Financial Modeling Self Study Program

I’m trying to make the switch into banking from another career. How do I get interviews?

In order to get interviews, you have to get your resume in front of the right people.  Occasionally, this can mean HR, but more often than not, it’s going to take a banker looking at your resume.  Like every other type of job search, you’ve got to network.  First thing to do is to contact any friends and acquaintances that are already in banking.  Ask them to look at your resume and to pass it on to the right people.  Without a doubt, you’ve got a much better chance if a banker passes your resume to HR than you do sending to HR directly (but do that too).

The next best thing to people you know, is your alumni network.  Almost all schools have them, and almost all schools (undergrad and MBA) have alumni on Wall Street.  Talk to alumni, ask about job openings, ask for advice and ask for informational interviews.  Informational interviews are when you meet with (in person or over-the-phone) a banker for 15-30 minutes just to chat and to learn more about the job and the bank.  Even though they are not technically interviews, definitely treat them as such.  If the person likes you, he or she may be able to get you actual interviews.

Once you’ve exhausted your friends and your alumni network, try cold calling/emailing bankers.  Most calls or emails won’t get returned but remember, it only takes one.  And make sure to expand your search.  There are literally thousands of boutique investment banks out there and boutiques are typically more flexible about their hiring practices than are the bulge bracket banks.  And cover all your bases.  Try headhunters and try to sending your resume to HR or applying online if the bank has an online application system.

Most importantly, don’t get discouraged.  Networking and looking for a job is a difficult and ego bruising process.  Some would say it’s a full-time job in and of itself.  If you really hit a brick wall, then think longer term.  Are there other jobs which could be stepping stones to banking?  Or should you be considering an MBA?

I’ve had 10 interviews with a bank. Does everyone have to like me in order to get an offer?

It depends.  At some banks, if you get negative feedback from even one person with whom you’ve interviewed, you won’t get an offer.  At other banks, 8 or 9 “yes’s” will be enough to outweigh 1 or 2 “no’s,” provided that the “no’s” aren’t very strong and aren’t coming from the most senior bankers.  Occasionally, the opinion of the head of the group can be enough to get you an offer, regardless of the other feedback.  Unfortunately, you will never know the dynamics of the situation when you interview so the best advice is to take all of your interviews seriously.

How important is it to have done a banking internship?

In this job market, an internship is almost mandatory.  Having done an internship in banking (either over the summer or during the school year) shows (a) that you are serious about banking and (b) that you have a good idea of what you are getting into.  Being able to demonstrate both A and B because of an internship will go along way in helping you differentiate yourself during the interview process.

For MBA students (who were not Analysts pre-business school), a summer banking internship is extremely important when it comes time for full-time recruiting.  Interviewers will tend to question how serious is your interest in banking if you did your internship in another industry.

How difficult is it to switch from law to banking?

Switching from being an Associate at a law-firm to Associate at a investment bank is difficult but definitely doable.  A fair number of lawyers make the switch every year.  The more experience you have as a lawyer doing deals (M&A transactions, for example) and/or working directly with investment bankers, the easier it is going to be.  One area of law from which lawyers very often make the switch over to banking is bankruptcy/restructuring.

In making the switch, there are two broad questions that you will have to answer during the interview process:  (1) why do you want to switch and (2) can you count.  Answering the first question obviously requires you to emphasize your interest in the banking side of transactions as well as general “business” topics.  You should also be ready to answer the question of why did you become a lawyer rather than a banker in the first place.

“Can you count?”  This is banker shorthand for saying, “Will you be able to do the analytical work required of a banking Associate – the valuation work and the modeling”  “Do you understand financial statements and basic accounting?”  And “Can you use Excel?”

Of course, “Can you count?” is a very silly question to ask a lawyer since most of us know that keeping track of billable hours in twelve minute increments is a lot harder than most of the analytical work required of a banker.  In all seriousness, the truth is that the average lawyer (at a top law firm) is smarter than the average banker.  And in fact, ex-lawyers often make the best senior bankers.  But because some bankers have issues with inferiority, they can have a built-in bias against lawyers trying to switch to banking.  Hence, the generalization that lawyers “can’t count.”

What is the typical process for a lateral hire or someone outside the industry?

Assuming you’ve passed the first steps of getting your resume to the right person and that they want to interview you, the next step is to schedule your first round interview.  You will typically have one or two back-to-back 30 minute interviews.  If you are interviewing to be an Analyst, you will often meet with Associates and/or VPs and if you are interviewing for an Associate position, you will probably meet with VPs and/or Directors.  At some banks, especially bulge brackets, one of the first round interviewers might be someone from the HR department.  If you are from out-of-town, your first round will probably be a phone interview.

If your first round interviews go well, then you will be invited to meet with more bankers on site.  In total, you might meet with anywhere from four to twelve or more bankers over one or two days.  You will probably meet with bankers at all different levels (Associate to MD for an Analyst position, VP to MD for an Associate position), including the head of the group with which you are interviewing.  If all goes well with the additional interview rounds, then someone (either HR or a banker) will let you know that you will be receiving an offer.

I’m still in school (undergrad or MBA). What is the typical recruiting process?

For both undergraduates and MBAs, investment banks typically have a number of “core” schools at which they recruit.  In the early fall, the banks will come to campus for informational presentations and receptions to give students an opportunity to learn more about the bank and to meet some bankers.  These events are also an opportunity for the bankers to begin to identify potential good candidates.  A little later in the fall (typically in late September or October), banks will hold first round interviews on campus.   It is often competitive for students to win places on the interview schedule.  Some banks and some schools will leave a number of interview slots open to students, through a lottery or other mechanism who were not directly selected for an interview.

Generally, students will have one or two 30 minute interviews.  Second (and typically final) round interviews generally take place at the investment bank at what are known as “super” days (usually occurring either on a Friday or Saturday).  Banks will normally pay for out-of-town candidates to travel to the bank.  During these “super days,” candidates can expect to have anywhere from 4 to 10 or more interviews of 30-45 minutes in length each.  Banks usually make their decisions very quickly regarding to who they will offer full-time positions.  Candidates are contacted accordingly, often that same day, with the good or bad news.

Those that are being offered positions will receive a formal offer package.  The offer package will include salary, signing bonus and a host of HR documents.  Most of the time, the offer will have an expiration date, known as an “exploding offer.”  While some schools try to crack down on exploding offers, banks use them to pressure candidates to accept and to try to prevent candidates from using the offer as negotiating leverage with another investment bank or other institution.

Will headhunters be helpful to me in my job search?

It is important to understand that headhunters (executive search firms) get paid by the investment banks when they place people at those firms.  The implication of this is that headhunters want to spend their time on people who are likely to get hired, and those are going to be people with prior banking experience:  lateral hires.  So it’s not to say that a headhunter will never be helpful to someone without banking experience, but this occurs pretty infrequently.  Bottom line, it can’t hurt to give headhunters a call, but don’t hold your breath.