Can You Really Use Business School to Re-Brand Yourself and Break Into Finance?
“Just go to business school.”
“Go to a top MBA program.”
“With HBS on your resume you can do anything you want.”
It’s one of the most common pieces of advice given to anyone interested in consulting or finance: get into a top MBA program.
Even if you went to a no-name undergraduate, did nothing finance-related since then, and you don’t know anyone in the industry, a top MBA program will let you break in.
Or will it?
The Short Answer
Getting into a top MBA program may narrow the gap between you and former bulge bracket investment bankers.
But it won’t level the playing field.
Business school is often thought of as a magic bullet – a way to break into finance when all else has failed or when you have no shot normally.
There’s some truth to that – but there are also a lot of problems with it.
“Non-Target” Programs
Ranking banks, schools, and anything else is a massive waste of time and brain cells – which is why there will never be “rankings” of any kind on this site.
But the relative “prestige” of your business school is important, even if the specific “rank” doesn’t matter: if you don’t go to a school that banks recruit at, you’re wasting your time and $150K.
So even if something seems prestigious on paper or it’s in “The Top 10″ you need to go there in-person and ask students how recruiting really works.
There’s a less obvious conclusion as well: if you have a very small chance of getting into the top programs, then you’re better off pounding the pavement to get in.
Start with informal and unpaid internships and temporary positions at smaller places, and then leverage that to move up.
Cold-calling may not be fun, but it’s a far better use of time than going to a school where no banks recruit and where no alumni are in finance.
Part-Time vs. Full-Time
Until recently, there wasn’t much respect for part-time programs.
This is starting to change, but they’re still not on-par with the most well-known full-time programs.
If you can’t afford to go back full-time and are only looking at part-time options, you need to visit the school in-person, walk around and ask students and faculty how many banks actually recruit there – otherwise you’ll end up with $150K in debt and access to 0 recruiters.
Running Away From Your Past
If you’re coming from an unknown school, you have a lower GPA, or you have less “prestigious” schools or companies on your resume, you might feel like The Fugitive: you didn’t do anything wrong, but you’re always running away from your past anyway.
But here’s the problem that often gets overlooked: your past will still come back to haunt you, even if you get into a top program.
There are some people in finance who just don’t understand anyone who’s not from a wealthy, blue-chip background, and you’ll always have to deal with it if you have the misfortune of running into them.
Getting into a top business school may reduce your sentence, but it won’t clear you of all the false charges.
Geography
“What about top MBA programs in Europe / Asia? Are they as recognizable as ones in the US?”
The short answer: the best programs are still well-known, but no, they are not viewed the same as Harvard/Wharton/Stanford etc. if you want to work in the US afterward.
It’s not because they’re “worse” – it’s just that most US positions are taken by people who go to US business schools. Recruiting is a lot easier when you don’t have to cross multiple oceans for an interview.
If you can get into top schools in Europe / Asia, but can’t get into the top US programs, then sure, go abroad.
No Network
You might be motivated to go to business school if you don’t have a great network and don’t feel like cold-calling dozens of firms each week to get into a local boutique and then working your way up.
On-campus recruiting is convenient, but it’s almost too convenient. The temptation is to sit around and wait for companies to come to you – but that doesn’t work when everyone else at your school is also impressive.
So you need to start building your network even before you even get there. Start calling alumni, say you’re going to attend XYZ school next year and wanted some advice, and take it from there.
Experience: Too Much vs. Too Little
Another dilemma: you might have too little experience or too much.
Going straight for an MBA right after undergraduate is a losing proposition (yes, there’s Harvard 2+2 but that is new and unproven) – you need at least a few years of experience and often more than that to be competitive.
I get emails every week from students asking, “Should I go for a top MBA program right after I graduate?”
No. Bad idea.
Many Associate-level resumes have 5 or more years of work experience – even if you get into a top school, it’s tough to compete with that.
You can also have “too much” experience to make business school useful, but this is less of a problem than having too little.
If you’ve been working for, say, 15 years, it’s almost easier to work your way to the top in another field and then move into finance at a much higher level.
The Solution?
All these pitfalls go back to the original point made in the beginning, and something that Kevin and Jerry brought up on Management Consulted (Why Harvard Business School Does NOT Equal McKinsey):
Going to a top MBA program helps, but that alone will not solve all your problems.
It’s Just Like Breaking In As an Undergraduate
I still get a lot of questions on the CFA and other certifications, despite repeatedly bashing them in the past.
Many students think that adding these lines to their resume will seriously boost their chances, forgetting that they’re just small pieces of the big picture.
And yes, business school is different and much more than just another certification, but the same principle applies: a top school and access to recruiting there will improve your chances, but you need to do more than just go to a good school and drop $150K to break in.
What to Do?
Let’s say you are committed to going to a top MBA program to re-brand yourself and then using that to break into finance – what should you do to make sure it’s not a waste of $150K and 2 years of your life?
- First, make sure that banks actually recruit anywhere you’re seriously considering. Visit in-person, meet with students and career services, and see what the real story is.
- If you come from a more “random” background then start addressing “objections” to your background even before you arrive at school.
- You also need to start networking long before you ever get to business school – all the former bankers will have a big advantage over you otherwise.
Think about pre-MBA programs in finance – if you can, take time off to do an unpaid or part-time job related to finance.
Think about activities and professional organizations that might take you closer to business, or at least ones that let you spin your resume more aggressively.
And start contacting alumni and going through referrals in the months before you arrive so that they know who you are when it’s summer recruiting season.
But Sometimes You Have to Go
Business school is not a magic-bullet solution, but sometimes you pretty much have to go just to have any shot of breaking into finance.
Recent graduates would be better served by going to boutiques and then working their way up to larger banks – but if you have 5-10 or more years of experience, banks only take you seriously if you’re coming from an MBA program.
And if you had a completely random background that had nothing to do with business – like a traveling bard – then you might have to go just to have more than a 0.000001% chance of getting in.
Got Brand?
There’s always a temptation to buy more degrees, certifications, or anything else that gets you more “prestige” and makes you seem more qualified.
But not only does HBS not equal McKinsey, it also doesn’t equal Goldman Sachs, JP Morgan, or any other top bank.
Think of recruiting as a court case, with your key witness representing business school: a great testimony can push the odds in your favor, but you need plenty of “supporting evidence” as well.
That might be informal work experience, anything that can be spun into sounding like business, or a solid network.
So make sure you have both the supporting evidence and the key witness – otherwise, you’ll end up with a hung jury and no offers.
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Tags: cold-calling, investment banking, MBA, MBA internships, on-campus recruiting, prestige, understanding investment banking, unpaid internships
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Hey Brian,
Is it mainly a US phenomena where banks come to universities to recruit? In Asia/Australia, it seems that regardless of which university you attend you still have to apply online. Does that make attending business schools in this region useless?
It’s mainly US/Europe – but keep in mind that even in other regions, even when you apply online they are still judging you based on the name of your school and how well-known it is.
Business school is certainly not “useless” but may be less helpful in those regions.
So you are saying Columbia Quantitative Methods of Social Sciences program pretty much does not do anything else other than pushing the job seeking process 1 year later?
I’m not familiar with that program specifically – this article was discussing traditional 2-year MBA programs. If that’s just a Master’s program, then it wouldn’t do much aside from giving you another year to find jobs / possibly give you better access to recruiters.
I’ve heard that post-MBA banking associates who didn’t do banking before obtaining their MBAs have no shot at transitioning to PE. They say that for post-MBA banking associates “the ship for PE has already sailed.” In general, is this true?
I wouldn’t say “no shot” or “never” or “can’t do it at all.”
I saw post-MBA associates w/ analyst years jump ship easily.
For the post-MBA associates w/o finance experience, I’d imagine that it’s possible, but in my experience with post-MBA banking associates with no prior banking experience, they generally suck.
Well, I’ve read what analysts have to say about post-MBA associates. I don’t plan on being the pretentious douchebag who thinks he knows everything. I definitely want to absorb everything I can from the analysts and try not to create extra work for them.
Most post-MBA associates w/o analyst years think that way at first. But there are a few problems with that
1) Associates are still higher than Analysts. You will have to give work to Analysts.
2) When you give work to Analysts, most likely you will give “extra” work since you never spent time as the monkey at the bottom of the totem pole. Post-MBA associates w/o analyst years generally have no idea how to do things efficiently.
3) Even if you try hard to learn from the analysts, most likely they won’t have time/energy to teach you. And back to #1. You’re an associate, one notch above analyst.
I’m sure there are great post-MBA associates w/o analyst years but I never came by one. My views might be skewed/salted a little with a little anger having to deal with them.
As Summer Analyst said above, it’s possible but not likely. Very, very difficult to get into PE post-MBA especially if you haven’t done banking before that. It’s easier when the market is frothy.
I’ve got an interesting one for you. I enrolled in a top-25 JD program in NYC immediately after a top-25 undergrad. Halfway through I realized I wasn’t too hot on being a lawyer, so switched into the JD/MBA, intending to enter a career in finance, prob portfolio mgmt or trading. However, the b-school where I was a JD is ranked far lower than the JD program, so not nearly as much recruiting. I’m currently in the final year of what became a 4-year program. So, soon I’ll be a JD/MBA with little to no relevant experience. What’s my best move from here? Great appreciation for any advice.
That’s a tough one. I would say test the waters bit, contact some alumni, and see what kind of response you get to your profile… if that doesn’t work, I would say the best move is to do corporate law for a few years and then transition over to banking, using clients/former clients and other professional contacts.
Hi Brian,
I went to a large state school and majored in accounting (top 10 nationally), and graduated with a high GPA. I’ve accepted a Big4 offer as an auditor but would like to move to banking ASAP. I’m currently finishing up my Master’s in accounting and CPA exam, and will be done by spring.
I would ideally like to move into an analyst role at a BB IBank, then go for a top finance MBA and finally into PE/HF.
However, I’m not so sure what’s the most efficient or realistic way for me to do this. I’ve heard about boutique banks accepting candidates with 1-2 years experience in accounting. What would my chances of ultimately attaining a top-MBA -> BB associate/PE be with this route?
Also, I know there is a transaction services group at Big4, which basically does M&A due diligence. I’m deciding whether I should go this route for a couple years or if it would be better to go to a boutique?
Thanks!
I would definitely go to the boutique first – it’s much more direct than doing Big 4 first. Otherwise you could do Big 4 and then make the switch over to the boutique.
You can do the top MBA –> PE route, but be aware that it’s very, very difficult to get into PE post-MBA unless you did banking before.
Hi,
I was wondering if it would be easier to move into large cap PE or a well known Mid-market PE shop like TIAA if I work at a) A bulge bracket, b) A no name regional boutique, or c) A no name regional PE shop.
I am from a non-target background.
My guess is BB.
Bulge bracket is definitely the path of least resistance there.
Brian,
Could you talk a little bit about Venture Capital as alternative to PE? I’ve heard VC firms value an MBA.
Actually VCs probably value an MBA even less – they really want people who have started successful companies. It’s very, very, very difficult to move up to Partner-level at a VC unless you’ve done that or you’ve picked home-run investments. MBA is more useful in banking/PE.
Brian,
Thanks for the quick reply. I’ve already signed Big4 because I had no realistic shot at banking last recruiting season due to the state of the job market at the time. Not to mention no banks recruit at my school…
My question to you is this: If I make the move to boutique after a year or two, and go for top MBA from there, what are my chances of landing a BB associate position? PE?
Secondly, aside from networking from the start and keeping up to date on the finance blogs etc, what else would you recommend I do to increase my marketability in the next year?
Would passing the CFA prior to applying to the boutique help at all?
You have a good shot at bulge bracket Associate position, PE is harder but do-able.
Don’t bother with the CFA, huge waste of time. Networking, maybe doing some self-study that doesn’t involve 400 hours to take an exam… always good to be able to show them work samples.
Haha. Should just put up a post with a big bold title “Here’s all you need to know about CFA to be a banker”
and then in the body text with 100pt font, “IT’S A WASTE OF TIME.”
Hey!
What the difference between an MBA and a MFin in regards to investment banking? I’m a student right now at a Canadian university and I’m thinking of getting a MFin (right after graduation) at a US university that’s closer to Wall Street.
Do you think it’ll be useful? Do I still have to get a MBA later on to advance if I have a MFin?
They’re completely different – MBA lets you enter as an Associate, whereas MFin you’d still be an Analyst. MBA requires several years of work experience as well.
You won’t necessarily “need” an MBA later on, it’s more helpful for career changers.
MFin is most helpful if you go to a non-target school right now and need a better name.
Thanks for the reply. It’s much quicker than email!
I am from a Canadian school that’s far from Bay Street. However, if I happen to find a full-time job with a major investment bank… will there be any point in getting a MFin?
I’m thinking of schools like MIT or LSE.
There’s no point in doing it if you already work for a major bank
Hi Brian,
First off, I love the site! And I just bought the networking toolkit, and I’m loving it too. Haven’t found another site that’s as practical and informative.
One question though, I’m actually not actively pursuing a career in banking, although I would definitely be open to it. I’d really prefer working as an analyst in investment management (especially real estate related) or research. Is there anything you would say differently to someone like me in terms of resumes, cover letters, interviews, career paths, or networking? I’ve already come to the conclusion that the vast majority of your advice still holds true, but is there anything you can say about what makes breaking into investment management/research different than breaking into banking? Thanks!
Thanks, glad you have found everything helpful.
As far as investment management/research vs. banking or PE, there’s actually not a whole lot that’s wildly different. Really the main difference is that interviews are not squarely focused on corporate finance/accounting/valuation – they’re more about the markets, what companies you like, selecting investments, etc. Resumes/cover letters are pretty much the same.
The career path is probably a bit more “stable” in that there’s not quite as much risk as the other fields on here, but there’s also less up-side because you’re not working with multi-billion dollar deals and correspondingly huge fees.
Hey Brian,
If you’re in undergrad and making about 15 million a year trading/investing money. What are some of the options in IBD or in finance in general?
Um… you can just drop out of school and invest full-time if you’re raking in $15MM per year
yeah I’d forget about school and banking and take the money and run somewhere else.
How important is it to work in New York when you begin full time? Would it be better to work at GS at a non-NY office or at a slightly lower-level bank in its New York office?
It depends if you want to stay in NY or move somewhere else. It’s harder to move from another location back to NY later on, easier to do the reverse.
That’s a really long article! Lots of great insight.
Bschool can certainly be important in helping people transition over to finance if they are somewhere else at the moment, but most people place an over emphasis on the MBA as a guaranteed ticket.
Your article is very realistic in the sense that there’s so much more that needs to be done outside of the MBA curriculum and group activities in order to position yourself for your own goals.
Your advice of reaching out to alumni contacts even before Bschool starts is def good advice to follow.
I would also recommend MBAs to focus less on the group activities and classroom projects and more on your future career. You don’t want to be the guy who aced all class projects and took on major responsibility but then graduate with no job offers. MBA is a good platform to be on. You still need to jump from there to get to where you want to be.
If you think this article is long, clearly you have not read the rest of the site.
Hi Brian,
Love your website! I accepted an offer as an Invetment Banking Credit Risk analyst for a BB for next year. How good would you consider this job compared to a regular IB analyst (without the ‘risk’ part)? What about exit opportunities? Do you think that if I excel as an analyst I could move and stay in the firm as an associate in an M&? group without an MBA? Thanks!
It’s usually tough to transition from middle-office to investment banking – more likely to get into sales & trading, so I might go for that instead. Exit opportunities – not too familiar offhand, but I think again you’d have the best luck with S&T-type positions or anything else related to credit / credit ratings etc. Moving into the M&A group is possible, but you need a really solid connection there to make the jump.
Thanks for your response. Just two quick questions: (1) Given that I’ll be an ‘IB Credit Risk Analyst’ (and not and M&A, FIG or Tech analyst, for instance), would you still consider me to be a ‘real’ IB Analyst or not? (2) I will be in the same training program as other IB analysts and I know that my salary is going to be the same as for analysts in groups such as M&A, etc… But don’t really know anything about the bonuses. Do you have any idea about how analyst bonuses for this kind of position compare to bonuses for analysts in other teams (such as M&A, etc)?
1) No, this sounds more like a middle-office role where you’re supporting others rather than working with clients.
2) I don’t think the training program will be the same – bonuses are probably less than what IB analysts would make, but I’m not sure of exact numbers.
Thanks for your response. Just two quick questions: (1) Given that I’ll be an ‘IB Credit Risk Analyst’ (and not and M&A, FIG or Tech analyst, for instance), would you still consider me to be a ‘real’ IB Analyst or not? (2) I will be in the same training program as other IB analysts and I know that my salary is going to be the same as for analysts in groups such as M&A, etc… But don’t really know anything about the bonuses. Do you have any idea about how analyst bonuses for this kind of position compare to bonuses for analysts in other teams (such as M&A, etc)?
(1) Risk is generally not considered front office / ‘banking’
(2) No, middle office bonuses are a small fraction of front office bonuses
I have a 3.2 gpa (rounded up from 3.12), and for some reason I put 3.3 on the official online application for a bulge bracket as well as the resume I included with that application.
I had a phone interview with them and they asked about my 3.3 gpa and I didn’t want to say it was actually a 3.2 in the interview since he would assume I wasn’t honest on the application.
If I end up getting the offer, and the background check shows its actually a 3.12, not a “3.3″, will I be screwed? What can I do to fix this, if anything?
You can’t really do anything about it. It really depends on how thorough the background check is – 3.12 to 3.3 is a big jump and you could potentially get in trouble for it, but there is not much you can do. You definitely DON’T want to bring it to their attention.
What do you mean “how thorough” it is? Are there any banks that don’t confirm your gpa? I’d assume that’s one of their first priorities.
It means: “Will they think that the difference between 3.3 and 3.12 could happen between when you told them and when you started? Or will they assume you were lying all along?”
There is absolutely 0 you can do at this point. Banks do look at transcripts, but they don’t necessarily calculate GPAs unless your transcript has the GPA written on it (some schools do, some don’t).
So if my gpa is around a 3.3 by the end of this semester (mid-december) then I should be fine? Or is there still potential for problems?
That’s fine
Hey Brian,
I’m a big fan of this site. I was hoping you could help me: I live in Europe and there is a graduate program opening in M&A at a BB. The only problem is that it is in a small city and the M&A advice is for small caps. Is it relatively easy to switch to more prestigious M&A groups or is it hopeless? There’s also another one in corporate banking, once again, how easy is it to switch to IB?
my background: top EU school and am currently interning at a ‘top 5′ management consulting firm and having a hard time deciding whether I should pursue IB or consulting…
I would do the M&A one. It’s not exactly “easy” to switch but small M&A group -> large group is easier than moving in from corporate banking.
Hey, so I know where you stand regarding the CFA, but just to be sure, do you feel the same way towards the CMT?
I don’t think the CMT has anything to do with banking. Maybe its of marginal help for trading but honestly all traders care about is how much money you can make for them.
Would applying for an analyst position after a JD from a top 10 law school make sense? Your comment re: MBA + years of experience vs straight through/re-branded MBA for associate positions suggests that.
No, not really. They would not let you come on as an Analyst after law school, that just makes no sense – from law school your best option is to work in corporate law and then move over.
Here’s my situation: went to decent northeast undergrad for business management now at bad law school in northeast focusing on Corp. Finance and M and A, both were because broke and had full rides. Option for post law school between big 4 tax and small marketing firm for big bank credit card modeling (think creatig models for credit card offers and financing the creation of new credit car programs). I’ll be 24 when out of law school. If I work one of these ( help deciding would be appreciated) for 3-4 years and go top MBA what are my odds for BB associate?
Edit: over 3.6 gpa in undergrad and law school. Thank you very much in advance
It’s kind of odd to go from law school to an MBA program then to a bank… but I guess it’s do-able. Personally I think you’d be better off by doing corporate law afterward (if possible), and then moving into banking from there instead.
The corporate law route has been difficult. I’ve had plenty of legal offers but nothing really in line with corporate M&A (i.e. Weil, Skadden, etc..) Another question though. Would such a transition be possible from M&A consulting at an Accenture/Mercer/IBM caliber firm (not exactly Bain/Mck/BCG)? Opportunities in consulting have been presenting themselves, but I want to optimize the opportunity to jump into I-banking down the road (3 yr work + 2yr MBA or 5 yr work)
M&A consulting to banking is possible, but it’s much easier if you’re at MBB vs. the others you mentioned.
M&I, can you speak about breaking into Banking from a Trading background? I did a Structuring/Marketing at a bulge bracket as an Analyst – got hit by the recession – and am doing product development at a Fortune 500 for the past year. I want to see if I can break into banking. Thoughts?
I was thinking: 1) Take modeling classes 2) Network like crazy 3) MBA (last choice)
All of those are good ideas, but I would not do the MBA unless you get a lot more experience first – it’s really a matter of spinning what you’ve done to make it sound like you’ve gotten more and more interested in corporate finance over time, show evidence of that i.e. self-study, and then networking by focusing on small boutiques and local firms.
Hi M&I,
your website is incredible, i feel bad i haven’t discovered until now. Your advice seems very straightforward and you seem to know a lot about the finance industry. I really want to get into banking, below is my profile:
- bachelors and masters in computer science
- 4 years of consulting work experience, worked with clients across ny, chicago, westcoast (brokerage firms, stock exchanges etc)
- currently working for a software startup as a consultant for a top IB in ny.
- having worked with financial firms, i understand a lot of what goes around and i am intersted but i know that alone doesn’t cut it to switch careers
if i get an mba from a top school focussed on finance, can i break into finance? precisely into banking? and what are the chances i can make it big in 10 to 12 years.
I am 28 now, i obsess numbers, even though i work in technology i spend other time reading earnings reports, merger info etc so i thought why not pursue something that interests me more.
any thoughts much appreciated.
Yes, a top business school is your best bet. You would stand a good chance if you could do that.
“Making it big” is hard to answer because just like anything else, most people never make it to the top / decide to do other things etc.
thanks! and what are the odds of getting into front office banking? i think if i do switch careers its best if i can get into front office with client exposure right, also how long you think i should work as an entry-level analyst before becoming an associate?
will i stand any better chance than a fresh college finance grad from a top school in early 20s OR in other words, will i i have any advantage of my current career experience and academics at all or prettymuch i will be starting over?
i really appreciate your insights!
K
Usually you have to spend 2-3 years before becoming an Associate. At this point you honestly don’t have much of a chance of getting in as an Analyst – business school is by far your best bet because you’ve been in another field for several years.
ok makes sense, so you are saying MBA is really a bridge for me to switch from technology into finance and i will have to start from analyst position in banking.
thanks so much for the advice.
In case i don’t make it into Top 10 schools for MBA, do i have any shot at Banking at all?
Is there anyway i can leverage my being a top BB bank (in IT) for networking etc? How about trying to gain some experience doing
related work paid/unpaid first before or while trying mba? if i take the contacts of some Associate level people in the banking division
and email them, you think that might work?
I am thinking in this direction, because even if i do MBA from a NON TOP 10 school, with no finance experience, i don’t want to
end up in a position with NO on-campus bank recruiting OR going into consulting or IT related areas when I really want to make a switch to mainstream
banking.
If the only possible way is MBA from a top 10 school, i will just put all my energies to that and if i can’t crack it, i will
just let go of the MBA idea
thanks for all the advice, your website is helping me in understanding a lot of this.
my profile summary:
4 yrs experiece
bachelors and masters in computers science (3.9 and 3.6 gpa)
IT Consulting experience in financial firms across US
currently in a top Ibank in ny
You can try, but it’s probably easier to network your way into S&T rather than investment banking if you’re in IT right now – more overlap with trading. Unpaid internships pre-MBA are also a good bet as you mentioned.