Comparison of College Athletes to Investment Banking
In the world of college sports, top athletes from high schools all over the country compete to join the best programs for 2 to 4 years. Just like college sports, banking takes the absolute cream of the crop of their pool, sometimes less than 1% of those who want it, simply because there are not enough spots for everyone.
In this article I will be comparing the recruiting process of investment banks to recruiting for college sports
In the beginning of recruiting, candidates start by reaching out to coaches, or if they are high level enough will receive attention from top universities/banks about applying. Each year the process gets moved up earlier until recently when the NCAA/Goldman mandate a strict recruitment schedule as high school/college students progressed through their freshman, sophomore, and junior years.
Athletes have an opportunity to join one of three divisions. Division 1 = Bulge Bracket; Division 2 = Middle Market, Division 3 = Boutique (elite and otherwise)
Banks in division 1 are the most well known, take the best athletes, and tend to give those athletes opportunities to advance their careers past their time at university. Division 2 has some opportunities but not nearly as plentiful as D1. D3 is where is gets interesting. Many D3 schools/boutiques are worthless and are purely a play by an “athlete” to act like they made it to the big time, when really it is a joke of a program. However, there are some schools- Amherst, MIT, Williams, CalTech/ Evercore, Centerview, PWP that end up being some of the best schools/banks in the country and while they are small, compete with the big D1/BB schools like any other.
After someone takes an offer they immediately go to instagram/linkedin to announce their commitment so their friends/colleagues can comment and like what they did. While the post may be thanking others for their achievement, the entire reasoning for the post was to bring attention to themselves (while this can be hard to admit).
Once secured many of the top athletes in these programs become 1 and done or 2 and done players and leave for the Pro’s/ Private Equity. These kids were top talent from the beginning and only used college as a stepping stone to get to their final league. Other kids may not be so lucky and decide to become a 4 year athletes in college. Many of these athletes try to succeed in the Pros afterwards but cannot and are forced to stay in their level, go international where it’s easier (corp dev), or quit (mba).
College sports is a grind and it is interesting to see how an athlete can finally be done with one process and right when they get where they want to be, need to start it all over again.
Thank you BigD973, very cool!
Sir this is Wendy's.
Many good points raised although the EB / D3 thing seems off. Why not just lump the EBs with the BBs like we always do on WSO, seems more accurate and doesn't force the weird point about Williams being a D3 diamond in the rough.
MBA quit thing was funny.
Interesting post. I’d compare getting into banking out of UG being the same as going D1 out of HS though. D1 is broken into multiple conferences, each varying in quality. BBs could be in the SEC/Big Ten/ACC tier with higher ranked EBs sprinkled in. Next tier could be Big 12/PAC 12 with lower EBs mixed in with higher ranked MMs. The last tier would be those FCS schools that can’t really compete with the Power 5 teams, but most are better than D2 schools except for those random small D1 schools that you don’t even know exist (ie TN Tech). Most banks (lower MM and boutiques) in the FCS tier are better than D2 (ie Big 4) jobs, but some of the shittier boutiques can be worse than the D2 jobs. D3 jobs would be something like Corp dev and obscure consulting firms. You could probably throw MBB in the Power 5 conferences somewhere. Then going into PE would be the pros and the level of bank you are at determines the amount of looks you get from PE. SEC/Big Ten/ACC tier gets the most interest from PE with Big 12/PAC 12 tier getting the rest of the interest. The non-power 5 tier can on rare occasion get to the pros, but it’s highly unlikely.
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