Advice For Impressing Adcoms

Cayuga Fund Managers in the Parker Center for Investment Research (PCIR).

The New Rules For Getting Into Investment Banking

Years ago, there were three rules for landing a job with a big bank:

1) Know someone high up in the food chain.

2) Be able to churn out models and PowerPoints like a madman.

3) Earn an MBA at a top school.

Place a check mark next to two out of three and you had a shot. Now, as John Byrne, Poets&Quants’ editor-in-chief, argues, “investment banking jobs have become a smaller piece of the MBA job pie.” Since 2001, for example, the percentage of Columbia Business School graduates entering investment banking has plummeted to 16% from for 43.7%, with 11% of that decline occurring from 2011-2014. Wharton has experienced a similar 12% slump over the past decade.

Mind you, investment banking isn’t dead. There are plenty of MBAs willing to schlep through 80-hour work weeks to make $200,ooo  – and earn bragging rights in the process. After reviewing the profiles of 2014 MBAs hired by the top i-banking firms as associates, eFinancialcareers’ Sarah Butcher has derived some new rules for landing in the catbird’s seat.

The first one she found — earn an MBA from a top school – hasn’t changed in decades. However, Butcher also points out that several notable hires also earned undergraduate degrees at top schools. “Banks like brands,” she writes. “While it helps to have a top business school and a CFA qualification on your CV, it therefore also helps to have a big brand undergraduate qualification too.”

Speaking of CFAs, notice the debate raging on whether bankers should get an MBA or a CFA? According to Butcher, that point is moot at top investment banks like Goldman Sachs or JPMorgan. “It’s no longer a question of CFA or MBA, it’s a question of CFA and MBA.” In fact, Butcher points out, you can’t take too many finance courses in business school if you want to get your foot in the door at Wall Street. “Most MBA courses will give you an opportunity to specialize,” Butcher adds. “If you want to work in finance, you must (self-evidently) specialize in finance.”

And that exposure to finance doesn’t just start in graduate school. In reviewing her sample of new hires, Butcher noticed that most new associates had previously worked in finance in areas like transaction services and financial consulting. Even more, they were deeply involved in their business schools’ financial clubs – often serving as co-chairs or co-presidents. “It’s not enough just to be studying an MBA at a top school,” Butcher points out. “You also need to demonstrate your passion for finance through your extracurricular activities there.”

Finally, as Butcher observes, if students didn’t complete a summer internship at an investment firm, they seemingly had no chance of landing full-time work in the industry. “Every single associate we look at, at every single top bank, had interned at the bank the previous summer.”


Source: eFinancial Careers

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