The Don Draper Guide to Investment Banking
A few years ago some banker friends and I were thinking about creating a TV show.
Entourage meets The Office: all the glamor of movie stars and the celebrity lifestyle, but in cubicles rather than Hollywood.
But the outside world has never hated Wall Street more, and post-financial crisis there’s no way a drama like this could ever take off.
Plus, there’s another small problem: it would be impossible to make a show more awesome than Mad Men.
Don’t believe me?
Here are all the lessons you could learn from Don Draper himself:
1. Have a Great Name
You cannot underestimate the importance of having a name that rolls off the tongue: “Don Draper” is 100x better than “Dick Whitman,” so it’s no wonder that Don assumed someone else’s identity.
You’re judged on your name just like you’re judged on your appearance: so if your name sucks, change it or come up with a nickname or shortened version that’s easier to pronounce (just make sure it’s done officially so you can handle those pesky background checks).
Some people succeed without great names, but why take the chance?
2. Don’t Hook Up with Co-Workers
While Don has had dozens of affairs, up until season 4 he never crossed the hook-up-with-co-workers line.
And when he finally did cross the line, he hit rock-bottom and found himself more adrift than ever before.
You’re required to have affairs and random flings if you’re in finance – just make sure they’re not with co-workers or things will head south very quickly once it ends.
3. If You Do Hook Up With Co-Workers, Don’t Take the Marriage Seriously
So you just had a random fling with your secretary, suddenly decided that you’re in love, and proposed during a trip to California?
If Don can do it, you can too.
Remember that you cycle through wives or husbands approximately every 2 years in finance, so it’s perfectly fine.
With the amount of money you’ll make, alimony is almost an afterthought anyway.
4. Don’t Take Your Employment Contract Seriously, Either
Don didn’t even have a contract with Sterling Cooper until everyone realized he needed one, midway through season 3.
And even when he “signed” it, he didn’t use his real name and then broke the contract to leave and start his own firm anyway.
The role of contracts in investment banking is similar: they’re just a formality.
5. Take 4-Hour, 3-Martini Lunches
Has Don ever not gotten a hotel room with his mistress-of-the-moment after a 3-martini lunch?
You think you have to be available for clients and senior bankers 24/7, and that’s usually true…
…except for when you get that buy-side offer and are on your way out the door anyway.
Remember that no one cares about you at a bank: especially when you’re about to move on anyway, do the bare minimum to get paid and slack off as much as possible.
4 hours may seem like a long time for lunch, but if you’re leaving anyway and all the senior bankers are gone, who would notice?
6. If Conrad Hilton Calls You at 11 PM, Do Whatever He Says
And no, not just because his great-granddaughter is Paris Hilton.
If you have a high-maintenance client who’s worth millions of dollars and demands to speak to you 24/7, you better do whatever he says.
That includes getting his dry cleaning, dressing up as a clown at his kid’s birthday party, redecorating his house, and meeting him in the middle of the night just because he’s bored.
Remember, clients and work come before everything else – even if your wife is about to divorce you and your kids don’t remember who you are.
7. Exploit Loopholes for Personal Gain
So you just found out that your own firm is being acquired by a much larger company and you’d never want to work there.
Simple solution: just do what Don did and gather up everyone important and fire yourselves before the transaction goes through.
If your bank is actually getting acquired, the acquiring bank is smart enough to prevent that specific scenario with the reps and warranties in the definitive agreement…
…But there are always other loopholes you can exploit.
Send out emails late at night to feign busyness, work hard during your first and last month and slack off the rest of the time – do whatever it takes to get top-tier bonus.
8. Keep Stacks of Alcohol in Your Cubicle
Bankers may not drink alcohol out in the open anymore like advertising guys did in the 60s, but if you work 100 hours a week you’re going to need alcohol and drugs – ideally cocaine – at some point.
Rather than running out to buy overpriced bottles constantly, keep a stash hidden away in your cubicle.
Once the support staff and senior bankers are gone, you have free reign to do whatever you want.
So if it’s 3 AM and your balance sheet isn’t balancing, just pull out your Jack, take a swig, and hope for a moment of clarity.
9. Don’t Lie on Background Check Forms
Don gets away with assuming someone else’s identity for years, but it finally catches up with him in season 4 as North American Aviation, a new client, demands background checks on everyone so they can receive security clearances.
And if you’ve been lying about your identity for years, background checks are the last thing you want to think about – so Don forces his company to drop the client.
You might think that’s bad – but if you lie on your own background check forms, something much worse will happen: you’ll get your offer rescinded and you might even have your career destroyed with the right chain reaction of forwarded emails.
10. Think on Your Feet
So the government has started telling everyone that cigarettes kill you – and your top client is Lucky Strike.
They put you on the spot in front of everyone else and ask you how to address these claims and market the product.
Simple solution: avoid the issue altogether. “It’s toasted.” – everyone else’s tobacco is poisonous, but yours is special.
Remember that investment banking is a sales job: it’s less about analysis and more about selling, relationships, and thinking quickly.
Even as an analyst you’ll be put on the spot all the time when your MD or VP ask about your work or for specific numbers – so you better be prepared.
11. If You Get Arrested for Drunk Driving, Get Your Most Trusted Friend to Bail You Out
After indulging in alcohol yet again, Don finds himself in a wrecked car and in police custody along with his “female companion” of the moment.
So he does what any reasonable businessman would do: he calls Peggy, the one person he can trust to bail him out without telling anyone else at Sterling Cooper.
You should also have a “designated friend” to bail you out, because you’ll probably be arrested for drugs or alcohol at least a few times.
Just make sure it happens after you’ve already gone through background checks.
While you don’t want to follow everything Don does (e.g. sending a major announcement about your firm to the NY Times without consulting anyone else first), you can pick up a lot from him.
Advertising in the 1960s was just like finance in the 2000s: the most prestigious and highest-paying industry.
And if Don were in business today, he’d surely be a Partner at a bank or PE firm – so watch Mad Men and take notes the whole time.
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Stuff Investment Bankers Like, Round 2: Email Forwards That Destroy Careers, Blue Shirts, Headphones, The Track, Markup, The West Wing, and Closing Dinners
Ok, let’s get started with round 2. See round 1 (cocaine, Buenos Aires, and more fun) right here if you missed it before.
8. Email Forwards That Destroy Careers
You’ve already seen this story, so I won’t bother repeating the details here. But while everyone else focused on the foolishness of one intern trying to lie his way into an offer, they missed something else:
You have to be very careful what you write in emails once you start working in finance.
Say something stupid, and it will get forwarded around to tens of thousands of people within 3 hours.
Sure, none of the people involved in forwarding this particular email got in trouble since it was just about a potential hire – but you better think twice about emailing your “friend” to trash-talk your MD.
Bankers love the “Reply All” and “Forward” buttons.
9. Blue Shirts
How many suits do you need for your internship? What’s the proper attire once you start working full-time? How do you pick your ties?
The answer to all of the above: “It doesn’t matter – just make sure you have at least a 2-3 week supply of blue shirts.”
You might be tempted to make a “fashion statement” by wearing a yellow or green shirt. And pink is great for “Casual Friday,” right?
No, no, and no. Everyone else will just laugh at you and wonder why you’ve deviated from the standard banker protocol of wearing a slightly different shade of blue every day.
And don’t even think about wearing white: it’s too plain.
Ladies: I am clueless, but please consult Fashion Financier’s article on the subject here.
See that annoying MD coming over to ask for your help with yet another fire drill?
Just put on your headphones, pretend to be listening, and start rapidly scribbling down notes while appearing stressed out.
When the senior banker stops by, silently motion that you’re on the phone and stare intently at your screen to show that you’re listening to something important…
…which is usually just Pandora, but for all he knows it’s a conference call with the CEO of the company you’re pitching the next day.
11. The Track
With the recession, banks failing, and pay unlikely to ever return to 2006-2007 levels, you’d think that fewer people would take the Ivy League –> Banking –> PE/HF –> Greatness route, right?
You’re forgetting about The Track (image courtesy of LSO).
The Track is what separates financiers from “normal people.”
It’s what separates those with the 9 AM to 5 PM mentality from those with the 9 AM to 5 AM mentality.
You can try to resist the pull of the Track, but you’ll probably fail: 40% of bankers go into PE, 40% join a hedge fund, 19% stay in banking and only 1% do something original.
Rather than fighting it, just accept your fate.
How much modeling do you do? How many deals do you work on as a summer intern? How much sourcing do summer interns do?
No, no, and no. All summer interns “source” is bagels and coffee, and sometimes dry cleaning if you’re lucky.
And what you really do as a banker has nothing to do with models, bottles, or even forwarding emails that destroy careers.
You look at markup and make the appropriate changes.
Yes, that’s right: senior bankers print out everything you do, mark it up with red pen, and then leave a stack of changes on your desk.
If you think this sounds tedious or annoying, just think about the fun that ensues when you get 5 markups from different bankers, all with conflicting changes.
If you’re wondering why they would choose to re-write entire paragraphs on paper rather than just typing it on the computer in 1/10 the time, well, welcome to banking.
13. The West Wing
Much as I hate to admit it, the quintessential banker show is not 24, but rather The West Wing.
Yes, I know it’s over now, but any self-respecting banker has the complete DVD set. And should he happen to get home early, it’s the first thing he watches (but only up to Season 4 – let’s face it, it sucked after Sorkin left).
Most financiers know they are actually destroying the world and doing evil by working in finance – but they secretly don’t care.
But watching The West Wing allows them to pretend that they could actually do good for the world – serve their country, solve economic and social malaise, and even stop terrorists and prevent assassination attempts.
But… oh wait a second, even the President only makes $400K a year?
I’ll leave that one to you, Martin Sheen.
14. Closing Dinners
If the deal you’re working on is a marathon, the Closing Dinner is what lies just beyond the finish line.
It’s the ice cream sundae with oreos and sugar on top.
The Closing Dinner is the only “fun” part of any deal process, so you better make sure you’re present for any that you get invited to.
Sometimes you’ll go to Vegas (fun, but not “exotic”), and sometimes you might be taken to more interesting locations – Paris, Rome, or the Isle of Lesbos.
And there’s always some sort of drama, especially if your superiors bring along their “assistants” or your entire team secretly hates the client.
Just make sure you observe rather than participate – unless you’re on your way out anyway and you wouldn’t mind some quick, high-risk fun.
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How to Win Friends and Influence People in Investment Banking by Slacking Off and Pretending to Work Hard
Ask senior bankers what quality is most important in Analysts and Associates, and 99% of them will say “A good attitude.”
If you’re going to work 100 hours per week, you need to be positive about what you do every day… right?
All you have to do is give the appearance of a good attitude – and here’s how you do that:
You might be able to maintain a genuinely good attitude throughout your 2, 3, or however many years you’re in the industry.
But in many cases, you just can’t do that:
- You get stuck in a terrible group, or your group changes and your life goes down the drain.
- You find an exit opportunity and are planning to leave early, or you simply stop caring because you know something better is down the road.
- You get tired of what you do and the job becomes repetitive – but you need to stick around until you find what to do next.
#1 and #3 are the most common scenarios and the most desperate situations because you don’t have a backup plan – whereas with #2, at least you can move to another job if you get fired.
#3 is especially common between Year 1 and Year 2 if you’re an investment banking analyst – that’s when most people get tired of the routine and all deals start to look the same.
Appearances vs. Reality
Senior bankers say “a good attitude” is essential because they are interested in maximizing profit and minimizing annoyances and problems.
“A good attitude” just means “1) This guy/girl gets his/her stuff done without mistakes, which helps me make more money, and 2) he/she doesn’t bother me at all and is usually pretty sociable if I go over to the bullpen to talk to him/her.”
Oddly enough, young bankers have the most trouble with the second part of that statement – winning friends and influencing people.
Here’s how you can buck the trend and succeed where others fail:
The most important point with the game of office politics is your first impression.
If you pull this off correctly, you’ll only have to work hard for a month or so – enough to give everyone the impression that you’re a hard worker.
A poor first impression is almost impossible to overcome, but a good first impression is very difficult to screw up.
In your first few weeks (or first 1-2 months if you’re a full-timer), you want to volunteer as much as you can for projects, helping the older Analysts, and making other peoples’ lives easier.
Even if it causes some temporary pain, it will allow you to slack off later on – and on top of that, it also gives others at your bank the impression that you’re always busy.
Working Smart vs. Working Hard
This is one area where MBAs tend to be far savvier than undergraduates – and one area where I’ve seen many Analysts who didn’t know any better get abused.
You could make people think you work hard by actually working hard the entire time, pulling all-nighters each week, and trying to make your life as terrible as humanly possible.
Or you could just make people think you work that hard without actually doing so.
If you want to work smart rather than work hard, you need to use 3 main strategies: learn to act, under-promise and over-deliver, and let everyone know about it.
If you constantly look stressed out and tired, then other banker swill assume you’re always stressed out and tired.
If you’re like this naturally, you’ll have no difficulty here: just be yourself.
For everyone else, pay attention to the full-timers around you, determine who The Star and The Defeated One are in your office, and try to make your attitude a cross between the two of them: you want to look tense at all times, but you don’t want to be quite as depressing as The Defeated One.
But don’t become The Star – or your progression toward not trying hard would be halted.
Under-Promise and Over-Deliver
Once you have everyone thinking that you’re working 24/7, you need to take advantage of the fact that you’re not really that busy and under-promise and over-deliver.
The worst response to new work is, “I’ll get this to you right away!” and then to drop everything you’re doing to rush around and finish it – especially for anything that’s not urgent.
The better response is, “I have these 3-5 other projects due tomorrow and the day after – I’ll take care of this as soon as I can.”
After which, of course, you proceed to deliver the work tomorrow or the day after in a shorter timeframe than you originally promised.
Let Them Know About It
Once you’ve made sure that you always appear stressed out, but miraculously come through in record time with your work, you need to let the senior bankers know about it.
You can’t be too obvious – don’t go around saying, “Well, I just pulled 2 all-nighters this past week…”
The best way to do this is with late-night emails. If you’re about to email your team at 8 PM, save it until 3-4 AM instead so that they say, “Wow, he/she must have been at the office really late!”
If you get home “early” (9-10 PM), then log in remotely later on (caution: some banks don’t let you do this) and send out your emails right before you go to sleep.
Two points to be careful of here:
- You need to mix up your routine every so often – don’t always send out your “team update” email at 3:15 AM. Vary the email send times between “early” (9 – 11 PM range) and “late” (2 – 4 AM).
- This is more difficult to pull off at larger banks and offices, because some senior bankers actually stay quite late and can observe who’s there and who’s not. And sometimes if the staffer has no life, he/she will walk around at midnight to see who’s still there.
And that’s how you work smart so that you don’t have to work (as) hard.
Gravitating to the Right People
Once you’ve made everyone think you work hard all the time, you need to make sure you’re working with people who don’t take the job that seriously.
If you’re an Analyst, gravitate to the softest-spoken Associate(s), and if you’re an Associate, find the VP who’s most disillusioned and therefore cares the least about work.
This takes some trial and error, and that’s why you need to observe what’s going on around you and get to know full-timers who will give you the real story on who’s good and who should be avoided.
There’s no single rule for “the best people,” but here are a couple types you should definitely avoid:
- Former consultants. Since consultants don’t actually do anything useful, they spend all their time in investment banking solving problems that don’t exist and making you do unnecessary work.
- Summer Associates who have never worked in finance before. I’m sure all the Summer Associates reading this right now are wonderful, but most of the other ones I’ve seen tend to come in with a “I know everything because I paid $100,000+ for a prestigious MBA program” attitude.
- Anyone who’s 35+, doesn’t have a family, and has been in banking for life. These people are like miniature versions of Patrick Bateman, so avoid them unless you want to end up hacked to pieces in someone’s bathtub.
Once you’ve given the impression that you work hard all the time and you’ve surrounded yourself with the right people, it’s time to make them like you even more.
The best way to do this is through small talk. When a senior banker gives you work, don’t just accept the assignment and scurry off to go do it – say “Ok, sounds good” and then take a few minutes to chat with him/her about a completely unrelated topic.
It doesn’t matter what it is – baseball, travel, the news, or the client’s clueless CFO are all fine.
The point is to bond with the senior banker in question by quickly chatting about a common interest, which accomplishes 2 objectives:
- He already thinks you’re busy all the time and will be amazed that you could take a few minutes out of your all-nighters just to speak with him – he must be your favorite!
- You reinforce how much you “like your work” because you’re saying, “You know, I’m really busy – but I enjoy doing this work so much that not only will I happily do it for you later on, I can even take a few minutes right now to chat because I’m going to like doing my work so much later tonight.”
Most people are 100% business-focused when speaking with senior bankers, but that’s exactly the wrong approach.
Why So Many Tricks?
You might be wondering, “Wait, why are you suggesting all this deception? Why do I need so many tricks? Isn’t honesty the best policy? What if I just work hard all the time?”
First off, being 100% honest is not the best policy – unless you want to be abused and work more than everyone else.
You could work hard all the time, but there are 3 good reasons to avoid this:
- As with anything else, the learning curve in investment banking flattens out after about 6 months and you don’t learn much past that point.
- If you’re constantly working at 100% capacity, you will never have time to find exit opportunities – or apply to business school, or do anything else outside work.
- The marginal improvement you’d get in your bonus and/or recommendations from working at 110% capacity rather than at 70-80% capacity is not worth it (Would you want to work an extra 20 hours per week for a bonus that’s $10,000 higher? That’s about $10 per hour…).
You don’t have to follow the steps I recommended above. If you want to be The Star and you truly love to stare at Excel and PowerPoint every day, then feel free to work at 110% capacity.
For the rest of us, though, winning friends and influencing people by slacking off and pretending to work hard is a better bet.