Math PhD to IB (M&A)
I am in a rather unique situation in that in a few months I will get a PhD in math from a top UK institution (think Oxbridge), but I don't want to go down the academic career nor I want to get a quant job. I want to make a drastic change in my life and start a career in IB (M&A). Any advice on how to get there? My academic credentials should be good (4.0/4.0 gpa in undergrad and master's, and top PhD in maths), but I am already 29 and have no relevant work experience (apart from teaching maths to undergrads).
I am thinking of two possible paths:
1) join a consulting firm (MBB) first for 2 years, then move to IB.
2) Try IB directly.
Questions:
In path 1), after 2 years as a consultant, will I need an MBA to make the move to IB, or will my PhD be enough?
In path 2), should I target analyst or associate positions? What are my chances at BB? Something in particular I should focus on to prepare for the interview?
Finally, in case I can make it to banking, what will my chances of moving to PE/HF look like after 2-3 years on the job, i.e. when I'll be around 33-34?
Many thanks to everyone who will take the time to answer, I am aware of being in a very atypical situation and appreciate your help a lot!
Imho your best bet is to do an MBA if you’re serious about moving to IB— I went to an M7 and there were a few PHD/MD types in my class. Non recruited for banking but I am sure you could. You don’t want to start as an analyst at 29 and I don’t think most firms would take you at that level.
But I def think the quant route would be significantly easier and pay you more, I think quite frankly it’s dumb to invest more time in school if that route is open to you. Probably not incredibly difficult to lateral to M&A once you’re in the industry at a respected firm but I could be wrong.
Thank you for the answer. Yes, I am definitely considering an MBA but I don't think I can get in without work experience.
For what concerns the quant route, my impression is that people overestimate the compensation and career prospects of those jobs a lot. They certainly pay well, but the top ones are extremely competitive (getting into Jane Street is imho considerably harder than getting into BlackStone) and in any case also top performers hit a glass ceiling pretty soon at about 500-600k (non-top performers at about 300k) with virtually no room for career progression after that.
I am 90% sure MBAs would count your research and teaching experience as professional experience at least in the USA
If we're going to talk about JS in particular, quant traders there start at ~600k and climb to low 7 figures within 3-5 years. At any of the notable prop shops it's reasonable for the median trader/quant to make 7 figures after 5-7 years. Even non alpha researcher quants at big funds make >500k.
OP, you’re in the UK and I assume you’re recruiting for the UK. Do not do an MBA, just apply directly to IB analyst programmes. They will snap you up with your background.
An MBA does not have nearly the amount of value nor anywhere near the amount of structured associate recruiting programmes in the UK compared to the USA. A lot of advice you’ll get here will be US-centric and won’t be quite as applicable to the UK.
Have you looked into quant consulting at MBB/B4? It has the mix of client interaction work that IB does and the math skills that you have.
Thanks for the suggestion. Do you know how much those jobs pay? One of the major reasons I want to switch to IB it's because it pays a lot and generally quite consistently (meaning you're not going to lose your job if you underperform for one or even more years, unlike in quant funds).
In the US MBB pays about $120k all-in out of undergrad. B4 pays around $100k all-in. Quantitative consulting is essentially a division within MBB consulting so I don’t believe pay materially differs from the classical management or strategy divisions. If you’re a PhD though you’d probably get hired at a higher level so the numbers above are conservative. The pay in consulting always staggers IB but you’ll still be very comfortable. You can certainly hit 7 figures in MBB as well if you make it to partner status.
Job security is extremely high because you build quantitative models for clients in various areas such as pricing and risk. Even if one firm blows up, you have many more that will look for services.
You are going to be so bored in IB. You don’t have to go quant but with your background I would at least take a look at sales and trading roles…
Well, if the tasks are menial and I can do the work with minimal mental commitment while still being paid 500k+ (after some years of we ofc) it would be just great, actually.
For what concerns trading roles in banks, I heard that they are dying due to regulations and don't pay nearly as well as they used to.
But you will be working considerably more hours.
Do what you want but as someone with a math background I was absolutely miserable working in corporate banking, which while not IB, has very similar tasks. You will be working long hours doing tasks which require no critical thinking. Not trying to discourage you but this is the reality.
Also the talk of S&T dying is incredibly played out on this forum and is largely perpetuated by undergrads that have never worked at a bank before. S&T is very much alive and people are still making very good money (especially for the hours). It is far more meritocratic and your quant skills will be far more in demand and useful. Make your own decisions but if you’re not going to start until 30, I would pick the job I’m going to like more, has less hours and allows me to move up quickly (IB does not do this).
you're in London, you're not hitting 500k until you make MD lol... and that's probably 15 years of experience.
Bro stop thinking about money. If you enjoy your job, you are likely to become good at it. If you are good at your job, you are likely to make a lot of money. Stop being myopic and do what you enjoy.
You're a math guy, so I'll put it into notation for you. What is P( you will enjoy IB | you are a maths PhD )?
I appreciate you commenting in this thread but I do not share your views neither on money nor on what it's needed to be successful on a job.
If you care to know my opinion, I think that money is actually the most important thing to consider when picking a job (together with wlb), that "passions" are mostly bullish*t meaning that what one is "passionate about" in 99% of cases has nothing noble or "intrinsic" to their character but it's just the result of the random events that have happened in their lives, and that the main factor that determines success on a job (a part from IQ) is motivation (and money, or actually what you can do with money, is an excellent source of motivation).
I’d wager that almost no one would put in the amount of effort necessary to truly go above and beyond, which is necessary to reach the outlier level of compensation, simply for the money. If you are saying passion is just caused by a series of random events, then are you implying that athletes, in another world, could’ve been a book worm? I think that’s impossible. I think passions are, to a great extent, determined genetically, but of course the specifics are determined by randomness.
Regardless of if you think passion is bullsh*t, picking something you’re passionate about is the best strategy since it not only guarantees that you’d enjoy it, but it will also give you the greatest possible return.
Let me assure you that chasing money will probably motivate you in the first 3 months of an IB job, but gradually thereafter you will rethink your career choices and wonder why you're still working during the weekends and Christmas on slides that will be omitted anyways. Sure, you can earn a shit load of money but what is your end goal? Just earning some quick bucks to buy real estate and then leave the industry for a job with better work life balance? I get that life is expensive in London and you want to enjoy the good life by travelling to Paris or Florence, having quality sex with a local cutie, and spend some pounds or euros on a Patek Philippe Nautilus watch, so that you don't have to worry about cost of living. But then what? Before you leave for your weekend trip to Florence you receive a forwarded email from your MD with an urgent RfP request or just plenty of work to review over the weekend. And unfortunately you have to work on it. Yeah, this happens in IB way more often than you might think.
Do whatever you want to do in your life. But be mindful that the grass is not always greener in IB.
I came from a very STEM-y background at a top uni as well. I'd urge you to consider other paths. Being the numerical and tangible person I am, I went for the job that had the highest number £££ on the offer letter. Can provide you reasons why IB might not suit people like us, but since your main question was on how to break into IB - here goes...
"MBB option" - no. Dont bother. Its rare that people move from MBB to IB, especially not after an MBA. Large number of lateral hires into IB junior roles are from big 4 audit / deal advisory / transaction services etc. It's not that consultants aren't able to break into IB (they definitely can) but there's not much reason to at that point. If they wanted money - straight to PE. If they wanted impact - to startups/non profit. If they wanted a better life - in house corporates. So if you're trying MBB just as a stepping stone to IB, dont. If you're trying MBB because you think consulting might suit you, definitely go for it. (most firms will recognise your PhD and give you a headstart over undergrads)
"Try IB directly" option - yes. Analyst position. Fresh PhD to Assoc not possible (not that i've heard of). I'd say chances at BB/MM/EB are the same as any other undergrad. I personally know of a few PhDs that recruited for IB (some successfully, some not). In fact I think they have a higher success rate than undergrads. The difficulty for you now is that you didnt go through the UK "pipeline" of springweeks and summers. So probably worth applying for summers/off cycles as opposed to full time directly as internships are usually an unspoken requirement. I'd also add that you should apply as wide as possible - given you're not a traditional candidate, you might have better luck at non-traditional shops (MM independent ones like Torch Baird etc). They are less well known but it gets your foot into the door, which you urgently need as you havent had the "pipeline".
Your point on age - does not matter. Just make sure that you show that you have the same level of energy as the starry eyed 21 year old BSc grads. Only reason age can be a downfall is if your interviewer / recruiter thinks that you have family commitments or you simply dont have the energy to sustain the analyst life. And wrt PE / HF - its a big world. BX / KKR / Apollo might not screen a 34 year old IB analyst but there are thousands of other great shops.
And regarding your conversations with others about doing an MBA just to get into IB - dont... You'll need 2+ years work experience for a good MBA, and 2 years of MBA. Thats 4 years just to break into IB - rather spend that time doing IB / finance internships and I'm 100% sure you'll get in one day (with proper IB experience less 200k MBA debt).
Thank you very much, I love this on point answer.
I have two further questions if you don't mind.
1) How about entering directly in PE after the PhD? Or for PE would it be better to spend 2 years in consulting and then try to move from there?
2) I would be curious to hear why you think that IB would a bad path for me.
1) Probably much much easier to do the 2 years IB / MBB route if you want to get into PE. Not many PE firms have inexperienced hires
2) Echo most of the points made by others. I used to think like you - focusing on money. But after awhile of doing IB and seeing your friends in other fields having a great life with less money, you'll realise your pursuit was not exactly the most rational. Also - there are much better ways to make money than IB. MDs at banks are nowhere as rich as successful founders / angel investors.
I think you're really overestimating how much IB pays in the UK...
I use the site Mergers&Inquisition as my main reference for compensations... Do you think it's not accurate?
Furthermore, I will be happy to move to the US.
Not a great source. In IBD you start out at around 100k but slow down really quickly in the UK. 7 figures as an MD isn't common here and a lot of MDs aren't moving past 400-600k gbp before tax. Bare in mind it takes 10-15 years to even become an MD.
Quant is a much better pathway to wealth here. You start out earning more at Jane street as a grad than you make total in 2-3 years at a bulge bracket bank
Also, can't really move to the US full time without a visa.
Why those as opposed to joining a quant fund? You'll make more money, skill sets closer to what you already have, and wlb is much better.
The problem I have with quant funds is that Ive got convinced (maybe mistakenly) that they are a place where only the best of the best of the best in terms of raw intelligence (eg gold winners at IMO) can succeed, while for "normal" PhD graduates, even at top programs, only crumbles are left. Furthermore Ive read quite a few people complaining about the lack of career progression and the fact that you reach a cap in comp pretty soon in 3/4 years. But actually what worries me the most is probably job insecurity, meaning that apparently it's pretty standard for quants to be laid off after a few years since firms prefer to hire new grads.
Also, I am pretty demoralised by the numbers I see on Google when I type "quants total compensation hedge funds" or similar things. They are so low compared to what I was expecting, like 1-200k for portfolio managers while I was expecting 1m.
At the end of the day I guess that my problem is just that I am very confused about this industry and I keep finding contradictory information. I am afraid that all this clamour about "quant funds paying a lot" might be only hype, meaning that maybe they pay a lot only to a very small minority of ppl who make news while the vast majority who gets relatively little is ignored. To be honest at this moment I am really down and just wish I had done something else like medicine, since now I would be doing my residency in an good speciality and would have the prospect of a safe job paying 300k£+ in some years without the constant worry of being the best among the people around me.
Edit: sorry for the rant.
Edit 2: See for example Tom Costello's answer to this question on Quora (https://www.quora.com/Are-hedge-funds-the-most-prestigious-place-to-wor…) to understand why I am lead to believe (again, maybe mistakenly) that hedge funds are places where only "the best of the best of the best" can actually make it.
Have you even tried?
If you're this clueless about quant fund career trajectory then maybe you shouldn't be in the field.
You're so deluded as to what comp looks like. Doctors in the UK do NOT make 300k; that's very much an american thing. They tend to cap out around 150k after a decade of experience.
Also quit googling stupid shit like "quant hedge fund". You're not going to get actual comp numbers, use wso and look at comp threads. Jane street starting comp is 400-600k USD for graduate traders. You absolutely can progress in terms of comp in quant; become a desk head and have a good year and you're earning over 1mm.
Also portfolio managers only eat what they kill; you have <20% at a shop like citadel (hedge fund, not the prop arm) making enough money for the fund to earn bonuses that are over 6-7mm or whatever. The reason the average is low is because most PMs don't make money.
Aren't you already a quant a top hedge fund? https://www.wallstreetoasis.com/forum/hedge-fund/quant-to-discretionary…
You're going to be taking a massive pay cut.
This thread is just oddly confusing. The obsession with cash is just utterly disappointing.
Just apply into the roles and see if you can actually make it in versus speculative ideals. You’re wasting your brain power on fruitless endeavors.
Life happens, things changes, even if you landed a job now in the field…what’s to say that something doesn’t happen and it makes you rethink your priorities?
You have your views about life, I have mine. Really, who do you think you are to come here just to "moralize" me with some trivial and hypocritical considerations?
If you wanna help and answer my question, great. Otherwise you're welcome not to even bother to comment.
Very unique and interesting situation indeed. Curious why a math PhD would be interesting in banking lol, given that there are HISTORY MAJORS bored with banking and saying it is menial and numbing. But there are defo PhD banking MDs. All the best!
Thanks!
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