Stand Out as a Non-Target: Career Management (Part 4 of 4)

Mod note: See part 1, See part 2, See part 3,

To wrap up our series on working as a non-target the final question you’re likely asking yourself is when does the stigma wear off? Or when will I be placed on par with Target students?

Here we’ll address some opinions on long-term career management and how you’ll be compared, on a line item basis to a Target entrant. Notably, a lot of this advice can also be applied to Target entrants as well.

On the Job: We previously outlined how to perform on the job 1) lower expectations, 2) stay in the top quartile but avoiding being the “rock star” and 3) correctly prioritizing tasks. With that in mind, we would estimate that roughly 6 months into your job, you will be equal with all of the Target students.

The reason why is

after roughly 6 months, the firm has a strong understanding of how good/bad your work performance has been. Up until this point, banks will remain risk averse and likely still lean towards keeping a Target student. Once you clear this 6 month marker however, you will see a move toward more meritocratic upward mobility.

Job Mobility: This is the biggest part of a Wall Street career, correctly navigating your moves on the Street and here is where many people make severe mistakes both as Targets and Non-Targets.

“Always Go To the Buyside”: This one is going to garner a lot of negative feed back but it needs to be said: “Going to the buy-side is not always the right move”. Before all of the down votes come in, this also does not mean all buyside jobs are bad, what it does mean is that getting promoted to say an Associate or VP may be the better long-term move. If a person simply says “buyside is where one should go 100% of the time” you should be next to certain the person has never worked on Wall Street. Below is how you should really view switching firms, ask yourself the following:

Do I have a chance of being promoted to an Associate/VP? If the answer is yes you should be careful when you consider a jump to the buyside for the following reasons 1) Your pay is about to increase in a meaningful way 33% at minimum, 2) you have built trust with your firm and they may be considering you as a long-term asset/banker meaning they will treat you better, 3) You will unlikely ever need an MBA, 4) Your pay is more stable.

If you have considered all four of the above and truly have an interest in the buyside then by all means jump. Notably, if you track candidates who blindly jump to the buyside many end up returning to the sell side, they catch a patchy year and see pay decline substantially or end up joining a group that is a bad fit for them.

To end this short rant on why leaving the sell-side isn’t always the correct decision remember to write down the following: “If everyone else is blindly doing it, it is probably a bad idea”. As a quick example, going from an Analyst to an Associate position at say an E-boutique will likely help you more (again long-term pay in mind) compared to simply jumping ship to a mediocre buyside shop.

Non-Target Stigma is Relatively Short: For an intelligent reader, you can read between the lines and realize that if you are able to receive an associate promotion or VP promotion, the stigma of being from a Non-Target quickly goes away. The reason? Investment Banks and businesses in general are about driving profits and adding real value. If you are promoted this will trigger a large signaling effect as banks realize that you were outperforming within the firm. It is relatively rare to see Analyst to Associate promotions or Associate to VP promotions for Non-Targets so the change in title would quickly dispel any concerns regarding work productivity.

Develop an MD Relationship: This is where many Wall Street Professionals slip. When you join an Investment Bank if you can develop a strong personal relationship with a Managing Director you’ll unlikely ever be unemployed again. This is a bold claim however it is relatively true. If you have worked well with a Managing Director he will help you with your career in ways you never imagined. The Managing Director would 1) take you with him if he switches firms*******, 2) help you join a corporate finance job, 3) search for private equity slots for you and 4) alert you of hedge fund opportunities.

Notably, things are changing rapidly and less and less high end professions want to hire unproven candidates, making a Managing director relationship of utmost importance and why the phrase “don’t burn bridges” is used profusely on Wall Street.

Concluding Remarks: This wraps up the series on how to manage your career/stand out as a non-target. The TL;DR of the entire series would be the following: 1) Get real finance experience, 2) Network appropriately and stand out in the interview by showing your expertise/research, 3) Stay in the top 25% of your class but don’t be #1 to avoid raising expectations and 4) think long and hard about long-term career management as many professionals will make the mistake of following the herd.

******
One last caveat to relationships is a low end analyst/associate would unlikely move with the MD, however the point stands that a MD would help the analyst/associate switch into a new career if he has helped the MD make money in the past (IE: strong work within the bank).

 
Best Response

Generally A to A promotions are more group specific rather than target versus non-target specific.

What this means is that if your bank/group rarely promotes you're out of luck. If your bank/group has a strong history of promotions then you've got a great shot.

This is also a great way to tell who actually works on the street versus people who do not work on the street posting on this forum. If someone says you should always choose xyz bank, they likely don't have a Wall Street job because the Street is about aggressivley increasing your opportunities by taking on more responsibility. This is why career management is so important.

To answer the final part, there is no stigma since you've been there for 2+ years at that point. They will know if you are good or not. As mentioned by month 6 or so you're on even footing at your particular bank, but you are on uneven footing leaving the bank because a recruiter is always going to choose Target + xyz bank over non-target + xyz bank. Unless you have some proof of outperformance.

 

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