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Poets and Quants (November 2013)
By Michael White
Students going to business school with hopes of cracking into investment banking should expect a grueling, exhausting, ultra-competitive recruiting process. Only the best and brightest first year MBA students are offered summer associate positions, and that alone isn’t enough to succeed. You need to nail it all along the way. It’s an unforgiving process and making a mistake, even a small one, can cost you dearly, but fear not, our “Top 10 Difference Makers” offers guidance and advice on how to land that coveted investment banking internship.
Finance in general has lost some of its luster after the financial crisis, and areas such as technology have gained the minds and attention of students in general. This has impacted how investment banks attract and retain junior bankers. At the most junior level, some banks, such as Goldman Sachs, are moving away from the traditional two-year analyst program and making it open-ended, hoping to retain the talent pool for longer periods.
For MBA students hoping to land summer associate internships, changes in tactics mean banks are being more aggressive finding and targeting the right candidates and senior bankers are getting involved earlier in the process. But make no mistake, banks are not compromising their standards and it’s as competitive as it’s ever been to get that prized offer.
TOP 10 DIFFERENCE MAKERS
There are, however, a number of steps first year students can take to improve their candidacy. Our “Top 10 Difference Makers” are, in summary:
Recruiting starts right away, about two to three weeks after school begins. You need to think about the process and start planning in advance of your school’s start date.
Research all the banks you want to talk to. You need to understand there are differences, even subtle ones, at each firm.
Finding a job at an investment bank will take time and commitment on your part, and you need to make it a priority. Don’t let your teammates down or grades suffer, but you will need to make a few compromises along the way.
CAST A WIDE NET AT EACH I-BANK YOU TARGET
Reach out to as many people at each bank as you can, and early stage professionals (associates; recent grads) are a great start. They can educate you, and lay the law of the land while you don’t feel the need to be perfect all the time. Finding a “shepherd” can also help navigate you to the right decision makers.
Find a way to get to the banks to schedule your own informational interviews. These are informal interviews, typically with junior bankers whereby you can ask more rudimentary questions. But be careful and understand there really is no such thing as an “informational” interview – they should be treated as actual interviews. Although you have more leeway in this part of the process, doing something dumb can shoot down your candidacy.
Nail your actual interviews. This is obvious, but you need to be prepared for the fact that your MBA interview was a veritable softball pitch to what investment bankers can throw at you. Chances are you may not get the “odd” question, but expect it. Although you can never fully prepare for the unexpected question, the general rules I give are (a) know thyself through and through, what makes you tick, and what you want to get out of life; (b) when given an ethical dilemma question, answer it honestly; and (c) when given a numerical question, work it through.
BE CONFIDENT, LEAVING ANY TRACE OF ARROGANCE AND COCKINESS AT THE DOOR
Oftentimes, there are no right answers to these questions (but sometimes there are!) and bankers generally want to throw you off and see how you think. Be confident, but definitely leave any arrogance or cockiness behind.
Understand what it is you’ve done that has differentiated yourself and is “interesting,” and work it into the interview. Volunteering at the local soup kitchen only throws you in the “volunteers at the local soup kitchen” bucket. What is it about you that is truly impressive and makes you different from all the other applicants?
Understand senior bankers want Associates they can leverage. You may become a good Managing Director eventually, but the important thing in the here and now is the bankers need to feel they can trust you with the models, that you’ll pay attention to the slightest details, can build relationships, are willing to compromise every aspect of your personal life when necessary, and feel confident you can “figure it out” without badgering them with unnecessary questions.
FOLLOW-UP AFTER THE INITIAL INTERVIEW
Look for follow-up opportunities after the initial interview. For example, let your network know you got the call-back. They’ll already know this, but will expect to hear from you. Once you make it past the initial interview, they’ll be more willing to invest time in you – use it to your advantage. Ask for their advice, but don’t over-indulge.
Throughout the process, develop “professional” relationships with several bankers who will go to bat for you – but do not try to become their “friend.” At the end of the process, you’ll want a few people in the room willing to carry your flag. Associates have a voice in the debate, but MDs carry the most weight.
And as a bonus tip: Dress appropriately for your interviews. For men, don’t go in dressed like an MD – you haven’t earned it yet. But don’t go in looking like a used car salesman as well. Bankers know students are operating on a budget, so I’ve always counseled guys if you’re going to spend any money to start with the tie and work your way out. For instance, a nice tie provides a strong ROI that can dress up an otherwise ordinary shirt and suit. For women, dress smart, stylish, put together, and conservative – and conservative does not mean to wear an old lady suit.
Applying these Difference Makers will better prepare you for what can be a grueling process. Hang on, for it’s a roller coaster ride.
Michael White is the Co-Head of Darien Academic Advisors, LLC and Head of its MBA Admissions Consulting practice. Previously, he spent over a decade as an investment banker at Merrill Lynch and Bank of America advising financial institutions on raising capital and mergers & acquisitions. He also spent nearly 4 years as a Senior Columnist writing opinion and commentary on the U.S. financial sector for Dow Jones’ Banking Intelligence product. He can be reached at email@example.com. For more information, visit www.darienacademicadvisors.com.)