Investment Banking Stigma

I feel like all sources keep talking about investment banking like it's the worst job in the world. They continuously cite the classic "IBD makes less than McDonald's on an hourly basis KEKW" statistic and talk about 100 hour weeks like it's every single week.

While I admit I'm at a bit a of a weird boutique bank with better work-life balance than average, my time as an analyst has honestly been a joy. I've been recruiting for PE, but am de-motivated given how much I'm liking my time in IB.

I've worked >90 hours less than 5 occassions, and my hours average 60-75. First year comp was $150 - $170k all in. The assignments are way more interesting than people made it out to be. Sure I still spread comps, have to do multiples charts, etc., but the majority of projects have been more than interesting in terms of learning and modeling through complexities.

As a second year, I also now actually have a voice that people listen to, and any analyses or presentations are discussed with my associate and VP actually taking my recommendations and commentary.

Idk if bankers just tend to exaggerate greatly or I found a legit IBD oasis, but curious what other people's experience has been. Has it really been that bad?

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Comments (49)

May 7, 2020 - 4:01pm

There is no shame in being in a different job or industry. Most of my friends are doctors, lawyers, in entertainment or technology. They are all happy.

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  • Analyst 2 in IB-M&A
May 7, 2020 - 7:04pm

Certainly not talking about shame here. Moreso, it just shocks me how much it's exaggerated on internet articles and forums. Everywhere, you hear the "oh, bankers actually only make $85k working 100 hours doing administrative work tsk tsk tsk" comments.

Sometimes, it really feels like the universe (from internet forums to career counselors to legit news articles) is trying its absolute hardest to discourage people from pursuing this career....maybe because society deems us evil, idk...

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May 7, 2020 - 5:23pm

I don't think its right to shame anyone based on what they for a living - everyone's just trying to put food on the table at the end of the day. But if its a genuine curiosity that a person asks why you are doing IB, I don't see why it'd be something difficult to defend. I'd argue you can learn a lot more in banking about substantive issues than you can in McDonalds. This is coming from someone who flipped burgers whilst in first and second year of uni.

  • Prospect in IB - Gen
May 7, 2020 - 5:31pm

Some people are just stuck with the mentality that bankers are evil and add nothing of value to the world. Then you try to explain, and you get hit with them saying "oh well you just help the rich get richer." You can try explaining even further, but sometimes it's just not worth it.

May 8, 2020 - 4:23pm

You do realize the only value a banker adds is their network right? All the models and decks are just for show and at the end of the day it's a sales job. Any structuring advice that a banker can offer is nowhere as good as what an accountant or lawyer who sticks with the company post deal can offer.

May 7, 2020 - 5:26pm

I think the coolest part about working in finance is learning how to compound your own capital effectively.

Your life is not fun until you divorce your income from time. If you work in finance, you have a HUGE leg up. You get access to so much data and incredible resources other people do not have.

I don't think most people here even realize how awesome having access to tools like Preqin or Pitchbook is...

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  • VP in PE - LBOs
May 7, 2020 - 5:47pm

I've been meaning to write a longer post about this, but the people who complain about bankers being idiots and analyst work just being glorified monkey work were either i) shitty analysts who were too lazy to go beyond the bare minimum; ii) worked in shitty groups where their MDs didn't provide any value beyond generic pitches.

There's a lot of very interesting, very intellectually stimulating work you can do as an analyst. Sure, it isn't as complex or difficult as engineering work, but being the sole analyst running the model for a multi billion dollar M&A transaction, or crafting the materials for an IPO, or working with management to tell their story in a CIM is a pretty incredible experience. Sure, there's a lot of tedious minutia, but if that's all you remember getting out of your analyst stint then that's more on you than on anyone else.

I'm obviously way past my analyst years, but I still look back on that time fondly and regularly keep in touch with many people from my banking days, all the way from my analyst class up to my group co-heads. There's nothing wrong with enjoying the work and wanting to stick with it and, in the scheme of things, it's a pretty great job.

May 7, 2020 - 7:10pm

Yeah, the experience really is dictated by your own motives. I was always an argumentative person, so always brought up any points in analyses that I disagreed with, politely of course. I think once the seniors noticed that, I started getting more responsibility, especially with crafting stories and narratives and such. I think that's been by far the most rewarding.

It does still surprise me though how many claim that the analysis is braindead. I really don't understand how....there's always so many complexities in a model, I struggle to see how people find it easy. Granted our firm doesn't use templates for the most part, but even in generic internal materials with valuations, templates ALWAYS have to be modified because there's always some nuance to capture..

Controversial
May 8, 2020 - 4:30pm
VP in PE - LBOs:

There's a lot of very interesting, very intellectually stimulating work you can do as an analyst. Sure, it isn't as complex or difficult as engineering work, but being the sole analyst running the model for a multi billion dollar M&A transaction, or crafting the materials for an IPO, or working with management to tell their story in a CIM is a pretty incredible experience.

->Building an excel model filled with bullshit assumptions that no one ever believes and will question mercilessly for your over inflated purchase/investment price
->Crafting a sales pitch for a CIM to tell some "incredible story" while trying to hide everything wrong about your client
->Believing your own bullshit this much

You truly are a Bankers' Banker. I commend you, best of luck with all your pitches and year end quota you gotta bring to the table.

May 8, 2020 - 6:00pm

On your first point, a model with projections is exactly that. Projections. No one can tell the future, so yes you can technically call all of this "bullshit" but that's why there's something called sensitivity analysis so you can at least find the bookends of where you'll probably end up.

On the second point, I don't understand why you have a problem with crafting a sales pitch. That is literally the job of investment bankers. You craft a story that says this is where the company was in the past, these were our issues, these are the measures we've taken to improve, this is where we think we can get to based on the measures, and this is how a merger will benefit both of us.

In terms of "hiding everything wrong," what are you referring to? Any material legal / accounting issues are revealed during diligence. It's not the seller's responsibility to go through and poke holes. That's on the buyer. Same with projections. Of course you are going to present optimistic projections, but they always need to have some basis behind them because again, it all comes out during diligence. The buyer can build their own downside case.

May 8, 2020 - 1:34pm

False, but you shouldn't be choosing a career based on that anyways.

Array
May 8, 2020 - 2:18pm

I'm going to give you a thought that I hope you take with you, forever.
What other people think of you is none of your business. Literally. Other people's opinions come from their own biases, experiences, and frequently, when they are negative, from a reflection of their own lack/disappointment/issues. Comments (especially online, with the protection of anonymity) putting anything or anyone down are frequently fear or jealousy based.
Do what you like. Do what you're passionate about. Do what you're great at, what your calling is. Opinions about your field, your compensation, stereotypes, etc. are meaningless.
Truth is, in any field, you have to learn. You have to put in sweat, blood, and long hours. Edison failed 10,000 times before he succeeded. Lincoln failed many times and was nothin' special until his late 40s or so? Yeah, IB has a reputation. But truth is, it's a place to learn a lot in a short period of time, it's an opportunity to learn sometimes you gotta know how to take apart and clear the paper from damn copy machine at 2 am. It's not a bad thing at all to do menial crap, because at some point you may start your own business from your garage and be doing menial crap…until it turns into Amazon.
Take your precious time, energy, intellect and brain space out of those conversations. Don't waste a second on it. Do what you were meant to do.

Funny point: years later when I was 'just a mom' and PTO treasurer, people were like HOLY EFF!!! about my Excel spreadsheets and budgets. Most had no clue how to use Excel, and were absolutely in awe of it's multiple spreadsheets within one file, linking, basic functions. The stuff we take for granted! One person's "trash" is another person's "treasure".

  • Analyst 2 in IB-M&A
May 8, 2020 - 6:03pm

Great advice! And I realize my post sounds like me griping about other people not recognizing my title, but that really wasn't the intention. I was just shocked by the amount of conflicting information out there relative to my own experience, so I wanted to gauge if others had a similar experience, especially as I'm considering this career for the long-term.

May 9, 2020 - 8:22am

Fair enough. There have been too many movies - too many "worst" stories (people love to retell the disaster scenario, not report the awesome) - and generally there's just this sense of pure aggressive avarice attached to the business. I never worked in a shop like that, personally. Once you get on a deal, esp. middle market, there are real people involved, real work to do, the silliness and rumors kind of fade into the background. Especially when you're reviewing 200 pages of legal docs and you're expected to comment on them to someone with decades more experience...always fun.
Excited for you - good luck - it's a journey, too. The incredible attention to detail, attention to timelines, communications, legal doc, negotiation skills in themselves are hugely transferable to so many other endeavors. Even at the most junior level you absorb these skills - you might not be in a negotiation, but you're following process on e-mail - it's amazing what you glean from this. Next time you come across it, a light bulb goes off.

  • Analyst 2 in IB-M&A
May 8, 2020 - 9:35pm

I'd say that you were a lucky analyst, groups with stronger deal flow tend to work the higher end of the spectrum (80-100 hours). Being in a MM M&A group can be grueling because the lean nature of deal teams. While there are slow weeks, I want the younger monkeys to be prepared for very rough spans of months where you just want to leave before 3am...

If you are on 3-4 live M&A deals, you can get absolutely destroyed. Honestly 1 hairy deal can ruin your next 6 months. Don't mean to scare anyone but without protected Saturday's and lots of work, the job can be intense

  • Intern in IB-M&A
May 10, 2020 - 9:41pm

A lot of these people who try to clown IBD are the same people who tried and failed to get in. When I won the offer, a lot of these dudes who applied with me are now saying they never wanted it in the first place.

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