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Why Investment Banking? 43 Sample Answers

Patrick Curtis

Reviewed by

Patrick Curtis WSO Editorial Board

Expertise: Investment Banking | Private Equity

I have only heard standard cookie cutter answers before, and I am curious how best to answer this investment banking interview question.

The Safe "Why Investment Banking?" Answers

Of course, your desire to stand out and leave a strong impression is justified. Interviewers have more applicants than they know what to do with. And yes, they're looking for people that display intelligence, confidence, and certainty in their future career path. But sometimes it's best to stick to the safe answers and just go with what works.

Here is a collection of the best standard responses to the "Why Investment Banking?" question from WSO users.

  • CompBanker - Private Equity VP: Stick with cookie cutter -- Don't try to be special or unique; stick to logic and passion.
    • Kyc133enydc - WSO User: Steep learning curve. Result driven environment. Enjoy working under pressure. Significant responsibility.
    • Ideating - WSO User: The best answers would typically be some combination of experience working on big deals, the caliber of your colleagues, gaining a strong financial foundation, and a strong interest in finance.

    Detailed Why IB Answers?

    While cookie-cutter responses are safe, sometimes a little more substance is appropriate/appreciated.

    WallStreetPlayboys:

    I want to work in investment banking because I understand it has a steep learning curve and will allow me to establish a strong foundation for valuation, Excel modeling skills, and understanding the XXX sector. I know the hours will be long, but the time spent understanding and learning about XXX space would give me the opportunity to remain in finance over the longer term.

    This answer does a few things:

    1. You left him 'bait.' Now he will ask, "Oh really? So what hours do you expect?" So you simply answer 80 low-end and 100+ if a lot of going on.
    2. By mentioning valuation/Excel, you're showing you know what you'll be doing, and you have pitched why it is valuable 'a strong base of skills for *future* on Wall Street'.
    3. Because you never want the interviewer to think you're interested in anything besides banking."

    The Wrong "Why Investment Banking?" Answers

    While there are very few "correct" answers, there are plenty answers that are just plain wrong. Here are a few examples and how to avoid them:

    • Answers that somehow indicate you are going into the profession to earn large amounts of money or because you eventually want to go to business school/private equity/hedge funds. Even if this may be true, you want the interviewer to think that you are committed to the industry even though he/she knows that, more than likely, you'll decide to leave after two years of service.
    • Marcus_Halberstram - Industry CEO: Don't say anything about client interaction. Period. Any interviewer that's said anything about 'CEOs, executives, clients, management teams, and (cringe) the C-suite' are immediate 'this kid doesn't know what we/he will do here' dings.

    What If You Are a Non-Business Major?

    Great answers to this question focus on skill-building, networking, and a love for difficult challenges. You want to emphasize that:

    • Being a non-business major, you are excited to learn the complex accounting and finance skills involved on the job and eventually transform into an analyst that has potential to significantly impact the group.
    • You are excited to work with driven, smart, and motivated colleagues and are looking forward to pushing your limits from a work standpoint.
    • You ultimately want to come off as a positive, 'go-getter' type."

    Law to Investment Banking

    Jbarret34 [Second Year Corporate Associate] outlines why the move from big law to investment banking makes sense for him:

    • I know that I love transactional work, like working in a fast-paced, demanding environment, don't mind long hours, and eventually want to be the one making the deals, rather than a lawyer/banker who only facilitates them.
    • Investment banking makes sense because I can develop valuation/pitching/modeling skills.

    Consulting to Investment Banking

    "WallStreetOasis.com" noted the following if coming from consulting.

    • If you're interviewing for an entry level junior role, then your response to the "Why Investment Banking?" question could be, "While I have gained some great experience working in consulting that translates well to investment banking, I feel that I could learn a more useful technical skill set at an investment bank working on live transactions at [XYZ Firm]."
    • For those trying to get into more senior roles post-MBA, a more appropriate response would be, "I like long projects and getting to know clients; however, the transactional nature of investment banking is very appealing to me because you see the results of your work much more quickly. Whereas consulting engagements can last for years, especially when implementation is involved, the average investment banking mandate typically lasts for several months, so you are getting exposed to more scenarios and the learning curve is faster.

    Commercial Banking to Investment Banking

    Onemanwolfpack [Investment Banking VP] Gives those coming from a background in commercial banking some solid advice:

    • Demonstrate you belong. Given your 'atypical' background, you will have to try that much harder to show you belong compared to your interviewing peers who may already be working at other IBs and looking to lateral.
    • Read up on the latest M&A deals, know your technicals frontwards and back, and show an over-the-top eagerness to break into the industry.
    • In response to the 'Why switch from CB to IB?' question, I recall responding, "Because I look around at 5 pm seeing everyone head for the exit, and I know I have more to offer and want more out of my career than that." May have been cheesy in retrospect, but I believe that's when I won over the interviewer."

    Asset Management to Investment Banking

    Started your career in AM and want to make a move to IB? Here's some insight on whether or not it's the right choice for you, and if so, how to convince a potential employer you'd be a fit.

    • MandAisOkay [Investment Banking Analyst: If you don't feel you have an actual passion for AM, I would make the switch to IB because it gives much broader exit opps. If you actually enjoy your work in AM and can see yourself in this business for a long time, just stay.
    • WallStreetOasis.com [WSO CEO]: With a background in AM, a strong response to the 'why' question could be, "Although Asset Management allowed me to analyze companies and financials and make trades based on that analysis, where I really feel that I would excel long term is working more directly with these companies and in transactional work.

    Interested in Investment Banking - Breaking In

    The fact of the matter is you won't improve unless you practice. To have any chance at the technical questions, you need to prepare yourself with legitimate questions. The WallStreetOasis investment banking interview course is designed by countless professionals with real world experience, tailored to help you break into investment banking by acing the technical questions.

    IB Interview Course Here

    Patrick Curtis

    Patrick Curtis is a member of WSO Editorial Board which helps ensure the accuracy of content across top articles on Wall Street Oasis. He has experience in investment banking at Rothschild and private equity at Tailwind Capital along with an MBA from the Wharton School of Business. He is also the founder and current CEO of Wall Street Oasis. This content was originally created by member nickleeson and has evolved with the help of our investment banking mentors.

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    Comments (416)

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    7,548 questions across 469 investment banks. The WSO Investment Banking Interview Prep Course has everything you'll ever need to start your career on Wall Street. Technical, Behavioral and Networking Courses + 2 Bonus Modules. Learn more.

    Dec 12, 2009

    You need to figure out why you want to do investment banking. yes there are stock answers, but that won't help you when you are doing 100 hr weeks for something you never even wanted.

      • 4
    Dec 12, 2009

    "For the chase and rush of doing such a high and lucrative business deal" "deal exposure" "passion for finance" all these I have heard before but not sure how much substance they hold.

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    Dec 12, 2009
    mCobb:

    "For the chase and rush of doing such a high and lucrative business deal" "deal exposure" "passion for finance" all these I have heard before but not sure how much substance they hold.

    Please never actually say "passion for finance" out loud. In front of anyone. Ever.

    A good rule of thumb for this and other personal questions in interviews is to stay as far away from cliche answers as possible.

      • 1
    Best Response
    Dec 12, 2009

    "I wanna make bank, bro. I wanna get ass. And drive a Range Rover."

      • 22
    Dec 12, 2009

    lmao dude, this is me all three... and i never connected it w/ IB

    What concert costs 45 cents? 50 Cent feat. Nickelback.

      • 1
      • 1
    Dec 12, 2009

    MD in my group says he ask this questions and if they don't include for the compensation in the list, he knows they're lying and usually writes them off

    Dec 12, 2009

    The few points I made:

    1. You like the high level of exposure/analysis you get to do. Working with executive level people at companies to help them achieve they're financial and operational goals.
    2. The learning curve. You get learn a an incredible amount of applied finance/finance/valuation in a short period of time.
    3. As you become more experience and learned the technical side of the job, you get to become more involved with the client and start to build relationships.
      • 4
    Dec 12, 2009

    You can stick to the standard "I want to learn" or "the transaction process is very interesting" answers, but this is one of those questions where you can really set yourself apart from other interviewees if you've done any amount of networking. Mention who at that bank you've networked with and what they have had to say about their experience. This not only answers the question, but it also shows that you took the time to learn more about the bank and the industry in general.

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    Dec 12, 2009

    Agreed, I was giving a more broad answer before. So not only go into detail about why banking, but add why banking at X Firm. Obviously every persons situation will be different and every firm is different so tailor your answer to the situation. In the end, don't over think the question but deliver a good response that covers the basics and provides more details than the standard responses.

    Dec 12, 2009

    I did ROTC where we were frequently assigned military analysis projects where we would do things like evaluate the suitability of a town for military operations. We had to take lots of information, condense it down into key points, draw conclusions and process it all into a brief report or presentation within a very short period of time. Because I had such a good research mindset and was good at public speaking, doing this was considered one of my unique strengths, and I was quickly put in charge of these groups. I loved it because it was (a) intellectually demanding and (b) exciting and fast-paced. When I learned about investment banking, it sounded exciting to me because it featured the same dynamic of round-the-clock, high adrenaline administrative/research work which I couldn't find anywhere else.

    Dec 12, 2009

    No right answer. a few good ones i've heard redirect the question and then answer it. For example, 'Well, 80+ hour work weeks aren't appealing to everyone, and I definitely don't think they are what makes the job fun, but there are very few other places that afford you the opportunity to get so much exposure so quickly. The amount of reps and doing something over and over again, leads to the level of proficiency that I desire in my career and expect from myself. I know of the benefits because i've talked to xxx and have seen first hand heard first hand xxxx blah....'

    Dec 12, 2009

    I'm motivated to learn a skill set that will stay with me for the trajectory of my career

    Dec 12, 2009

    If you're under the age of, say... 28, we know you're talking bullshit.

    For me, this question is more a test of how well you can read me and how much you think that I will believe your bullshit.

    Dec 12, 2009

    You definitely need to personalize it but I always felt that giving an answer that builds from the ground up to be strong as it can offer a thorough explanation and potentially allows you to guide conversation in a direction you prefer.

    What I mean by that is follow some sort of timeline that follows your initial interest, research into the subject, confirmation of your interest through internships/school/networking etc. (in this part I like to acknowledge some potential turnoffs like the time commitment and then saying why thats actually a draw for you), most recent stage of interest which you really need to come up on your own and then why you are interviewing for this particular role at this particular bank. I know that may not be the most specific answer to your question, but if you fill in the gaps in a way that sells your personality and matches up with the story your resume tells, an answer built around that model will usually allow you to draw attention to any strengths or experiences you may want to highlight and make yourself more of a "character". What I mean by that is that it gives you the opportunity to differentiate yourself a bit so the interviewer remembers you in a certain light (ie. that gritty kid from a non-target, the sharp, smart target kid who's down to earth etc) which will help you stand out against more generic candidates. I found my interviews went much smoother and rapport was built much faster once I started following this model. It had a tangible effect in the form of offers, superday invites and even led to me building a few contacts from interviewers. I should note I worked in a SA program I wasn't interested in and had to go through FT recruiting explaining that away which this type of response allowed me to do at my own discretion.

    Dec 12, 2009

    I am extremely focused on my industry, and could speak volumes to that.

    Dec 12, 2009

    Wait, I thought we're in it for the dough?

    Dec 12, 2009

    Notable dialogue my friend had with a new freshman back when I was in college:

    Frosh: "I really wanna do investment banking."
    Friend: "Why do you want to do it so badly? I just finished up an internship, the hours were pretty bad, and the work wasn't great."
    Frosh: "I don't know man, I just really like stocks."

    And that's how you land the job.

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    Dec 12, 2009

    just give an answer that aligns your interests with your firm's goals without coming across like some goober who is going to bring up ebitda multiples at the bar

      • 1
    May 10, 2017

    My reasoning is because of the following:
    Steep learning curve
    Extremely tough hours that make or break you
    Molds you into not only a more efficient person, but a quick thinker
    Learn about various industries
    Surrounded by passionate and intelligent individuals
    Competitive and that's just the way I like it

    Just an Undergrad trying to get a job. Something you disagree or dislike about my posts? Let me know by PM'ing me or commenting constructive criticism.

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