Do You Make These Critical Mistakes When Answering the Most Important Investment Banking Interview Question?
Much of my email these days contains questions on advanced topics:
“Where can I learn LBO modeling?”
“How do you use Section 382 to determine allowable NOLs in an acquisition?”
It’s nice to show this kind of initiative.
But even if you can answer these questions, there’s a 95% chance you will not get past the first round of an investment banking interview.
Why?
Because you don’t know how to answer the most important question:
“Walk me through your resume.”
No matter how much experience you have or where you’ve interviewed before, you’re probably making critical mistakes that bore the interviewer and result in a “PASS” within 5 minutes of the interview starting.
So what are these fatal errors and how can you avoid them?
Pretending Your Resume is Pulp Fiction
I love Quentin Tarantino and Pulp Fiction is one of my favorite movies.
But if your story is out of order chronologically just like most of Tarantino’s films are, you’re going to confuse your interviewer.
Interviewees often start with college activities or work experience, then jump back to childhood or high school, then go into what they’ve been up to recently.
If your life story involves Samuel L. Jackson and great dialogue this might work, but unfortunately you’re interviewing for investment banking – not writing the next great independent film.
You should start from the beginning – whether that’s your childhood or high school (for university students) or college or post-college (for MBAs and working professionals).
Then, show how you became interested in finance and how each experience increased your interest in banking.
Telling an Essay Rather Than a Story
If you start off with “I’ve always worked extremely hard to achieve my goals,” your story is going to get a worse reception than The Matrix: Revolutions.
Remember back in middle school when your English teacher taught you to show rather than tell?
You want to show that you’re hard-working and goal-oriented with your experiences – not with lengthy exposition in the beginning.
Don’t say, “I’ve always been very attentive to detail” – explain how you had to proofread a newsletter that went out to thousands of readers, or manage a budget for 15 different groups.
Being as Logical as The Joker
Remember that scene in Batman: The Dark Knight where The Joker burns all the cash he just received? That’s how logical your work experience sounds if you don’t link together each experience properly.
You should show how you learned something valuable with each experience, but increasingly realized you wanted to do banking over time.
Don’t say, “I did marketing, then went into wealth management, and now want to do banking.”
Say that you liked marketing but wanted something more quantitative and market-focused, which you found in wealth management, but then you realized you wanted to analyze transactions and major happenings rather than day-to-day events – which brought you to banking.
Why It Matters
Almost every interview starts off with a variant of “Walk me through your resume.” And if you answer it poorly, it’s difficult to overcome a negative first impression.
Also, the Managing Directors who ultimately make decisions rely on your background and story to determine if you get an offer.
How to Fix Your Story
Take a look at your resume and figure out where you should start – what initially made you interested in finance? Why did you choose the school you attended? Did your childhood influence your decisions?
Start at the beginning and lay out how each experience led you in your current direction – and at the end, explain why you want to do banking more than anything else.
Be chronological, be a storyteller, and be Mr. Spock – not The Joker.
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How important is this question for a prospective trader? (Whether it be for an IB or a Prop shop)
Still important – they will be very focused on the whole “Why trading?” angle. When I interviewed for HF spots they were very focused on what made me interested in investing/trading.
Much appreciated thanks. I was wondering if trading on my own account and having a record would be better then applying straight away for a prop shop.
I will probably do a bit of trading for myself before applying, just to try to get that extra edge. Plus the economy isn’t helping.
What concerns me is that here is Australia, the main prop shops keep a black list: if you fail their application tests you can never apply again. Ever.
It might help somewhat, if you feel you have no shot now and will get blacklisted I would do some trading on your own account first.
Hello M&I,
I have worked in M&A for the last 5 years but with BiG4s in India. I was working as a a Manager with independent clients handling and leading a team 5 of associates. I am currently doing MBA form one of the leading European B schools. Post MBA I would like to venture out in P-E or pure play I-Bs. I would like to know what are my chances of breaking into one of those for a FT position. Also, during internship, I got calls from the P-E/I-B, but got lost out either due to additional European language or the work Visa (as I come form a non-Eu country).
Your advice on this is deeply appreciated.
Thanks and kind regards
Your chances are good for IB, less so for PE. For PE you really need IB experience pre-MBA to have a good shot at breaking in.
Thank you very much for your reply. Actually this is my second MBA and I am already an MBA from one of the India’s finest B-schools alongwith LL.B and LL.M. I have been following the profiles of all the big guns of P-E, and many of them have this dual combo of a Law and MBA. I thought with these credentials + an international MBA, it would be a walk-in. But, I guess it is not the case.
The market in India is not that matured as compared to the Western counter-parts, I wanted to work in India only. I dont know how much I would be able to leverage.
P.S. your posts are awesomely informative. When I posted first, I accidently landed to your web-site. Since then I have been regularly following it up and I am really impressed. Hats off to you. Cheers
Great post and so very very true! Its all about the story….
Yeah, I figured you couldn’t go wrong with an article that contained The Joker…
Probably a stupid question, but nonetheless:
Do hedge funds take a lot of trading analysts? If I worked in Debt Capital Markets, would I be more likely to exit to a HF or PE?
Hedge funds do take a lot of trading analysts; it depends a bit on what you did though. If you worked on issuing loans for companies, PE is more likely; if you just executed fixed income trades for clients in S&T, hedge funds would be more likely.
I have an interview with a HF for an assistant trader position, i’m not sure what I should expect or what kind of interview it would be…im not even sure what an assitant trader does..yes i know thats sad. I’m too use to banking interviews that i’m not really sure what i should expect here….
Expect lots of questions on “why trading?” and on what specific investments you would make – those are most common. Also more math/probability questions than you’d get in a banking interview.
Hi Brian,
I’m interviewing for Barclays Capital Japan IBD through LA career forum this coming saturday (D-2),
I’ve read your interview guide in and out(which was very helpful=)), researching about the firm good, and I’ve read every article on M&I
So I think I’m pretty confident,
Just wanted to ask you for any last minute advice, if you have any, thought you might have some.
thanks
Not really – just make sure you’re relaxed and don’t sound overly scripted at this point. Messing those two up is what can kill you if you’re otherwise very prepared. Good luck!
When you’re asked the ‘walk me through your CV’ question, do you necessarily need to keep referring to your CV. Do you need to say for instance ‘we start at the bottom of the work experience section where…’ or is it better to just tell your story without pinpointing where exactly the experiences you’re talking about are on the document that is in front of your interviewer. Intuitively I’d think the latter, because you will sound much more fluent, but I just want to make sure.
No, don’t refer to your CV at all – just do it organically and start from the beginning. “We start at the bottom” sounds odd for that type of question.
I had a big boutique ib firm called me this morning all out of sudden and asked to “walk me through your resume.” I got nervous and did exactly that, walking through the resume but did not really mentioned how and why i liked banking. He said that his college will call me if there is any other question. Does this means that I have no more chance? Should I call him, since I got his number from the caller ID? Need advise…
Hard to say there – I would not call him back and try to apologize or anything. Maybe follow-up in a week if you haven’t heard anything and see what your status is.
Will do thanks :) Great website by the way.
@ Andy: I’m in Australia too and that “black list” thing you mentioned is new to me. Would love to know more as I have been a Financial Adviser in Italy.
@ the site Admin: great great content here. Love it. It’s a bit difficult for non-Americans to compare everything but still interesting.
Thanks
Hi, I find this site to be very informative, and I have gathered one thing from your site – that is the story is important. However, I have a degree in food science, does that mean my chances of breaking into investment banking is virtually nil although I really am interested in it?
You need to have some other evidence of your interest in finance – food science alone won’t kill you, you just need to show interest in other ways.
Hey,
I’m a mathematics undergrad looking into IB, but I’m not sure which denomination of IB is well suited for a mathematician. Are there any divisions/positions that are a better fit for mathemematicians (barring quants), either because the work is more mathsy or because they like mathsy people for the work?
Maybe structured products in trading, though I don’t know much about it / not sure where it’s going now with the new regulations.
Thanks for the advice!