Do some people never break into IB? Any stories?

Quick background summary: First post, but have been using this website for >2 years. Student from a top target who pursued another career and then lateraled from a boutique to IBD at a top BB (GS/MS). I definitely know how hard it is to break in.

My question: With all of the new resources (M&I, WSO, etc) for people to learn more about banking, I believe there has to be a large number of people who developed a strong interest in IB and were dead-set on it, but weren't able to break into the industry.

Any personal stories/friend's stories about people who never broke in? I don't want to be negative, but just feel like like all of these sites are all rah-rah "just network/cold-call and you'll be fine".

It might provide a realistic picture to a lot of users- I know someone with a sub-3.0 from a non-target who thinks he can just "network, brah" but in reality I don't think it's that easy.

Comments (46)

Mar 17, 2014 - 4:17pm
BTbanker, what's your opinion? Comment below:

I'll say one thing, the competition is increasing exponentially - not only because of sites like these, but because of the massive industry cutbacks and consolidation of banks.

The kids I know that couldn't get into banking did law and corp fin, others are pursuing an MSF for the rebranding. I still think anything is possible if you know what you're doing, but the industry is definitely not for everyone.

Mar 17, 2014 - 6:22pm
theHill, what's your opinion? Comment below:

I got my sophomore year internship at a tiny boutique shop by reaching out to an analyst who was working there for no pay. This guy's been trying to break into MM/BB for about 2 years now by networking and gaining more deal experience, but tough luck. Heard recently that he's given up.

Mar 17, 2014 - 6:31pm
j-phone, what's your opinion? Comment below:
theHill:

I got my sophomore year internship at a tiny boutique shop by reaching out to an analyst who was working there for no pay. This guy's been trying to break into MM/BB for about 2 years now by networking and gaining more deal experience, but tough luck. Heard recently that he's given up.

Yeah, I think this is common as well. You need a bit of luck. But becoming bankers is not comparable to becoming an astronaut or a Hollywood actor. You need to be in the right place at the right time. Some boutiques rather close doors for you than opening them. Those who want to work in corporate finance or investment banking need to be a bit more careful. Unfortunately, the boutique he worked for was probably one of those boutiques.

Mar 17, 2014 - 8:17pm
j-phone, what's your opinion? Comment below:
theHill:

I got my sophomore year internship at a tiny boutique shop by reaching out to an analyst who was working there for no pay. This guy's been trying to break into MM/BB for about 2 years now by networking and gaining more deal experience, but tough luck. Heard recently that he's given up.

Hi, sorry, can you PM me the name of this boutique if you have some time? I am curious. I am thinking about this boutique that doesn't pay the analysts and associates. It's possible that work experience in that boutique rather closes doors.

If you feel comfortable, you can name the firm here just to warn others not to intern/analyst/associate there.

Mar 30, 2014 - 12:21am
mb666, what's your opinion? Comment below:
theHill:

I got my sophomore year internship at a tiny boutique shop by reaching out to an analyst who was working there for no pay.

Curious how this is legal for a FT employee. It's not like he's an unpaid intern who is getting credits for his school. Are you implying that his salary is super low (or possibly commission based... which would be strange for an entry level position?
Mar 17, 2014 - 6:27pm
j-phone, what's your opinion? Comment below:

This might be a bit off the topic.

I am unsure if more people are applying for positions in investment banking or corporate finance. It's a relationship business and you need to be good with people to succeed (above the associate level).

Your time as a researcher in origination (or sourcing) or financial modeler (this is the most common route) soon comes to an inevitable end. At the end of the day, you are selling something, you need to be able to find buyers, shortlist buyers and spend considerable time with them to work out/negotiate an optimal deal structure.

It is my personal view, but a lot of websites like WSO or Mergers & Inquisitions make the world of banking sound/look like Hollywood. People talk about breaking-in. Getting unpaid work experience to get noticed by a mid-size player and then go into a major league.

Vast majority of junior bankers leave (and forced to by companies) and don't become "deal-makers." But they continue to talk about breaking into IBD.

At the end of the day, if you are well-linked/connected, there should be a room for you in investment banking. It has to be because that's our business, that's what we do.

Mar 26, 2014 - 10:14am
KnivesOut, what's your opinion? Comment below:
j-phone:
This might be a bit off the topic.

I am unsure if more people are applying for positions in investment banking or corporate finance. It's a relationship business and you need to be good with people to succeed (above the associate level).

Your time as a researcher in origination (or sourcing) or financial modeler (this is the most common route) soon comes to an inevitable end. At the end of the day, you are selling something, you need to be able to find buyers, shortlist buyers and spend considerable time with them to work out/negotiate an optimal deal structure.

It is my personal view, but a lot of websites like WSO or Mergers & Inquisitions make the world of banking sound/look like Hollywood. People talk about breaking-in. Getting unpaid work experience to get noticed by a mid-size player and then go into a major league.

Vast majority of junior bankers leave (and forced to by companies) and don't become "deal-makers." But they continue to talk about breaking into IBD.

At the end of the day, if you are well-linked/connected, there should be a room for you in investment banking. It has to be because that's our business, that's what we do.

Coming through with the knowledge.

Mar 26, 2014 - 5:27am
Ghosh, what's your opinion? Comment below:

From my school which would be a semi-target, I have not heard of anyone who wanted to but could not get into the industry. It really depends on what kind of school you go to. A non-target kid would be have a real tough time to break in. But this is not rocket science, it is not that tough to break in if you want to and have the requisite skills and background.

Mar 26, 2014 - 7:17am
tipper_of_windmills, what's your opinion? Comment below:

I'd be interested to hear more on this too, especially from those not in the US where cold-calling and networking are much more useful.

I'm currently in my 'junior' at a target in Australia. From what I've seen 80% of grad roles are filled by last Summer's SAs, with the other 20% usually made up of SAs from other banks that didn't get offers. What's more, it seems that when a VP/MD leaves here, rather than replacing them with a lateral hire, everyone just moves up a position and they just bring on a new grad. This makes interning practically essential to breaking in. But in my city there were probably 20-30 IBD SA positions on offer last year for some 2-3 thousand students. So I would guess it's probably the NORM not to break in here, and I'd be curious to hear what the stories are for those who didn't make it. Personally I'm taking the prerequisite subjects for Med School 'just in case'.

Mar 26, 2014 - 8:04am
notthehospitalER, what's your opinion? Comment below:

I can speak to this - I am an undergrad student at a top 'target' in Australia and interned in IB (and received a FT offer) this past summer.

I disagree about cold-calling and networking being more useful here - it is by far more important in the US (can speak to the US too, as I spent 2 years of my degree there). In the US, there are far more boutique banks etc, and networking goes a really long way. Networking would obviously go a long way here too, but it's not necessary - I was overseas when I applied to the bank where I interned and didn't know anyone there. I got offers at 2 BBs without knowing anyone at either bank, and by applying online only - this is the norm in Australia, whereas in the US your resume often won't even be considered if you apply online without having any referrals/on campus recruiting.

Also not true about the lateral hire part - I know for a fact that banks do laterally hire when associates, VPs etc move on - although I concede that because of the relatively small size of the market, it can very difficult to find appropriate lateral hires and a few banks at the moment are top and bottom heavy, with very few (sometimes 1 or 2) associates and VPs - and these are large, global banks too, not boutiques.

Interning is basically the only way to break in here, you're right. Also correct about hundreds of applications for every single IB intern spot. It's actually even tougher than that right now - the market is relatively weak, and based on what I've heard from a number of friends interning elsewhere, the situation at my bank etc, it sounds like maybe 30-50% of interns received full-time offers, and many banks aren't even hiring for grads this year - I know of at least 3-4 major BBs who aren't hiring a single extra grad for next year.

I don't think there is as much of an emphasis on banking here in Australia as there is in the US - here, summer internships etc (even for university students at good universities) are often the exception rather than the rule. That being said, as mentioned above (and as you alluded to) there are still hundreds of applications for each intern spot, and I do believe it is the norm here for people NOT to get into banking. I know of a large number of people who expressed interest in getting into investment banking and were forced to enter other jobs because of a lack of an offer from an IB.

PM me if you have any questions etc, happy to help if I can.

Mar 26, 2014 - 9:06am
tipper_of_windmills, what's your opinion? Comment below:

Sorry, the networking thing was poor grammar on my part, I meant it's much more important in the US than here.

Thanks for the additional info though (+1 SB), I concede that the part about lateral hires was taken from conversations with mates at one BB with a relatively small presence here, so it might just be unique to their office.

I think a big issue is that we have a high number of boutiques that are 'just' under the capacity required to take an intern or two each Summer. Even a couple of the 'major players' don't take a single intern some years (e.g. I didn't see any SA opportunities from Moelis last year). It's not really like in the US where you have dozens of relatively unknown boutiques willing to take a chance on someone over the Summer, if only as a learning experience.

Mar 26, 2014 - 8:57pm
caribe_mexicano, what's your opinion? Comment below:

i'm from sydney, top uni and i didn't make it to IBD, i got an opportunity to intern in consulting so i aligned everything i did with that but i know i couldn't have made it into a IBD grad program as i just don't have the stats of other candidates or anything on my CV that demonstrated a real drive for corporate finance - not a great year for banking recruiting, number of grads is now 20% of pre gfc levels

i know of one kid who got a boutique banking internship in the US very easily, over here he wouldn't have got an interview above big 4

i just did a linkedin stalk of bankers i know in sydney, top 1% high school entry scholarships to a top 3 uni double degree, finance and law... sometimes another major in economics or statistics marks in the top 1% of the uni, first class honours international exchange 4.0 GPA GMAT 750 (this is just one person) a stack of others academic awards, normally top 3 in most subjects, 1st in finance subjects minimum 1 internship in IBD or MBB, majority have 3 as they've done 5 year degree

Mar 28, 2014 - 7:43pm
MQ, what's your opinion? Comment below:

I agree with @notthehospitalER let me provide you with the perspective from London. I got a returned offer to join the IBD team in GS London office starting this July. Very much looking forward to New York Training.

I have been following WSO for long and never understand how cold call/network makes a difference, I think it plays a large role in US because of campus hiring but not UK where all applicants are all considered equally. Having internship experiences and/or relevant finance experience is the ONLY way to break into BB in London, especially in IBD. I personally know a few people who got through the door by having connections, but only in Tier 2 banks (HSBC/Barclays) and for Private Wealth Management. In my case, I know no one at the BB I work for. I applied to 5 banks (CS/DB/GS/MS/HSBC) got into final round for all five, get rejected by 3, get an offer from one and use it to leverage to the bank that I now work for. I think a bank knows good candidate they have options and so does the candidate themselves so top candidates are fought between banks very fiercely here.

However, I have seen many failure case. Due to where I study (LSE) literally EVERYONE is obsessed with IB and on the first day of first year people have already discussed about how to get a spring internship with these BB. Those among my peers who fails frequently are ones who: 1. Keep on insisting on IB although their skills and passion are better off somewhere else/in other industries. 2. In it solely for the money/reputation. 3. Are very competitive in nature but wants short cuts to success and dont like to do the dirty real work. I have friends who applied to 15 banks and didnt get even a single interviews. I have friends who have done internships but fail to get the FT offer. Any kind of possible failure, you named it, at this stage I think it is due to those three reasons. I myself have failed 3 final rounds interviews (That's like after 16+ interviews with these three banks) before I get my first offer, and it was very risky because I gave up my study all together. I learnt from my failure then move on, and I am very lucky to have failed the first three so I ended up where I am (GS) and find a wonderful team with really nice people/boss.

lequynhmai.com
  • 2
Mar 26, 2014 - 9:41am
explosions09, what's your opinion? Comment below:

I was one of the people who didn't get a banking job straight out of UG and it took me about 8 months to finally land a full time. I was about to quit looking for a banking job when I finally landed my role, so there's probably tons of kids who want to do banking but don't get a job after they graduate and just start looking for other jobs. Especially kids who are in tough financial situations/have to start paying back student loans.

Quick question, how did you lateral from a boutique to BB? And how long did you stay at the boutique before you moved on.

Array
  • 1
Mar 26, 2014 - 8:56pm
LACconsultant, what's your opinion? Comment below:

I'm in this situation! Graduating under 2 months from now and unable to find a banking job so I'm just looking for internships in other fields. There's the pressure of being a first generation college who paid his way through college himself and still has a ton of student loans left to deal with. Maybe I'll just make friends with some bankers and do ib vicariously haha

Mar 31, 2014 - 10:46am
wangofett, what's your opinion? Comment below:

I had a friend from undergrad who worked on the same floor as my current group- he told me about the opening and I sent my stuff in. Even though I was at a boutique, I still had solid experience modeling/creating pitchbooks and my boutique had a 2 month training program for the other analysts that joined with me. (Note: small non-elite boutique but packed to the gills with Ivy grads)

I think it was different in my case because I would have been a great BB fall-recruiting candidate (Top target, 3.5+, solid leadership experience) but I chose another field when I left undergrad. That being said, I didn't qualify for fall-recruiting anymore because of my graduation date.

The master in the art of living makes little distinction between his work and his play. He simply pursues his vision of excellence at whatever he does, leaving others to decide whether he is working or playing. To him he is always doing both.
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Mar 31, 2014 - 10:51am
wangofett, what's your opinion? Comment below:
explosions09:

Quick question, how did you lateral from a boutique to BB? And how long did you stay at the boutique before you moved on.

I had a friend from undergrad who worked on the same floor as my current group- he told me about the opening and I sent my stuff in. Even though I was at a boutique, I still had solid experience modeling/creating pitchbooks and my boutique had a 2 month training program for the other analysts that joined with me. (Note: small non-elite boutique but packed to the gills with Ivy grads)

I think it was different in my case because I would have been a great BB fall-recruiting candidate (Top target, 3.5+, solid leadership experience) but I chose another field when I left undergrad. That being said, I didn't qualify for fall-recruiting anymore because of my graduation date. To answer your second question, I was at the boutique for about 8 months.

The master in the art of living makes little distinction between his work and his play. He simply pursues his vision of excellence at whatever he does, leaving others to decide whether he is working or playing. To him he is always doing both.
  • 2
Mar 26, 2014 - 10:06am
FinanceWizKid1000, what's your opinion? Comment below:

I have wondered about this topic when I looking to break in. As someone who broke into the industry at two different levels (SA and FT), I would agree with other commentators that people who truly invest the time in networking and being diligent for interviews eventually break in. The caveat is that it can be really time consuming and frustrating going through the recruiting process, which leads a lot of people to settle with something else (which is perfectly fine).

Best Response
Mar 26, 2014 - 6:25pm
CaR, what's your opinion? Comment below:

As a state schooler, I have witnessed many situations pertinent to this topic, and I've found that most are related to misconceptions of banking and readjusted post-graduation career aspirations.

Unless you're one of those kids who comes from a finance family, the majority of students don't have the slightest idea what the fuck an investment bank is; they see Boiler Room, hear names like Goldman Sachs and Morgan Stanley get tossed around, hear about the long work hours and huge paychecks, and probably think investment bankers trade stocks. All they know is that investment bankers make big money, so that's what they need to do. For whatever reason - be it grades, lack of industry knowledge/internships - they don't get that FT offer upon graduation, and settle for an alternate position they think might be related (financial analysis, operations, etc).

Some of these people continue trying to climb in; they'll sit for CFA exams, email everyone they can find, all the while working their 9-5 they're so ashamed to tell their WSO friends about. Some eventually get their break, but far more often than not they take a different career path. I think there are a couple reason for this:

1) Disillusionment. I think for a great number of people, the mystique and allure of banking quickly wears off post-graduation when they aren't competing with their classmates day in and out. Maybe they see their friends who work banking jobs, and decide they simply couldn't commit to the hours and grind of the job. Or maybe (like me) they worked a banking internship and decided they had little to no interest in pursuing it as a career.

2) Complacency. Many of my friends that didn't break into finance were simply okay with whatever role they ended up in. Most weren't the type of kids who would have succeeded/excelled in banking anyway. Others simply don't care that much (probably hard for many of you to believe).

3) Discovery of Alternatives. A couple of my highest paid buddies are kids who thought they wanted to break into banking senior year after hearing everybody talk it up so much, but instead landed in some other realm of finance (more often energy or real estate though). People get hyped on banking for the money, prestige, and branding - if you say otherwise, you're a self righteous, lying fuck. A lot of people discover that the same - or often more - money can be made in other places, and refocus their efforts thusly.

In short: there are an infinite number of viable career paths out there, and when people discover investment banking isn't the only way to make money, they often adapt new values and pursue new paths.

Mar 27, 2014 - 1:51am
MonkeyWrench, what's your opinion? Comment below:

I agree with a lot of what CaR said. There are a lot of professions where you have the potential to make more money earlier on than in IB, but they are a lot riskier. I think your comment would be better worded 'Where is there more money to be made in a relatively risk free manner, where the main opportunity cost is your time?' (this is assuming you break in, obviously).

"Who am I? I'm the guy that does his job. You must be the other guy."
  • 2
Mar 27, 2014 - 9:59am
CaR, what's your opinion? Comment below:

My best friend growing up sells residential home loans at Ideal Home Loans. He made more than $200k his second year. One of my other best friends sells ETFs and unit investment trusts for a big portfolio manager in Chi- he made more than $115k his first year, and surely significantly more than that his second. Never left work after 6. Another one sells industrial lighting and makes an easy $100k. Meritocratic environments yield far higher salaries (especially after tax) for those who are intelligent and work hard. Don't want to shatter your world/dorm room here, but it's almost as if being good with people is more important than knowing to add back the depreciation

Mar 28, 2014 - 2:51am
alargefox, what's your opinion? Comment below:

Couldn't agree with you more here man. Fellow state-schooler and while I haven't worked in IB, I'll going into a role that gets shit on a lot on these forums. I don't disagree with views on the role, but honestly the things I value right now are hitting the gym 3-4 times a week, hanging with friends, girls, and sleep. I'm perfectly content with working 40-50 hours a week and being able to check out at the end of the day/week and enjoy my weekends. When interning over the summer, I definitely had a glorified idea of finance (which I'm sure still exists in a few places), but nothing like what Lehman or similar cultures used to be like (from reading various books). A job is a job. You're getting compensated for your time that can be used as a means of exchange for bigger and better things.

I have nothing but respect for people who are truly passionate about their roles and what they do. However, sometimes I really do wonder about what some people on here are like in "real life". I'm content with hanging with the friends I've made over the summer and meeting the new analyst class at my workplace, enjoying my "free time", and sticking around for a year while I figure out what the hell it is that I really want to do in life. Regardless, there's always the option to reset by shooting for a top 15 MBA down the road...

Mar 27, 2014 - 12:56am
zeroblued, what's your opinion? Comment below:

A lot of people I saw didn't make it...there's only so many spots... let's say 1 in 10 of the people I saw at super days.

And you do banking for the exit opportunities...not to be in banking forever (well, most). If you don't get into banking at a good firm as an analyst, you typically miss the train for top PE and HF shops... which some strive for. (not necessarily a good or bad thing, just is what it is).

sure, you there are always other ways. but the chances go from 20% to like 2-3% breaking in the tough route. Harsh truth. Understand that analysts typically don't stay and are considered cream of the crop...just how headhunters work.

Mar 27, 2014 - 12:02pm
Ballstein-FG, what's your opinion? Comment below:

With my academic profile, it would be impossible to get into IB. However, I was able to get an SA position with a BB's commercial banking group in a specialized industry. I am more than excited about this because of the company I will be with, and the possibility to lateral within the company. I know for sure my office works with investment bankers so I'll have exposure to that. But right now with my personality and desires for work life balance, commercial banking is more than a dream come true for me, especially as I had no other immediate prospects.

Mar 28, 2014 - 4:10pm
DoubleBottomLine, what's your opinion? Comment below:

Entirely depends on how low you're willing to go. Plenty of target kids are only interested in BBs/elite boutiques and recruit exclusively for them. In fact, shitty IBs don't even show up at target schools for them to be an option. If a target kid strikes out with BBs/EBs then he's usually shit out of luck. Such a kid won't start cold-calling random boutiques, he'll probably look at jobs in different industries.

But if one's goal is to work in some kind of IB role at all costs, I'd say it's pretty hard to come up empty handed if you have at least a 3.0 and attend a school whose name people have at least heard of. It might end up being an unheard-of regional lower middle market boutique but you will get an IB job if you have no standards. In fact, plenty of people that have sub-3.0s or attend no-name schools end up getting IB or IB-esque jobs every year.

Mar 30, 2014 - 3:30am
Working9-5, what's your opinion? Comment below:

I know plenty of guys I went to school with that never got their foot in the door. A few of them are still trying and have been working in related fields just to pay rent. Some are 5+ years out of UG (graduated during the crisis or just before and got let go).

CNBC sucks

"This financial crisis is worse than a divorce. I've lost all my money, but the wife is still here." - Client after getting blown up

Mar 31, 2014 - 12:05am
Bretton Woods, what's your opinion? Comment below:

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Apr 2, 2014 - 1:06am
aempirei, what's your opinion? Comment below:

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My name is Nicky, but you can call me Dre.
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