Guide to Lateraling in 2021

Hey everyone - I've browsed through this forum for years, and finally thought it was time to give back and help out with what I've found to be one of the most confusing, unpredictable processes ever - lateraling. As someone who just successfully wrapped up a months-long lateral search, I've found WSO forums to be super outdated (especially now with COVID) and often just blatantly wrong. At the same time, it seems like the market for laterals has never been hotter. So, I wanted to use this post as a way to help prospective laterals learn 1) what these processes often look like today and 2) how to best navigate lateral processes to come out with the best offers. Hope people find this helpful - don't hesitate to ask questions in the comment sections and I'll try my best to respond!

My Context / Timeline

I graduated from a target (which definitely helped get foot in the door during lots of processes), and was working at a non-IB front office role. Don't want to give too much info beyond that, but I was in a role that was looked upon equally as favorably as other IB Analysts. For full transparency, I was super selective in my lateral process, which brings me to my first big tip - create a list of firms/groups you'd be willing to take before you start recruiting. I had about 10-15 very specific groups in mind that I targeted, based on a combination of factors like deal flow, firm reputation, exits, etc. This is because I really felt the switching cost associated with moving was too high to take an offer I wasn't super excited about.

As for my motivations for lateraling, it came down to the learning experience. I generally wanted a broader / more generalist experience than what I was getting at my old firm. Again, can't get into too many details here, but note that everybody's motivations are different for lateraling - as long as you can convey them clearly to interviewers you'll be fine.

I knew I wanted to lateral for a while, and set a specific date where I'd start testing the waters and putting myself into processes. I started sending out networking emails in Week 1 (~30-50 emails total, again being super selective here), was involved in a variety of early-stage interview processes (ALL of which came through networking) from weeks 3-8, did a bunch of modeling tests around Weeks 8-10, and had my superdays / offers come through around Weeks 11-14. I also applied online to about 30 different roles (was only interested in about 5 of them, the rest was just for shits and giggles) - literally heard back from none of these. 

In total, I actively reached out to about 20 groups (14 cold emails, 5 distant connections I rekindled, and 1 close connection). Of these, 15 or so got back to me and had some form of intro informational calls (keep reading to see how I got such an insanely high response rate - I was suprised too tbh), 7 of these amounted to first-round interviews at some point over the next 2-3 months, I got to the superday stage at 5 of them, and ended up with 3 offers, 2 post-superday rejections, and 1 process I dropped right before the superday.  

Processes at Different Firms

I've (somewhat) anonymized firm info below, but found the process to be drastically different at different firms. Again, I was super selective with my interviews so assume the more "top-tier" echelon of banks apply to the below.

EB #1 - specific industry group:  Got into the process from a referral with a person I networked with, though they also posted the job online. Had 1 behavioral phone screen with an Analyst, 1 difficult technical screen with an Associate, then a modeling test followed by a 2-3 hour superday with the rest of the team. The modeling test was done at the same time at the superday, and I think this is what dinged me - just didn't prep enough. Was an LBO, DCF, and some other shit all in 1 hour.

EB #2 - specific industry group / geography: Also a difficult process, but less structured. Pure referral through networking, no online posting. Had about 10 individual phone calls, 5 of which were super technical, 3 were somewhat technical. Also a challenging modeling test somewhere in there. Didn't end up going with this offer due to personal reasons / geography.

EB #3 - specific geography: No online posting, referral through networking got me into the process. A couple of first-rounds then a modeling test. Got dinged after the modeling test - honestly was super easy, I was just exhausted that day and made some stupid mistakes. Didn't care too much for this group either so that probably played a role too lol

EB #4: Ended up taking an offer here. Got in the process through a networking referral, again the job wasn't posted publicly. About 8-10 phone calls total, and there was a modeling test + technical non-modeling test mixed in there. They never asked me a technical question in a call which was great since I tend to choke on those, but the calls were focused largely on fit and general resume/deal questions

BB #1 (hint: it's Goldman Sachs): I'm gonna call out GS here since their lateral process is an absolute fucking mess. Got into the process through networking (again, no posting) and was invited to a Hirevue. Did the Hirevue, then got emailed 4 weeks later asking to do the exact same Hirevue again (lmao). Did it again, then got notified at 8pm on a Wednesday that I have a superday the following morning. Superday was three 20-minute behavioral calls and I still haven't heard back even though it's been 2 months. The entire firm seems to be ghosting me. The problem with GS's system is that they run their lateral IBD process as part of "Early Careers", which also encapsulates like Ops and Accounting shit across the country, so you've got these three overworked people in like Salt Lake City trying to coordinate literally every experienced hire process across the country ranging from IBD laterals in NYC to 35-year-olds looking to get into Compliance in Phoenix. Just a fucking disaster of a system - beware if you try to lateral here

BB #2 - specific industry group: Reached out asking to network, immediately got put into a process, had a total of 4 calls (only slightly technical) and got a verbal offer within a week of that first email. This group seemed to be insanely desperate to bring in laterals, but I didn't really vibe with the people I met there and have heard horror stories about the culture so decided to turn it down.

BB #3 - specific industry group: Noticed there was a posting online so emailed to network, got into the process but dropped before the superday after accepting my other offer. Like the other BB processes, wasn't technical at all and no mention of a modeling test

General Tips & Advice for Lateraling

While no two peoples' lateral experiences will be the same, below are some general things I discovered along the way which I found to be super crucial.

1. Network, Network, Network

I don't care what anyone else says - networking is the only way to have a successful lateral process. The only difference between networking for laterals vs. FT is that you need to place a bigger focus on making meaningful connections (i.e. ask interesting questions, be super engaged, follow up a lot) with people who can pull for you. It's essential to note that lots of one-off lateral openings don't get posted online. Why would firms deal with the hassle of setting up a Workday posting, screening hundreds of resumes, etc. for a single opening when they can just tap into the pool of connections their employees already have?

Of the ~10 processes I was properly involved in, I got into every single one of them through networking. I did a ton of applying online as well, but literally none of those applications amounted to anything. The reason is that online postings for most firms' lateral positions are literally just compliance protocols so that the people who get an offer through an informal referral can get set up into the firm's HCM system. Not making this up - I was often asked to apply online AFTER I got the offer or the superday at some firms, just for compliance reasons. 

I'd networked a ton for SA/FT as well, but came into this process with a different strategy. I reached out to a total of ~30 people in total, mainly across disparate groups, and had an email response rate of ~75%. I know, I was shocked too. I got this by networking with people who had lateraled to the groups I was interested in or people who are from less traditional backgrounds. I knew the dude from Harvard who interned at a tiger cub sophomore summer and then did an SA -> FT stint at the bank I was interested in had 0 chance of responding to me, but the guy from a semi-target who started off in a less traditional role and lateraled is more likely to empathize with my position and give me the time of day. More importantly, these people are more likely to actually help you out during the process / refer you, since they genuinely understand where you're coming from and know what it takes to lateral. Also, try to network with Associates instead of Analysts if looking for an Analyst role, since often Associates are the ones running point on the processes and can loop you right into the process if they like you. 

Final tip on networking - follow up, a lot. Lateral roles tend to just pop up out of nowhere, so there's no shame in checking in with connections every couple of months. Doing this out of the blue actually got me into 3 of the processes I was in.

2. Know Your Reason for Moving, and Know it Cold

You are going to get grilled on why you want to make a move. This is the critical question for laterals, both when you're networking and interviewing with anybody from Analysts up to Partners. Have a very clear, concise reason for lateraling written out verbatim - soon, it will become second nature. And be prepared to answer any questions that might come up, making sure there are no holes in your story. 

The standard "oh I'm at a bank with bad deal flow and want to go to a top-tier bank to do bigger and cooler shit" reason isn't often gonna cut it. Geography/Industry are also common ones, and can be compelling in some cases but often just fall flat if not backed up enough. Come up with something creative that you can back up effortlessly and defend to death. Don't lie, just try to give a nuanced, well-reasoned illustration of your reasoning that nobody will bother arguing with.

3. Become a Technical God

Banks don't want a lateral to come in and spend 4 weeks ramping up and training just to barely scrape by for their first year. They want an Analyst who is better than their current Analysts and can hit the ground running. Doesn't matter if you haven't touched a model since starting your FT gig - you better start learning. I really like the WSP modeling courses and found that plus Macabacus and BIWS guides to be the most helpful for both modeling tests and technical Qs. At EBs especially, technicals are going to be hard and won't be coming from the guides. Spend as much free time as you have going through modeling tests, reviewing any concept you're not 100% confident in, and make sure you truly understand all the standard technicals and beyond. This isn't a "bonus" for lateraling, it's an absolute necessity. Technicals were always my weakest point in recruiting, but I dedicated a couple months of my life to perfecting this shit and it thankfully paid off.

4. Demand > Supply (at least in 2021)

There has truly never been a better time to lateral. People are moving around all over the place, nobody seems to enjoy remote work, and Analysts are quitting at alarming rates. Banks have also realized that driving Analysts to literal depression in their childhood bedrooms isn't a great approach, so are looking to bulk up Analyst classes. There are jobs appearing left and right, you just need to make sure you position yourself through networking and technical prep such that when an opening does come up, you'll be first in line to get an interview and will be prepared to crush it.

5. Trust the Process

I resonate with the feeling of wanting nothing more than to leave a role you're in to join a new firm. It sucks. It often feels like you're trapped - your quality of work starts declining, you become impatient with your processes, and motivation just starts to sink. In most people's lateraling journey, there will definitely be a point where you start to consider if it's even worth all the effort.

The key here comes back to Tip #2 - know your reason, and stick to it. Stay committed, keep reviewing technicals every week, make sure your modeling skills stay flawless, and don't stop networking / following up with connections. Sometimes, it's the leads and opportunities you least expect to work out which end up pulling through at the point where all hope seems lost.

Hope everyone finds this helpful! Lateraling can be a grind and certainly isn't as formulaic as SA/FT recruiting, but there's no reason you shouldn't be able to pull it off!