by Brian DeChesare

How to Break into Investment Banking from a Non-Target MBA Program

Non-Target MBA to Investment Banking

Is there anything more difficult than breaking into investment banking at the Associate level coming from a non-target MBA program?

Yes!

Breaking into investment banking if you also have spotty work experience, a non-target undergrad degree, and not-so-great GMAT scores.

When a reader with that background contacted me, I was skeptical at first.

But then I looked into his story, realized it was true, and knew it would be a great example of how to beat the odds.

So, I asked him to share his full story along with tips on recruiting and the trade-offs of boutiques vs. large banks at the MBA level:

The Twisted Path into Investment Banking

Q: Can you summarize your story?

A: I went to a non-target university, completed a liberal-arts major, and planned to go into law or academia at first.

I realized they were both terrible, so I decided to work full-time after graduation instead.

I did a sales job at an architecture company, followed by a rotational program in corporate finance and operations at a fin-tech company.

I became interested in M&A right around then because of an acquisition that our firm was completing.

Unfortunately, I had also accepted admission at a part-time, non-target MBA program by that point (I had wanted a change, but I didn’t know the type of change).

I knew it would be an uphill battle to get into banking, so I began sending out hundreds of emails to bankers at middle-market, elite-boutique, and bulge-bracket banks.

I also interned at a boutique bank during business school while I was still working full-time.

The boutique offered me a flexible schedule, so I worked 18-hour days for several months to get my foot in the door.

I won a lot of interviews at large banks via my networking efforts, but I didn’t get a single offer from that.

So, I shifted my efforts to smaller firms and went through one of our very few alumni to win a summer internship at another boutique bank.

I quit my full-time job to complete that internship, turned it into a full-time Associate offer, and worked there for about a year before moving to a different boutique bank to get better deal experience and compensation.

Examining the Autopsy of a Recruiting Process

Q: That is quite a story.

Let’s start from the beginning: Why did you attend a non-target MBA program?

A: I had a fairly good GPA (3.7), but I didn’t do well on the GMAT (~600) since I’m a poor test taker.

Also, I had unimpressive work experience next to other candidates, and my liberal-arts degree from a lesser-known university hurt my chances.

To have the best shot at the top programs, you need work experience at brand-name firms or something unique.

Q: OK. You put incredible effort into networking with bankers – why didn’t you do well in interviews at large banks?

A: I didn’t bomb the interviews; I just didn’t do “well enough” to win offers.

The main problems were:

  • Much Higher Bar for Technical Understanding – They grill you on advanced technical concepts, so you must be polished and know the material like the back of your hand. And if you’re a “career changer,” you need to start preparing far in advance.
  • Alma Mater Preferences – Many MDs and other senior bankers have attended Top 10 MBA programs, and they often prefer candidates from their alma maters.
  • Networking Contacts – Many of my contacts were Associates and VPs, but they didn’t have much power in the hiring process. Knowing more MDs would have helped.
  • Skill Set Mismatch – Since I had worked in sales, I felt very comfortable speaking with clients and sourcing deals. But you don’t do much of that as an Associate at the big banks; they want people who can crank out Excel and PowerPoint and check Analysts’ work.

Q: Fair enough. After you had shifted your focus to boutique banks, how did you win the summer internship? You said it was via alumni networking?

A: Yes. I spoke with a few alumni who had entered IB from our school, as well as a friend in the program who had interned in investment banking.

From them, I found out that there were 2-3 boutique banks in the area that accepted students from my non-target program.

These firms are often well-kept secrets, but they exist for many non-target MBAs.

I contacted them, name-dropped everyone I had spoken with, and received a positive response from one of the firms.

Q: Why didn’t you do that from the start?

You could have gotten the same results and skipped hundreds of emails and informational interviews.

A: At first, I really did not want to join a boutique bank.

It seemed more difficult to make a lateral move to a bigger bank as an Associate, and I didn’t want to get stuck at a small firm.

Also, I gained a lot of interview practice and contacts at other firms from all my networking. I would not have done as well at this boutique if I had not completed the whole process.

But yes, looking back on it, I should have spent less time on large banks and more time on boutiques from the start. My sales skill set was also a much better match for boutiques.

Q: Right. On that note, how did you convert your internship into a full-time offer?

A: My sales experience helped me the most: I felt very comfortable leading calls with other banks and clients, and senior bankers asked me to do that fairly early in the internship.

There were a few other summer Analysts and Associates, but they were more technically inclined, which isn’t necessarily what a boutique bank needs.

Everyone will tell you to do the generic stuff: Work hard, always make yourself available, stay late, etc.

That’s all true, but you also need to work at a bank that matches your skill set for the highest chance of a return offer.

To Boutique or Not to Boutique: That is the Question

Q: You’ve worked as an Associate at several boutiques and interviewed for these roles at many large banks, so what are the trade-offs?

A: As an Associate, the biggest potential benefits of joining a true regional boutique – not an elite boutique – are:

  • Better Work – You’ll often be treated more like a senior banker, and you might work exclusively with one MD or one MD and an Analyst. You’ll also spend more time on the phone and less time in Excel and PowerPoint.
  • Improved Hours – I work around 60-70 hours per week, and that drops to 50-55 hours in slow periods. Even at a middle-market bank, I would work significantly more than that.

The main downsides are:

  • Highly Variable Experience – You might end up specializing in one deal type or geography, and if that segment suffers, you might be doing nothing but pitches.
  • Highly Variable Compensation – Some boutique banks offer Associates a “profit share,” in addition to a base salary, bonus, and benefits. In a good year, that profit share could take you up to VP-level pay – but in a bad year, you might earn far less than Associates at large banks because base salaries and bonuses are significantly lower.
  • Reduced Exit Opportunities – I’ve received offers for corporate finance jobs at large companies, and I’ve seen some opportunities at bigger banks. But it’s quite difficult to win traditional buy-side roles at private equity firms and hedge funds as an Associate at a boutique bank. I do know a few alumni in PE, but they went to smaller firms and did a ton of networking.

Q: Thanks for that run-down.

What would you say to other MBA students at non-target schools who want to get into banking?

A: A lot of it comes down to your work experience.

If you’ve spent 3-4 years in Transaction Services at a Big 4 firm or corporate finance at a Fortune 100 company, you could still move from a non-target MBA program to a large bank.

But you have to know the technical side like the back of your hand and network like crazy long before the program begins.

If you don’t have that type of work experience, or you have other problems such as a non-target undergraduate degree or low grades/test scores, you should focus on boutiques.

Q: Thanks for that summary.

What are your plans now that you’ve worked as an Associate at several banks?

A: Unlike most people who enter investment banking, I want to stay in the field for the long term.

I want to start my own firm eventually (maybe in 5-10 years), and I’m thinking of specializing in deals in a certain industry or geography where I have some experience.

I’ll probably stay here for the Senior Associate or VP promotion, but I’m also thinking of moving to a larger bank before I start my own firm.

I would make that move mostly for the brand name: If I do start a bank one day, I would have more credibility coming from a bulge bracket or elite boutique.

Q: Great. 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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