How is Goldman able to get good candidates???

While their general applications open extremely late, majority of candidates that get in go through accelerated process such as Possibilities Summit, Insight Day, Emerging Leader Series, winning their Case Competitions, and others. 

As for their SD, it is indeed 3 20min interviews that are largely if not completely behavioural. One might (rightly) argue that this is a poor method to judge a candidate holistically and thoroughly, but they are Goldman so who knows; interviewers are probably highly trained and adept at spotting promising candidates or something along those lines. 

Shining beacon of finance etc 

easy picking of lateral candidates as you get more senior in your career and realize the brand equity matters

edit

They don’t, they get the worst kids. It’s kinda hilarious

While this may seem hard to believe, GS behavioral questions are leagues ahead of other banks in terms of difficulty. It’s not “Tell me about your strengths and weaknesses” it’s a combination of very specific questions regarding your past and business situational scenarios that you have to give your solution to. It requires quick critical thinking and the ability to articulate complex solutions with 0 notice. If it sounds like I’m shilling for GS, I’m not. I despised their interviews because of how difficult it was, but understand GS is GS and they have to maintain a standard.

Most junior talent is very similar across the street. The main difference is from seniors so my point Is that GS isn’t getting the best candidates, they get normal candidates like every other bank.

I'd say they get some of the absolute strongest on the street but also so of the absolute worst (mostly nepotism). Friends there in 4 different group have said the bottom 3rd of analyst are generally just very well connected and awful analysts but still get to GS and decent bonuses becuase you don't want to piss off their daddy and have them take their business elsewhere. To be fair, every bank has this to some degree but hear its really bad at GS.

Goldman’s reputation enables the company to convert a higher % of those it extends offers to. Whether that translates to them having the best analysts is a much more difficult question to answer. The reality is that one’s resume still plays a very significant role in the decision on which candidates they give offers. While 3x 20 minute behavioral interviews seem insignificant, they are really basing their decision on 60 minutes of interviews plus multiple years worth of academic performance + personal pursuits (or alternatively, who the person’s parents are). Whether this is the best methodology or not is hard to say.

I will say that it is very difficult to predict who is going to be a strong analyst even after 10+ hours of interviewing. The skills that make someone a successful analyst are hard to test in an interview setting or determine from a resume. How does someone perform on little to no sleep? Have they performed well academically because they are very bright or is it because they put in long hours to master the material? Until the analyst is in that live situation, no one really knows how they will perform. People who rely heavily on academic achievement for hiring decisions are betting that academics are the best predictor of performance. Other interviewers might make the decision based on the candidates grit or tenacity.

So is Goldman’s process ‘bad’? Hard to say. I would think they wouldn’t keep repeating it if it weren’t yielding good results, so it is probably working out well for them.

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When working there it wasn’t the candidates that were impressive. It was the shear amount of social pressure to be the best that was impressive.

To this day I can not believe a culture like that can exist. The thought of people literally crying about making mistakes sounds so stupid now but it was so common (but this is probably the same across banks to different degrees).

Place is truly a cult but unparalleled when looking to start a career.

By giving them jobs

Here’s the real answer, there’s two reasons:

• Candidates aren’t that different and IB isn’t that hard a job, so many people can do it.  Put another way, the difference between analysts at Jefferies and GS is more or less the same. From my experience, there is little correlation between prestige of bank and ability. The interviewing process is a crap shoot and because analysts aren’t revenue generating and their job is really being a process runner it doesn’t really matter if the analyst is 99th percentile intelligence or 80th percentile—both can be just as solid as analysts. Phrased another way, there’s a bar of intelligence analysts need, but once they pass that bar it doesn’t really matter. Also, that bar is pretty low. All else being equal, analysts might pick the evercores or GS’s over other banks, but from my experience the people I know who went to those banks aren’t smarter or better analysts, more often than not they just prepared earlier and were better at navigating the interviewing process or coming across as likeable. Which gets to the second point:
• Undergrads and new grads systematically overemphasize technicals not realizing how little they matter and how poor they are for effectively measuring future analyst ability. All they really do is asses some level of critical thinking and time spent preparing. But most of all they just test exposure to the concepts, which isn’t indicative of ability to learn on the fly which is a way way more important skill in IB. I’ve made this post before, but I think this point is really lost on undergrads and it really shines a light on why when people say diversity recruiting is easier and that they are weaker candidates it isn’t really always true. It’s also why banks continue to invest so heavily in diversity efforts—despite them not getting grilled on technicals as heavy, they aren’t really noticing a decrease in analyst quality. Every year, individuals go to investment banks and they come in with varying levels of finance understanding. By the end of analyst stint, the girls or diversity candidates aren’t all pooled together as weak candidates. Also, the kids who were the strongest at technicals and who came in ultra prepared aren’t always the best analysts at the end. Instead, what really matters is ability to learn on the fly, tolerate BS, navigate politics, and some natural skill at things like hyper attention to detail (this isn’t rocket science, it’s noticing things like missed periods and typos in documents). Once all analysts are on a level playing field working 100 hour weeks, the 100 hours some try hard prospect spent memorizing guide questions or doing a practice LBO really matters quite little. Instead, it is how people process information over the span of the next 9,000ish hours of their fulltime analyst stint that will determine really whether they are a “good high quality candidate or not”.
• Finally, the last point, post GS or post evercore, those analysts get a premium in the market for hiring, not necessarily because they are smarter, but instead because of their experience and deals they saw and environment they were in for two years. If your goal is facilitating mega-buyouts, there is no better experience than working on those mega-buyouts with people who have a very high standard of professionalism—that’s why people value those candidates.

Others might disagree, but take it from someone who recruited 5 years ago and saw analysts onboard to their bank and has seen kids recruit, good analysts are everywhere because the interviewing process is very imperfect and technicals can help measure exposure to concepts, effort, and some critical thinking ability, but the kids who are the most prepared at the start of analyst stint are 100% no the kids who usually are top bucket at the end of a stint.