Why does everyone want IB?

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Hi guys,

Graduating undergrad here, just got converted at US mid-BB.

Why the f*ck does everyone want to do IB?

It was all I could think about in my previous 2-3 years of undergrad, but now that I've done a few internships and gotten an offer - I've been asking myself why I wanted to do it, and why others want to as well. We don't get paid particularly great, we don't get treated super well, yes we learn to f*ck around on a spreadsheet and look like a pro (pro what I still have no idea lol), we can make a nice looking slide (I'm sure consultants can do a better one, also it's not us doing the actually "make look nice", it's the DTP team).

I would cum for a trading job in energy or something with half the pay and half the hours. Is it all about the exit opps? What am I missing here? Please give me something to tide me over the next 2 years. What is this prestige thing even about? I feel embarrassed telling people that I work in investment banking. I just say "finance" or "banking". It feels so cringe to say "I work in investment banking."

Comments (59)

 
Aug 3, 2020 - 11:05am

Same boat as you. I’d say the prestige, money, and exit Ops. Working for a big bank, or any reputable bank at that, will carry a lot of weight when trying to move to different areas of finance.

I am hopeful to move into HF or RIA after my first few years of banking and a masters degree.

I really think it’s the opportunity to make a shit ton of money for a 22 year old, live in big cities, and have great work experience that will take you to almost any job.

 
Aug 3, 2020 - 11:22am

The salary isn't good for the hours. There are jobs where you get paid 75k for 40hrs a week. Whereas we get double that for double the hours. So yeah not amazing considering it's 80 hours a week, but the fact is you're starting off making 150k and then 3 years later, when you get the associate promote, you're making 300k. In what field can you say 25 yr olds are making 300k? Pretty much no where else. It's a fast track to constantly increasing your salary.

 
  • Analyst 1 in IB - Gen
Aug 4, 2020 - 2:14am

no banks prefer a2a promotes which is why some banks have been cutting analyst programs to 2 years instead of 3 to compete with pe recruiting/comp

Array
 
Aug 3, 2020 - 11:27am

prestige whores / good way for non targets to make decent $

What concert costs 45 cents? 50 Cent feat. Nickelback.
 
Aug 3, 2020 - 12:28pm

It is a solid footing for a future in trading if that is something you are interested in. That is coming from a guy who is officially moving in to trading at my BB in the new year (when some normalcy is expected to return on the floor).

It is one of those things where people stress WAY too much over the first few years of the career. You are fine. You landed in a front office gig getting paid solid cash and diving in to “finance” in a semi-real way (cheap shot at the accountants). After 12-24 months you’ll pick your head up and start seeing the path to where you want to be. 50 yr old you won’t give any fucks about the first few stints that helped you find nirvana. Just ride the wave and steer the ship the best you can.

I am one of the types who still doesn’t know what the hell they want to be when they grow up. So I just soak in what I can along the way and follow the paths/opportunities that make me tick.

 
Aug 4, 2020 - 6:06pm

Jeez butter me up first... falls under credit.

I lateraled after 2 years from a non-banking role. So, I am an “analyst” who is outside of the UG/college recruiting pipeline and does not have the structure of all that BS holding me back.

Due to the timing of my lateral and big bank BS, I am an analyst on paper, but compensated as an associate/viewed as an associate within the dept. (saying that to give you an actual idea of my circumstances, which is a bit different than a 23 yr old 12 months removed from UG).

“Networked” (aka was a normal dude) and drifted more towards the markets side of the aisle during my last ~two years. A bit of turnover occurred on the desk and shook up some seats. Based upon being a normal human, producing solid work when called upon, and some of the interests I have expressed... I was offered a seat.

 
  • Intern in IB-M&A
Aug 3, 2020 - 1:35pm

honestly i just want a few hours a week to play warzone with my buds and maybe grab a cocktail with a chick - is that too much to ask for?

 
Most Helpful
  • Analyst 2 in IB - Gen
Aug 3, 2020 - 4:45pm

There are a lot of reasons people want IB, but a pretty good one is that once you have the job, its effectively risk free return. There are so many banks that convert effectively 100% of interns to full time, and anyone that wants to stick around after 2 years gets the A2A promote. Even after that it is not at all difficult to the get the associate to VP promotion after 3 years, especially if you went A2A and can run circles around the MBA associates. The first true bottleneck / competitive promotion is getting promoted to director. Think about that for a second. That's 150k a year while you're 22-23, 250-350k until you're 26, and then you can sit around as a VP making 500k a year starting from when you're 27 until your early 30s solely because you chose to grind it out and not quit. I have never seen nor heard of a junior employee getting fired in my BB's IB division because of incompetence or just being bad, and there are a ton of analysts, associates, and VPs at my firm who are quite frankly awful at their job. There are very few career fields in the world that will let you earn this much in your 20s -- most of them are literal one in a million athletes, musicians, models -- people with real god given talent, and even the ones that are normal jobs like tech, consulting, quant finance, and investing at least require you to be good or you get pushed out of the company. To date, IB is the only job I've seen or heard of that that will pay you half a mil a year when you're 30 simply for being not absolute dogshit. So long as you close your eyes, grit your teeth, and keep showing up to work, even as everyone around you leaves, the checks keep hitting your bank account. And that's a job a lot of people would kill for, even if they don't yet understand why so many people leave or what it's actually like to do it.

 
  • Prospect in Other
Aug 4, 2020 - 9:57am

Maybe there’s a cogent argument to be made for the time commitment, but I don’t think that only having finance exit oops is an issue. In any industry, the exit oops will largely be related to that industry. This holds true in tech, medicine, law, and others. The skill overlap is just there for other careers in the industry, but not in other industries overall.

 
  • Analyst 2 in IB - Gen
Aug 4, 2020 - 5:37pm

Sure, but the question wasn't if IB was worth it -- it was why so many people want an IB job. For most people that break into IB, there will be a point in their career where it is no longer worth it, and they will leave to do something they perceive to be more interesting or more chill. But consider it from the perspectives of the many people in this country that work long hours, double shifts, or hard manual labor jobs, working just as hard as IB, but also don't get paid a ton. To them, a job that pays 150k a year and doesn't really require you to be smart or talented would sound like the greatest deal in the world. The problem is, word gets around about jobs like this and the competition is driven up and suddenly, most of the kids getting hired by investment banks are smart and talented, even the though the job doesn't really necessitate it. But smart and talented kids aren't going to sit around in a job that doesn't use their smarts and talents -- they get bored, and they leave, and the cycle continues. It's ironic because it's a job that winds up being least worth it for those who can have it, but most worth it for those who can't break in.

 
Aug 4, 2020 - 5:42pm

That argument is so terrible.

You are NOT trading your 20s at all. If anything, you are enhancing your 20s by having near “unlimited” cash at your disposal (chill hardos I mean that in a no worries about the daily life expenses sort of way).

Sure, you are trading a minor portion of freedom to do exactly what you want whenever you want, but we make that decision all day every day without being compensated for it.

This industry and the talent attracted to it wouldn’t exist if you were actually trading away a meaningful portion of your 20s.

Lame argument derived from / exaggerated upon the love to crank up the hours and commitment required to do this job.

 
Aug 4, 2020 - 6:41pm

The reality is not many are doing amazingly cool stuff in their 20s anyway...

Sure, some will become entrepreneurs of one flavor or another, but unless you are already deep into starting a tech company, building a brand as a musician, etc, the extra free hours you will have by going to work a 9-5, 65k job out of college are not going to be put to amazing use. You are probably watching Netflix, getting drinks + dinner more often with friends, playing sports more often.

Being a millionaire at 30 is totally plausible via the IB path, and sets you up with a lot of flexibility to have a more interesting rest of your life.

 
Aug 3, 2020 - 4:59pm

To me, go look at LinkedIn at any strategy or finance job and count how many prefer IB experience. That along with working at a place you can feel proud to work for (I guess), and have a couple hundred thousand saved up/invested by the time your 23-4, with the possibility of going to private equity and being a multi millionaire by mid 30s.

To me, it's the boujee life mixed with the option to leave whenever you want to whatever you want because everyone wants you.

 
  • Intern in IB - Gen
Aug 3, 2020 - 7:59pm

This seems like a very romanticised view of the industry. Unless they graduated college early, very few would have saved / invested 200K after 2 years of being an Analyst.

Agree there is potential to become a multi-millionaire by mid 30s in PE, sure, but this is very dependent on earnings / spending patterns. One or a couple, million? Yeah, possible. Multi million? Not sure what you mean by 'multi', but given taxes and living expenses, I doubt many achieve this.

Definitely true, however, that there is a good earning potential in banking and the wider finance industry compared to most other jobs.

Array
 
  • Intern in IB - Gen
Aug 3, 2020 - 8:58pm

What does the salary progression look like assuming you do IB for a few years, go to business school, go to PE, and then do whatever from there?

Array
 
Aug 4, 2020 - 3:18am

Yes, I was speaking to what I saw in college. People see $125-$150k in college and look to get there to start saving and have good exit opps. Granted, i think some cities you actually could do that, just not in SF or NYC.

Multimillionaire I’d say is 2-3M, which is definitely doable if you made the transition to PE at like 24.

 
  • Prospect in IB-M&A
Aug 4, 2020 - 9:36am

Intern in IB-M&A:

I would cum for a trading job in energy

Well as someone who has a week to decide betweeen an energy trading role full-time or a banking job full time this one is interesting. Fuck

Array
 
  • Prospect in IB-M&A
Aug 4, 2020 - 9:40am

Same commenter here: can you ellaborate on that actually? I'm having a really hard time making the choice. In energy trading I can retire by 30 and do whatever I want persay, but I won't have any real skills outside of trading. Banking I think gives me more optionality. At one of the top supers in their trading program rn

Array
 
  • Prospect in IB - Gen
Aug 5, 2020 - 9:48am

It's a good question and one I've been thinking of.
The thing that really bugs me is why grind away taking the 2+2+2 route for supposed "exit opps" only to exit into something that I could probably just go into directly out of undergrad.

Array
 
  • Analyst 2 in IB - Gen
Aug 5, 2020 - 11:43am

Because in the context of a 40-50 year career span, 6 years is nothing. If it takes 6 years at the beginning of your career to stamp 3 brand names on your resume that will never have your credentials questioned ever again for the next 40 years, its a good bargain for many people. Also, I understand your point about how nowadays you can enter pretty much any field directly out of undergrad if you're good enough -- problem is most people don't know what they want to do for their whole career when they're 22 fresh out of undergrad. This way, they get 6 years to consider that decision and make a more educated specialization after bschool and 2 jobs that expose them to a variety of industries and management teams, all while making a ton of money.

 
Aug 8, 2020 - 12:07pm

Prospect in IB - Gen:

It's a good question and one I've been thinking of.
The thing that really bugs me is why grind away taking the 2+2+2 route for supposed "exit opps" only to exit into something that I could probably just go into directly out of undergrad.

I am here right now. good question

Array
 
  • Analyst 1 in IB - DCM
Aug 7, 2020 - 11:56pm
Array
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