Why You DON'T Leave Banking for B School Just to Come Right Back...

This is the reaction any analyst who has ever worked in banking has when you say you want to leave banking for business school then come back as a post b school associate...

Allow me to list the potential downsides of going with this approach...

You certainly won't be...

Rather you will probably realize that you just attended one of the best business schools in the country. Now, when a summer analyst asks you if depreciation is "non cash" you're going to be like...

Within 2 months on the job...

After all that time spent around those motivated overachievers over the past two years when you come back to the desk and some VP who was a first year associate when you were a senior analyst will be asking you to "scrub" the analyst's comps to make sure they are correct... What you will want to say is probably...

But since you re-upped on $150k in debt in order to take that two year vacation, allowing Steve to move three levels above you as opposed to just one. You will realize that you not only desperately need this job, but you have to do everything in your power to maximize your bonus, including sucking up to Steve and staying till 4am to check comps. So your answer is going to be...

Eventually you will have an epiphany while ordering seamless one night...

It will be one of those nights when you pretend to have an internal struggle between ordering Just Salad and Bon Chon, but deep down... You knew it was always going to be Bon Chon... Then you will descend into ritualistic self-loathing while the eager beaver first year analyst from Amherst sitting two cubes away from you is unknowingly mis-linking all of the inputs to the model you were up late last night setting up... You will take a look at the carnage that used to be your perfectly formatted sheet... The one she naturally forgot to save a new version of... And even though you will restrain yourself (thank goodness for those Effective Conflict Resolution classes at Wharton), deep down your soul will be doing this...

Questioning the meaning of your current existence you will sit in front of your computer, dejected and dumbfounded by the meaninglessness of everything you are currently doing and you will whisper...

You will then likely begin to doubt your decision...

And you will remember the words of the inspiring professors in your MBA program...

At that point in time you will need a little bit of a pep talk, so you will turn to WSO, expecting something like the below...

Unfortunately you will probably be met with something more like this...

You could turn to your friends from b school to for a sympathetic ear... Except they might not be able to take your call right away because they decided to start the next Twitter and are currently a bit busy...

And you will be all like...

But luckily, you posted this question on WSO before going down that path, so we were able to be like...

And now you're all like...

You are welcome for the assistance in averting this potential disaster...

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Comments (84)

May 21, 2013 - 8:04pm

Just to play devil's advocate, what if your firm does not easily allow for analyst-to-associate promotions (i.e. 2 years as an analyst and you're out), and you want to continue down the banking path at your current firm (or move to a higher ranked firm)? Are you not forced to get your MBA at that point?

Curious.

Super Nintendo, Sega Genesis - when I was dead broke man I couldn't picture this
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May 22, 2013 - 12:53pm

idragmazda:

Just to play devil's advocate, what if your firm does not easily allow for analyst-to-associate promotions (i.e. 2 years as an analyst and you're out), and you want to continue down the banking path at your current firm (or move to a higher ranked firm)? Are you not forced to get your MBA at that point?

Curious.

There are a lot of firms desperate for laterals at the Analyst 3 level, and most places would prefer an Associate 1 with experience too. It's VERY hard to replace Associate 1-2 who leave because post-MBAs don't lateral for a couple years

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May 21, 2013 - 8:24pm

Never understood this as an interview answer to the question "where do you see yourself in X years." Maybe with VPs or MDs. But analysts? Really?

idragmazda:

Just to play devil's advocate, what if your firm does not easily allow for analyst-to-associate promotions (i.e. 2 years as an analyst and you're out), and you want to continue down the banking path at your current firm (or move to a higher ranked firm)? Are you not forced to get your MBA at that point

Curious.

I mean.. at least consider lateraling, or if you go MBA keep Associate as a plan b (or c). In addition, I get the sense that the sorts of firms at which Analyst/Associate conversion is more difficult are less likely to be the sorts that you (or at least I) would want to work at long term.

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May 22, 2013 - 12:17pm

rufiolove:

ewlang:

If you plan to never attend B School, do you think you may be limited in the future? Limited only for buyside firms? Don't most PE firms kick you out after two years?

Who said I don't plan to attend b school? I probably will attend b school.

What do you want to do after b school?

Best Response
May 22, 2013 - 2:59pm

AsianMonky:

rufiolove:

ewlang:
If you plan to never attend B School, do you think you may be limited in the future? Limited only for buyside firms? Don't most PE firms kick you out after two years?

Who said I don't plan to attend b school? I probably will attend b school.

What do you want to do after b school?


The same thing I do every night, AsianMonky-try to take over the world!
May 22, 2013 - 12:25pm

rufiolove:

ewlang:

If you plan to never attend B School, do you think you may be limited in the future? Limited only for buyside firms? Don't most PE firms kick you out after two years?

Who said I don't plan to attend b school? I probably will attend b school.

Wasn't necessarily referring to you - more curious about myself.

Apr 24, 2017 - 11:05pm
Bullet-Tooth Tony:

okay24:

great post

Rufio got approval from "okay". Must really be a great post.

As a mediocre state in the mountain west, I also approve

Make Idaho a Semi-Target Again 2016 Not an alumnus of Idaho
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May 22, 2013 - 10:45am

+1

Frank Sinatra - "Alcohol may be man's worst enemy, but the bible says love your enemy."
May 22, 2013 - 11:14am

rufiolove:

Then you will descend into ritualistic self-loathing while the eager beaver first year analyst from Amherst sitting two cubes away from you is unknowingly mis-linking all of the inputs to the model you were up late last night setting up...

Slayed me. +1

May 22, 2013 - 12:15pm

Good points. Do you think the standard should be migrate to: MBA after the Associate stint? Meaning you would come out of grad school looking for post MBA VP positions.

Make opportunities. Not excuses.
May 22, 2013 - 7:59pm

WSRenaissanceMan:

Good points. Do you think the standard should be migrate to: MBA after the Associate stint? Meaning you would come out of grad school looking for post MBA VP positions.


You're only allowed to go as high as President and Board Member of arguably the most prestigious firm in the world. (Gary Cohn). After that you hit a ceiling unfortunately.
May 22, 2013 - 12:50pm

JamaicaFinance:

How high up are you really allowed to go in banking without an MBA?

All the way up in Europe at least, dunno about the US but I can't imagine it being a prerequisite.

May 22, 2013 - 3:14pm

Glad that this post is getting the recognition it deserves. One more SB for good measure.

"For all the tribulations in our lives, for all the troubles that remain in the world, the decline of violence is an accomplishment we can savor, and an impetus to cherish the forces of civilization and enlightenment that made it possible."
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May 22, 2013 - 3:34pm

Great Show.

To answer ewlang et all

Don't most PE firms kick you out after two years?

Oh yes they do. So do BBs. Oh, my...What am I to do now...Can I write "Loser" on my Resume ?

The truth: In this economy most people re-enter school because it's better than unemployment.

Winners bring a bigger bag than you do. I have a degree in meritocracy.
May 22, 2013 - 4:03pm

0% of people who work on trading desks or an otherwise cubicle-less work environment can read this post without undergoing bullying or potentially having their compensation reduced. Someone please make a text-only version/summary/synopsis of whatever message this is supposed to convey.

May 22, 2013 - 7:29pm

SenhorFinance:

0% of people who work on trading desks or an otherwise cubicle-less work environment can read this post without undergoing bullying or potentially having their compensation reduced. Someone please make a text-only version/summary/synopsis of whatever message this is supposed to convey.

Just tell them you're researching the Tumblr acquisition. Boom, problem solved.

May 22, 2013 - 7:51pm

justin88:

SenhorFinance:

0% of people who work on trading desks or an otherwise cubicle-less work environment can read this post without undergoing bullying or potentially having their compensation reduced. Someone please make a text-only version/summary/synopsis of whatever message this is supposed to convey.

Just tell them you're researching the Tumblr acquisition. Boom, problem solved.

Haha, this would probably get me fired as well, Tumblr needs no research, it's 1B out the window. OK, best bullish constructive scenario, YHOO bought a lottery ticket that pays 2B with 1:100 odds for 1B. =)

May 22, 2013 - 6:24pm

As someone who is going to a top 3 MBA, I will say this: it is hard to get a PE, VS or HF job straight out of Bschool and banking is the best alternative.

As an example, 16% of the incoming class at HBS has PE/VC experience but only 14% leave with a PE/VC job. I don't think 2% of them choose not to go back so even some of the PE/VC superstars won't get a PE/VC job so us poor banking guys don't have a good outlook

All said and done banking is a good job and I would rather do banking than product management at Amazon or corporate finance at Google.

May 22, 2013 - 6:34pm

ElRusoAdomaitis:

As someone who is going to a top 3 MBA, I will say this: it is hard to get a PE, VS or HF job straight out of Bschool and banking is the best alternative.

As an example, 16% of the incoming class at HBS has PE/VC experience but only 14% leave with a PE/VC job. I don't think 2% of them choose not to go back so even some of the PE/VC superstars won't get a PE/VC job so us poor banking guys don't have a good outlook

All said and done banking is a good job and I would rather do banking than product management at Amazon or corporate finance at Google.

Why would you rather do banking? Just for the money?

May 22, 2013 - 6:45pm

AsianMonky:

ElRusoAdomaitis:

As someone who is going to a top 3 MBA, I will say this: it is hard to get a PE, VS or HF job straight out of Bschool and banking is the best alternative.
As an example, 16% of the incoming class at HBS has PE/VC experience but only 14% leave with a PE/VC job. I don't think 2% of them choose not to go back so even some of the PE/VC superstars won't get a PE/VC job so us poor banking guys don't have a good outlook
All said and done banking is a good job and I would rather do banking than product management at Amazon or corporate finance at Google.

Why would you rather do banking? Just for the money?

Not really the money because you work long hours and unless you make it to a senior role you are not making it rain. I think two reasons: I like finance and deals. So why not corporate finance. Talking to people, in a lot of companies finance is just viewed as a support function and people have you run budgets, variance and nothing very exciting. Probably not the same across all companies but in tech (industry I am interested in) that is often the case.

Product management can sometimes just be coordinating meeting. Some product managers do cool stuff but you always ran the risk of becoming a coordinator of meetings.

I also like the excitement of deals.

Welcome any thoughts though

Dec 31, 2019 - 1:33pm
ElRusoAdomaitis:

As an example, 16% of the incoming class at HBS has PE/VC experience but only 14% leave with a PE/VC job. I don't think 2% of them choose not to go back so even some of the PE/VC superstars won't get a PE/VC job so us poor banking guys don't have a good outlook

I know plenty of people who went to HSW from PE/VC intending to switch careers or at least to explore alternatives. Don't have hard numbers but 2% isn't very hard to believe at all.

From what I know, it's pretty rare for people with pre-mba pe experience not to be able to land somewhere. It may not be a top tier fund, but they get jobs eventually. VC is a bit different.

Your broader point is still true though. It's hard to break into pe without prior experience. But possible.

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May 22, 2013 - 9:30pm

If you happen to do 2 years IB, 2 years PE, then H/S/W MBA and don't make it back into PE, do you settle for Associate IBanking or do you actually shoot for VP IBanking? Aren't you overqualified to be an Associate in Investment Banking at that point?

May 23, 2013 - 12:09am

GorillaSachs:

If you happen to do 2 years IB, 2 years PE, then H/S/W MBA and don't make it back into PE, do you settle for Associate IBanking or do you actually shoot for VP IBanking? Aren't you overqualified to be an Associate in Investment Banking at that point?

I'm pretty sure you would just be an associate. Am I correct?

May 23, 2013 - 9:16am

Made me think a lot about next year when I will finish my undergraduate :/ At some point you want to pay off your debt from undergraduate studies with working but doing a master's right away is also tempting if you want to stay in the same firm.

Great post!

May 23, 2013 - 10:19am

panda123:

Made me think a lot about next year when I will finish my undergraduate :/ At some point you want to pay off your debt from undergraduate studies with working but doing a master's right away is also tempting if you want to stay in the same firm.

Great post!


Doing the masters right away is completely pointless. You will get next to nothing out of it and will have a very difficult time getting hired as an associate.
May 23, 2013 - 11:49am

rufiolove:

panda123:

Made me think a lot about next year when I will finish my undergraduate :/ At some point you want to pay off your debt from undergraduate studies with working but doing a master's right away is also tempting if you want to stay in the same firm.
Great post!

Doing the masters right away is completely pointless. You will get next to nothing out of it and will have a very difficult time getting hired as an associate.

This is exactly correct. There is no point to getting a masters directly after undergrad.

"For all the tribulations in our lives, for all the troubles that remain in the world, the decline of violence is an accomplishment we can savor, and an impetus to cherish the forces of civilization and enlightenment that made it possible."
May 23, 2013 - 9:24pm

The only time to ever get an MBA is if in you're a career rut and need to switch to something else and can't do so easily without getting the MBA. Even then, I would only advise it after trying to switch without the MBA, and only if you can get into one of the top MBA programs.

Getting an MBA to just come back to the same firm (or same general job, even if not the same firm) is absolute insanity.

I, for one, don't intend to ever get an MBA. There is nothing an MBA can teach you that you can't teach yourself through either work experience or diligent research. And paying six figures for some additional network connections (99% of which you'll lose touch with within 5 years after graduation) is stupid as all hell.

May 24, 2013 - 3:39pm

alexpasch:

The only time to ever get an MBA is if in you're a career rut and need to switch to something else and can't do so easily without getting the MBA. Even then, I would only advise it after trying to switch without the MBA, and only if you can get into one of the top MBA programs.

Getting an MBA to just come back to the same firm (or same general job, even if not the same firm) is absolute insanity.

I, for one, don't intend to ever get an MBA. There is nothing an MBA can teach you that you can't teach yourself through either work experience or diligent research. And paying six figures for some additional network connections (99% of which you'll lose touch with within 5 years after graduation) is stupid as all hell.

I agree. Unfortunately, my firm is winding down. I tried looking for other jobs but hit a huge wall either because (1) I have too much experience, or (2) I do not have an MBA. I got into an M7 school with a

That said, I would rather skin my left hand with a butter knife than go back to banking as a first-year associate.

May 24, 2013 - 3:30pm

awesome post +1

What we do in life echoes in eternity - Maximus Decimus Meridius
May 25, 2013 - 5:24pm

Story: a friend of mine interviewed for a SA position (IBD). The guy was an analyst, got his MBA and then went back to IBD as an associate. At the end of the interview when you're given the chance to ask questions, my friend asked him why he went back. The guy said: "Well...I COULD tell you, but that's not relevant to you, so I'm not going to tell you. You should ask something more relevant." My friend didn't get the offer.

May 27, 2013 - 6:39am

I did my analyst program and spent 12 years as an investment banker, before moving to a sr buyside role. Looking back, I think going to a Harvard or a Stanford or Wharton (pretty much just those three) would have been quite additive, and I regret not having done so. I'm 34 now, and I'm not sure it would be the end of the world to be 36 and in the same place, and the money is not large in the scheme of one's career. I do think business school opens up a lot of insights outside of one's narrow finance perspective.

I realize its a much tougher equation in today's economic environment than when it was on the table for me, back when first year associates were getting 300k+ in banking and 400k+ in private equity right out of business school.

I would also caveat that outside of those analyst colleagues who went to HBS or Stanford GSB, most regret it. The HBS and GSB ones seem to have thought it worthwhile.

Jan 2, 2014 - 8:58pm

Fuck this MBA crap just keep working. Or you might end up like my out of shape ass and actually enjoy life.

Follow the shit your fellow monkeys say @shitWSOsays

Life is hard, it's even harder when you're stupid - John Wayne

Jan 3, 2014 - 10:14am

how long did it take to put that post together?

I'm talking about liquid. Rich enough to have your own jet. Rich enough not to waste time. Fifty, a hundred million dollars, buddy. A player. Or nothing.

See my Blog & AMA

Jan 3, 2014 - 5:12pm

Guys serious question. Why is coming back so bad?

I plan to get my MBA at INSEAD/LBS/NYU after 2-3 years as an analyst to upgrade from middle-market to bulge bracket bank in my preferred industry group. People who went to top MBA schools say that people with previous banking got the most coveted banking internship summer positions and gave him an advantage,

We all know the myth that buyside makes more money but in reality they are pretty much the same in both hours and pay. Maybe when you make Partner at Bain you have the potential to kill it but if you're an equivalent MD at Deutsche you also get the opportunity to kill it.

My real question is was this thread made to give serious advice about do not come back to banking or made to show off all the cool gifs?

Jan 4, 2014 - 5:28am

great post. funny how many commenters are acting like you just hit this huge wall after 2 years of banking and 2 years of PE and absolutely MUST go to business school like there's nothing else on earth you can do. several of my friends from school went top ivy --> GS / MS --> Mega Cap PE --> top Ivy B school and it's like after this 6 year period of thinking of their career in 2 year chunks, they have this come to Jesus moment of "oh shit what do I actually want to do?" or worse, they return to banking.

After banking and PE, if you want to stay in finance, you can go work at a hedge fund. Some people work at startups afterward. Some start their own thing. At that point, you are 25 / 26 and have no kids or wife (Lord knows you can't build a healthy relationship working in banking / PE unless you were together in college). If you're smart and especially if you were at a mega cap fund, you could realistically have 300 - 500k saved up after 2 years banking and some pretty good contacts. given that, surprised more people don't start small funds, perhaps angel invest or invest in real estate, etc. given that they understand businesses / valuation. what's with the lockstep march from ib to pe to b school.

Jan 9, 2014 - 10:53am

DubStreet, I'm in that spot right now. Correct on the amount of pure cash saved up (b/w 300-350k in cash dumped in a trading account after maxiziming both roth 401k and IRAs for four straight years).

One thing I want to mention:
1. Most PE associates do not get the chance to stay at their firms after their two year pre-MBA stint is up. The industry has become ridiculously fleshed out and competitive - particularly at traditional LBO shops, there are just too many hungry guys who are trying to make partner, and too many competitors doing the exact same thing to really differentiate the fund. I think most people will agree that the golden age of PE has passed. Still tons of money to be made and a great asset class that will stick around, but the IB->PE->MBA->Partner track positions are becoming tougher and tougher to get, and with the top-heaviness of firms, the economics definitely aren't what they used to be. The point of all this is to say that a lot of these guys with picture perfect resumes find themselves at the age of 25 with a job expiration date looming near. They can't lateral to a partner position at a megacap without a MBA, and they certainly don't want to go back to banking. I think lateraling to a HF would also be somewhat difficult, it's a very different job that takes a very different mentality for the most part. So in the spirit of continuing to build on one's already "elite" resume, getting a MBA from H/S/W can look really attractive.

At the end of the day you're going to have to take a career risk (bet the farm on making partner track, switch into the tech industry and try to work for Google/FB, etc.). But after doing IB and PE you have this really broad and desirable skillset that can be applied almost anywhere in finance with success, assuming you've got the chops. So H/S/W affords you some time to meet other successful and competitive people with differing interests and continue to develop yourself personally, without taking a brand name hit or downsizing your career options.

Jan 9, 2014 - 9:02pm

hawainpalmtree:

DubStreet, I'm in that spot right now. Correct on the amount of pure cash saved up (b/w 300-350k in cash dumped in a trading account after maxiziming both roth 401k and IRAs for four straight years).

One thing I want to mention:

1. Most PE associates do not get the chance to stay at their firms after their two year pre-MBA stint is up. The industry has become ridiculously fleshed out and competitive - particularly at traditional LBO shops, there are just too many hungry guys who are trying to make partner, and too many competitors doing the exact same thing to really differentiate the fund. I think most people will agree that the golden age of PE has passed. Still tons of money to be made and a great asset class that will stick around, but the IB->PE->MBA->Partner track positions are becoming tougher and tougher to get, and with the top-heaviness of firms, the economics definitely aren't what they used to be. The point of all this is to say that a lot of these guys with picture perfect resumes find themselves at the age of 25 with a job expiration date looming near. They can't lateral to a partner position at a megacap without a MBA, and they certainly don't want to go back to banking. I think lateraling to a HF would also be somewhat difficult, it's a very different job that takes a very different mentality for the most part. So in the spirit of continuing to build on one's already "elite" resume, getting a MBA from H/S/W can look really attractive.

At the end of the day you're going to have to take a career risk (bet the farm on making partner track, switch into the tech industry and try to work for Google/FB, etc.). But after doing IB and PE you have this really broad and desirable skillset that can be applied almost anywhere in finance with success, assuming you've got the chops. So H/S/W affords you some time to meet other successful and competitive people with differing interests and continue to develop yourself personally, without taking a brand name hit or downsizing your career options.

Hey, are you from Hawaii dude? Iolani or Punahou?

Anyway great post. Something for me to keep in mind. I would love to reach out and get some advice like this sometime via PM. Thanks for this spot. INSEAD MBA is what I'm aiming for and coming back to banking is not the worst thing in the world.

Jan 9, 2014 - 10:26pm

hawainpalmtree:

DubStreet, I'm in that spot right now. Correct on the amount of pure cash saved up (b/w 300-350k in cash dumped in a trading account after maxiziming both roth 401k and IRAs for four straight years).

One thing I want to mention:

1. Most PE associates do not get the chance to stay at their firms after their two year pre-MBA stint is up. The industry has become ridiculously fleshed out and competitive - particularly at traditional LBO shops, there are just too many hungry guys who are trying to make partner, and too many competitors doing the exact same thing to really differentiate the fund. I think most people will agree that the golden age of PE has passed. Still tons of money to be made and a great asset class that will stick around, but the IB->PE->MBA->Partner track positions are becoming tougher and tougher to get, and with the top-heaviness of firms, the economics definitely aren't what they used to be. The point of all this is to say that a lot of these guys with picture perfect resumes find themselves at the age of 25 with a job expiration date looming near. They can't lateral to a partner position at a megacap without a MBA, and they certainly don't want to go back to banking. I think lateraling to a HF would also be somewhat difficult, it's a very different job that takes a very different mentality for the most part. So in the spirit of continuing to build on one's already "elite" resume, getting a MBA from H/S/W can look really attractive.

At the end of the day you're going to have to take a career risk (bet the farm on making partner track, switch into the tech industry and try to work for Google/FB, etc.). But after doing IB and PE you have this really broad and desirable skillset that can be applied almost anywhere in finance with success, assuming you've got the chops. So H/S/W affords you some time to meet other successful and competitive people with differing interests and continue to develop yourself personally, without taking a brand name hit or downsizing your career options.

What do most people with pre-mba PE experience do after H/S/W from what you've seen?

Array
Dec 16, 2014 - 9:41pm

WSO needs more posts (or a string hilarious animated GIFs to be precise) like this one. SB-ed!

I'm also gonna bookmark this post just in case.

Fortes fortuna adiuvat.
Dec 17, 2014 - 10:06am

What if you went to a top 40 usnews college (so non target) and went into banking. Would you advise going back to bschool if you intended on staying in banking and worked at a top MM or BB? Would you eventually need to "pedigree" yourself with a bschool if you didn't have a top undergrad?

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