Why You Can’t Get an Investment Banking or Private Equity Job via Recruiters – And What to Do About It

58 Comments | Private Equity & The Buy-Side - Networking

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Now Hiring Must Have a ClueWhile most of the interviews on this site have been with job seekers or with current investment bankers, today we’re going to change things up and speak with an investment banking and private equity recruiter who works at a well-known recruiting firm.

You’re about to learn some little-known, highly valuable, and controversial information about the finance recruiting industry.

Keep reading to find out how to impress recruiters and interviewers and land PE and investment banking offers.

Where Did It All Begin?

Q: Can you tell us about your firm and what types of candidates you focus on?

A: Sure. We started off specializing in placing ex-military candidates, and since then we’ve expanded into almost 20 other industries, including accounting and finance.

Within investment banking and private equity, we focus on $200K – $1M total compensation per year positions. This corresponds to entry-level positions up through the mid-level – we do a few Partner and MD-level searches occasionally, but they’re not our core focus.

We work with a wide range of banks, but on the buy-side we concentrate on funds below $1B AUM and usually funds in the $50 – $500MM AUM range.

Q: How’d you get started doing this? I know sometimes investment banking analysts make the move over to the recruiting side – were you coming from that background?

A: No, I started off doing recruiting for general “Analyst” positions across all industries.

That was ok, but I found that I liked private equity and investment banking recruiting more because the fees were better and placement took more time – so you could focus more on a few key clients rather than spreading yourself thin.

While some investment banking analysts want to make the move into recruiting, they often fail to realize that technical skills matter very little for recruiting – it’s a sales job, not an analytical job.

You need to be a quick thinker and good on the phone – knowing the in’s and out’s of models and how an M&A deal works is ok, but you only need to know these topics at a very high level.

Q: You mentioned that you don’t do many Partner-level searches – but wouldn’t you earn far higher fees by placing these types of candidates rather than lower-level people?

A: While the fees are higher, there are a couple problems with Partner-level searches:

  • Usually it takes 6-8 months to place a single candidate.
  • All searches at that level are highly confidential, so making introductions and maneuvering the process has an added layer of complexity.

Overall, we’ve found that sub-$1MM range candidates are the best to work with because the chances of placing them are higher and because it’s not quite as extended a process.

How to Boost Your Interviewing Skills by 200% in 15 Minutes

Q: When you first emailed me, you mentioned 3 qualities that every successful investment banking or private equity candidate needs to show when they’re interviewing – what are they?

A: You need to demonstrate 3 specific skills when you interview:

  1. How you made money for your firm in the past.
  2. How you saved them money.
  3. How you improved a process.

The #1 mistake that you can make is focusing too much on your technical prowess and not enough on how much money you will make for a bank or PE firm.

Talking about models in interviews is fine, but you always need to tie them back to business results.

I get people who come in and start rambling about deferred tax liabilities and their hyper-advanced LBO models, and they miss something very important: most VPs and MDs don’t even remember how to build a model or use Excel.

What they do understand is making money or saving money, so you need to re-frame everything you’ve done in that context.

Q: Right, that makes sense – but a lot of people may not have “business results” to point to. Let’s say you’re working on a deal that never goes anywhere – how would you talk about how much money you made or how much money you saved your client?

A: You could talk about partial or potential results if you don’t have concrete numbers to point to.

Here’s an example: let’s say you’re creating a list of potential acquisitions for your client and you’re making recommendations on which ones they should pursue.

Even if this deal doesn’t advance to the final stages, you could easily talk about how much money you saved them if you can point to any acquisitions that you crossed off the list:

“I had to research potential acquisitions for our client – we got it down to a list of 10, and then I recommended taking 4 of the companies off the list because they weren’t a fit with the client’s product line. Any one of those would have cost them over $100 million, so I helped them to avoid a potentially bad acquisition and saved money in the process.”

If you worked on a merger that never went anywhere, you could talk about your model and key findings within that got your client a higher price if they were selling, or a lower price if they were buying.

Or you could always tie your work to the client coming back to you for more engagements in the future:

“The client was impressed with our work and especially the recommendation to avoid those acquisitions, so they decided to come back to us for 2 more engagements – I did the work that led to those, with a total fee potential of $10 million.”

Q: Right, that makes a lot of sense. Firms want people who can make them money or save them money – but is this true even of non-Partner-track positions?

If someone is just going to work there for 2-3 years and then go to business school does it really matter?

A: Yes, because there’s no such thing as “predictability” when it comes to IB or PE careers.

People come to me all the time and say, “So, where will I be in 10 years if I go to this firm? Can you give me an exact blueprint of my future career?”

Sure, here’s your blueprint: you make a lot of money for your firm and you move up. You don’t, and you’re out.

It’s really that simple: no matter what they say about you, if they see in you the potential to make them a lot of money in the future, you move up.

Q: Ok, I see – so there’s less of a “path” than most people think. What other key mistakes do candidates make when recruiting for finance jobs?

A: I could probably write a book about key mistakes, but here are just a few more:

  1. Not proving that you can evaluate and run a deal by yourself.
  2. Focusing too much on features and not enough on benefits.
  3. Relying on pedigree rather than results.

For #1, private equity firms might look at hundreds of deals each month, but might only invest in 2-3 per year max. Principals don’t have time to sift through all the information and evaluate every single detail – they need someone who can step up and do everything on their own.

Even at the entry-level in private equity, you’ll be coordinating with lawyers, bankers, the debt financing team, the company’s executives, and more – and you need to be comfortable doing all the work for everyone else and driving the process.

On #2, this is just a classic sales mistake: too many people go in there and say, “Well, I have a 4.0 GPA from Harvard and I worked at Goldman Sachs.”

Guess what? Those are features, not benefits.

How will you make me money? How much money have you made or saved for other people in the past?

Whenever I meet a candidate for the first time, I make him/her write down 10 things that are great about himself/herself.

Even if it’s “I’m great at baking cookies, so you can enjoy great food if you hire me” that’s better than nothing – the point is to always present benefits rather than features.

#3 is related, but I see a lot of people from Ivy League schools and bulge bracket banks expecting the world just because they have well-known names on their resumes.

It doesn’t work like that: you need to deliver results if you want to advance.

Often, candidates from less privileged backgrounds perform better because they’re twice as motivated.

Q: I also get lots of questions from people with Liberal Arts backgrounds who want to do banking or PE – how should they position themselves?

A: Actually, if you have a liberal arts background that can often be a big advantage because you’re probably much better at talking and BSing than math/science/finance nerds.

You want to position yourself as someone who can tell a good story around the numbers rather than just cranking out models all day long.

When they ask about your weaknesses, don’t say your analytical skills even if you’re tempted to mention that – pick something more qualitative and show how you’ve improved over time.

How to Work Effectively with Recruiters

Q: Thanks – those tips should be really helpful to anyone preparing for interviews right now.

What do recruiters actually do? Is it just a matter of screening resumes and making introductions?

A: We do some filtering of candidates, but it’s more than just looking through resumes and deciding which ones we want to pass along.

To give you some numbers on how the process works, here’s what I did over the past year:

  • Received 7,000 resumes or inquiries.
  • Got interviews for 42 candidates.
  • Successfully placed 10 candidates.

These numbers improve a lot when the economy is better.

A lot of what I do on a daily basis is helping clients find very specific candidates – they no longer just come to us and say, “We need an investment banking analyst.”

These days it’s more like, “We want an investment banking analyst from Barclays Energy Group who worked on a specific recent deal, grew up in the UK, spent time in the Middle East, and can also play golf with under an 85 handicap.”

A lot of my time is spent looking for these types of people, and also with preparing our candidates for interviews and helping them to sell themselves more effectively.

It’s a huge myth that recruiters only forward resumes to firms.

Recruiters are also your best source if you want to do a secretive job search and keep everything on the DL – if you just go directly to an MD, he won’t care about your privacy. He’ll just call your current MD and ask how good you are.

Q: I get a lot of questions from readers without investment banking or private equity experience wondering if they should contact recruiters to help with the job search process.

Is there any point in doing this?

A: Short answer: no. Over the past 2 years I haven’t placed a single candidate who wasn’t a 9/10 match for the job.

If the economy is booming and banks have ramped up their hiring, you can still potentially come in with an unrelated background (e.g. do marketing at a Fortune 500 company for 2 years and then move into IB), but it’s pretty rare otherwise.

It’s not that you’re unqualified – but we just have so many people who do have finance experience lining up for jobs that it’s almost impossible unless you’re the Chairman’s son or you can bring a unique skill set to the table.

Q: OK, so what should people without the required experience do? How do you get noticed if you’re not a perfect match for the job?

A: Become your own recruiter. Make a list of firms you want to go after, go to LinkedIn, look up people at those places, contact them, call them, visit in-person and start introducing yourself like that.

Then once you get to know a bunch of people at a specific firm, you can come back to me and say, “Hey, I’ve made some inroads on my own and know these 10-15 people – now that I’ve done that, what can you do for me?”

That puts you in a much better position to interview there, and we can help you a lot more if you’ve already done some of the work yourself.

Also, look up jobs on Indeed.com – other sites are OK, but I’ve found that Indeed is the best for finance. Just search for “banking analyst,” don’t narrow down the region, and see what you can find there.

Some of these listings are for “ghost jobs” – they’re not actively recruiting at the moment, but they’re collecting resumes and will contact you when they’re ready.

A lot of bankers apply and expect to hear back the second they submit their resumes, but it doesn’t work like that – expect to wait up to 3 days for any “live” jobs.

Q: You’ve mentioned how much more specific clients have become with their requests. What else has changed over the years, and specifically what happens when the economy has softened?

A: A lot of regional boutiques and lesser-known firms suddenly get the attitude that they can pick up analysts at top bulge bracket / boutique banks simply because the market is bad.

They come to us and say, “So, can you pull out the top analyst at Goldman or Moelis and send him to us right away, for half the pay?”

But it doesn’t work like that – even in a terrible market, top performers are unlikely to leave unless they have a really, really good reason to do so.

Some candidates have decided to go and speak with these types of firms anyway, but very few actually make the move from a top bank or group to something lesser-known.

Q: Awesome, thanks for your time – learned a lot!

A: No problem. And let me know if you know of anyone who shoots under 85 and is a killer chef so I can refer them to my clients…

About the Author

is the Founder of Mergers & Inquisitions and Breaking Into Wall Street. In his spare time, he enjoys learning obscure Excel functions, editing resumes, obsessing over TV shows, and traveling so much that he's forced to add additional pages to his passport on a regular basis.

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58 Comments to “Why You Can’t Get an Investment Banking or Private Equity Job via Recruiters – And What to Do About It”

Comments

  1. Kyle says

    How do you go about finding analysts that fit a clients descriptions? How do you know a good analyst v. a bad analyst in a specific group? Is it based on bonus buckets/is that even information you can get?

    • says

      It’s usually based on a quick scan of the resume, checking with the MD if you know him, and then speaking with the person yourself.

      The thing is, 95%+ of resumes that come through are from completely unqualified people (i.e. position requires 2 years full-time M&A experience and they are a sophomore in college) in the first place so initial screening is not that hard.

  2. za says

    Hey Brian, great article.
    Just had a quick question as a college junior – I’ve been working at a small PE firm since January, and I pretty much burned all my bridges at summer IB jobs at this point. Keep working at the PE firm over the summer and shoot for fulltime positions in the fall seems to be the only route now, but is it frowned upon if you see 6-8 months of one internship?

    • says

      I think that’s fine, though it may raise questions over whether you really want to do IB (if you interview for that rather than PE).

  3. John says

    Thanks for the great article.

    This recruiter’s focus on some of the softer skills gives me hope as a coverage analyst. I only bring this up because I’m currently stuck in a coverage group where although the deal flow is quite good, the M&A group typically takes most of the good modeling work. I was wondering how I could prepare/position myself for private equity interviews with this deficiency in mind.

    John

  4. Riley says

    1a)In want ways do investments banks make money?
    b) Are bank’s fees solely based on closed deals or are there other ways for investment banks to generate money?
    2)What are some possible unique skill-sets I can develop that will be useful in investment banking?
    3) what are the most important factors to understanding and evaluating a potential deal?

    • says

      The first 2 questions are addressed here:

      http://www.mergersandinquisitions.com/investment-bankers-make-money/

      I can’t answer the last 2 in-depth here, but basically a “unique skill set” would be something like, “Expert on the Middle East, knows Russian and Arabic, worked in Special Forces, and knows finance pretty well.”

      For evaluating a deal, there are books that have been written on that – it comes down to the likelihood of it happening (i.e. can the company really sell? is it crappy or appealing to investors?) as well as the potential fees.

    • says

      See the response above – sometimes firms look for people with regional expertise, language skills, or other random skills e.g. they play golf really well.

    • Harald says

      To get an idea of what people are looking for you might want to look up job positions on sites like fiercefinance etc.

      Just read through the first 100 or so analyst/associate positions and you’ll know what kind of “unique skills” they are looking for.

      There really is not much you can do in advance to get those skills. You either happen to have detailed knowledge of the region and for some reason speak this and that language as well as have a couple of years worked in Group XYZ.

      Life is a lot more random than the school-ivy-IB-MBA-PE-path suggests.

  5. crack-spread says

    I was contacted by a recruiter at an established recruiting firm and was informed specifically of the firms and the open roles. The recruiter requested a meeting and a discussion of the usual ensued. A week later, I was told that I didn’t get selected for the first round. Assuming that the meeting wasn’t an “information-digging or CV collecting” session, and that I am keen – would it be ethically/politically correct (you get what I mean…) to make an application directly to those firms? My idea is that I can pitch better than the profile the recruiter put forward and that its possible that the HR dept filtered me out for some reason. Any take on this?

    • says

      It happens, but it’s not that common due to visa issues and an extremely stupid US immigration policy that makes it very difficult to work in the country if you’re not a citizen.

  6. Entertained Students says

    Information on the site is great.

    Quick question, though. As a soph in college, I’m trying to get an early jump on the game. I’m heavily interested in Ibanking/ Finance jobs, but I can’t help but wonder what happens after you get fired? (If it happens).

    “Sure, here’s your blueprint: you make a lot of money for your firm and you move up. You don’t, and you’re out.”

    Say you screw up because you’re new, or you just have terrible luck and never have any clients that are willing to buy.

    Once you get kicked from a first job, does that basically conclude you’re career opportunities in finance?

    Can’t say I’m all too worried about it, but it would be nice to know what different options are taken off a table if you are fired vs. leave to pursue bigger things.

    Sorry for such a long winded response! Thanks!

    • says

      The most common option is to move to a normal company and do finance / business development there. Your life is not over, but it does get more difficult to move back into finance if you’re already out.

  7. New Analyst says

    Fantastic post M&I, very insightful.

    How do analysts working in non-investment grade DCM stack up for PE recruiting? I will be starting FT at a BB in their DCM group working on middle market syndicated loan deals. I’m not quite sure what skill set I’ll be building, but I want to know what sorts of opportunities exist for those coming out of DCM and whether I should try and switch groups asap if exit ops are limited.

    Thanks!

    • says

      You would probably be more limited in terms of PE… maybe just ones that focus on a certain type of investment and such. So yes I would try to switch if you’re certain you want to do PE recruiting.

  8. volunter says

    Can i write my culinary skills in the resume.. seriously if i have been doing this for a long time ?- if cooking makes you an interesting person then i can be very specific in what i have been doing in this ..

  9. James says

    “can play golf with under an 85 handicap” – wow this recruiter knows his stuff…anyone shooting less than 157 is pretty awesome and is a great catch for a firm! Good article though.

    Cheers.

  10. PB says

    Hi M&I, thanks for this wonderful site. Quick question. Why is it harder/impossible to get into PE/Hedgefunds from something like GWM/Private Banking/Asset Management. I assume in GWM you are technically “buy side” as technically you would be picking investments for clients. wouldnt PE/Hedgefunds be similar but just on a much larger scale?

    • says

      Because there is no skill set overlap. In wealth management you do not value or model companies or conduct due diligence (at least not in the same way as banking). Buying individual securities is also much different than buying entire companies or even minority stakes in companies.

  11. DM says

    Excellent articel… Can you please provide me with the contact details of this recruiter? I have adecent background and would like to get in touch with him. Thanks.

  12. EM says

    can you break into PE if you work at MBB for 2 years and then do an MBA at a top 10 school?

    Can you learn some relevant skillset in consulting?

  13. MJ says

    I apologize for this being a long post.. I’m working my first job as an Analyst in Sydney Aus and am trying to break into the industry in SF. In following your advice on on the blueprint to breaking into wallstreet and this post I made a CL to give to recruiters…( my story and pitch ). Is my conclusion too aggressive, and am I on the right track? Advise?

    I’m from San Francisco originally. I spent my childhood growing up in Portland, OR. My interest in finance came from watching my father’s career in finance and business. I grew up watching him go through various career changes, successes, trials and tribulations. I admired his perseverance to work through the hard times and his fire when things were great. Naturally as a young boy I wanted to be like my dad, that is where my spark for finance began. Since then I have tried to cultivate my understanding and passion for finance through education, personal reading, and internships.
    I went to the University of Oregon following my dream of being a college football player. I played linebacker for two years until injuries and lack of attention to my schoolwork along with the financial meltdown in the US made me grow up and revaluate the direction I was taking in life. I decided to take my greatest skill (competitiveness) and apply it to my life in a different way. I saw the gloomy job market and decided if I were going to have a successful career in finance I had to be more competitive than other graduates. That’s when I dedicated myself to getting the best exposure to finance I could before graduation.
    My first internship was with Morgan Stanley Smith Barney. It was 2009 in the middle of the hardest economic times our country and world had seen. While at MSSB I learned a lot but came away with 3 specifics: 1) How to operate professionally in the business 2) How the business model of wealth management works 3) Client relations: the importance of being the professional and expert in all situations with your clients and the importance of being clear and honest. I liked many aspects of the internship but what I learned about myself was that I wanted to work with numbers and people, and that I wanted to ‘create’. Whether it be creating wealth for myself, my company, my clients, or create new business, it was clear that it was one of my passions.
    My second internship with Merrill Lynch was the summer of 2010. At Merrill Lynch I gained analytical skills and learned how to apply them to specific market sectors. I sat in on seminars and wholesale meetings and took every opportunity I could to learn about the equities markets. Although wealth management was interesting I didn’t feel like I was making as big an impact because I worked with individuals rather than companies – I became more interested in the big picture.. After a talk with a family friend and investment banker he encouraged me to pursue my interest in investment banking.
    I graduated this past June and am now interning as an analyst with a boutique investment bank called #### in Sydney, Australia. My focus is creating pitch books, DCF valuations and performing market comparable research specific to Oil and Gas and Technology start-up companies.
    I would be a great fit for your company because I can produce success and results in the face of uncommon adversity. Nothing about the path to where I am and going has or will be ordinary or easy. What makes me different is that I am a creative competitor; the more adverse and uncommon the scenario, the better I am creating a solution. I hear people in the industry say this is the worst time to get break in. I think it’s the best time. I would rather my roots to finance be planted in the face of the worst economic outlook the world has seen so that I can learn how to create success from it. I’m writing you because in the long-term I want to advise start-up companies working in venture capital on major transactions and business development, and working for ( company name ) would give me all the skills I need to do that.

    • M&I - Nicole says

      Hey MJ, while we’d love to answer short questions, your comment/pitch is way too long. If you could shorten your question/comment to 2-3 sentences, we might be able to help.

  14. IBFY says

    Thanks for a great article. For an analyst looking to get into PE, how does one initiate contact with a PE recruiter? Are there websites / networks where PE recruiters advertise?
    Thanks again!

    • M&I - Nicole says

      I’d directly email the partners of the PE firms you are interested in and ask to see if they are looking for someone w/ your background & skills. Don’t think websites work as well though you can always try glocap

      • IBFY says

        Thanks! Does that mean that typically the analyst initiates contact? I was under the impression that headhunters and recruiters actively reach out to analysts towards the end of their first year, whether by phone or email.

        • M&I - Nicole says

          Haha, recruiters (HR) might but don’t think HH do unless they are responsible for junior hires. HH don’t make much from junior hires so they don’t tend to focus on juniors as much. Always initiate contact. Don’t wait for others. You might have to wait a lonnng time

  15. John says

    Obviously work experience and employer are important factors but do headhunters look at other criteria to screen candidates?

    I will be joining a BB as an analyst next year, how much do undergrad school, GPA,SAT matter? (In my case I go to a mid-tier ivy with a 1600 SAT and head of multiple on campus organizations but a relatively low 3.5 gpa)

    Also, do headhunters consider things like part time jobs, leadership positions in extracurricular activities?

    • M&I - Nicole says

      Yes. Fit.

      Undergrad matters more. GPA/SAT not so.

      Not really.

      Why do you care about what headhunters think anyway?

      • John says

        Thanks for your reply!

        Well I was under the impression that headhunters are the gatekeepers for PE and they’re the ones who determine whether or not you get the first round interview. Mostly concerned about official or unofficial GPA cut offs.

        • M&I - Nicole says

          Not necessarily. Yes they are. However, you can always network w GPs yourself and convince them to hire you. Better than going through a headhunter in my opinion

    • M&I - Nicole says

      Most large PE firms start very early, traditionally it was in the spring of each but it’s moving closer to January all the time. HFs vary a bit more but the big ones also tend to start early. The smaller the firm the later it usually starts.

  16. Stark says

    Two questions, one of them a bit off-topic:

    1. Is it often for recruiters to contact directly with analysts or should you get in touch with them if you are looking for an exits within PE/VC/HF…?

    2. If you are from Europe and do an MBA at the US, is it possible to stay in a firm there once you finish your internship, or is that honor reserved to US-citizens?

    Thanks!

    • M&I - Nicole says

      1. I think you should contact the people at the funds you are interested in working for directly
      2. Depends on whether the firm you are working for “sponsors” your visa or not

  17. Mike says

    Would it be possible to disclose the name of the recruiting firm discussed in the article above? I’m a veteran with Wall Street experience and would like to connect. Thank you.

  18. Alex says

    Hi Dude, I really like your website good work, I have a 2.5 years of Management Consulting Experience and 2 year of Strategy experience in an Investment Bank, Now i have an opportunity to do M&A,Coming out of that How much more would I need to do to be a serious consideration for a PE firm ?

  19. Draper says

    What should you expect if you get contacted by a recruitment agency via email. Would you expected to be interviewed on the phone straight away or would you have an informal discussion to see if you are suitable and then arrange for an interview. I just got contacted asking to speak and want to make sure I’m ready if its an interview thus I am hesitant to give a time to speak.

    • M&I - Nicole says

      The latter is more likely. I wouldn’t worry too much about it though you may want to articulate why you want a particular role if you’ve applied there

      • Draper says

        It was for an analyst position in metals and mining at a PE company. Any advise on preparation? My experience is in consumer and agribusinesses but i figured there is some cross over with mining i.e fertilizers (potash mining etc)

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