Investment banking is an incredibly competitive industry to break into. The long hours, high pay, and prestige associated with working at a top bank attract hordes of ambitious candidates every year. However, only a tiny fraction of applicants make the cut.
If your goal is to land an investment banking job at a leading firm like Goldman Sachs or Morgan Stanley, you’ll need to maximize your chances of standing out from the pack. Follow these 9 essential tips to improve your odds and start your career in investment banking.
Tips On Getting Into Investment Banking
1. Attend a Target University
There’s no way around it – investment banks focus their on-campus recruiting efforts at target schools. These are top universities with established pipelines into banking. Examples include Ivy League institutions and prestigious colleges like Stanford and MIT.
Recruiting starts early, so if you want global bank exposure you must attend a target campus. That said, don’t despair if you missed out – there are other paths besides straight undergraduate placement. Transfers, masters programs, pre-MBA placements and off-cycle recruiting allow candidates from non-target backgrounds to enter the fray.
2. Maintain a Strong GPA
Investment banks seek out candidates with stellar academic records. A rough guideline is to keep your GPA above 3.5 to be competitive for analyst roles. The further above that threshold the better.
Banking teams deal with complex financial issues daily. Top grades demonstrate the intellectual aptitude needed to learn and apply advanced financial concepts on the job. Networking may help you get an interview, but first round cuts often start with screening below a minimum GPA level.
3. Develop Financial Modeling Expertise
The lifeblood skill of investment banking is financial modeling. Bankers build complex valuation models to assess mergers, acquisitions, IPOs, leveraged buyouts and countless other financial transactions. Solid modeling abilities are mandatory to handle this workload right out of the gates as a junior banker.
Start sharpening your Excel modeling talents early. Plenty of free learning resources exist online, and courses teach financial statement modeling step-by-step. Build your own models from scratch, memorize common shortcut keys, and understand best practices like structuring and formula consistency. These efforts will give your resume an instant boost over the competition.
4. Show Passion for Finance
The top candidates for investment banking show genuine interest and passion for finance. Recruiters try to assess this in interviews through questions about why you want to be a banker and what draws you to the industry.
Simply citing the pay, hours, travel or prestige won’t cut it. You need to demonstrate deeper understanding of deals and markets. Read banking writeups in the financial press. Follow deal announcements and earnings calls. Understand optimal capital structure concepts and valuation methodologies. This finance passion is what separates the true enthusiasts from those just chasing the status.
5. Take Advantage of Networks
The odds are stacked against those trying to break into investment banking cold. Networking is pivotal to surfacing opportunities that circumvent competitive on-campus programs.
Alumni networks are goldmines for tapping existing investment bank employees who can refer promising candidates. Don’t ignore family friends, parents’ colleagues, and mentors as additional sources to work for informant interviews and introductions.
Every interaction increases your industry exposure. View informational chats as auditions to reinforce skills and leave memorable impressions. Building genuine contacts enhances visibility to decisionmakers who facilitate final hiring calls.
6. Prepare Thoroughly for Interviews
Investment banking interviews have a notoriously difficult reputation. Hours of case studies and behavioral questions await promising applicants to evaluate mental horsepower, grace under pressure, and communication abilities.
Meticulous interview practice is mandatory. Internalize frameworks for approaching case questions across accounting, valuation, mergers, LBOs and DCF models. Use the STAR method for composed behavioral answers showing developed competencies like leadership, initiative and attention to detail.
Schedule mock interviews for feedback to sharpen responses and avoid memorized pitches. Canned answers fail to connect. Conversation flow displaying genuine intellectual curiosity impresses banking veterans conducting interviews.
7. Showcase Dealground Knowledge
Few candidates enjoy practical investment banking experiences before recruiting, but showcasing deal knowledge indicates genuine engagement.
Conduct informational interviews with bankers in groups you want to join. Ask how they advise clients, structure transactions, and overcome deal hurdles. Relate these insights to deals you read about in news briefs or case studies.
Subscribe to banking insight newsletters and highlight relevant LBO models, IPO valuations or M&A constructs from publications in interviews. This applied financing awareness separates you from academics lacking real world transactional contexts.
8. Apply Broadly and Follow Up
The odds of landing one particular opening at an elite investment bank are incredibly narrow. Savvy candidates submit high volume applications across numerous institutions to amplify options.
Blanket applications also allow comparing interview experiences across banks throughout the bidding process. Initial first round screenings with a firm won’t guarantee callbacks or offers down the line. Pending opportunities must be cultivated until definitive offer letters are signed.
Leverage multiple connections to relay continued interests after initial outreaches. Periodic emails or conversations show persistence banks admire in aspiring candidates chasing coveted openings in a competitive landscape.
9. Develop Back Up Plans
Even if investment banking is your absolute goal, having contingency options keeps desperation at bay. Recruiting cycles and deal pipelines constantly flux, shifting firm demands and hiring capacities over time.
Related roles in equity research, corporate development, Big 4 transaction services or consulting allow alternative avenues to glean financial experience. Maintaining expanded job searches creates leverage while interacting with banks. Ironically, those with the least banking tunnel vision often show savvy strategic thinking bankers notice.
Conclusion
Breaking into investment banking demands resilience through years building credentials at target checkpoints. The recruiting game rewards those maximizing both qualifications and connections. While the barriers are high, early and sustained efforts to engage practitioners, demonstrate passion, and perform under pressure position eager candidates for hard fought spots at the most prestigious financial institutions.
The long hours and workplace intensity await. But for those few maneuvering multiple years of incremental steps towards a dream job in investment banking, the hard fought entrance opens a world of challenge, reward and prestige almost unmatched across professional domains.