You’ve just arrived at the newest, hippest downtown bar.
Walking inside to meet your friends, your jaw drops in wonder. You notice that 70% of the crowd consists of attractive members of the opposite sex.
You sit down to get a drink, and you’re in for another shock: you start getting approached every few minutes. Before the night is over you have 20 phone numbers.
Sounds too good to be true, right?
Not if you had been recruiting back in 2004-2006, because that’s exactly what the hiring market was like back then: too good to be true.
“Check the Box” Recruiting
Back then, most students at top universities and business schools acted like you did when you walked into this imaginary bar: they sat back and waited for the opportunities to come to them. And professionals in related fields found themselves drawn into finance by the alluring calls of headhunters.
Being proactive helped – but it wasn’t a requirement. There were so many opportunities that even if you were a borderline candidate, you’d probably get something – just by submitting enough resumes and investment banking cover letters.
As you’re probably aware, 70% of the crowd in a bar never consists of attractive members of the opposite sex approaching you all the time – unless you’re in Brazil.
If you went to an actual bar rather than an imaginary one, you’d need to be a lot more proactive.
You couldn’t just wait for opportunities to arise; you couldn’t get free drinks from everyone who came up to you; and you wouldn’t be leaving with 20 numbers.
And the same holds true of recruiting, both in “normal” times and in highly unusual times – like today. You need to move beyond submitting online applications and “hoping for the best” and start pounding the pavement until you get offers.
In other words, you need to move beyond “check the box” recruiting and into actual recruiting.
If you’re from a more unusual background or haven’t gone to an Ivy League school, none of the above is news to you. You’ve been contending with it for years.
It is news to a lot of surprised students at traditional “core” recruiting schools, who have suddenly found themselves without internships or full-time jobs.
It now requires significantly more effort to break in, which is one reason why applications have fallen at many places and why overall interest in finance is down.
Changing Your Recruiting Strategy
We identified 4 key ways you need to change your recruiting strategy in the midst of the worst hiring market in finance in… well, a long time. A lot of this echoes what we’ve said before on breaking in during a recession, but some things cannot be repeated enough.
1. If You’re Going Fishing, Cast a Wide Net
It’s just like applying to school: sure, go for HBS or LSE, but make sure you have a Plan B, C, D, and E as well.
How many banks should you apply to?
There’s no upward limit – I would apply to dozens of firms at a bare minimum.
And that doesn’t mean just sending your resume and cover letter to all these places – it means actually getting on the phone with them and getting to know people there.
Where do you get started looking for dozens of banks?
I would start with this thread on WallStreetOasis that lists boutiques by region:
It doesn’t have the contact information for each place, but start there and then move into networking and use referrals to get additional names.
To focus your efforts, start with firms in your local geography or any companies that match your background (e.g. they’re Restructuring-focused and you come from a Distressed/Restructuring legal background).
2. Become Carman Sandiego
If you could choose any city in the world to find a job in right now, where do you think you’d start?
I’m not sure, but I can tell you the 2 places I’d avoid at all costs: New York and London.
While everyone has been hit hard by the recession, New York and London have suffered disproportionately.
“But isn’t it better to start your career in New York / London?”
Well, yes – but these days it’s better to start in a less ‘prestigious’ location rather than watching TV in your parents’ basement for 7 months because you couldn’t find anything in New York.
If you’re in the US you need to look at other locations (Midwest, West Coast), and if you have any international connections / family / language skills you need to think about that angle as well.
With finance you are often “funneled” into a specific geography because of where you’re located or where you went to school – the best way to get around this is to develop a network in other locations.
In consulting you can actually gain an advantage if you give less “sexy” locations, like Chicago or Houston, as your preferences. Those offices are not used to getting floods of applicants like New York / San Francisco are, so they view it positively that you would prefer to work there.
The main obstacles you’ll face in going international:
- Lack of connections / network in the area.
- Lack of language skills.
For #1, start thinking about other places you’d consider working and develop your network there (more on this in detail soon); for #2, I would recommend learning as much as you can – sometimes even if you’re not native-speaker level you can get in anyway.
3. Stop Arguing Over Consulting vs. Banking and Take What You Can Get
But if you’re still arguing with your friends over which one is “better,” you should stop and go play some Wii Tennis because that’s a better use of time.
The main downside to an adjacent field like corporate finance, strategy, business development, or even the US Treasury?
Making the transition back to consulting/finance is usually difficult.
But that’s not necessarily true in a bull market – last time around we saw recruits coming in from all sorts of corporate backgrounds, at the junior to mid-levels.
I hesitate to “rank” which options are “best”, but in general the closer you can get (in terms of working on transactions / working with clients and doing financial analysis), the better.
It would be easier to move from business development at a Fortune 500 company into an M&A group than it would be to move from marketing into an M&A group, for example.
In the worst case scenario, maybe you’ll have to go back to business school first to re-brand yourself.
Another thought – and I might be crazy for stating this publicly – but maybe you’ll find something that you like more than finance/consulting.
Most of my laid-off friends in banking have gone into finance/business development roles at normal companies – and have a much better lifestyle than they did before. With the way bonuses are tracking this year, they haven’t taken much of a pay cut either.
4. Turn Into a Human Rolodex
You’ve probably noticed one common theme in each of these points: you can’t do anything without a great network.
“Networking” can be a nebulous concept, but it’s just a fairly simple process that involves doing a good amount of work on a consistent basis:
- Develop an initial set of contacts in the industry or related industries.
- Begin emailing them and setting up brief phone calls and/or in-person meetings.
- Stay in touch, develop the relationship, and request additional calls when appropriate.
- When appropriate, be more direct (but not too direct) with asking about opportunities.
We’ll dive into this point in more detail in the next article, but for now keep in mind that your networking efforts are the only way to set yourself apart from everyone else, at least at the junior and mid-levels.
From Checking the Boxes to Actually Recruiting
If you’ve just relied on submitting applications online and sending your resume and cover letter blindly to firms, you don’t have a recruiting strategy.
You’re using “check the box” recruiting rather than actual recruiting – and you don’t need to think for a second about which one is more effective.