8 Reflections on Leaving IB After a Decade

It was recently noted by a commenter that I haven't done much on this board besides fight about politics for quite some time. The truth is, as one of the older posters still around, I'd given most all advice that I could think of as I rose through the IB ranks. However, this year I left investment banking to join a sponsor-backed portfolio company and thought I'd check back in here to share a few reflections after a decade in investment banking for the younger monkeys to consider.

Yes, it was worth it. With one major caveat.

This is the $750 question (you didn't expect me to avoid all politics references, did you?!). I can confidently say that entering and staying in IB was worth it for me. I got to travel the world, sit in with F500 executives, work on interesting transactions, and make significant money along the way that allowed me to experience life to the fullest while setting my family up well for the foreseeable future. The highly anticipated "exit ops" were interesting and plentiful for me, even in a depressed Covid job market.

However, I never in 10 years worked in a sweatshop, and my regular hours were far closer to 60 than 100. I only recall pulling 6 true all-nighters in 10 years and rarely spent a weekend night in the office. Part of this was luck (and sometimes inconsistent deal flow) at the shops/offices I worked, part of it was by design (I passed on approaches from "better" banks for bigger bonuses, knowing I'd be signing away my limited free time). I worked til midnight during the weeks throughout my 20s and never joined a Tuesday softball league or Thursday night trivia, but rarely missed the big events that were important to me (i.e. weddings, bachelor parties, family holidays, ski trips). I considered that a fair tradeoff, and made all of the warped work/life warped balance worth it. Had I missed out on the important things (like I concede so many of you have to do), I don't think I could justify ten years in the investment banking industry, no matter the size of the paycheck.

I stayed in IB the first five years for the experience, and the last five for the paycheck

Pretty self explanatory, but the learning curve flattens out far quicker than you'd imagine. I always worked in standard vanilla sell-side shops, so most transactions looked the same. Once I hit VP, there was very little to learn from each new transaction, and I was on a glide path to a glorified high-paying sales gig. Each bonus season, I had fewer reasons to stick around for another 12 months, but the bonuses kept getting bigger and the hours lighter. A good problem to have, no doubt, but at some point, I knew I'd have to jump off the merry-go-round, because I was far too young to "ride it out".

Golden handcuffs are real, and hit a lot sooner than you'd expect

Usually you hear about the MD who can't leave banking because they have to pay for three mortgages and four private school tuitions (and I've seen that story play out plenty of times). What I'm talking about is the 25-year old who is already making more money than they thought they'd ever see in their lifetime. I passed up a lot of interesting opportunities simply because I couldn't justify rolling the dice and taking a 75% pay cut at a young age. Had I been making $50k, I'd gladly swap that out for a more interesting $50k job, and perhaps I would have found my passion or rose to greater heights in another field. You can count on one hand the number of jobs that offer a 25-year old $250k outside of banking, and it's really hard to walk away from that, no matter how much equity your friend's startup promises you. 

Live within your means and always prepare for a life outside banking

On a related note, save your money. I have two watches - one cost $200 and the other was $10. My nicest car was under $30k. I get far more joy knowing I have enough savings to last 10+ years without working, than I ever got from buying bottle service. A career in banking is highly volatile especially as you ascend the ranks, and you always need to prepare to take that big paycut if you ever leave (or get kicked out of) the industry.

Prestige is an empty pursuit, but I understand the allure

I was that college kid who wanted Goldman on my business card like everyone else here. Never happened for me, and I quickly learned that all that stuff wears off quickly. Prestige is something employers sell you to underpay and/or overwork you. It carries no value, and the sooner you discard that from your equation, the more clarity you'll find when making those big career decisions.

Drop the ego as soon as possible

No one cares you're a banker. You're a glorified Excel/Powerpoint monkey, then a salesman going hat in hand begging for your next mandate. Most of your friends think it's pathetic you work so many hours. And truthfully, most of my friends outside of IB were happier than I was. The difference now is I host them at my lakehouse. Who cares? We both get a lakehouse weekend out of it, and theirs is free of charge.

You only live your twenties once

Tying in a lot of the points above - a career in banking is all about delayed gratitude. Work 80 hours weeks in your 20s for that cushy buyside gig or 7 figure C-suite job in the second half of your career. And that is a tried and true path! But I had more fun in my 20s at $1 beer night than I could ever have now with 7 figures in the bank. I'm settled down with a family, and life is great! But it's a different kind of great. That period in your life to live carefree on the weekends, jetting around the country, skiing, golfing, etc. only happens once. You wait to do that as a single guy in your 40s, and you're the creepy rich guy in the bar. Find a balance. Set your limits. Ensure you have something to show for your 20s besides a bank account and work stories.

Learn and practice empathy

If there's one thing that troubles me observing WSO over the years, it's the seemingly lack of empathy conveyed by many posters. Many of you grew up in extreme or at least above-average wealth. Many of you are white males, that yes, still have an enormous amount of privilege, even in 2020. Don't feel bad about that, but be grateful for it. The fact that all of you even found this website puts you in the .01% of the workforce who can expect to live a pretty prosperous and comfortable life. A 22-year old who gets a donut for a bonus will still be in the 97th percentile of income earners for their age with just their base salary.

Have empathy for those who aren't in the same position as you. Yeah, you worked hard. So do billions across the world. You also fell into a hell of a lot of luck along the way. I still don't know how I landed my first IB job - I was in the second round interview before I even knew what role I was interviewing for, and I have no recollection of ever applying to that firm. I didn't even know of investment banking until I caught my senior year roommate browsing Wall Street Oasis and asked a few questions. Internalize how much good fortune played into your story, and you might look at our world's issues a bit differently with more compassion.  

Take care WSO! I've had a rocky relationship with the Trump crowd on here the last few years, but I will always be grateful for the education and guidance this website provided earlier in my career. Patrick and team have built a great resource, and you all are lucky to find such a great career resource at your fingertips.

 

Alt-Ctr-Left

Have empathy for those who aren't in the same position as you. Yeah, you worked hard. So do billions across the world. You also fell into a hell of a lot of luck along the way.

Would also note that the biggest part of that luck is having been born in a country that still respects the free enerprise system. It's up to us to pass on that luck to the next generation.

Unfortunately, the reason that billions around the world work hard for nothing has everything to do with bad economic policies which they are unlucky enough to be born under.

 
Most Helpful

What a comedicly bad take on the source of inequality. Billions around the world work hard for nothing because their countries were raped by the western world for their natural resources, material wealth, and labor over the period of hundreds of years, not because they "don't respect free enerprise". Hard for a kid to get that investment banking summer analyst offer when their country has been in a constant state of war for two decades due to the US randomly dropping in and destabilizing an entire sub-continent. 

 

Sure, colonialism initially screwed a lot of these countries. However, at a certain point, you can't blame colonialism from 200 years ago for bad policies instituted by these governments yesterday. For example, Spain is not responsible in any way for the terrible policies instituted by the Venezuelan government in the past few decades. It is the Venezuelan government's fault for destroying its own country.

The problem with a lot of these countries is not the West robbing them. It is the fact that many of these countries are organized as kleptocracies where a small group of elites rob their own people and keep them poor.

EDIT: Seems like a lot of people are confused by my comments here. Check out this short Youtube video which goes over a lot of the disasterous policies implemented by many African nations which had nothing to do with colonialism. Lots of the same bad ideas were tried in South America and continue to be tried in places like Venezuela.

 

The effects of white western actions can certainly reverberate for centuries - look no further than the plight of black Americans today. To unilaterally blame any national government for the struggles of any developing country without even acknowledging the root cause of power vacuums is like setting a house on fire and blaming its wood construction for it burning down - when the west vacates nations throughout the world, leaving behind impoverished, desperate populations stripped of their economic resources and identity, it is almost inevitable for a cycle of failed states, corruption, and abuse to arise. You can blame a lack of an efficient market system, rule of law, etc. on the failure of developing nations to develop faster, but in the end it is almost impossible for an infantile, unsupported, poor nation to develop these things without significant help. The true blame falls on western superpowers for colonizing states which HAD all of those things (developed over centuries), stripping them of their resources and labor, and leaving them completely destabilized. 

 

SteelGun

 when the west vacates nations throughout the world, leaving behind impoverished, desperate populations stripped of their economic resources and identity, it is almost inevitable for a cycle of failed states, corruption, and abuse to arise. 

So you're saying that despots have to rob their own people and be corrupt because the West colonized them 200 years ago....probably the same story that they tell their own people. I mean do you not realize what a ridiculous statement that is?

By the way, their resources are not stripped. Venezuela has a ton of oil. Same with Nigeria. Same with Libya. You could go on and on. It is not a lack of natural resources that is driving a lot of these countries into the ground. 

Edit: Side note. Ask China, Hong Kong, and Singapore how they are doing. Pretty amazing how fast countries can grow when you start putting the right policies in place. Under Mao ZeDong China literally had millions dieing of starvation. The economy pivoted towards a system that allows much more free enterprise and 50 years later, China is emerging as an economic super power.

 

I think the both of you have a point but to me, the answer is a blend of both. I know this because I'm African.

Colonialism played a significant role in our destruction. It is still playing because Britain still has it's clutches deep in the heart of my country. Policies are backed by western countries when it benefits them and vice versa not caring for the impact on the country. The civil war in my country is a goid example. We don't speak of it in my home - it's too horrible.

But then, our leaders are corrupt illiterate fools. Noequityresearch had a point when he pointed that it's run by oligarchs looking to fill their pockets. We're still in this mess because they want to fill their pockets and they know the countries that help them do so, and the rest is history.

TL;DR: Some African leaders have definitely helped to make the continent worse but you cannot discount the impact of the western influence that is still going on today. I can't even put in words right now some of the things they did. You'll never find it in your history books. History is for the winners, or something like that.

 

Thanks +SB BankerwithaFro As I noted earlier, I agree that colonialism definitely did a lot of destruction in Africa, but it's ultimately policies that drive economies. What I find sad with some of SteelGun's comments above is that they show a complete misunderstanding of the most basic ideas of economics. It's been more than 250 years since Wealth of Nations was written and thousands of economics studies have been done. We have a pretty good idea of what drives economies. Take for example China versus North Korea. One is a closed economy and the other has opened itself to free enterprise and trade. The difference in results is not surprising.

And back to my original point, those born in the US are EXTREMELY lucky. Almost every time a colony breaks away from an empire, the end result is many times worse than the original colonizer. A new dictator or kleptocrat steps into the power vacuum. People are often promised populist and socialist economic ideas which promise to redistribute what the empire/colonists stole and things go bad pretty quickly.

The US was an extremely rare example where the founders did not want to be dictators and in fact, created a constitution that restrains the powers of government. To be born in the one country out of a hundred that was founded on the idea of individual freedom versus kleptocracy is so lucky. I also find it sad that some of our citizens no longer even understand what makes their country unique, but it is not entirely surprising in the age of AOC and Bernie.

 

I don't have a "misunderstanding of the most basic ideas of economics" - I have never argued against the merits of free market systems. There is simply nuance to the struggles of the developing world that you fail to grasp. You seem to believe if a new country embraces capitalism, then it will be successful, and if it does not, it will fail. There is simply more to it from a historical context. 

Take your belief of American exceptionalism. In a sense, you're not wrong - we are very fortunate to have had founders who did not want to be dictators and created a strong constitution. But we must look deeper and understand WHY America developed such a system early on while almost no other nation has. Firstly - our founders were not indigenous to our land; they were white Europeans who were able to wipe out the indigenous population and benefit from their resources at almost no cost while also exploiting black slaves for free labor. Importantly, they also were able to benefit from European styles of education, becoming well-red in philosophy, economics, politics, and law. They were white, spoke the languages of the European world powers, and were able to work together easily with the wealthy nations of the world. As a result at the end of the revolution, there was no sense of desperation (not saying there wasn't instability but this is in comparison to other modern cases of new nations) - America was independently already a wealthy nation, not solely because of the success of its free market system, but largely because of their forced exploitation of demographics deemed beneath them. 

In the modern age, the success or failure of a new state has very little to do with how they embrace capitalism but moreso how wealthy the nation independently is and to what extent to powerful / rich western nations support them in their infancy. Take Hong Kong - under British rule, Hong Kong because a major trading and financial hub in the east and by the time it was released from British rule, it was a wealthy nation and had the political support of both Britain, who had over a decade to prepare for and aid the transition, and China, who helped enforce rule of law in the new nation. Sure, capitalism was the economic system, but most new nations have a free market economy but fail to distribute the economic gains equitably and end up as failed states - the key differentiator is the island's pre-established status as a trading hub and the swift establishment of a fair rule of law. 

To further illustrate my point, there have been dozens of examples of new countries embracing a capitalist system and ending up as failed states because they lack what America, Hong Kong, and others had - independent wealth, strong education, in-place rule of law, and international support. In modern history, pure-play capitalism in new nations has almost always immediately led to devastating wealth inequality / plutocracy. China, which you used as an example of the success of capitalism, is one example of this. Another example are the African nations BankerwithaFro talks about - implementing capitalism in a new nation without support is a recipe for extreme inequality. To clarify, this is not me arguing they would be better served under another economic system - I'm arguing that the key determinant in these nations success isn't the economic system but a variety of other factors. 

That being said, there are also several examples of new nations that have the recipe for success but chose not to pursue laissez-faire capitalism and still achieved stability. Taiwan and Singapore are two examples of nations who gained independence and did not pursue laissez-faire capitalism (Taiwan pursued a highly planned party-state capitalism model under KMT; Singapore also pursued state-capitalism, with the government owning almost all of the land and 30+% of all enterprises). 

 

So much of what you wrote is so wrong that it's hard to know where to start....but how about here....the fact that you think China is an economic growth failure is just insane. Basically, you're looking for utopianism where a country magically propels itself out of poverty and everything is equal and everyone is treated nicely. I'm sorry to tell you but that doesn't exist. Something like China is sadly a best case scenario. 

Rather than discuss everything point by point. I really think it would be more helpful for you to do more reading on the topic of developmental economics. If you or anyone else on this forum is more interested in this subject, I highly recommend The Elusive Quest for Growth: Economists' Adventures and Misadventures in the Tropics by William Easterly (Phd Economics from MIT). Basically, it's one of the best overviews that I've read of what has worked and what has not worked and what has been tried.

https://www.amazon.com/Elusive-Quest-Growth-Economists-Misadventures/dp…

On a side note, I don't believe in American exceptionalism. In fact, I think we have one of the dumbest populations on the planet. What we have is an exceptional framework of government which has done an incredible job of guiding the country despite our unexceptionalism.

 

I'm Chinese, have lived in China, and grew up with China's transition to a market economy. Don't lecture me on the Chinese economy - I've forgotten more about China than you would ever know. I never said China was a "failure", I said that it was an example of economic gains being distributed inequitably leading to extreme wealth inequality. The notion that China is a "best case scenario" is comedic - in fact I've listed several examples above that are better cases. Easterly himself warns of the dangers of inequality in his chapter on Polarized Peoples. 

Regardless, I think you're confused about the nature of this conversation - it's about privilege, not about solving problems in developing nations, which is what that book focuses on. Your original claim is that our largest privilege is being in a country which has a functioning free market system. But the fact is that simply implementing a market economy has very little correlation to the success of a nation. Again, Easterly agrees with this point, declaring that working to promote proper incentive structures is "no panacea". 

The reality is the misfortune of those born in the developing world isn't that they were born under economies that aren't functioning with perfect efficiency. The lack of efficiency is caused by other factors such as weak governments and rule of law, which more often than not can be traced to vacuums caused by Western influence and failures. Their misfortune was being born in countries that were devastated by centuries of exploitation by the West, which is the root cause of the problems Easterly talks about in the book. 

 

SteelGun

The reality is the misfortune of those born in the developing world isn't that they were born under economies that aren't functioning with perfect efficiency. The lack of efficiency is caused by other factors such as weak governments and rule of law....

Yes 100% agree!!!! And a pre-requisite of having a free market economy is having a strong rule of law and strong protection of property rights. If you don't have that, you really don't have a free market system.

That's almost my entire point.  You noted earlier that African countries are examples of where capitalism doesn't work. Well, most of those countries don't have a strong rule of law, strong courts, or strong enforcement of property rights. Based on those characteristics, I would not even consider them remotely close to free market systems. And that's part of the problem with this converstation. You're arguing against the free market implementations and capitalism, but your very definition of those terms is faulty. 

Side note.....doesn't really matter where you are born...ideas are ideas. You can be Chinese with really bad ideas or you can be Chinese with good ideas. We have Americans with no appreciation of the US Consistution....doesn't make them correct just because they were born here.  

And you're right the conversation was about priviledge....it was never about income inequality.

 

NoEquityResearch

SteelGun

The reality is the misfortune of those born in the developing world isn't that they were born under economies that aren't functioning with perfect efficiency. The lack of efficiency is caused by other factors such as weak governments and rule of law....

Yes 100% agree!!!! And a pre-requisite of having a free market economy is having a strong rule of law and strong protection of property rights. If you don't have that, you really don't have a free market system.

That's almost my entire point.  You noted earlier that African countries are examples of where capitalism doesn't work. Well, most of those countries don't have a strong rule of law, strong courts, or strong enforcement of property rights. Based on those characteristics, I would not even consider them remotely close to free market systems. And that's part of the problem with this converstation. You're arguing against the free market implementations and capitalism, but your very definition of those terms is faulty. 

Side note.....doesn't really matter where you are born...ideas are ideas. You can be Chinese with really bad ideas or you can be Chinese with good ideas. We have Americans with no appreciation of the US Consistution....doesn't make them correct just because they were born here.  

And you're right the conversation was about priviledge....it was never about income inequality.

The problem is that you seem to be straying into "No True Scotsman" territory, here.  By definition, a "free market economy" doesn't require strong rule of law or strong courts - in practice it does, because otherwise you end up with plutocracy/kleptocracy.  In this context, it means that the only societies you'll consider "free market" are the ones that are already successful.  Of course the system you advocate for is going to be ideal if you only include in your sample set those societies which are stable and successful.

And when you look at successful free market economies versus unsuccessful ones, part of that equation has to deal with the history of the society in question.  I don't think it's a stretch at all to say that European colonialism (or colonialism in general) has been the root cause of a lot of issues plaguing third world countries.  Saying "these places could pull themselves out of their current spiral if they didn't allow dictators and juntas to rob the country blind to line their own pocketbooks," is all well and good, and true as far as it goes, but it's not always that simple.  If you look at Africa, for example, most of the continent was used to extract raw materials, which means that human resources were not educated and that the physical infrastructure installed was geared towards continuing an extractive economy rather than moving up the value-add chain.  If the people have neither the education nor the wealth/economic freedom, how do you expect them to protest unjust leaders?  This also ignores the random state boundaries the European powers drew, which leads to nations with huge internal ethnic and cultural tensions.   In Colonial America, literacy was enormous, even in the less-educated South.  Slavery notwithstanding, landowning was common and the idea of a peasant underclass didn't exist.  In other words, even the common people had the intellectual and economic capacity to understand and engage with the ideals of the Revolution.

And mind you, this isn't centuries in the past - the end of European rule in most of Africa is a matter of living memory. It blows my mind when people want to treat this kind of stuff as the relic of some mythic past - there are millions of people alive who remember this. 

 

The most basic defition of capitalism by wikipedia:

"Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, a price system, private property and the recognition of property rights, voluntary exchange and wage labor."

As I said a little later on this thread, it's pointless to argue back and forth if we can't even acknowledge the most basic definitions. So, I have no more comments to make in this debate.

 

NoEquityResearch

The most basic defition of capitalism by wikipedia:

"Capitalism is an economic system based on the private ownership of the means of production and their operation for profit. Central characteristics of capitalism include capital accumulation, competitive markets, a price system, private property and the recognition of property rights, voluntary exchange and wage labor."

As I said a little later on this thread, it's pointless to argue back and forth if we can't even acknowledge the most basic definitions. So, I have no more comments to make in this debate.

Um, excuse me sir, this is what you said:

Yes 100% agree!!!! And a pre-requisite of having a free market economy is having a strong rule of law and strong protection of property rights. If you don't have that, you really don't have a free market system.

We can't agree on basic definitions because you insist on making your terminology interchangeable.  This is truly incredible - being called out for not being precise in my definitions as you're actively misusing your own terms!  

A prerequisite for a free market economy is minimal government interference (one of the many reasons we've never seen a free market economy in practice).  A prerequisite for functional capitalism is what you described.  That being said, it's the same underlying issue - you want to work backwards.  If you want to make the argument that capitalist systems are the most successful, that's a different story - because, you know.... free markets and capitalism are two different concepts.  But accepting that premise, it still is a dumb argument, because it isn't the capitalism that leads to success, it's the rule of law and respect for private property.  You've put the cart before the horse - post-colonial societies have a lot of trouble achieving economic success because they don't have those underlying fundamentals, not because they aren't capitalist societies.  And it's quite reasonable to tie that to the very fact that most of these places were under a colonial heel, and thus couldn't develop those kinds of institutions.

You are incorrect as your argument stands.  Not maybe, not a difference of opinion - you have (again) made a factually incorrect argument and then decided to stand behind it.  Either you don't know what the hell you're talking about, or you're just too stubborn to admit when you're wrong, which might actually be worse.  But it is quite typical of you, from what I've seen, to run away from an argument you can't win, instead of eating crow and moving on with a discussion.

 

didnt read the full comment so maybe you touched on this, but you can’t read easterly without also reading sachs’ “the case for aid”. both are equally valid yet 100% opposite views on development and aid. there’s no right or wrong here. 

while you’re at it i highly recommend poor economics too, which gives empirical backing to a lot of the theories prevalent in the easterly vs sachs debate. probably the single best book on development (for which duflo and banerjee rightfully won a nobel)

source: studied under and did research with a nobel-winning development economist for 3 semesters in undergrad

Array
 

+SB Agree, that would be a good read as well!

The problem with this conversation is that SteelG's points are in of themselves not logical and coherent. I don't mean to be a jerk but sometimes, the best solution is for someone to just pick up a book and start reading whether it's Sachs or Easterly.

According to his comments above, China, African countries, and the US are examples of capitalism. Taiwan and Singapore are not?  The basis is that they have state interventions in major parts of the economy.....which China also has. Note that Taiwan and Singapore have a TON of characteristics of free markets. The Heritage Foundation's Freedom index even lists Singapore as the most economicly free country in the world....Taiwan is #11....the U.S. is #17. (https://www.heritage.org/index/) Very cool index by the way. On the other end of it, most African countries don't even have secure property rights and courts which is basically a prerequisite of a free-market.

It's difficult to have a discussion with someone if they can't even define what constitutes a mostly free market driven economy and they are not familiar with the literature of what works and doesn't work in development economics.  The guy is talking about the correlation between free markets and the success of countries....well if you think most of Africa is a free market paradise, then guess what? There won't be a correlation! If your definitions are all screwed up, all of your conclusions thereafter will be too.

So yes reading anything would go a long way!!

 

First off, I would make the distinction between free-market capitalism and command or state capitalism. Many Asian countries, from an initial disenfranchisement with free-market capitalism, made the leap to modernity with heavily regulated command capitalism (ie the four tiger economies and China). Only recently have they begun to embrace more open-market policies. To simply praise these countries for being "capitalistic successes" without considering the background of the totalitarian regimes that occupied these command economies for years and the suffering of the oppressed would be a very right wing and a very anglo-centric view of the development path of these countries. Secondly, I find your first statement regarding colonizers not being responsible at all for current challenges rather absolute. You mentioned North Korea, for example. After liberation from Japan, Korea was split between the North and the South. Postcolonial scholarship today suggests that the division was a result of, in part, U.S. foreign policy (the U.S. handed over South Korea to a far right dictator and was not at all accommodating of moderate left views). Also, North Korea today wouldn't have a chance to be a free-market economy because of the sanctions placed on it by Western countries. The fact is North Korea has been vilified strongly for years and it is entirely intentional, since it is the only legitimate reason U.S. occupation in Osaka and South Korea exists today. And those military bases don't only serve to rebuff North Korea. They also are there to monitor and push back China. My point is foreign policies of the colonizers and now I guess you could say neo-colonizers continue to greatly affect countries around the world and their development paths. Sometimes you might find that those very kleptocracies in power were in some part created by Western countries (eg. Saddam Hussein, Syngman Rhee, etc.) to promote a form of hegemony.

 

Sure, Spain doesn't decide what policies their former colonies choose to enact, but you are very wrong to think that what happened 200 years ago has no impact on today. Societies have strong path dependency. Why do you think certain places and people are where they are today? Because their ancestors were enslaved by the people running these countries, and even when they were "freed", that impact is carried down through generations, and far from enough was ever done to help these people. You should reread his point on empathy. 

 

First of all, thank you so much for writing this article. It was extremely informative and well-written, always glad to hear from very successful people and people who have achieved and persevered through a dauntless IB career! 

On equality, I would say your take is so and so. I come from Lebanon, a third world country that had it all. A beautiful coastline, mountains, ski resorts, tourism, a diaspora that sends billion is remittances every month. Lebanon is currently undergoing a severe financial crisis, our bank accounts are frozen and long-gone, banks do not lend us a single dollar of our money.

Unemployment is at 40%, and we are second to none other than Venezuela in inflation. This will leave a large part of the generation behind, creating a vacuum or a lost decade or two. Everything is caused by the inept, elite ruling class, the terrible government that tried to provide by the company by only taxing certain parts of the country, the millions of public employees who made absurd money leaving well above their means by bribes, inflated pensions and belonging to certain political groups, all supplemented by politicians that ravaged and quite-literally killed us (August 4 Bomb that left hundreds perishing, wrongful storage of chemical weapons).

The more a government is given power, the more regular, hardworking people are hurt, the more inequality exists. This isn't specifically about Trump or Republican policies, but they truly are better for the middle class and pushing people from lower-income levels to higher ones. If Lebanon did not rely so much on imports, supported and built proper infrastructure to help out local produce and exports, we would not have a balooning debt bubble, a faltering currency and all the terrible things people are coping with.

Again, thank you so much for the insightful post! You have truly made my day!

 

Agree that having a free market system and entrepreneurial culture that rewards risk-taking and innovation is a big factor for US wealth, but it’s a huge stretch to say that wealth inequality is mostly due to bad economic policies. The US is protected by 2 large oceans and didn’t suffer large-scale destruction of its infrastructure and industrial base like its rivals in Europe and Russia did in WW1 and 2. The US has only really been a superpower since WW2, when almost all of its rivals were left in shambles. The US also has advantages because it encourages immigration, leading to an inflow of talented and industrious employees (immigrants by their nature are more risk-taking), which is more of a cultural reason than an economic one. And last but not least, as other posters have noted, the US also didn’t have its resources and people pillaged for hundreds of years by a colonial overlord. India is a good example of a country massively set back by colonialism. When the British arrived in India, it produced 23% of the world’s GDP, and Britain 2%. When the British left 300 years later, Britain was at 15% and India was at 2%, with massive de-industrialization occurring in the first few decades of colonization, as India was transformed into an agricultural country that was only meant to be a captive market for finished British goods. Similar stories have been repeated in dozens of other countries over the last 400 years or so.

 

+1 SB for the good coherent discussion points even though I don't completely agree on all points.

I think the WW2 point is an interesting one because it really cuts both ways. For example, Germany was basically leveled to the ground and half the country was taken over by communists. 70 years later.....Germany is economically the strongest nation in the EU.

That's one of the things that makes me a little skeptical on fully blaming colonialism. As is the case of Germany or say China that had millions of people starving, gulags, etc., we've seen that you can completely destroy a nation but if you have the right policies in place, it can bounce back within 50 years.

So, I look at former colonies and other countries such as Russia and much of eastern Europe and ask myself, "why did these countries not bounce back in 50 years?"  There is no doubt that colonialism, wars, and destruction cause real economic damage, but I think it's more difficult to explain why it's sometimes 50 years of damage and why it's sometimes 200 years of damage. And in my opinion, when you start looking into the details of those countries, the policies and leadership are a big culprit.

Also, I think that the Eastern European examples are particularly interesting here. Yes, there were 50 years of being beyond the iron wall, but we don't have real colonialism unless you count something like Turkey's control of the Balkans and Greece. Yet, even without colonialism, these countries langish in a sort of 2nd world status.

Side note: US immigration is a policy stance....perhaps by circumstance of past heritage but regardless. In a hard-core libertarian sense, open borders and freedom of movement are very free-market principles.

 

Although I often lurk and disagree with your political posts, this was very well-written and insightful. Appreciate it!

If you don't mind sharing did exit into a corp dev/strat role or is it something more operating focused? If more operating focused what made you leave the finance side of things?

 

nontarget hardo

Although I often lurk and disagree with your political posts, this was very well-written and insightful. Appreciate it!

If you don't mind sharing did exit into a corp dev/strat role or is it something more operating focused? If more operating focused what made you leave the finance side of things?

Corp Dev/Strategic Finance route with a path to CFO down the road. It seemed like the natural transition in-house, and perhaps I'll explore other operational paths once I spend more time on the inside.

"I don't know how to explain to you that you should care about other people."
 

You said you were too young to ride it out so you decided to leave. I am interested, what is your next career move? It sounds like you find it more exciting/riskier so curious to see what you left a job that you seemed relatively happy with for.

 

You said you were too young to ride it out so you decided to leave. I am interested, what is your next career move? It sounds like you find it more exciting/riskier so curious to see what you left a job that you seemed relatively happy with for.

I didn't hate banking by any means, but I had no interest in shooting for MD, and frankly wasn't sure my network would be strong enough to build that consistent deal flow with sponsors (I didn't grow up with money, didn't attend b school full-time, etc.). I'd always wanted to sit on the other side of the table from my clients and help execute on a growth strategy long-term. It's a much more dynamic and well-rounded role than reviewing comps, pitchbooks, and CIMs that your analysts and associates put together for you.

"I don't know how to explain to you that you should care about other people."
 
Take care WSO! I've had a rocky relationship with the Trump crowd on here the last few years, but I will always be grateful for the education and guidance this website provided earlier in my career. Patrick and team have built a great resource, and you all are lucky to find such a great career resource at your fingertips.

You're still better than Financeabc! 

 

Take care WSO! I've had a rocky relationship with the Trump crowd on here the last few years, but I will always be grateful for the education and guidance this website provided earlier in my career. Patrick and team have built a great resource, and you all are lucky to find such a great career resource at your fingertips.

You're still better than Financeabc! 

If you only knew how often Trump was openly mocked in the finance world, young prospect...

"I don't know how to explain to you that you should care about other people."
 

Wondering this as well. MBA associates get a lot of shit but I’ve had calls with a few recently that are genuinely intelligent people. Do you usually see MBA associates still able to rise through the ranks of banking?

 

Any recommendation of spending a longer time at an EB or BB? And personally, how do you think the two differ? Thanks!!

 

Any recommendation of spending a longer time at an EB or BB? And personally, how do you think the two differ? Thanks!!

I think it’s a bit easier to stay on the banking track at a BB where you have a balance sheet and built in coverage universe you can inherit from senior bankers. EBs can ride a couple of strong bankers but don’t have much to fall back on, so your office fortunes can change quickly with senior departures, and thus affect your long term prospects. MMs are in a crowded space and have less to differentiate themselves. Most have far too many sub sector coverage teams and there’s very little room for a VP/Director to make room for themselves as they ascend the ranks.   It can make it harder to make “the jump”  from deal execution to BD. 

In general though I think this forum worries way too much about BB vs EB vs MM vs boutique. All offer interesting work, good pay, long hours, and promising exit ops. Figure out what’s important to you besides the category of the bank, and make your job decisions accordingly.

"I don't know how to explain to you that you should care about other people."
 

BigTuna5

Amazing post! If you could go back, anything you'd do differently? Any advice you'd give your younger self? 

Good question. If I could do it over again, I would have partied a little less in college and gotten a better GPA, which limited my 1st job opportunities. I was still able to lateral into IB later and things worked out well, but I think I benefitted from a lot of luck and good fortune, and made it harder on myself than it needed to be. There's plenty of time to study and party in college if you manage your time well and treat your studies like a job. Stay on campus/in the library until 6pm, and then do whatever you want with the rest of your night. I also see far too many college kids today ONLY study, and end up with 8 internships on their resume by 21. You're only in college once, enjoy it!  (Covid notwithstanding).

I'll have to sit in my current chair a bit longer to know if I'll have any regrets on when/how I left banking.

As for advice, it took me awhile to stop getting caught up in the "fire drill of the day" which would temporarily overwhelm me, and the inevitably blow over or not materialize. Eventually I put I put a 10-10-10 rule into place to help me level set my reaction appropriately. Will this (situation) matter in 10 days (random work deadline), 10 months (trouble with girlfriend, missed promotion) or 10 years (death or illness of a loved one)? I'd then try to match my emotional reaction accordingly. I spent too much time stressing about the 10 Day category early on, and not a single one of those things ultimately mattered (I can't even remember the vast majority of them now).    

"I don't know how to explain to you that you should care about other people."
 

I'm interested in what made you shoot for director as opposed to leaving at VP? Was it just comp and wanting to maximise your nest egg before branching out? I ask because at my firm (consulting so maybe a different model) we have engagement manager - director - partner. Plenty of people make it to EM and then leave, the assumption from the firm and the team is people who make it to directors could be and want to be partners one day. Did you ever want to be MD got close enough to see the reality and realised you didn't like the idea?

 

JCCOL

I'm interested in what made you shoot for director as opposed to leaving at VP? Was it just comp and wanting to maximise your nest egg before branching out? I ask because at my firm (consulting so maybe a different model) we have engagement manager - director - partner. Plenty of people make it to EM and then leave, the assumption from the firm and the team is people who make it to directors could be and want to be partners one day. Did you ever want to be MD got close enough to see the reality and realised you didn't like the idea?

I knew I didn't want the MD life forever, so I worked backwards and determined I could still make the transition in-house during my mid 30s/young Director years. If I waited any longer, I ran the risk of being pigeonholed as a banker for life (I've seen very few MDs go on to do something else besides banking). Every year I could hang on in banking before reaching that "point of no return" yielded big bonuses that would pad my  nest egg, and allow me to take a risk and/or reduction in compensation when I moved in-house.

"I don't know how to explain to you that you should care about other people."
 

thebrofessor

bravo, thank you for your insights, I had a feeling the political back and forth distracted from the nice, thoughtful person I always thought you were, you proved me right. I'd love to get a beer with you someday.

I'm curious about the cultural differences between IB and corpdev/in house work, any comments there?

My insights here impact my political insights, and vice versa. But I realize I could have made my political points the last few years in a more respectful tone :) Happy to grab a beer sometime, as I've enjoyed your posts over the years as well.

As for your question, I think there are two big changes:

1) Complete ownership of acquisitions, from the strategic fit, to post-merger integration and post-deal management. As a banker, you really don't care about who is buying or selling, so long as the deal closes and you get your transaction success fee. This dynamic grew to bother me, as at times I felt that our incentives weren't aligned with our client, and I regularly jumped from deal to deal, industry to industry, without a change to wear the "strategy hat" long-term.

2) Culturally, it requires you to collaborate with a broader set of people and personalities, with various motivations and ideas of work/life balance. Everyone in banking looks the same and is motivated by that six/seven figure bonus check. In a way, it's refreshing to see people care about things in life besides money, but can also be tougher to get people to grind for a pressing deadline, where there was no such concern in IB.

"I don't know how to explain to you that you should care about other people."
 

If you have to have people grind for pressing deadlines in the first place, it means somewhere along the chain of command someone didn't plan, order, and execute things properly. Banking is notoriously filled with terrible managers and planners. Things that supposedly are always high priority from a VP and MD literally could've been done in a week and had no reason to be rushed in the first place. But that's sales for you in a dying/shrinking industry.

 

Appreciate the color here. I’m nearing 7 years in IB / IB-related roles and beginning to think hard on my long term career move. You hit home on a couple points that have been in the back of my head.

It’s all about closing the deal. Doesn’t matter if it’s the right deal. There have been times where we have delivered the greatest return for investors, but left the management team with a new owner that we ultimately knew wasn’t the right fit. The thrill of closing a deal used to mask this, but it’s becoming more clear this isn’t the career for me.

 

BrokerJoker

Legit post telling how it really is... I did the same and experienced the same. Truth is that in IB, the best bankers are great salesmen. The smartest guys are usually the worst bankers because they find it hard to bring in and close business. Name of the game is hustle and close by any means necessary. 

Funny you say that..MDs always said I'd make a better buy-side sponsor guy than sell-side banker. I struggled to always pretend to be an industry expert in everything in front of clients, and there was a very fine line between lying and "putting a positive spin" on a dogshit company we were selling that I wasn't always willing to cross. IB is sales.

"I don't know how to explain to you that you should care about other people."
 

Reposting my comments about the almighty Exit Ops that were buried in a reply thread above:

I think the types of roles are similar when leaving IB after 3 years or 10, but the level at which you enter can vary. A 10-year IB veteran can exit to lead an in-house M&A team, whereas a IB analyst can exit to work on in-house M&A team reporting up to the group lead. Senior bankers may also be able to make the rare jump right into the C-suite (usually CFO), but I've only seen this happen where a banker went to work for their former client (and thus there was already mutual comfort in making the big jump into CFO).

Here's a sample of roles I interviewed for/received offers over the last year:

  • Head of global M&A for a rarely-acquisitive family-owned large diversified industrials company
  • #3 on the M&A team of a highly-acquisitive professional services publicly-traded company
  • CFO for a private equity backed distribution company
  • VP of Growth Finance for a unicorn services company
  • Various roles to lead M&A for private-equity backed portfolio companies
  • Hybrid investment professional/portfolio operational finance for a family office's portfolio
"I don't know how to explain to you that you should care about other people."
 

Thank you for sharing! This is a great reminder to all of us to reflect on what ladder we are climbing. As a young professional, I feel a little more hopeful to read this post. I realize that there are still (a few) people up the food chain who care. Some bosses just seem so rude and unforgiving that it's unbelievable. It's sad that IB is so grueling that many talented people have to leave the industry. Will IB be a more sustainable and less grueling career choice someday?

 

I am 18 years old, about dive in to IB recruiting head first and full force within a month at an age that I probably shouldn't be allowed to make most decisions at. I've read your post over maybe 8 times and sent it to my equally as distraught friends maybe 20 times more. Thank you for posting this. I almost went pre-med, in fact I still might who knows. Reading your post has helped me realize which avenue I'd rather lose my 20s to. Congrats on the new direction you're going! 

 

Thank you for this great insight and interesting replies. Since you exited from IB could I ask you to give advice to last/penultimate year Msc students like me entering in the job market with a not certain view if they would remain for life in IB. Would you suggest to enter (internship then analyst also for 2-3 years ) in a BB or EB, learn a lot, increase personal background and then decide what to do or directly choosing another path (HF, PE, M&A junior role in a firm or tech company, Sales and trading)? Also considering your statement regarding the fact to think a lot about "losing the 20s".
Thanks

 

crispus

Thank you for this great insight and interesting replies. Since you exited from IB could I ask you to give advice to last/penultimate year Msc students like me entering in the job market with a not certain view if they would remain for life in IB. Would you suggest to enter (internship then analyst also for 2-3 years ) in a BB or EB, learn a lot, increase personal background and then decide what to do or directly choosing another path (HF, PE, M&A junior role in a firm or tech company, Sales and trading)? Also considering your statement regarding the fact to think a lot about "losing the 20s".
Thanks

IB is a young man's game, so if you're not sure if you want to make a career of IB, find out sooner than later in your career.

"I don't know how to explain to you that you should care about other people."
 

Man, what a great post and great perspective... thanks!  

 

Mollitia asperiores dignissimos aut sit. Et qui numquam officia consequatur enim. Hic quam aliquam architecto vel. Reiciendis cum ut eius labore cum tempore.

Consequatur quaerat earum eveniet illum dolor autem. Et minus maiores harum eos rerum dolorum totam. Laudantium et et quia explicabo.

 

Iure molestiae molestias qui voluptatibus. Sit assumenda doloribus sit consequatur consequatur illo libero omnis. Qui ut quibusdam dignissimos fugiat non occaecati repudiandae. Sint aliquid soluta voluptatem dignissimos. Est at aspernatur rem eligendi.

Aut expedita quas eos aliquid natus perspiciatis. Inventore maxime et illo dolorem dolor sint. Id facilis alias quia. A id nesciunt architecto rerum totam vel sapiente.

Ratione culpa reprehenderit maiores sit omnis sed quam. Culpa saepe dignissimos aspernatur aut nostrum.

 

Incidunt fugit quis vel cum tenetur hic sint. Nostrum non iure eius aut quis quis minus. Modi eius magnam rerum necessitatibus numquam modi assumenda. Odit velit beatae at sapiente dolores molestias.

Qui atque dolores autem qui. Porro aut voluptas aut esse reiciendis. Deserunt et velit excepturi qui. Sint eum officiis fuga pariatur.

Perferendis qui distinctio rerum officiis. Architecto ratione aliquam provident nemo nostrum.

Career Advancement Opportunities

March 2024 Investment Banking

  • Jefferies & Company 02 99.4%
  • Goldman Sachs 19 98.8%
  • Harris Williams & Co. (++) 98.3%
  • Lazard Freres 02 97.7%
  • JPMorgan Chase 03 97.1%

Overall Employee Satisfaction

March 2024 Investment Banking

  • Harris Williams & Co. 18 99.4%
  • JPMorgan Chase 10 98.8%
  • Lazard Freres 05 98.3%
  • Morgan Stanley 07 97.7%
  • William Blair 03 97.1%

Professional Growth Opportunities

March 2024 Investment Banking

  • Lazard Freres 01 99.4%
  • Jefferies & Company 02 98.8%
  • Goldman Sachs 17 98.3%
  • Moelis & Company 07 97.7%
  • JPMorgan Chase 05 97.1%

Total Avg Compensation

March 2024 Investment Banking

  • Director/MD (5) $648
  • Vice President (19) $385
  • Associates (86) $261
  • 3rd+ Year Analyst (13) $181
  • Intern/Summer Associate (33) $170
  • 2nd Year Analyst (66) $168
  • 1st Year Analyst (202) $159
  • Intern/Summer Analyst (144) $101
notes
16 IB Interviews Notes

“... there’s no excuse to not take advantage of the resources out there available to you. Best value for your $ are the...”

Leaderboard

1
redever's picture
redever
99.2
2
Secyh62's picture
Secyh62
99.0
3
Betsy Massar's picture
Betsy Massar
99.0
4
BankonBanking's picture
BankonBanking
99.0
5
dosk17's picture
dosk17
98.9
6
DrApeman's picture
DrApeman
98.9
7
kanon's picture
kanon
98.9
8
CompBanker's picture
CompBanker
98.9
9
GameTheory's picture
GameTheory
98.9
10
Jamoldo's picture
Jamoldo
98.8
success
From 10 rejections to 1 dream investment banking internship

“... I believe it was the single biggest reason why I ended up with an offer...”