What is so hard about investment banking recruitment?
Is it networking, technical prep, luck? In theory, the pathway to investment banking and other roles has been paved and refined yet there are endless threads with the same questions and concerns year after year (Yes I know I am contributing too).
Those of you who have been through this process what is something you would tell your college self? Are there tools you that you wish you had access to or leveraged while recruiting?
For context I am rising sophomore at a Canadian school just beginning my recruitment journey, and although I could list off a number of reasons why it has or will be challenging I wanted to hear from a the great people of WSO.
Several factors. Firstly, like you said, it is easy. And bc it’s so easy esp now with so many widespread guides and toolkits out there, the barriers to entry historically reserved for a few are now available to everyone. This isn’t a bad thing since it allows a much wider range of candidates but also increases the difficulty.
Secondly, reduced demand. The main theme for nearly all firms in the past few years has been do more with less. This sucks both on the internship hunting phase and the return phase bc you can imagine not only the difficulty to get into an internship class but difficulty of getting into one with headcount. This also creates an overflow of overqualified juniors similar to the uk with like 4 FO internships to guarantee breaking in.
That right there is a heightened supply with reduced demand.
Additionally on the supply side, the CAD economy has gone to such shit that many feel like “high-finance” is the only reliable path to semi-upper middle class. Pre GFC, being in IB was almost like a golden ticket to generational wealth it seemed whereas now it means you can afford a small apartment and get guac at chipotle. This state of the economy has pushed that many more people who’d usually “settle” for a chill job recognizing the grind they must put in to be semi-successful
TLDR: Supply up, demand down
Interesting, so you think both internal and external factors are the greatest contributor to recruiting becoming more difficult as well as finding full-time employment. Although resources have gone up arent the winners of yesterday still generally the winners of today? Individuals who come from affluent backgrounds or have the right signal in terms of school or internships still eat.
If Investment Banking isn't really what it used to be why is it that more and more people are recruiting for it every year. Are all of us college students a little delusional in hoping that there is a path and this is the space we need to be in to thrive?
Do you think there is a way out or is this just a natural consequence of the system that we live in?
Yes, if you come from money/are nepo, what was historically easy for you should overall still be easier for you just with a bit more competition and a bit less allowance for stupidity (I've seen nepo's still not get RO's because they were so ass). I'm too young to be seriously weighing in on this but I've heard that in previous generations, breaking into IB was as simple as knowing what IB was. Think, if your school didn't have any connections and no one in your close circle was in IB, how in the world would you know you had to apply up to 12 months before you would even start working.
Compared to now, let's look at 15 years ago. Things like the BIWS guide were just coming out and being able to walk through a DCF and knowing the 3 valuation methods almost made you a superstar in your own regard bc easily accesible info had only just begun to come out.
Now let's look at today, everyone from Harvard MBA's to your most untarget of untargets has at least heard of IB and is gunning for it when there are less spots than ever and more info than ever. You can only perfect walking through a DCF so much and this has also led to some stupid level of interviewing where firms can ask basically anything bc they need a differentiator.
In terms of why do people still want to go into it, I'd say 2 factors. #1, at least for me while the work itself might not always be the most interesting, the results are pretty cool. Even if I might not be as well compensated as a techie, I'd always choose to say "I worked on that deal or IPO" over, "I wrote the code that powered that". Different strokes for different folks.
The 2nd factor is while a rising tide lifts all boats, a falling tide does the same where nearly every industry right now is trying to make do with less people. Look at tech over the past decade. At one point if you graduated in CS you were set for life whereas now gender studies majors might have higher employment. So either way you have to pick your struggle.
People need to accept that it’s hard to make money and things change over time.
crapshoot & black box unless well connected
I will also say definitely varies top bank yes I would assume you need to be virtually perfect
It’s only hard if it’s your end all be all. Where do you want it to take you? Do you want to be a lifer at the firm? Is it truly a critical step?
One thing you realize as your career progressed and are established is going into interviews without caring too much is important. After your first job it’s not a game of super days anymore, at least wasn’t for me. And if it was I’d view as a red flag for the firm knowing not what to ask.
Another thing is the questions do become higher level and generally focused on cultural fit and to some degree work ethic. With real experience you will be able to demonstrate technical proficiency within your answer without singing a song about how a transaction flows through the financial statements.
Also, stop using ‘rising _____’ or ‘incoming _____’ it reads as being highly narcissistic.
I've found it to be just a numbers game. I sent out probably 100 cold emails with my resume. I'm at a non-target school, but I have good grades. Got like 8 interviews and one offer.
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