What do you do?
I work in the Internet and Interactive Entertainment group of the bank, where we perform advisory mergers and acquisitions services and work to arrange financing for our clients through IPOs and by issuing debt (I help internet companies get access to piles of cash).
As a banker on the internet team, I get to work with the top brass at every possible website you can think of. Whenever you hear “xyz dot com is going to merge with abc”, you can bet that I’m involved.
Investment bankers do one of two things for their clients. all my clients are in the internet/video game space.
1) We help companies get access to capital (money) by issuing corporate bonds (debt) or by going public through an IPO. companies need money to expand, and we offer that service.
Issuing corporate bonds is similar to taking out a mortgage, except the dollar amounts of bonds are several orders of magnitude larger.
2) We help companies merge or acquire other companies. these often very complicated transactions that require the buyer to have access to billions of dollars of cash, for example.
Investment bankers are like real estate brokers. We don’t “invest”.
How much do you make?
I expect to make around 1.2 million this year
How many hours do you work per week?
Hours are easily 100 hours/week. Younger guys often sleep in the office, and work 7 days a week. You will be expected to drop everything, even if your brother is getting married, for the job.
How do you not burn out?
I take extravagant trips to crazy places and do serious outdoor/adventure type stuff. Last trip was a backpacking trek through the rockies with around two mountain passes each day and wild weather. I like to live off the land, and lots of guys here are obsessive about training for marathons, mountain expeditions, etc.
Being in the city helps. it never closes and you get to socialize. The worst part is waking up in the morning after you got home at 4am the prior night. it’s tough. really tough.
I get to see my fiance on the weekends and we basically see each other only in the mornings on weekdays.
We dont have kids yet. i’m not sure how that is going to go down, to be honest. I don’t think i want to be that kind of dad. and that day is coming soon. we think we can last about 2-3 years but i’m not sure i want my child raised in that kind of environment.
Is your lifestyle worth the money?
Like many in the business, I plan to earn big and retire early, leaving banking for good to focus on raising a family and living in the mountains. banking, for me, is a means to an end. It is also incredibly exciting, cut-throat, and demanding. Definitely not for everybody.
Although you earn an amazing amount of money each year, do you ever feel envious of other co-workers/superiors that earn 20-50x more? Do you hope to attain that level of income?
Yes i do. i think it’s human nature, especially when you see a guy and say “dude, i totally do the same thing that guy does, and i’d like to earn that much”. of course, i’m sure that other guys at the bank say the same thing about me….
Pretty sure they set it up this was on purpose so that employees retain an absurd competitive fire in their bellies for year after year.
Truth be told, i’m pretty satisfied with my income, but having an eight figure annual income just for one year would set up anybody’s family forever.
How’d you get that job and is it really all connections?
I got the job through a traditional route: top undergrad school with high gpa and engineering background, work experience in technical field, back to get my mba at top 5 school where i got a 3.8 gpa, and was hired to work at the bank following graduation. I did a summer internship at the bank.
Getting into investment banking is easy – as long as you are still a junior in college and are a serious student. the easiest way into banking is to get an internship after your junior year of college. it’s incredibly compettive, and you will need to stand out from the crowd.
Connections can play a big part in helping you get to know the bank.
How do you stand out from the crowd?
They assume the applicant pool for these jobs will have stellar grades, cool extracurriculars, and so forth.
The way to stand out is to show the bank you REALLY want the job. you do that by meeting with as many current employees of each bank as possible before the applications are due. place phone calls, get to know people etc etc.
Also, nailing your interviews and being supremely prepared for finance questions doesn’t hurt.
What kind of skillset do you have and do you use?
Powerpoint and Excel are the two tools that an analyst will use almost exclusively. it’s about creating the slides that we use in our “pitch books”. recent college graduates enter the bank as “analysts”, and after three years are either promoted to associate, go to business school, or are shuffled out of the bank.
A you progress, you become less “excel” (doing discounted cash flows aka DCF) and more into “client” relationships ie: going into Ford Motor and telling them how some crazy acquisition is going to increase the value of the firm. Investment Banking is ultimately a sales job, and the guys with the biggest rolodexes win.
Investment banking is by far the most competitive field to get into. I compare it to being a professional athlete. what would you sacrifice to become a starting pitcher for the yankees? year round strength training, intense focus, competitive fire, endless practice, and years on the road, away from your family.
What do you think of trading? Is it more competitive?
Trading has a slightly more aggressive culture, but it is easier to get into, possibly by a whisker. if your friend formatted an excel table incorrectly, he’d probably get absolutely reamed out by his superiors. screaming and yelling is very common. Trading is like that, but they also scream about everything in general, and they tend to have worse grammar than me when writing emails. Lots of capital letters and misspellings “HARLY DAVIDSON KITCHEN SINKED HTE QUARTER AND UR TELLING ME THAT THEIR FINANCEING ARM IS GOING TO BE OKAY LOL”
Have you been effectively saving a portion of what you earn throughout your employment?
Yes and no. firstly, yes my expenses have risen as I have purchased a nice apartment. but more importantly, outside of a house, you really have to push the envelope in my profession to spend more than you earn.
One of the pressures is this: you have so little free time that you’re actual free time/vacation becomes invaluable. it means i end up spending inordinate amounts of money to get places quickly – if i haven’t taken a single day off for three months and i finally have five days, you better believe i’m not taking the bus or slow-boat anywhere for my vacation.
How do you invest your savings? By yourself or with an adviser?
My money is professionally managed. due to compliance issues, lots of the information I possess is “inside”. I speak directly to management and we are given extreme amounts of need to know information. The SEC watches all of our trades and our families and friends trades to combat insider trading.
What are the motives of most people involved in the industry. Is it simply money, or do people actually find joy in that kind of lifestyle? Or anything else?
Having a ceo call you up and ask for your opinion day after day after day is pretty awesome.
Every day, the things i work on are reported on the front page of every newspaper in the world. you get to be involved at a very high level, which is honestly thrilling.
Money plays a big role in putting up with the hours. but there is more to the job than simply long hours and big paychecks. The work we do tends to be rockstar awesome. Call me crazy but I get off on doing stuff like that. We get to talk to so many interesting and successful people.
The worst kind of investment banker is the guy who just really, really doesn’t want to be there. they wanted the lifestyle, but just can’t deal with the downsides, which are monumental. If you get into banking for the wrong reasons, you’re going to hate it!
What’s the most you ever spent on strippers?
Not a lot. Have been with people who have spent a lot. Strip clubs are not my scene to be honest. I am a geek/nerd/numbers guy. Outdoorsey.
If after college graduation you’d unexpectedly inherited a trust fund that meant you could live an extravagant life without working, what career do you think you would’ve ended up in?
Mountaineer/ski instructor/backcountry ski guide – without a doubt. my third career will hopefully be something tangential such as opening up a heliski operator or ski store or something.
If you were to die tomorrow, would you have been happy with your life?
Actually, very happy. have an amazing, beautiful, smart fiance and feel a real sense of accomplishment about my work. I am optimistic about the future, and proud of what i’ve accomplished in the past.