MBB: The Target School Advantage

Just wanted to confirm: this is undergrad -only- right?

there is literally not one nontarget at MBB? that is incredible. i would imagine these numbers are representative of big PE like KKR,BX,Apollo as well?

These are the stats from ONE office at one of these firms, for undergraduate hires. They are reasonably reflective of historical figures at that particular office but aren't necessarily of the entire firm or industry.

I'd be curious how these figures stack up to other offices as well, if anyone else has contributions.

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Interesting stats.

Would like to know any information on MBA-level hires if you could share.

I'm at MBB at a large office and this is pretty much in line with what I see. i think it's harder for nontargets to break into consulting than finance

This has been posted before but it seems to be pretty accurate:

http://talk.collegeconfidential.com/college-search-selection/1206919-sc…-BCG-McKinsey.html

Someone asking about top office (NYC, SF, etc) versus a smaller office is onto something; it is notoriously harder to get into an NYC-level office, and thus, not surprising that it skews towards more top target kids. A lot of the more regional offices hire from more regional targets.

really surprised to see a school like Columbia isn't considered a top target. Just highlights how competitive MBB really is, especially out of UG.

Correct, this is a major, non-regional office.

Once again, not trying to start a war about what's a top/target/semi. IE, I bundled them subjectively - HYPSW are traditionally bundled together on this list although there's no particular reason anymore to leave Columbia out.

It would make a lot more sense to list out the school and how many consultants per year are hired from the school. Obviously that raises some privacy concerns and the OP won't do that, but by lumping in so many schools together the results are somewhat meaningless, as different schools make up a different proportion of the percentages.

What about BB's? They typically have more non-targets I assume.

I mean this is understandable. What MBB are selling is their name and prestige. They don't produce any solid stuff for their clients, just some fluffy stuff which is blatantly obvious to the company their are serving. The prestige that MBB brings helps to rubber stamp the decisions though.

Prestige matters in Finance as well, but they can take any kid from non-target schools if these kids can produce the goods. I mean if you are a fund manager making great returns, who cares where you went to school. (Most likely they did go to a top school, but that does not matter)

But if you are a top consultant trying to bring in business for your firm, your prestige matters a lot. The middle management at some company in Iowa is more likely to listen to you if you show you went to HYPS/HSW. And even at blue chip companies, management needs a stamp of approval, so they hire consultants.

Just guessing.

Steven Hsu, a physics prof at Oregon, has a great post on this from 2011:

Credentialism and elite performance

See earlier post for Lauren Rivera study of recruitment at elite law firms, consultancies and I-banks. I refer to these as "soft" elite firms, whereas I will refer to hedge/venture funds, startups and technology companies as "hard" elite firms. (Goldman is a mix of the two; hence the internal battles between traders and bankers. I welcome comments from insiders on this particular issue :-) In the latter category performance is a bit easier to measure, and raw prestige plays less of a role in marketing to customers or clients -- i.e., the customer can directly tell whether the gizmo works ("these search results suck!") or the fund made money. Whether or not the advice received from a law/consulting/M&A firm is any good is much more nebulous and, well, soft. ***

1) Rivera's work confirms that in the real world, people believe in folk notions of brainpower or IQ. ("Quick on the uptake", "Picks things up really fast", "A sponge" ...) They count on elite educational institutions to do their g-filtering for them. In the past, as noted by one commenter, firms often asked for SAT scores.

2) Elite soft firms generally want people who are smart, but not too smart. Other factors, like personality, communication and leadership skills, etc. are valued as well. Startups, hedge funds, MSFT/GOOG, etc. generally want the smartest people they can get their hands on, at least for technical roles.

3) The soft firms know that what they do isn't "rocket science" -- it just isn't that hard, and any academic admit to a top university is smart enough. They just have to appear elite and smart enough to snow their clients and sell the work. Thus the emphasis on factors other than intelligence, once the threshold requirement is satisfied. Someone who appears smart and inspires confidence in clients is better than a smarter person who doesn't get along with (often middlebrow) clients.

4) In Rivera's research school prestige was the number one signal used by soft elite firms in evaluating prospective hires. Extracurricular activities came in second, but this is probably just a way to differentiate between applicants who have already been filtered using school prestige.

5) It is odd that the soft firms, which market themselves to clients as being super-smart repositories of brainpower (of course this is largely a fiction; see point 3 above), would rely so heavily on university admissions committees. They effectively outsource a big chunk of due diligence on their most important investment (human capital) to a group of people whose judgement they somehow trust, but perhaps without detailed understanding. When I was on the faculty at Yale I knew people in admissions and it's not clear to me that they were the best able to spot potential in 18 year olds. In studies of expert performance admissions people are less good at predicting UG GPA than a simple algorithm. (The "algorithm" is simply a weighted sum of SAT and HS GPA!)

But this doesn't matter if the success of HYPS grads becomes a self-fulfilling prophecy. Once soft elite firms and large parts of the rest of society (in particular, clients) have accepted the idea that elite universities should be trusted to do the filtering, these schools will automatically produce large numbers of successful alumni -- the imprimatur itself has value. The outsourcing of human capital filtering is more dangerous for hard elite firms, with their more objective criteria: if they find that Yale grads aren't actually any good at pricing derivatives, writing code or designing chips, then they'll have to adopt a different filter. Fortunately, since even the dumbed down SAT is still pretty g loaded, hard elite firms can be confident that the lion's share of top talent is at elite universities.

*** Although I have assigned hedge and venture funds to the hard category, cynical or rigorous readers will note that in most cases there is insufficient data to actually determine the alpha (risk adjusted performance) of a fund manager. Thus prestige and other soft factors may have as much impact as real performance.

Based on the comments in the thread, it seems like some of you think a Harvard degree is a ticket into MBB. There are lots of Harvard students who don't get MBB offers.

But as far as that initial résumé screen goes, yes, seeing Harvard or Stanford means that the candidate is much more likely than the average candidate to be qualified because they were able to get into such a good school. It has nothing to do with selling the prestige of those schools to clients.

Pretty sure that's a Northeast Office. Offices in other regions are much more diversified as far as undergrad hires go (generally). There's only 2 dudes with Ivy League degrees in my starting class, and 4 people from SEC schools and a few TFA sprinkled in. You don't really see much school diversity in the northern offices, although the southern offices are HEAVY on Duke.

While thematically I think you're right in that UChicago and Columbia place worse than you might expect (i.e. none in my office in 6 years), the numbers themselves are really office-dependent.

In any given year (My class + the 2/3 before and after), the pre-MBAs were only 30-50% from those 5 schools you called top targets. We'd have just as many from a top public or Duke in most years as from one of those top schools you mentioned (and I wasn't in the south). It was rare if we took more than 2 people from a school in any given year.

People from schools without recruiting presence get hired (if that's you're definition of non-target), maybe 5-10%. I've heard of folks from U Iowa and UGA getting hired, which I think actually qualify, vs. schools like UNC and Texas, which actually get recruiting interest (semi-targets).

Coming from a non-target myself, and having recently gone through the MBB recruiting, I'd like to add another possible causal factor here - total lack (at least in my case) of exposure to the culture and/or any information about it. No one to discuss it with, no one to support/motivate you, no one to benchmark against et cetera. At my school, I'm literally the only guy who is interested in consulting, and that gets frustrating sometimes. Luckily I have friends from a prior internship as well, otherwise I'd be totally solo in this quest.

People from (semi-)targets have things like case clubs, networks of like-minded friends/peers/acquaintances, on-campus presentations et cetera, that really is a gamechanger.

Princeton doesn't place as well as HYPS in consulting. It's more comparable to places like Brown and Duke for some reason.