Investment banking is one of the most sought-after careers by business, economics, and finance students across the globe. However, it is also one of the most challenging professions that require long hours of work, significant dedication, and a high level of financial knowledge. Before deciding to pursue a career in investment banking, it is essential to:
- Understand the day-to-day of an investment banker
- Learn the benefits and challenges of this career
- Research the different banks where you can work
In this article, we will examine how to do a thorough research on the industry and what are some of the main advantages and disadvantages of a career in investment banking.
1. Understand the day-to-day of an investment banker
There are multiple articles, blogs, and books which explain what a career in investment banking is, however the most important way to really understand it is through networking.
Networking means connecting and building relationships with multiple people in the industry. You should attend career fairs, networking events, and informational interviews with professionals in the industry. Building a network of contacts can provide valuable insights into the industry, increase the chances of getting an interview, and help to secure a job offer.
You can start with professionals on your current network, a friend of a friend, a relative, someone you met during your previous internship, or someone you met at university. Once you contact everyone you may already know, the search should not stop there, you should continue connecting with bankers you don’t know during events or on LinkedIn. You can start by asking them about their experiences and about what they like and don’t like about their jobs. Bankers love talking about their careers and the multiple deals and transactions they have worked on, so take advantage and don’t be afraid!
When speaking with as many people as possible in the industry, try to gather as much information as you can about the type of activities they typically engage in and how appealing they sound to you. Can you picture yourself working in such an environment? Do you feel truly interested in the role? Do you admire the person you are speaking with for what he or she does?
What to look for during these conversations:
- Skills and qualifications: Investment banking requires strong analytical and quantitative abilities, exceptional attention to detail, and excellent communication and interpersonal skills. It is crucial for you to evaluate your strengths and weaknesses and determine whether you have the necessary skills to succeed.
- Company culture: Investment banks have a unique culture that can vary significantly from one institution to another. It is important to evaluate whether it aligns with your values and work style.
- Career growth opportunities: Investment banking offers excellent career growth opportunities for those who perform well. You should look for investment banks that offer comprehensive training and development programs, mentoring opportunities, and clear career paths.
- Industry focus: Investment banks typically specialize in specific industries, such as healthcare, technology, energy, or real estate. You should evaluate if you have any strong preference or previous expertise in any of these industries to identify where you can fit best.
- Geographical location: Investment banks are located in major financial centers around the world, such as New York, London, Hong Kong, and Singapore. You will need to understand if you will want to relocate to these main hubs or look for local opportunities in your home country. You will need to understand which location offers a better chance for you and if they are willing to sponsor visas if needed.
2. Learn the benefits and challenges of this career
After you have a better understanding of what this career is about, you will be able to measure the benefits and challenges. Here are some of them, although these can be subjective depending on your own interests and values.
As you can see from the list above, Investment Banking is a challenging but rewarding career. It offers high salaries from the start with high potential increase while growing the ladder. It is also a career with a lot of prestige and recognition, which together with a very specific training and development program, can give you incredible exit opportunities. Investment Banking not only gives you the necessary skills and tools to grow inside the bank, but to change jobs into very competitive sectors such as private equity, venture capital, consulting, corporate M&A and others.
Investment Banking exposes you to complex financial and strategic transactions where you will advise companies on how to maximize value for their shareholders. Finally, it gives you the opportunity to see a tangible impact not only on the company itself but on the global economy.
However, there are many challenges as well, as it is also a highly competitive and demanding industry that requires long working hours, high-pressure environments, and limited job security.
Before deciding to pursue a career in investment banking, it is essential to consider these pros and cons carefully and evaluate whether this field aligns with your skills, interests, and lifestyle.
3. Research the different banks where you can work
Besides understanding what a career in investment banking is, you will also need to learn the differences between different investment banks to decide where to apply. Banks are different in size, industry focus, product expertise, geography exposure and mostly in culture.
You will be able to get a flavor of these differences by reviewing the bank's website, researching recent deals they have worked on, reading news articles and most importantly talking to people across different banks.
Finally, it is crucial to review the Investment Bank League Tables. These are rankings of investment banks based on a set of criteria such as deal size or fees on specific product, industry or geography. These are also important for the bank’s credentials when pitching to clients. These can be accessed through different private or public sources, such as The Financial Times.
Selecting a job at the beginning of your career is one of the most important decisions you will make in your life as it sets the foundation for your future professional and personal growth. Making the right choice can help you achieve financial stability, personal fulfillment, and a sense of purpose. On the other hand, a wrong career choice can lead to frustration, stress, and dissatisfaction. Therefore, it is essential to take the time to research and analyze all the factors mentioned in this article to understand if a career in Investment Banking is the right choice for you.
That being said, as you can imagine the interview process for Investment Banking is highly competitive, with many qualified candidates vying for a limited number of positions. Investment banks have rigorous interview processes that may include multiple rounds, technical questions, and case studies. It is therefore essential to demonstrate a strong understanding of finance, accounting, and modeling to succeed, as well as critical thinking and the ability to solve complex problems. Preparation is key to stand out from other candidates and demonstrate your commitment to the industry.
💡 If you already know that Investment Banking is the career for you and you want to acquire all the tools and resources to land a job at the best firms, then you might consider Nova's Investment Banking fellowship by Nebula - an 8-week program led by top Investment Bankers and experts to help you prepare for and land your dream job!