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.”