I am currently a 1st-year MBA student entering IB. I know that the normal exits are some buy-side, corp dev, and corp strategy, but I wanted to see what else was out there. If you worked in IB and exited to another role or industry, please post where you are now in the following format:
Year you left: Ex. 2nd year associate
Role you left for:
Comp:
Current Role:
Current Comp:
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Curious about this as well - I know associates are expected to stay on as career bankers for the most part, but I assume lots still leave.
There are not many post-MBA associates on the forum I've noticed, but the stat I've heard is: for every 5 associates, only 1 will make it to MD (generally speaking, not necessarily at the firm they started with). Remember it's not the associate who is a modeling whiz who becomes an MD, but the one who is the best sales person who makes it to the top. Most people hate sales.
On average, at the 2 year mark there is a mass exodus of each associate class.
Purely anecdotal, but if I had to toss percentages on it it'd be:
Exit to corporate or startup finance/strategy role: 55%
Exit to trade up to another higher ranked firm (GS/MS/JPM) or EB: 20%
Exit to another same/lower tier bank for a VP role (done closer to their 3rd year): 10%
Exit to PE as a senior associate (it will NOT be top tier PE, typically MM PE): 10%
Stay with their current firm and group or possibly switching groups: 5%
Again, this is my best guess breakdown from conversations with peers. I have heard a mix of advice about when you jump ship. If you're targeting PE best to leave once year 1 is done because you'll be joining as a senior associate. I know some who either were about to get the VP promote or were VPs for a few weeks, bonus cleared and they bounced for another firm. You can find the base salary info for these roles all over this forum or google. Bonuses are going to be out of whack this year and for years to come. As the saying goes: your bonus is keeping your job.
Work on getting your return offer first and foremost. In this climate who knows how things will play out from an offer rate perspective, but the things in your control are: a great attitude, never complaining and being reliable.
All the best!
Good analysis. In my experience, I see this at 50%, 15%, 15%, 10%, 10% with some modifications to your categories:
Exit to what you mentioned + other professional roles and own / family business. Not everyone stays in a role that utilises their skills sets. You’d be surprised where some of your peers end up
Lower tier firm and not always in same product or group, sometimes as VP, sometimes at the same associate level for various reasons
Investments funds where PE would be the majority but see SWFs, credit, long only and family offices too.
Including non-IB roles. Corporate banking, internal strategy, markets, COO office etc.
Thanks for posting this. Have always been curious. Upcoming MBA intern here, and nervous about return offer rates.
What might be other options for full-time that could potentially set me up for a lateral into IB later? At what level of boutique bank would it be better to take a corp dev job at a "name brand"?
Also--one alum shared internal data for his BB (Citi/BAML) and he said between 20-25% make VP out of each associate class. Pretty nuts.
Im just an intern so dont listen to me too much, but I would question how many of those associates leave IB before VP by choice.
Speaking from experiene, most/all of them. Associates tend to become (almost) as jaded as anlysts in an equivalent amount of time. Out of the three associate classes I interacted with in my banking years, I believe there are a total of 4 still in my old group. All the others (class size averaged around 12-15) left very voluntarily.
Most them. In my associate class at GS / MS / JP, we had one person get outright fired after year 1, and a few people at the end of year 2 (less than 5). We started with 30 or so. Everyone else who left left by choice, because banking sucks. By the end of year 2, maybe half the class was still around.
Time with a name brand investment bank, regardless of tier, as well as corporate development opportunities at F500/F1000 will help with lateraling.
Reminder. The goal is to break into banking. Second best option is to get comparable technical experience such as corporate development.
Good luck!
Left in the middle of my 3rd year. By 2nd year I realized IB isn't for me. Exited to a CorpDev role.
in terms of comps did you take a pay cut and if so, how significant was it?
They gave me a good hike on the base salary (25-30%), but the bonuses were far lower. Overall comp was lesser compared to if I had stayed on in IB, but the stress/hours/BS work was also much lower.
I hear mixed messages on buyside after being a post-MBA associate. If I'm starting my MBA this fall coming from a strategy consulting background, and my goal is PE/other buyside but I'm comfortable with doing IB first, do I have any real shot at IB->PE, or is it unrealistic? If 10% ended up making the jump to PE, did only 20-25% want that and half were successful, or do most people go for that? I've also heard it's best to make that jump at VP/D, but someone here said 1st year associate is best--which is better generally? And if I get to GS/MS/JPM/even CS or BarCap, is that much better than say EVR/Moelis/CVP other EB?
I think you're overthinking things a bit here. The percentages shared earlier were just anecdotal. Focus on what you can do right now:
Of course during your first and second year do all of the banking, PE, VC competitions- there is at least 1 of each that MBAs from across the Top30 compete in. Network hard there to lay the ground work for opportunities and connections.
Especially as an MBA, your recruiting path is guided more by network than an analyst. Remember the biggest takeaway from your MBA is the network with your peers and companies. Everything after your first role out of business school is essentially built on that.
Good luck with first year recruiting!
This is all 100% correct. Let's not split hairs on "which is better, EVR / Barcap / GS / JP etc etc" until you have all those offers in hand. Just focus first on getting a great offer for a summer internship.
I've posted stats on my associate class from MS before. Most left and went to tech/startup/corporate. Very few moved over to PE and HF. The remaining few are all MDs now at MS or other equivalent banks. My advice would be not to do banking if your goal is to break into PE and HF. The people who made the transition usually had strong connections or were not your "typical" associate.
yeah it’s tough to make the buyside transition when you’re old and not an analyst anymore. best bet is you’ll go into an industry specific PE shop that’s the same as your group coverage
Would you say it’s a little easier if you’re in an M&A group vs. industry coverage? Would it be better to try to recruit for the buyside 1 or 2 years into post-MBA associate role vs right before VP promote?
6 years out. Think only 25% of my MBA and group (not bank) start class are still doing banking. Only one person still at same bank at MBA level. Rest shuffled around - mostly to EBs. Most are doing some form of Corp fin, M&A, Corp dev or even a little PWM
No PE? Do you know if anyone tried to go to PE and struck out? Or was it not of interest? Thanks
Someone in my class I think is in a family fund type place. Not happy w comp. it’s way worse than banking. Ppl I know younger than me - know couple in smaller HF or one actually a brand name PE (not sure how he did it - was pretty bad academically. Maybe personal connection / certain group).
PE/HF is pretty saturated now to go there from banking at junior / mid level. Or as others said no one asks you.
Very senior level - does happen. There are some HC partners at CD&R, Centerbridge and LGP who moves from banking in last 3-5 years. But it’s still pretty rare.
I think a fair number of people want to go to PE, but it’s an uphill battle, plus you have limited time for the tough, self-directed recruiting process when you’re working grueling hours. The ones that strike out don’t tell you they went for it and struck out
Does the exits change depending on the bank? Like if you went to GS post-MBA, would your exits be better? Or EB for that matter? Also does age have impact on PE recruiting? If I'm 26 exiting my MBA and do one year of IB wouldn't my recruiting be similar for any person going into PE because I'm only 27?
Also interested
Bank quality matters - GS/MS/a solid elite boutique is going to get better looks than another firm, but since it's so random and sporadic at this level your personal network is going to help much more.
On the other point, your age isn't really the issue here--it's the fact you have an MBA. PE firms are pyramids and rely on a constant churn of associates with no long-term future at the firm to handle the day to day deal execution. Business school gives them a convenient reason to kick them out every couple of years before they get too expensive. Once you already have an MBA they can't hire you for a basic associate position any more and aren't willing to give a post-MBA position (which should include carry) to an unproven commodity.
That makes sense on both fronts, I guess I assumed it would be possible to transition to a basic associate role if you had only one year of IB experience under your belt. Is this the case across all verticals? I'm in RE and would be interested in REIB, but ultimately want to do REPE which is less structured in what they look for in their juniors. Curious if you could cross to REPE more easily?
Wait, I'm confused. If PE firms kick out associates so that they get an MBA, but are reluctant to hire folks after they get MBAs... how does one become a partner at a PE firm and get the coveted carry?
What’s to stop someone with an MBA from joining at the basic associate level? If you want to be in the industry badly enough, wouldn’t you be willing to take any job that got you there?
Stop guys! What are you doing? You are scaring away all of the prospects!
What do you mean they won’t make MD or go MF PE, and be a bsd. that’s their prophecy!!
It’s true. That’s what business schools and IB recruiting teams sell you on, and it’s almost entirely garbage. The exit opps out of banking at the associate level are way worse than you think they’re gonna be
Is a stint as a post-MBA IB associate necessary to pivot into the desirable F500 corp fin/corp dev roles? I'm entering MBA business schools">M7 this year and debating IB recruiting vs. going directly to F500 corp fin. Do the benefits of the 2 year stint in IB outweigh the supposed misery?
Going straight to an FLDP at a F500 (with a rotation through corp dev) is 100% attainable post-MBA. Went to a non MBA business schools">M7 and we send tons of students to Amazon's FLDP every year who have no IB / cap markets experience. Also, transitioning into corp fin at a F500 after a couple years of IB is very attainable.
Would say the main differences are 1) whether you have the IB badge of honor on your resume (advantage IB) 2) much higher comp for 2 years which can help with student loans (advantage IB) 3) a less well-rounded, but more intense, finance experience in doing 2 years of IB vs. an FLDP where you rotate through 4 departments in those 2 years, building a strong network in the firm, and knowing that particular F500 company inside out (advantage Corp Fin)
Could I exit banking after my analyst stint to a F100 FLDP? If so, would I join the same program as the MBA grads or have to completely restart and join undergrad college graduates?
+1 totally agree with this. As a MBA student now, I've grown to realize how accurate this is. Personally know an alum at my school that went from MM IB summer (w/ a return offer) --> F500 FLDP FT. Has no regret in his decision.
Similar logic with strategy consulting vs. going straight to industry via an LDP.
Can anyone dish why a person would want to do an post-MBA associate role, just so we can get a full picture?
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I’d argue depends, considering where we are now with Covid, it might not be the worst to go IB if PE off-cycle isn’t active. My program ends in August so I’m done at an odd time.
It's all about perspective. To the college student with a 3.9 who focuses super hard on their schoolwork instead of being a frat-star and partying non-stop during undergrad, the idea of a post MBA associate seems stupid. "Why wouldn't you just go into IB right out of undergrad?"
But to the guy who partied in undergrad, squeaked by with a 3.0 and minimal effort, and didn't even know about this world where 20 year olds spend every day pursuing a highly coveted job at an investment bank, IB was never an option. Usually post-MBA associates realized they wanted to work in high finance after a couple years in the workforce, so getting an MBA and breaking into the industry is appealing.
If you like nerding out in finance and markets then IB is the only post-MBA job that gives you that and has a formal recruiting process (HF & PE recruiting is very informal / network driven at B school)... although being a junior banker comes with a lot of BS too.
That makes sense, I went to a non-target, then I moved to EU and did REPE, and want to continue in the US. I’ve considered REIB if I got into a BB/EB so I had a brand that US firms would recognize, but I’m not sure its worth it or not. I’ve been networking hard, have some calls this week with MF MDs, but not many are hiring.
Well said!
I wouldn't say nerding out in markets means you want to do IB but probably S&T. I wonder how many post-MBAs do S&T...
It's pretty tough to get an IB job if you come from a non-target with a low GPA and back-office positions, MBA from a top school allows you to reset and start with a new reputation.
2nd year IBD associate (but not from MBA) credit hedge fund $350k same role $400k
How was it being recruited?
would’ve been a lot easier if I had recruited when I was an analyst that’s for sure. same headhunters and stuff but just wrangling them to be as responsive and getting opportunities. the older you get the harder it becomes.
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