May 30, 2013

phosho, in your experience, what type of people did they look for (Lazard)...

May 30, 2013

What are the prop trading desks that employ undergrads? Everyone talks about GS, but which desks specifically? Statistical Arbitrage, rates, credit, global macro, special situations?

May 30, 2013

Goldman Special Situation is the distressed debt investing group. So, this will involve valuation working (= banking skills). Special Situations takes a few undergrads.

Most of Goldman's (and other bank's) prop desks take undergrads as well. Macro, credit, stat arbitrage are more true trading desks though (= no valuation skills, more mathematical / quant skills) - these desks take people from Goldman's FICC/Equities program. Special Situations actually recruits through FICC/Equities too, but you have to specifically specify your interest in it (it's a really, really hard job to get) otherwise you're in the general FICC/Equities program.

May 30, 2013

i would say the best possible job is an analyst job with a large hedge fund (citadel, SAC, etc). they do recruit undergrads, and you will learnto think. sure you wont have the same formatting skills as you would have gotten banking but youll have a leg up on everything else over others looking to get in later on

May 30, 2013
gusthebus:

i would say the best possible job is an analyst job with a large hedge fund (citadel, SAC, etc). they do recruit undergrads, and you will learnto think. sure you wont have the same formatting skills as you would have gotten banking but youll have a leg up on everything else over others looking to get in later on

I don't disagree that these (citadel, sac, etc.) jobs are great jobs, but they are VERY different from banking. If you come out of one of these funds, you will not be competing for jobs with bankers since you'll have a completely different skill set. Also, the math/quantitative aptitude needed for hedge fund jobs at places like Citadel is pretty high - I doubt the average econ major banker could do it.

May 30, 2013
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May 30, 2013
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