by Brian DeChesare Comments (4)

From Non-Target Engineer to Investment Banking: How to Make the Leap

Non-Target Engineer to Investment Banking

Once you go quant, can you ever go back?

Yes!

There’s a ton of hype over quant hedge funds, AI, machine learning, and anything else with “quant” in the title, but those fields are not right for everyone.

Even if you come from a technical background – like our reader today – you might still pick a field that requires less math, such as investment banking.

I was intrigued when I heard about someone who had moved away from a quant fund and made the “non-target engineer to investment banking” move, so I asked him to share his story:

From Engineer to Corporate Finance: How to Break In

Q: Can you summarize your story for us?

A: Sure. Growing up, I was an athlete and I didn’t think too much about my university or major.

I ended up at a non-target school and majored in computer engineering because I saw it as versatile with plenty of career options.

I started working in an engineering lab where the person in charge also operated a quant hedge fund on the side, and I asked about his fund and used my experience at the lab to win an internship there.

I was drawn to finance because there were no concrete answers – unlike engineering, where many problems had “right” and “wrong” approaches.

I enjoyed the analytical work at the quant fund, but I also became more interested in fundamental investing and understanding real companies, so I started networking for investment banking roles in my second year and interned at a large money manager.

Then, I recruited for internships at large banks and took a different approach to networking by focusing on quality over quantity.

After all that, I was rejected three times by one bulge-bracket bank before finally winning a summer internship offer there, completing the transition from non-target engineer to investment banking.

Q: Great! So, investment banking was not your initial plan, but you became interested in it over time.

A: Yes. Everyone told me to work at a quant fund or to do quant research because I was a computer engineer and I had the skill set to do it.

But I wanted to understand companies’ business models in-depth, and you barely do that in quant roles.

Also, in many quant roles, you operate solo even if you’re “in a team” because you come up with and test the statistical models on your own.

But I liked the team environment at banks and how you communicate with different groups throughout the day; I also think IB provides the most useful all-around skill set in finance.

So, I fell into the same category as some of your other readers who switched from quant work to more qualitative roles.

Q: OK, but won’t quant funds, AI, and machine learning replace everything? The media tells us that all human jobs are in danger.

A: I would say that sales & trading, asset management, and hedge fund jobs are at far more risk than traditional investment banking jobs.

It’s extremely difficult to beat the market just by picking stocks these days; computers can analyze so much more data than humans that it’s not even a level playing field.

However, investment banking is based on relationships and advice.

If a CEO needs advice on a growth strategy, he’s not going to type questions into a computer and then present the computer’s automated responses to the Board of Directors – he’s going to call his trusted banker.

Technology will automate some of the work in IB, but humans plus computers will perform better than either one alone.

Non-Target Engineer to Investment Banking: Networking Strategies

Q: Well said, and I agree with your assessment.

Once you had decided on IB, how did you start your recruiting process?

A: I started by reaching out to alumni via LinkedIn and email, but there weren’t that many alumni in finance, and I didn’t get a great response rate from them.

So, I ended up using information sessions and in-person events more than online networking.

Unlike the readers in your other networking case studies, I never corresponded with hundreds of bankers; sometimes I only spoke with 2-3 professionals at each firm.

However, the contacts I made were stronger because I had met them in-person first, so I was more than just a name and email address.

I started attending networking events early in my second year at school and stayed in touch with bankers throughout the year, leading directly into recruiting season.

Q: OK, but you were at a non-target school. How could you attend these events?

A: Some banks host sessions for an “area,” such as Chicago or Boston, so I went to those and met bankers there.

I also went to information sessions at target schools in my area – generally, they did not check IDs, and most bankers appreciated the effort I made to go there.

Finally, I also connected with professionals who had initially attended my university but then transferred elsewhere and then gone into the finance industry.

Students tend to overlook those contacts, but they can be extremely helpful because they receive fewer inbound messages.

I always tried to find common ground with bankers at these events, such as a similar interest in sports or a similar hometown, and then I followed up by asking for a phone call or coffee meeting.

I started earlier than other students, so I had time to develop these relationships and ask each person for referrals.

Q: Thanks for clarifying.

You’ve made the process sound straightforward, but what were the biggest challenges with networking? I’m sure you ran into problems along the way.

A: The biggest mistakes I made were:

  • Constantly Heckling the Person – If I kept sending someone messages asking for a “process update,” the relationship didn’t go so well. I got much better results when I followed up lightly and asked about something else, such as advice about classes or an upcoming internship.
  • Not Networking Beyond the Analyst Level – In some cases, I made the mistake of never going beyond 1st and 2nd Year Analysts when networking. And in nearly all those cases, I failed to receive interviews. It’s fine to reach out to Analysts initially, but you eventually need to get referrals to senior bankers so you can get recommendations from more powerful people.

Q: OK. And what about the key challenges in interviews?

A: As an engineering major, I found the technical questions fairly easy. I was used to studying and memorizing a lot, and corporate finance is easier than the hard sciences and engineering.

I struggled most with telling my story and explaining why I had left the quant fund and money management roles to make the “non-target engineer to investment banking” move.

Many bankers said, “We know you’re smart and hard-working enough to do this. But do you want to work in banking when you’ve already completed buy-side internships?”

I didn’t spend enough time drafting a concise, high-impact version of my story early on, so this question kept coming up.

Q: How did you eventually decide to tell your story?

A: It’s pretty much what I stated at the beginning – I grew up in [Place X], was an athlete in [Sport Y], and started university being interested in engineering.

I worked in a lab where the owner also ran a hedge fund, which drew me to finance.

I did an internship there, liked the analysis, but wanted to learn more about business models and fundamental investing, so I started learning about IB and completed a money management internship.

I liked the fundamental analysis there, but I wanted to influence companies more directly and take an active role instead of just following them, which led me to pursue IB internship roles.

And then I explained how my background fit in with the group’s deal or industry focus, which usually involved relating it to technology.

If they asked, “Why not a quant fund?” I said that I preferred the advisory, fundamental analysis, and teamwork in IB.

How to Get Into Investment Banking from a Non-Target School: Rejection Handling 101

Q: You mentioned in the beginning that you were rejected three times by one bank before winning an offer there.

Can you explain what happened?

A: The first time around, I received an automatic ding because I was at a non-target school. To get around that, I reached out to a junior banker at the firm to explain what happened, and he helped me re-enter the process.

The second time around, I made it to Superday interviews, but the bank had a “non-target student quota,” so they couldn’t give me an offer.

I thanked everyone who had helped me along the way and mentioned what had happened, and they got me back into the process once again.

I made it to final-round interviews for the second time, and they said I was a top candidate but once again cited the “non-target student quota” as a problem.

But once again, my contacts felt strongly about helping me, so several of them pushed for me to win an offer anyway.

Q: Why did these bankers go out of their way to help you? What was in it for them?

A: This may sound trivial, but I came across as more of a real person than other candidates.

Many students ask artificial or news-oriented questions when networking, such as “In which areas is your firm a leader?” or “How does Event X affect your firm?”

By contrast, I spent a lot of time researching each person so I could ask detailed questions about their hobbies, interests, and background.

As you always write, don’t overestimate the competition.

Yes, everyone “knows” that networking is critical and that you need to research each person first, but few people take the time to do it properly.

Also, I never tried to impress bankers – in many conversations, I admitted my flaws and weaknesses and asked the bankers for advice on how to address them.

And in the transition from non-target engineer to investment banking, there were quite a few weaknesses to overcome!

Many students do the opposite and attempt to brag about their accomplishments, which always backfires.

Q: OK. What advice would you give to other students who want to make the “non-target engineer to investment banking” (or similar) move?

A: Don’t obsess over the small details, and don’t take online comments, message boards, or commentary too seriously (and yes, I realize the irony of stating that in an online article).

Many students go into the process with the attitude: “I need to work as an Analyst in the TMT group at Top Bank X, or my future is ruined!”

But especially if you’re at a non-target school, you cannot think that way.

You need to keep your options open and focus on developing solid in-person relationships.

Also, never take rejections at face value.

If you are legitimately unprepared and cannot answer the technical questions, then yes, you need to re-think your plans.

But if you get rejected because of a “non-target student quota” or other silliness, fight back until you get the results you want.

If I had given up on attempts #1, #2, or #3, I would not have won my offer.

Q: Awesome. Thanks for your time!

A: My pleasure.

M&I - Brian

About the Author

Brian DeChesare is the Founder of Mergers & Inquisitions and Breaking Into Wall Street. In his spare time, he enjoys memorizing obscure Excel functions, editing resumes, obsessing over TV shows, traveling like a drug dealer, and defeating Sauron.

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  1. “Goldman, JPMorgan Hit Pause on Intern Recruiting ‘Madness’” – https://www.wsj.com/articles/goldman-jpmorgan-hit-pause-on-intern-recruiting-madness-1540819063

    So JP and GS have officially moved summer 2020 recruiting into the Fall of Junior year (like it was 2 years ago.) What are the implications of this? Will other banks follow? Will this make it harder for target students, easier for non-targets? Harder for non-diversity?

    As of now, Moelis and a few other banks are scheduled to come on campus next week, so it seems to me like the EBs will NOT follow suit.

    Brian – what are your thoughts?

    1. Yup, I saw that. I think it’s too early to say, but eventually most of the other large banks may follow suit since all the banks tend to copy each other (it’s not exactly an industry known for originality). Generally, the later the process starts, the better it is for non-targets and more diverse candidates (across all metrics). Realistically, most of the people who know they want to do IB in Year 1 will be from wealthy and well-connected families, so they’re not exactly “diverse” and they’re probably not the type of people who even want to stay in banking for the long term.

      I could see the elite boutiques ignoring this and still recruiting early, but eventually they may fall in line and push it back, especially if they start getting pressured to do so by the top schools.

  2. Heads up: Summer 2020 IB recruiting is kicking off in November, with first round interviews in February.

    At a top target. Crazy early!

    1. Thanks for adding that. It’s actually a bit later than I expected since it started in February this past year. An upcoming interview will cover this topic and explain what to do to prepare early (spoiler alert: if you haven’t decided on IB in your first year of university, you probably won’t make it).

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