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If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Overview One of the most stressful decisions in your career is picking which industry vertical to dedicate to. The industry you pick has huge ramifications for the exit opportunities you have, the companies you will invest in, and the growth trajectories of the businesses you work with. After the firm you choose, the industry quickly becomes one of the most important factors to think about. By the time you reach the mid-level, you’ll generally be expected to have some industry expertise. It’s difficult to be a high-functioning VP at an investment bank if you’re still unsure how an industry fits together. On the buyside, it can be very unproductive if you don’t know specific and informed questions to ask the management team. After four or five years in your finance career, you’ll generally have to pick an industry to start specializing in. You can theoretically remain industry agnostic or a “generalist” if you specialize in a product function (like M&A or capital markets), but even then, many product people start to develop familiarity with an industry. Industry group divisions depend heavily by firm and by geography. Many firms will not have every industry group and satellite offices tend to only focus on a few industries. On the buyside, most firms only invest in a select number of industries. Even the largest mega funds typically don’t successfully play in every single industry type. At an investment bank, the most common industry group categories are as follows: Industry Groups Technology, Media, and Telecom Financial Institutions Consumer and Retail Industrials Healthcare Natural Resources Real Estate Technology, Media, and Telecom Over the past decade, TMT has produced some of the largest IPOs and M&A deals, including Alibaba ($21.8B), AT&T / Time Warner ($108B), and Verizon / Vodafone ($130B). Many of the world's largest companies operate in TMT, with groups like FAANG (Facebook, Amazon, Apple, Netflix, Google) becoming extremely popular indexes in public investing. Let’s go over a couple of reasons why TMT tends to be so popular and try to validate whether these reasons are credible. Exit Opportunities are More Plentiful When you get down to it, most junior people still pick industry groups based on the presumed “exit opportunities”. I would say that most people entering investment banking don’t have enough conviction to pick an industry group out of genuine interest. And when you think purely about exit opportunities, you can see that TMT has a natural evolution down several paths. Want to do venture capital? The vast majority of VC bankers have either a technology (or healthcare) background. This is because venture capital firms invest in startups, which commonly are rooted in technology. Want to do corporate development? Some of the largest corporate development teams are in technology because of the acquisitive nature of technology industries and the high valuations of the Big Tech companies (which can make acquisitions “cheaper”). Corporate development opportunities are also present in consumer, industrials, and healthcare, but software, Internet, and semiconductors are notoriously acquisitive. Want to maybe do startups or become a PM? The most logical path is still TMT, as it’s an easier sell to headhunters and interviewers when you at least have some exposure to those businesses. Essentially, TMT leaves almost all your options open. Private Equity Firms Love to Invest in Software Speaking of exit opportunities, most large-cap private equity funds have started to invest in software. There are several prominent TMT-only funds like Silver Lake, Thoma Bravo, and Vista Equity, which have upended the entire software industry. In fact, Thoma Bravo is technically the fourth largest software company in the United States due to the number of companies it’s acquired. Software is a business model that is a natural fit for private equity, as it has high operating leverage, sticky revenue, and long-term contracts. Private equity firms have understood this over the last decade and flocked toward software, which in turn has influenced their hiring. It feels like there are more TMT and software spots at private equity firms than there are top investment banking analysts in TMT. Almost every large-cap private equity firm has had to learn the ropes of vertical software investing. Technology Stocks Have Outpaced the Broader Industry Similarly, technology stocks have been responsible for a great deal of the recent growth in public markets. Big Tech companies like Microsoft, Amazon, Meta, and Google have shaped much of the business landscape over the past decade and many hedge funds have earned their reputation betting on these companies. The cumulative return of the tech-focused NASDAQ-100 is over double that of the S&P 500, which mirrors the broader stock market. Technology stocks have been the heavyweight champion of the past decade and have created the most lucrative industry to take part in. This influences where hedge funds recruit from and the talent pool they look at. If you're interested in joining a top technology private equity firm, check out our comprehensive Private Equity course. Businesses Tend to Be More Consumer Facing and Accessible Even when you don’t account for exit opportunities, technology and all of TMT has an advantage because it tends to be much more accessible to the average consumer. Consumer tech is such a pervasive industry that almost all millennials and Gen Z-s have at least some exposure to it. It’s much easier to understand an industry when you actually interact with the product, which is why Internet and consumer tech tend to be such popular industries. It’s extremely easy to have an opinion about something so actively covered like Facebook or Google, while it’s much harder to have a natural opinion on more esoteric industries like natural resources or healthcare (I’m not even sure if I know more than five natural resource companies in the S&P). This popularity tends to also apply to consumer retail groups, though consumer retail tends to be a less actionable and popular strategy amongst private equity firms. Of course, popularity is a huge double-edged sword. If you want an easy path in recruiting, it can be helpful to specialize in a less sought-after industry. Popularity just tends to increase the top-of-funnel candidates that pursue an industry, which is why you get so many people clamoring to do TMT. Conclusion TMT’s popularity at the investment banking level almost directly mirrors the growth in the technology industry and the amount of investment going into technology businesses. Many of the top-earning private equity firms and hedge funds have won big by betting on growth valuations and technology companies. I personally think that TMT is a safe bet if you’re unsure what you want to do since it's the industry with the most career optionality given the number of jobs that interact with it. It does tend to be more competitive and filled with talented individuals, but that’s a symptom of being a very lucrative path.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Succession in Private Equity Succession is one of the hardest things that any corporation has to plan for. This is true across every field of business and these challenges are becoming particularly apparent in the investing world. It is generally difficult finding a high-quality leader who understands the company’s culture, knows how to grow the business, and has earned the trust of the management. Each year, 10-15% of corporations need to appoint a new CEO due to retirement, resignation, or health. However, it is estimated that only 54% of boards have groomed a specific successor, with 39% having no viable internal candidates. The result oftentimes is extremely messy internal politics and dramatic power grabs. Successful investment firms plan for succession over several years. Recently, some prestigious investment firms have had their succession become hugely public affairs. In this post, we’ll cover a couple of high-profile succession plans in private equity and take note of some key takeaways. Succession at Top Private Equity Firms KKR KKR is the investment firm credited with starting modern private equity and the leveraged buyout strategy now employed by all traditional firms. Two of their original founders, Henry Kravis and George Roberts, remained involved in business operations until their late 70s. In 2021, KKR announced that Kravis and Roberts would step down as co-CEOs. They were replaced by Joe Bae (left) and Scott Nuttall (right), who both joined KKR in 1996. Bae and Nuttall were nearly 50 at the time, much younger than the leadership at other top private equity firms. However, the two were originally named as co-presidents back in 2017, which makes the case for a multi-year progression to the top spots. By all outward appearances, KKR’s succession seems to have been handled responsibly. This succession makes the case for promoting long-time employees and having a multi-year transition period. Caryle Carlyle is another private equity megafund and is one of the largest asset managers in the world. Carlyle began its transition of senior leadership in 2017, naming Glenn Youngkin (left) and Kewsong Lee (right) as co-CEOs in 2017. Lee had worked at rival private equity firm Warburg Pincus for 21 years, whereas Youngkin spent 25 years at Carlyle in total. The timing and appointment of the two leaders mirrored that of KKR. In 2020, Glenn Youngkin left Carlyle to launch a successful campaign to be the governor of Virginia. Kewsong Lee assumed the primary leadership role in 2020. However, in August 2022, Kewsong Lee abruptly stepped down before the end of his 5-year contract. A Reuters report suggested that the original Carlyle co-founders thought that Lee was antagonizing partners by reorganizing the firm's corporate structure. There were also reports of a dispute over compensation, with Lee being denied a $300mm compensation package. This series of events has left Carlyle facing an unclear future, with both of their chosen successors now out of the picture. Apollo Perhaps the most dramatic succession hand-off of private equity firms was that of Apollo’s. Apollo is one of the most successful private equity firms of the past few decades and its private equity unit has expertise in opportunistic investing. Leon Black (left), one of Apollo’s co-founders, had been heavily linked to disgraced financier Jeffrey Epstein. The increased scrutiny of their connection led Black to step down as CEO. Josh Harris (right), another of Apollo's co-founders, had long been considered the front-runner to be CEO, but instead stepped down in 2022 following a power struggle with Black. Marc Rowan (middle), also co-founder, would instead take the top spot. Blackstone Blackstone is the world’s largest private equity and investment firm. Stephen Schwarzman (right), the firm’s founder, acts as CEO to this day. The firm has been trying to produce a drama-free hand-off to Jonathan Gray (left), who currently serves as President and COO. Gray was formerly the head of Blackstone’s real estate arm and received the promotion to President and COO in 2018. Schwarzman is still involved in Blackstone’s operations, but Gray is publicly recognized as the apparent heir to the business. Observations A few takeaways to conclude: It may be too early to declare any of these successions as truly successful. The fallout between Kewsong Lee and Carlyle shows that even for those given the top spot in name, there are often enough measures available for incumbent partners to remove them. Most private equity firms seem to choose leaders that have grown with the firm over decades. This is applicable to all of the leaders here with the exception of Kewsong Lee (who joined Caryle from Warburg Pincus). Anecdotally from other firms I have worked at (Silver Lake, Providence), this appears to be the norm as well. If you come for the king, you best not miss. The highly spectacled Apollo succession suggests that Harris may have overplayed his hand when making a move for Apollo. Although Black had to step away from the reins on paper, it was clear he still had extreme influence over choosing the leadership team and was able to remove Harris.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Overview 2021 was a banner year for the investment banking industry, as companies took advantage of low-interest rates and high share prices to do M&A and raise financing. The huge volume of deals led to overall industry revenue increasing, salaries rising dramatically, and the level of suffering getting worse across the street. In this post, we are going to do a quick review of three key factors: salaries, league tables, and prestige/industry perception. Investment Banking Salaries and Compensation In general, investment banking salaries increased across the board through 2022: Analyst base salaries were raised, with first-years making $100k, second-years making $110k, and third-years making $115k in base. The corresponding all-in salary per Overheard on Wall Street is $175k, $210k and $230k. In typical fashion, Centerview raised their base to the top of street, with their first years making $130k in base. Associate all-in pay ranged from $300k as Associate 1 to almost $500k as a senior associate. VPs reported an all-in average of $580k and Goldman VPs were reported by Litquidity to be earning between $750k and $1mm. These figures are significantly higher than before, which is a direct result of firms' increased revenues as well as their elevated retention efforts. As a fairly cyclical industry, the size of analyst/associate classes can vary significantly from year to year based on anticipated deal amounts and market sentiment. The extremely fast attrition of the industry means that firms can adjust their employee base very reactively, and these salaries are a direct response to growing attrition in the industry. Historically, investment banks had a tough time competing with Big Tech for junior roles and many analysts left to the buyside for higher salaries. When considering the GS13 discussion about poor working conditions, increasing salaries was a very logical response from investment banks. It's generally easier to just increase raw salary instead of making structural changes, such as increasing deal team sizes. It's worth noting that top IB pay also led to an increase in PE salary. Private equity firms at the upper middle market and large-cap levels increased their salaries as a response to the elevated investment banking salary. However, top IB pay has generally dwarfed middle-market private equity pay as a result of these increases. League Table When looking at the M&A league tables, we can see that the top 10 firms are the same as last year, though in a different order. J.P. Morgan became the #2 M&A investment bank, overtaking Morgan Stanley by a healthy margin. These deal values and volumes also illustrate how much busier 2021 was for investment banking. Most of these firms doubled in revenue and had at least 50% more deals than in 2020. It should be noted that Lazard and Evercore are the only independent advisors on this list, though Centerview would be here if it was a U.S.-only list. When you zoom out and look at global investment banking, you can see J.P. Morgan’s further dominance as a bulge bracket. The difference between this chart and the last one is that this pertains to revenue and includes other business units like IPOs, debt capital markets, and lending. Firms with larger balance sheets tend to do better on this metric because they are able to underwrite more deals. Financial Institutions was the most active industry segment, with nearly $30B in deals, followed by technology and industrials. J.P. Morgan almost did a clean sweep of the industries when it comes to the top banks. Prestige / Sentiment Vault / Firsthand maintains a very effective ranking when you are considering which firms to work for. It's not going to be perfect across every division and geography, but it generally maps to how top candidates pick offers. You can view the full survey here. The biggest changes here are Perella Weinberg Partners moving up two spots and Credit Suisse dropping 4 spots. Credit Suisse faced significant issues in 2021 due to the Bill Hwang / Archegos scandal as well as general mismanagement. Credit Suisse's bulge bracket status may be threatened and these issues illustrate how difficult it can be to stay on top in this industry.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Overview Corporate development is an interesting career path that blends the M&A engine of investment banking with the perspective of working for a single company. Many ex-bankers tend to pursue corporate development because it uses the skillset learned in investment banking but tends to be much more humane (i.e., fewer hours) than investment banking. If you want to earn six figures but be able to work closer to 40 hours, then Corp Dev might be the job for you. It’s viewed as one of the best blends between lifestyle and compensation in all of finance. Corporate development is a career path where you can really learn about the ins and outs of a single business, immerse yourself in an industry, and still play the role of the financier. What is Corporate Development? Corporate Development is the role that is responsible for the corporate finance and M&A at a business. Responsibilities carried out by the corporate development team may include: Identifying potential acquisition targets and landscaping the industry Performing due diligence in an acquisition of another company Running the sale process when selling to a private equity firm or other company Managing the financing process to raise new debt or equity Divesting non-core assets or different parts of the company Coordinating strategic or financial partnerships Working with the CFO to maintain the company model or cash flow projections It’s worth noting that Corporate Development exists in many different forms at different companies. Some companies will have a robust FP&A or accounting team that will be responsible for many of these functions. Some companies might call the entire department Corporate Finance. Smaller start-ups might not explicitly have corporate development roles and might just have one or two ex-bankers supporting the CFO with a loose title. You can generally think of Corporate Development as a company’s “internal investment banking team”. Companies often reach the scale where it’s important to have continuity and long-term vision when executing on M&A strategy. As such, it can be valuable to build out your own team as opposed to always relying on external M&A via investment bankers. If you are a large tech business that is constantly doing M&A, it will be your Corporate Development team that is taking a first look at businesses and thinking about how the financials work. You might hire an investment bank to do the nitty gritty work or to handle the deal process, but the Corporate Development team will act as the thoughtful client. If you look at very acquisitive companies like Salesforce, Disney, or Canada’s Constellation Software, you’ll see that they all have large Corporate Development teams that help systemize M&A. If you’re in investment banking or private equity and happen to work with one of these businesses on a deal, you’ll often see that you’re working directly with a Corporate Development team. Corporate Development Compensation The range of Corp Dev salaries is extremely wide. Larger companies typically pay more cash, while smaller companies typically pay more stock. We’re going to borrow the Corp Dev estimates from Mergers and Inquisitions, which have been substantiated by our own industry sources. Associate: Base salaries of $100K – $120K and bonuses worth 20-30% of base salary, for total compensation of $120K – $160K. Manager: Base salaries of $140K – $160K and bonuses worth 35-50% of base salary, for total compensation of $190K – $240K. Director: Total compensation of ~$300K – $400K, with a higher percentage from the bonus and stock (over 50%). VP or Head of Corporate Development: Total compensation of $500K+, perhaps approaching $1 million depending on bonuses and stock-based compensation. Why Corporate Development? I would say most people end up pursuing Corporate Development for the following reasons: Pros of Corporate Development Hours and lifestyle tend to be better than investment banking and buyside roles Anecdotal estimates seem to put Corp Dev hours between 40-60 hours per week, which is a healthy improvement over most high finance roles. Companies that do lots of deals might still require very intense schedules, but the median seems to be much, much lower than investment banking. In Corp Dev, you are the client. Unlike investment banking, you no longer have to respond to specific client demands or have to spend lots of energy trying to win business. This tends to make workflows more predictable and manageable. Unlike private equity, you’re less beholden to processes. You might still participate in the odd buyside process, but it’s not the core way your business runs. Processes lead to very lumpy and unpredictable work schedules. Roles tend to have much less attrition Corp Dev tends to be a longer-term career play and people stay in their roles more permanently than on the buyside. Lower attrition often leads to better culture and stronger team dynamics. On the other hand, many people that go to private equity are still focused on recruiting or thinking about their next step. The volatility of hedge funds can lead to hedge fund employees jumping ship more often as well. More discernible contributions and continuity Some people do not like the detached nature of advising or investing. It’s much easier to see the impact of your work when you work for one company and can see the impact of long-term projects. In Corp Dev, you’re working for a single principal entity. Build company-specific knowledge Similarly, if you work for a single company, you have the ability to truly go deep and build very deep expertise. If you’re the sort of person that prefers depth over breadth, corporate development can make some sense. Get company-specific equity opportunities One of the most reliable ways I’ve seen people become rich is to join pre-IPO companies. We’re talking Series E or F businesses that are on great growth trajectories and are likely to IPO soon (Robinhood, Coinbase, Roblox, etc.). If you want to bet on the outcome of a single space or company, you might get the most equity opportunity by joining them. Cons of Corporate Development Pay tends to be lower than other finance roles On a relative basis, Corp Dev does pay less than the top buyside roles. Whereas you can earn >$300k in private equity or hedge funds right after investment banking, you might only earn >$300k in Corp Dev after several more years of seniority. If your main priority is maximizing lifetime earnings, you can theoretically make more on the buyside, but Corp Dev again might provide a more well-rounded career. Lifestyle is not guaranteed to be better Lifestyle is not always going to be better. It typically is, but there are still some sweatshop companies, where the Corp Dev head is an ex-banking MD or the entire corporate culture is more intense. You might end up at a start-up, where you have to pull much more than your own weight. Career risk is more anchored to a single company’s performance By joining a Corp Dev team, you are also betting on the outcome of a single company. If the company performs poorly, goes through layoffs, or something changes in the industry, you have to deal with the entire risk. Harder to move back to high finance roles It tends to be uncommon to move to Corp Dev and then easily move back into a hedge fund or private equity role. It does happen, but it anecdotally seems to be much less common than vice versa. To put it bluntly, it is very hard to break into a buyside role at the mid-level and if you join Corp Dev, you are taking yourself off the buyside fast-track. Why Corporate Development? Corporate development is a bit of a hard career path to learn about, because it doesn’t exist in the same form at all companies and the recruiting process is much more ad hoc than the buyside. Here are some characteristics of Corp Dev recruiting that are important to be aware of: Corp Dev recruiting is ad-hoc and much more opportunistic Corp Dev teams at even the largest companies are not incredibly large. Large, acquisitive public companies might only have 5-10 people in their entire Corp Dev team. The team might only have 3 or 4 junior people, none of whom are interested in leaving. Therefore, if you want to join the team of a specific company, you might need to wait several months or years before a spot opens up at your level. Corp Dev roles are fairly comfortable, so there isn’t as much of a revolving door as there is at buyside firms. Analysts might have to be very patient if they’re trying to exit to a specific company or sub-industry. I personally think this contributes to why many analysts don’t end up recruiting for Corp Dev ⁠— there isn’t the same level of predictability as with private equity recruiting. In private equity, you might wait over a year to start your job after you finish interviewing. Corp Dev tends to be much more “normal” i.e., a position opens up and you start working there right away. Prep for interviews should be more “company-specific” Private equity interviews are a lot about passing a technical bar, while hedge fund interviews are a lot about talking about stocks. One generalization we can make about Corp Dev interviews is that you should do a deep study of the company you want to join. We would recommend you think about the following questions: Tell us a few potential acquisition ideas for our company. How does the company make money? What are the company’s most profitable products or business divisions? Who are the company’s main competitors and how do their strengths/weaknesses differ? Talk about a deal that we’ve done recently and what your opinion of it is. If we had to raise additional capital, what structure do you think would make the most sense? Corp Dev hires tend to be more senior The most common entry points into Corp Dev are post-MBA associates or VPs who have already spent a couple of years in investment banking or consulting. Corp Dev teams are smaller so there’s less infrastructure for training new hires. Corp Dev teams also aren’t afraid to lean on investment banks for grunt work, which is why they might not always have dedicated analysts or junior members. Recruiting may be administered by headhunters or by internal HR teams Relative to buyside firms, it seems that Corp Dev roles tend to be recruited more by internal HR teams. Buyside firms rely heavily on headhunters due to their size, but many large companies will have robust recruiting functions that will assist in filling Corp Dev roles. The takeaway here again is that Corp Dev recruiting comes in many different sizes and it’s hard to describe a standard process.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. What is Mifid II? The future of the investment research industry has been in question since the 2018 implementation of Mifid II regulations in Europe. The regulations were crafted with the intent of making financial markets more transparent, competitive, and stable. This would partly be done by forcing money managers to explicitly disclose how much they actually pay for research. Historically, the cost of equity research to fund managers was “bundled” together with the fees they would pay their brokers for transaction costs when trading securities. The idea behind introducing these regulations is to reduce the potential conflict of interest between fund managers and their clients, which may arise if certain fund managers route trades through brokers that would charge higher execution fees than competitors. Brokers would support their higher fee structures by providing supplementary offerings including research by their equity research departments. What Does Mifid II Actually Mean for Equity Research? Mifid II regulations would impact institutions involved in trading securities that service clients adhering to Mifid II regulations, which are primarily located in Europe. This would force banks to explicitly disclose the cost of equity research which will have to be paid for separately, either through hard-dollar payments or “Research Payment Accounts” by asset managers. While these rules are focused within Europe, they have impacted the way business is conducted globally, as asset managers in different geographies are now focused on how much money they spend on research services. This means that brokers might not necessarily be able to pass on the cost of research to their clients through higher commissions, making asset managers reconsider their direct cost to the service. While these regulations might seem negative to sell-side equity research, they also present some opportunities for the space. Are There Positive Impacts of Mifid II on Equity Research as a Career Path? While overall spending on sell-side equity research from asset managers will be pressured as a result of these regulations, some providers of research are likely to see an increase in demand depending on their service offerings. Sell-side research teams publishing high-quality research could see their market share grow. In practice, this would mean consistently publishing differentiated research that helps clients outperform their benchmarks by following the research team’s advice. The chart below shows data gathered by a 2019 study from the CFA Institute, which asked participants about how their research consumption habits have changed since Mifid II regulations were enacted. From the perspective of the buy-side (meaning actual asset managers), 49% of participants responded that they were relying on their own in-house research as much as they were before, implying that they still resorted to external research to meet their needs to the same degree as before. More notably, 14% responded that they spent more money on in-house research, which would be generated by research analysts employed directly by funds. These are the types of jobs that investment bankers and equity research analysts would typically exit into when pursuing jobs in the buy side. What This Means for Candidates Pursuing Careers in the Industry Compare the chart above with how payments to investment banks’ research departments have changed as shown below. From the same survey, we can see that 18% of participants reported spending fewer dollars on equity research generated by investment banks. This shows us that hedge funds and other asset managers may be reallocating funds away from the sell side to the buy side, creating more opportunities for candidates to work as part of the investment business conducting research on investable securities. This suggests a positive trend for those seeking employment within the sell-side now (where it’s still entirely possible to make ~$300k within 5 years of experience in current conditions) as there may be more demand for the same skillset at higher-paying buy-side firms. Check out our course on equity research to help you gain the skills to break into the industry and stand out from the competition. Some firms may also allocate more funding to recruit talent directly out of university. As an example, the hedge fund Point72 Asset Management has launched Point72 Academy, which is an investment analyst training program that often recruits inexperienced candidates. Conclusion Sell-side equity research continues to evolve, partly driven by the reallocation of funds by asset managers as a result of Mifid II regulations. While the impacts of these regulations have resulted in the shrinking of the industry from previous years, they present an opportunity for candidates seeking employment as investment professionals by potentially expanding the opportunity set of high-quality buy-side research jobs for which the required skillset is nearly identical.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Overview Investment banking is an extremely intense and laborious industry. It’s very common to work 75+ hours per week in investment banking because of the culture and job expectations. If you’re in a top-performing group at a top investment bank, you’ll constantly be on live deals that require lots of weekend work and late nights. The trade-off is that you’ll then have access to the most coveted buyside roles in the world. You’ll easily earn over $150k as a new graduate if you end up at a top investment bank. One true stigma that applies to investment banks is how poor the culture is. It seems almost perplexing that culture could be so collectively bad across the entire industry, right? How is it possible that all of these nasty people end up pursuing the exact same career path? I think some personality tropes are true and it’s true that many sociopathic folks pursue finance. But I would argue that the structure of investment banks and the core investment banking business model are the primary contributors to its bad culture. Most senior people don’t actively derive joy from torturing their analysts, but the demands of the business can cause them to treat their analysts harshly. Today I want to talk about a few of the most prominent characteristics of investment banking culture. And if you're interested in landing a spot in investment banking, check out our Investment Banking Recruiting Course. Characteristics of IB Culture Deal-oriented nature makes weekend and vacation work very common It’s essential to recognize that investment banking is a client-facing industry where speed of service is always an extremely important factor. If you’re working on a time-sensitive deal, you’ll be expected to get work done regardless of what is going on in your personal life. For example, a lot of auction deals will open their data room on Friday evening. If you’re an investment bank advising a client in that auction, you’ll almost definitely have to work that weekend to see what new information became available. Maybe there’s a public acquisition that is pending a fairness opinion. If you get put on the fairness opinion, your firm will likely rush to complete it to make sure the deal gets done in a timely fashion. There are many, many credible times when speed is an essential factor to execute a deal. As such, if senior investment bankers want to provide high-quality service to their clients, they often have to be demanding of their junior employees. This is true in other client-servicing roles like law, consulting, and accounting advisory roles. The short tenure of employees disincentivizes mentorship The investment banking industry suffers from very bad attrition. Your typical devoted analyst is going to be at the firm for 2 or maybe 3 years tops. Some good associates will stay in the firm and continue to climb the ladder, but it’s just as likely that associates will leave after a couple of years. There is so much competition for good talent in finance that star candidates will constantly be poached by other firms. Plus, the huge earning potential at some buy-side firms virtually guarantees that top talent will always be leaving your firm. Other analysts leave to roles with a better work-life balance, a trend seen increasingly throughout and after the Covid-19 pandemic. This revolving door of employees makes it difficult for seniors to conscientiously invest in mentorship. This causes juniors to be treated more like resources with a finite shelf life. Why would you put so much effort into cultivating a healthy relationship with an analyst if they’re actively trying to leave for a hedge fund? The disparity in knowledge and effort leads to extreme hierarchy and “star” culture There is an intense disparity in knowledge in investment banking, resulting in a very hierarchical structure at essentially all banks. A good MD will know years more about process and strategy than a VP. A good VP will know so much more about execution and modeling and industry than a new associate. A good second-year analyst is dependable, while a summer intern is the living embodiment of organizational burden. This knowledge disparity can lead to very hierarchical work processes. An MD won’t see a work product until a VP, associate and analyst have all tried their best to perfect the deliverable. This can take several iterations, which can be further complicated by the moving pieces of the underlying analysis (price updates, market movements, new data room information). A very common result of this is that MDs will only trust a select few individuals. Some analysts will get worked twice as much as other analysts due to their “star” reputation. This can lead to resentment between analysts and a general feeling of unfairness. And when a finite number of promotions or spots are available, you’ll see an increased level of competition amongst junior employees. Fee-oriented nature of the business model can lead to intergroup politics One more characteristic that heavily influences the dynamics in an investment bank is how different groups and bankers may compete with one another to win a fee. If boundaries aren’t clearly set, senior bankers may go after the same deal, or different groups from the same firm will pitch different products to a potential client. When your bonus entirely hinges on the completion of a deal, you will be much more incentivized to play to win. Culturally, I think this property of investment banking makes people less cooperative and willing to share resources. MDs may compete for analyst time and different product groups may punt work deliverables back to each other. Conclusion Investment banking has a reputation for poor culture, but the structure of the industry is typically the root cause of tension in the workplace.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Overview The right time to start being ambitious for a career in finance is at the end of high school. Some people might scoff at the idea that you should start preparing so early, but I am an advocate of extreme preparedness. Investment banking on-campus recruiting happens as early as sophomore year, so there’s not very much time to waste. If you end up at a semi-target or target school, you will be surprised by the level of competition you’re up against. You might feel very grateful to be at Penn, but you’re going to be surrounded by extremely competitive, smart, and prepared students. And many students will be getting continual help from mentors or older siblings, which is why trying to be overprepared can be helpful. Luckily, there is actually quite a lot you can do to prepare for finance recruiting before you even get to university. Finance technical knowledge may seem daunting, but most of it is actually quite intuitive and there is a finite amount of information you need to know to recruit for most roles. You can check out our Investment Banking Course if you’re looking for an efficient resource to learn all this. Let’s go over some of the main things you can start doing when you’re in high school. Key Steps Start Reading the News Reading the news is the easiest step and the step you’ll continue to do for the rest of your career. The good thing about reading the news is that you can start reading today and be as up-to-date as everyone else in the world. The bad thing is that you have to do it every day. I would recommend subscribing to one or two daily business newsletters. Most business news sites will have their own newsletter. Here are two that I like and which I know many industry people also read: General Business / Finance Newsletters: Fortune’s Term Sheet Axios Pro Rata Unfortunately, when you’re reading the news as a high schooler, very little will make sense. Even as someone who’s worked in the industry for a number of years, I still find some material is written with so much jargon that it’s hard to decipher everything. What I did when starting out was keep a large compendium of notes, where I’d paste the article and then try to take one or two bullet points synthesizing what I took away. You can do this by linking Instapaper with Notion for example. In general, your goal when reading the news should not need to be memorizing facts. It’s not very useful to remember what the jobs report posted in a given month or what the GDP growth rate was for a specific quarter. What is useful and more palatable is keeping an eye out for themes and trends. Do you keep seeing big deals happening in the same industry (e.g., lots of venture capital deals in online education)? Do you see a lot of headlines about a specific firm (e.g., RBC hiring top talent from other firms)? Try to get to a point where you can be conversational about a few topics. Follow Industry Blogs and Finance Thought Leaders The quality of online finance content has improved dramatically over the past decade. So many high-quality investors publish investor letters, tweet on Twitter, or write some kind of Substack. I would recommend following a couple of these industry blogs that pique your interest (like hedge funds, private equity, technology, AI, healthcare, etc.). Here are a couple of recommendations that I periodically check: Investing Blogs and Hedge Fund Presentations: Alta Fox Capital Research (Small Cap Hedge Fund) Aswath Damodaran (Markets and Valuation) Bain Capital Global Private Equity Report (Annual PE Report) 10x EBITDA Hedge Fund Presentations List Technology Blogs: Tomasz Tunguz (Venture Capital and SaaS) AVC (Tech and Lifestyle) Stratechery (Tech) As a high schooler, your main goal should be to read people’s blogs and see which career path or style of investing appeals to you most. Do you enjoy reading about the nitty-gritty of valuation? Do you like learning about dealmaking and reading thorough investment presentations? See what speaks to you and start to cultivate your own investing mindset. And if you ever need to quickly sound smart, it’s easy and convenient to steal these people’s opinions. Find Out Which University Clubs Place Well Every university will have a slightly different recruiting game. It’s your goal to figure out what the optimal strategy is at whichever university you are going to. At many universities, some clubs will place dramatically better than everyone else. It’s your goal to figure out which programs, clubs, societies, fraternities, etc. place the best and figure out how to get into those groups. As a Canadian, I can tell you that UBC PMF’s program is head and shoulders above the rest of its business school. Many other Canadian schools have investment clubs with long histories and huge alumni pools that tend to consistently place well. To find out which programs and clubs place well, just go on LinkedIn and start creeping people. Maybe keep a spreadsheet to keep yourself organized. Lots of clubs will have their own websites where they do a lot of the work for you. Start Reading a Finance Textbook Starting to learn finance will never get any easier, so you may as well start as early as you can. We outline some of the more technical information you should be familiar with as a freshman in this blog post. The de facto tome that most finance students will start with is Investment Banking by Rosenbaum & Pearl. It’s a fairly academic and kind of boring text, but it’s a good and safe place to start. We’ve also published a Valuation and Finance Starter Kit, which is designed to teach you accounting, corporate finance, modeling, and investing principles if you’d like to take a look. Ideally before the end of your freshman year, you: Can explain how a DCF and comparables work Have pitched 1 stock Have tried to build a simple model in Excel Speak With 3 People One Year Above You Networking is going to be a cornerstone of you how get jobs in finance. In the summer between high school and your first year, I would recommend reaching out to people a year or two ahead of you at the same university. Look for people with similar backgrounds (hometown, hobbies, high school). When you speak to someone, you should have thoughtful questions. Here is a post we did on thoughtful coffee chat questions for investment banking. I would suggest you proceed with extreme caution and take this step very seriously. Almost all high schoolers are going to be fairly unpolished and there’s no easy way for you to instantly become polished. That is why you generally shouldn’t reach out to people too senior or much more experienced than you. Freshmen and sophomores will also be relatively naïve, will still be figuring things out, and as a result, they won’t judge you too hard. By the time people do their investment banking internships, they’ll start becoming extremely judgmental, meaning you should only reach out to those people once you’re professionally ready. Here are some examples of how finance novices are commonly unpolished: Asking extremely broad, irrelevant, or easily Google-able questions (e.g., what is investment banking? Do you have any advice for me? How can I learn the most possible?) Having sloppy grammar, punctuation, and other errors in an email Having extremely long emails (over 7 sentences is way too long for an intro) Not sending calendar invites to confirm coffee chats Set Up a LinkedIn Profile and Shell Out a Resume Lastly, you should start setting up some professional branding for yourself. The only two things you’ll need are a LinkedIn profile and a resume. For your LinkedIn profile, think minimalism. Take a nice clear photo and only include relevant essentials. It’s fine if you have a virtually empty profile for now. Include the university you will be attending You can include your high school Include any relevant extracurriculars Make sure you have a clean custom profile URL Don’t add a bio For your resume, there is a standard template that virtually everyone in investment banking and private equity uses. You can see our Resume and Cover Letter Course for more concrete examples. It’s likely you won’t have enough content yet to fill out a resume as a high school student, which is why you should just shell out a resume. This means to set up a resume document in Word so that you’re ready to fill it in with relevant content as soon as possible. Once you join clubs, take classes, and participate in more competitions, you’ll have a lot more to add to your resume. Conclusion To summarize, here are the following steps you should take to prepare yourself for a career in finance as a high schooler: Start Reading the News Follow Investing and Finance Blogs Find Out Which University Clubs Place Well Start Reading a Finance Textbook Speak with 3 People One Year Above You Set up a LinkedIn Profile and Shell out a Resume Making progress with all of these steps as a university freshman or earlier will put you in an excellent spot for banking recruiting.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Investment Banking Analyst Path The typical investment banking analyst career is two years. At most North American investment banks, analysts are traditionally hired with the intention of employing them for two years. High-quality junior talent in finance is in high demand, as many of these analysts will be poached for private equity or hedge fund recruiting within a year of them graduating from school. Investment banks would love to retain their analysts for as long as possible and groom them within the firm, but it’s often not possible as the top analysts generally leave as soon as they can. When I graduated from university in 2015, my perception was that the 2/2/2 (2 years of IB, 2 of PE, then 2 of business school) was the only solid path. However, I encountered many successful 3rd-year investment banking analysts who took that additional year to gain better career focus, build their network, or take their GMAT. For many people, being patient and taking the time to accrue more experience is the right decision. Given how accelerated recruiting is (which in the past, has kicked off within 3-6 months of graduation), many people now opt to do an additional year in banking. Let’s go over the mechanics as well as the pros and cons of this decision. If you’d like to learn more about private equity recruiting, you should check out our Private Equity Recruiting Course. Why Does the 3rd Year Analyst Position Exist? Investment banks want to keep their analysts, but associates often cost 1.5 to 2x as much as analysts. So, many firms require their analysts to do a third year as an analyst before a potential promotion to the associate level. This gives banks access to cheaper labor and also gives employees get more experience before becoming an associate. As seen in the above image, associate salaries are often quite high. This can incentivize banks to keep their analysts for a third year and reduce salary costs. Some firms like Goldman Sachs and Morgan Stanley will do accelerated promotions directly after 2 years in order to compete with buyside offers, but most other firms will make you do a 3rd year if you want to go directly from Analyst to Associate. On the other hand, firms like Centerview require a 3rd year and will get testy if you try to leave before your 3rd year. This is part of the deal when you sign with Centerview. The 3rd year analyst position partially exists because the ramp-up for an analyst is honestly pretty time-consuming. Most new grads don’t know anything about modeling and it takes them 6 months to a year to not be a net negative to the team. However, analysts often try to check out as fast as possible in their second year. This generally means that most analysts are only very productive for a year or so. Investment banks in turn are generally happy to keep analysts around for another year, as they’ve already invested lots of time into them. A lot of 3rd-year analysts also end up being laterals from other groups or firms. Many people will start in “less good” groups and then lateral into a “good” group or firm in their 2nd or 3rd year. I think this is the most common reason why a high-quality analyst will still be around in their 3rd year. You have a lot of non-targets or people who were late to the finance game who need a few years to get caught up to speed. Benefits of Doing a 3rd Year Recruiting for the buyside before you're ready can be a disaster If you didn’t go to an investment banking factory like Penn, NYU or… Brigham Young, then you might not have had great exposure to buyside recruiting until you hit the desk. You might not even have known about the private equity recruiting process until you started talking to other full-time analysts. For these people, a third-year can be an extremely wise choice. Talking to headhunters expecting to get genuinely helpful advice can be extremely dangerous. Interviewing with firms before you’ve done ample technical preparation will lead to disaster. In my experience, firms are not very forgiving to people who already interviewed with them before. There is enough talent that many firms won’t be incentivized to give you another chance. Therefore, it’s often better to not talk to headhunters or firms at all in your first year if you’re not ready. The advantage of waiting another year to recruit can be immense. You’ll get more deals. You’ll likely get better deals too because you’ll have the trust of your team. You’ll have more impassioned and honest recommendations. You’ll feel more comfortable in the interview room and in your environment. Waiting an additional year can give you a clearer picture of what to recruit for Many people waltz into recruiting heavily pressured by their peers. Lots of people default to doing private equity because it’s the fashionable thing to do and it seems like everyone else wants to do it. I am a victim of this kind of thinking and I do think it is a very safe option. But private equity is certainly not for everyone and it’s nearly impossible for someone with only 3-6 months of work experience to know whether private equity is right or not for them. Doing another year can give you more experience and networking opportunities to actually meaningfully meet with firms. You’ll get a slightly better picture of what the different firms are like. You’ll probably know more people at each of the firms as well. Your 3rd year is going to be slightly more chill This isn’t true at every firm, but 3rd-year analysts are often viewed as “Managing Analysts”. You get paired a lot with 1st years and you’ll be competent enough to handle a lot of the work more efficiently. You should have enough clout that you only have to work on relatively important deals. Your salary is slightly higher This is a modest benefit, but your salary will increase a bit more from your 2nd to 3rd year. I would estimate it to increase by maybe $10k-$15k from the 2nd year position. Cons of Doing a 3rd Year You have to do another year of investment banking Being an investment banking analyst is not easy. It might seem like an OK proposition when you’re a 2nd year, but doing an additional year can be a pretty unpleasant position to be in. Most of your friends will have left the firm. You’ll feel like the kid who had to repeat their last year of high school. Most 3rd years I know developed a special, truly broken brand of jadedness and cynicism. And a year in finance is also a pretty long time for career development. Lots of the top people in finance will hop around several times in order to angle for promotions, and doing a 3rd year deprives you of that fast track. Most top analysts I know did not do a 3rd year I obviously still know a ton of extremely bright and capable 3rd years, but the most intense and “hardo” finance people still all got out of banking as soon as they could. The people at the top buyside jobs and the people who have gobbled up the most promotions both left banking early on. I also think buyside firms have a slight impression that the top talent is all going to be gone before they hit their 3rd year. It’s a bit like how the top NBA recruits won’t do all 4 years in college, they’ll leave after just 1 year in the NCAA. The very top talent doesn’t need the extra year to prepare themselves for the real world. That won’t prevent firms from hiring people who do a 3rd year, but it will likely mean that firms have a higher level of scrutiny. Recruiting Insights for a 3rd Year Analyst I would generally recommend people to only do a 3rd year if you really think you need the extra time to prepare for recruiting or if you started in a sub-optimal role. If you started in a bad group or firm, a 3rd year is likely going to be your best bet for recruiting. The top bulge brackets and elite boutiques have a definitive advantage over their peers for private equity recruiting. Here are some other recruiting insights that might be helpful: You might be surprised, but a fair amount of reneging and visa problems occur at the buyside level. Some people continue to recruit for other firms or change their minds and end up rescinding their offer. As a result, many private equity firms still hire for immediate starts. 3rd-year analysts are prime candidates for these roles as they’ll have more experience. I generally think that if you have lateraled firms in your first year, you should probably wait to recruit. It’s odd and difficult to recruit for buyside firms if you’ve only been in your investment banking group for a few months. You should ideally at least have one deal or one serious project before recruiting with that firm. For example, if you started at a regional boutique and end up lateraling to a top firm like Goldman or PJT part way through your first year, you might still get contacted by headhunters in the first round of recruiting. However, I would personally advise people to wait until their next year to fully recruit. I know a few examples of people who immediately lateraled and then recruited, but it’s a riskier proposition. Still entirely viable, but it’s a very “bet on yourself” move that doesn’t work for everyone. Some smaller elite firms (like small hedge funds and venture capital firms) don’t hire every single year. If you’re trying to go to a specific firm, there is some merit to doing a 3rd year and waiting for a spot to open up. I wouldn’t actively recommend this, but I know some 3rd years who landed great hedge fund spots because they were patient and those hedge funds don’t hire every year.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. International Finance Jobs One of the most frustrating obstacles to deal with as an international finance hopeful is visa problems. If you are a student at a non-U.S. school, an international student at a U.S. school, or an international employee, you will have much more difficulty landing top U.S. jobs than your U.S. peers. For junior roles, there is often enough talent domestically that U.S. firms are unmotivated to take a chance on an international hire. International hires require more administrative work, are more expensive (due to added legal fees), and come with more risk (due to the chance of a visa being rejected). There are a number of unique obstacles you have to face as an international candidate that U.S. candidates will never understand. As an international candidate, you will always be tied to a visa whenever you are in the U.S. You will have much less certainty as you go through the recruiting process. You will always have to consider whether a firm will deny you because of your international status. I’m not going to pretend like I have a defensible blueprint for people from every country (because there isn’t one), but I can share a couple of tips and strategies that helped me. Please note that I am Canadian, which has one of the friendliest working agreements with the U.S. I know that I was much luckier than many others are. Seek Legal Guidance The very first thing you need to do is just go talk to or e-mail a lawyer to see what is even in the realm of possibility. You essentially want to find out which visa makes the most sense for you given the passport you have. Ideally, you’ll be able to speak to an immigration lawyer who has represented people in your country. Here are a couple of great immigration lawyers that I have either directly worked with or who helped with peers of mine: Fragomen Garfinkel Immigration Allen & Hodgman I would just do a Google search for “immigration lawyer United States [your country]” (or something to that effect) and then e-mail 10 or so lawyers. It’s unlikely they’re going to help you that much because you won’t be paying them anything, but I think you can maybe get them to answer one or two simple questions for you. You might want to ask simple things like: Which U.S. visa is the most common for someone with my passport? How long does it take for that kind of visa to typically be processed? Do you know of any obvious restrictions that would prevent me from obtaining that visa? Do you know of any lawyers who specialize in representing people from my country? During my time in the U.S., I met people from many countries (commonly from Singapore, Korea, the UK, Australia, and the EU). Everyone had a different path to the U.S and the specific country you’re from will have a dramatic impact on what is available to you. There are unique nuances to each country and lawyers will know these nuances far more than anyone else. So, by far the most important thing is to just quickly connect with a lawyer. Lean on Alumni and People From Your Country Secondly, you’ll want to find alumni and fellow country people who have been in your situation. As unique as you might be, it’s highly unlikely you’re the only person who has wanted to work on Wall Street in the history of your country. There must be someone else who has walked your path, who knows which firms like your country, and which law firms will go to bat for you. Your goal is to find precedents of people who came from your country and ask them how they dealt with visa situations. Look at finance alumni who graduated from your university. Look at cultural clubs at your university and see who went to work in investment banks and private equity firms. As a Canadian, I know for example there is a Facebook group filled with people with the TN Economist visa, which essentially is people who want to pursue finance or consulting. I found this group through a university alumnus and the group is dedicated to helping people in my situation. I also know that a group of helpful Waterloo alumni constantly update a “USA Intern” guide for Canadians, that is filled with helpful resources. If you ask around, you’re bound to find some helpful communities like the ones below: Canadian TN / H1B Support Group on Facebook Unofficial Waterloo USA Intern Guide U.S. Immigration Forum hosted by Law Offices of Rajiv S. Khanna, P.C. Canada Visa Forum All of this visa information is extremely nuanced and country-specific, so it’s stuff you have to research on your own. Focus on Firms Who Have Sponsored Visas in the Past After connecting with a lawyer and some other like-minded folks, I think the next thing to do is to narrow your focus on firms that will explicitly hire from your country. If you can’t find a single person from your country at a given firm on LinkedIn, then there’s a chance that that firm just doesn’t want to go through the trouble of sponsoring a visa for you. Some paths and firms are much more friendly to people from different countries. For example, I know that some firms like Evercore, JP Morgan, and Goldman have tended to help and hire Canadians more often than firms like Citi or Bank of America (this is why half of Ivey ends up at Evercore every year). Here are a couple of steps/observations that might be helpful to be aware of: Check each firm in the H1B Database The H1B Database is a repository of all of the H1B visa entries in the U.S. The H1B is one of the most common visas in the U.S. and a great deal of finance and technology workers use it. It’s extremely helpful to check this database to see which firms actually sponsor people for visas. It might not be a good use of your time to network with a firm that has no or very few sponsored visas. Larger firms will generally be more open to sponsoring visas I find that larger firms tend to be more open to sponsoring visas than smaller ones. Larger firms mean more employees and that generally means they’ve encountered a specific visa issue before. I know of many smaller buyside firms that wanted to hire someone, but encountered visa issues and didn’t want to go through the trouble of figuring out the solution. Visas are a key reason people stay in banking vs. going to the buyside Relatedly, one of the key advantages of staying in banking with a diversified multinational firm like Goldman Sachs or Morgan Stanley is that they are much better equipped to deal with legal and logistical problems. Some of the most coveted buyside roles are firms with under 20 people, where everyone went to the same two or three schools, meaning they will have very little experience dealing with an international person. Recognize the Power of Lateraling I think it is extremely helpful to be honest and transparent with yourself. Recruiting directly into a New York banking analyst position from an international country, especially from a non-target, is extremely, extremely hard. It’s hard enough recruiting from a target school with an international passport, so being fully international is extremely challenging. In my experience, banks and firms are much more likely to take a chance on an associate, experienced hire, or someone who has proven themselves to the firm. As a result, you should really recognize how common and plentiful lateral opportunities are. It is much better to get some experience in a smaller finance city (like Calgary or Sydney) vs. putting all your eggs in one basket and missing out on an unlikely New York spot. If you know you have a tough visa situation, you should really think about the lateral game. Tons of people lateral every year because there is so much attrition in investment banking and finance. If you do well in a satellite office as an analyst, you will be one of the first people they consider when a spot opens up in New York or San Francisco for example. Similarly, it’s better to get some investment banking experience, even if it’s with a local boutique, vs. giving up entirely. I can think of many, many Canadians who started out in a Big 5 Canadian bank in Toronto and then lateraled to a top bulge bracket or elite boutique in New York after a year or so of working. And it’s much easier for people to do this because you’ll have experience and tangible recommendations. Consider Working in International Finance Hotspots First For some people, working in the U.S. directly out of school will simply be off the table due to their visa or personal situation. It’s good to be aware of this so you can dedicate your energy most effectively. If your ultimate goal is still New York or San Francisco, it might still be helpful to first focus on getting anywhere in investment banking and ultimately lateraling. Many of the largest investment banks will have offices all around the globe and again are much more friendly towards internal transfers than a new hire. Here are some non-U.S. cities that will hire investment banking analysts every single year. Some of these cities might be easier to target depending on your passport. Some of these cities might be considered less desirable and have less competition. London (though still very competitive) Singapore Hong Kong Zurich Toronto (lots of people lateral to New York every year from Toronto) Calgary Frankfurt Dubai Getting an Offer is Different From Getting a Visa The last thing I’d like to remind you is that getting a verbal or even written offer from a firm is extremely different from getting a visa. You need to stay diligent until you actually cross the border and get visa approval before completely celebrating. Plenty of people get rejected at the border or encounter visa problems before their starting date. I can think of a couple of people who got rejected at the border and the firm had to rescind their offer. The implication is that you should still continue to look for contingency plans and don’t completely stop networking just because you received an offer. You shouldn’t be actively looking for new work, but you want to still be reasonably sharp and prepared if something awful happens. One common case I’ve seen this in is private equity recruiting. On-cycle recruiting is sometimes so hectic that the interviewers won’t remember to ask about your visa situation. They might give you an offer during the on-cycle process but later realize they don’t have the capacity to accommodate a visa. These things happen all the time and border security tends to be unsympathetic and indifferent to how much you want the job. Conclusion As an international applicant, you face an extra challenge in the form of obtaining a work visa. Thus, you need to spend some extra time understanding the visa process in your home country.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Overview Berkshire Partners is a Boston-based private equity firm with an AUM of $24B. It invests across a variety of sectors including communications & digital infrastructure, consumer, healthcare, services & industrials, and technology. Berkshire typically invests in companies with an enterprise value between $200mm and $2B and makes equity investments between $100mm and $1B. Berkshire also runs a public equity investment business called Stockbridge, which was launched in 2007. Despite its name, Berkshire Partners has no relation to Warren Buffett or Berkshire Hathaway. Remember that in order to craft a great answer to the common question "Why this Firm?", it's your responsibility to read articles and speak with employees. If you are interviewing with Berkshire Partners, you should make sure you know: 1 deal that the investment team you are recruiting with has done 1 person at the firm (ideally someone who would have influence over your recruiting process) 1 business model-specific detail to mention We explain how to answer qualitative questions and research private equity firms in our Private Equity Course. We also teach how to build LBO models and prepare for case study interviews. Selected Transaction Berkshire Partners acquired a 49% stake in leading Israeli cloud services infrastructure firm MedOne, with the intention to grow MedOne's international client base. Transaction Date: Closed July 2022 Transaction Value: $439mm post-closing enterprise value Press Release Fact Sheet Company Name: Berkshire Partners Description: Berkshire Partners is an American private equity firm based in Boston, with investments in over 100 middle-market companies Firm Category: Private Equity / Upper Middle Market Status: Berkshire Partners is a privately held company Founded: 1986 Assets Under Management: $23.8B Flagship Fund Size: Berkshire Fund X ($5.8B raised in 2021) Chief Operating Officer: Terry Thompson Headquarters: Boston, USA Resources Company Website LinkedIn Glassdoor H1B Data Page (U.S. Salary) Based on the H1B Database, the average base salary for an Associate at Berkshire Partners is $157k. We note that this salary information may be dated and not reflective of their current pay.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Overview Clayton, Dubilier & Rice is a global pure private equity firm with offices in New York and London. CD&R is one of the oldest private equity firms, having started operations in 1978. CD&R has an AUM of $57.2B. CD&R primarily invests in the private equity asset class, with its latest flagship fund raised at $16B in 2021. CD&R focuses on the industries of business services, consumer/retail, financial services, healthcare, industrials, and technology. Remember that in order to craft a great answer to the common question "Why this Firm?", it's your responsibility to read articles and speak with employees. If you are interviewing with Clayton, Dubilier & Rice, you should make sure you know: 1 deal that the investment team you are recruiting with has done 1 person at the firm (ideally someone who would have influence over your recruiting process) 1 business model-specific detail to mention We explain how to answer qualitative questions and research private equity firms in our Private Equity Course. We also teach how to build LBO models and prepare for case study interviews. Selected Transaction Clayton, Dubilier & Rice partnered with TPG to acquire the remaining 75% stake in Covetrus, an animal health technology and services provider. The pair of private equity firms oversaw Covetrus' transformation from a $55mm online pharmacy to a global animal health leader with over $4.6B in revenue. Transaction Description: TPG Capital Partners VIII and Clayton, Dubilier & Rice Fund XI, L.P., acquired the remaining 75.85% stake in Covetrus, Inc. (NASDAQ:CVET) from a group of shareholders at a 39% premium to the company's 30-day volume weighted average share price. Transaction Date: Closed October 2022 Transaction Value: $4.2B post-closing enterprise value Press Release Fact Sheet Company Name: Clayton, Dubilier & Rice Description: Clayton, Dubilier & Rice is one of the oldest American private equity firms with nearly 100 investments Firm Category: Private Equity / Upper Middle Market Status: Clayton, Dubilier & Rice is a privately held company Founded: 1978 Assets Under Management: $57.2B Flagship Fund Size: Clayton, Dubilier & Rice Fund XI ($16B raised in 2021) Chief Executive Officer: Nate Sleeper Headquarters: New York City, USA Resources Company Website LinkedIn Glassdoor H1B Data Page (U.S. Salary) Based on the H1B Database, the average base salary for an Associate at Clayton, Dubilier & Rice is $150k.

If you're interested in breaking into finance, check out our Private Equity Course and Investment Banking Course, which help thousands of candidates land top jobs every year. Equity Research The specific responsibilities of an equity research analyst can vary quite a lot on a day-to-day basis but still follow a predictable pattern over the course of a quarter. Let's look at what the typical day of someone in equity research looks like. Broadly speaking, the pace of work you’ll be doing outside of earnings season is slower than the sprint associated with publishing reports during earnings. Let’s start with a normal day outside of earnings first. Earnings season refers to one of four periods in a year when companies you cover report their results for the most recent quarter. If you're interested in breaking into equity research, check out our course, which will teach you all of the modeling, valuation, stock pitching, and recruiting strategy you need to get the job. Outside of Earnings Season Equity research analysts typically start their day around 7 AM. At most investment banks, that’s around the time when the Morning Call is held, which is where equity research analysts present their most recent actionable reports and trade ideas to the sales team. As the sales team is generally one of the first points of contact between clients and a new piece of research, they ask the presenting equity research analysts questions to refine their own understanding of the pitch by anticipating what their clients might later ask them. Attending the morning call is optional, though senior analysts aim to make many appearances throughout the year to broaden their reach. As a junior, you’re likely going to attend to learn from other presenters or to help answer some questions that you're better equipped to handle. On occasion, you might be asked to speak as well. Keeping Up with News After the morning call, you’ll spend a large portion of your day keeping up with news and events relevant to coverage. As a new hire, you’ll spend a considerable amount of time after hitting the desk ramping up on your coverage by reading news and industry reports. You’ll need to have an understanding of overall economic trends and market developments to the extent that they impact the stocks you cover, whether directly or tangentially. More seasoned employees still spend a lot of time finding insightful news to stay current and continue to refine their views. Generally, you’re going to get hundreds of emails a day based on alerts you’ve set up to capture any announcements which could be impactful for your coverage, so expect to spend a good amount of time sifting through those to see what matters. Publishing Reports These are the most common types of reports you’ll create outside of earnings season: Company Initiations – Equity research teams publish Initiation of Coverage reports when they assume coverage of a new stock. These reports establish the team’s initial rating and views on a company and include detailed information on its business model, competitive landscape, and key financial metrics. From the reader's perspective, they’re a great source of information for someone who’s starting to learn about a company or industry. Rating Changes – Published to revise a team's rating on a stock. These reports often have a significant impact on a stock's price especially when the publishing team is well-followed by investors and the broader media. These reports include the rationale behind the rating change and a new price target when applicable. Price Target Revisions / Model Updates – Issued when a team changes the valuation methodology used to value a stock, or alongside publishing a model update which changes the financial metric inputs into an existing valuation framework. These reports also tend to be stock-moving, depending on the influence of the analyst team. Thematic Reports / Industry Updates – These reports focus on broad themes specific to an equity research team’s coverage. They are normally longer-term projects that are worked on over several weeks or longer. Interacting with Clients Throughout the day, you’ll speak with the sales team to set up calls with clients they manage. You’ll also be expected to keep the trading team updated on certain stock-moving news, especially as traders are spread too thin to keep track of relevant news across all the stocks they trade. Both sales and trading can be thought of as another client to equity research, as the same rules which govern interactions between outside clients and equity research also apply to anyone outside of the equity research department within an investment bank. You'll speak with many types of clients on the job which exposes you to different investing styles and stock theses. What Kinds of Requests Do You Get from Clients? Data / Industry Model Requests – Equity research analysts often get requests for the large datasets of industry-specific metrics they maintain. Clients often ask for these datasets to use in their own analysis or models and ask equity research to help them interpret any trends. Company Model Requests – These requests come from clients who want to compare their predictions with your team’s. They also typically ask questions about specific assumptions in your model, such as why you might be forecasting 3Q23 revenue growth that’s 200 basis points higher than management’s most recent guidance, for example. Industry Calls – Industry calls are requested by investors who are new to the space or by those who have recently picked up coverage of a stock in your coverage. You typically discuss overall market trends, your future expectations, and the nuances of analyzing the industry from your perspective. Specific Company Calls – These calls happen when a client wants to learn more about your view of a particular company. You would discuss your rating on the stock, talk about recent price movements, and answer questions about potential risks to your view (i.e., what would it take to change your rating on the stock?). During Earnings Season Earnings season is the time when publicly traded companies release their quarterly financial reports. These reports give equity research analysts actual data to which they can compare their prior estimates, and provide a new set of data points to inform forecasts for future periods. Earnings season happens four times a year. It's usually a really hectic time for equity research analysts due to the speed at which they have to synthesize a lot of new information to publish reports. Responsibilities During Earnings Season Earnings Previews – During the days leading up to a company reporting its earnings, you’ll write an earnings preview note which gives investors an idea of what to expect from the upcoming release. These notes can be used to reiterate an equity research team's views, or as a final opportunity to change estimates reflecting any new information they may have gathered before an earnings release. Set Up the Model – The day before an earnings release, equity research juniors set up the models for upcoming releases by building and formatting a variance table, which just shows how actual reported results differed from the analyst’s expectations, consensus estimates, and any previous management guidance. Write a First Take Note – In the U.S., core stock market hours are from 9:30 AM to 4:00 PM on weekdays. Companies release their financials either before the market opens (generally around 7 AM, or sometimes earlier) or after the close, typically around 4:30 PM. When results hit, you’ll have ~30 minutes to analyze the financials and publish what’s known as a “first take” note. While there's a lot of stress that comes with writing, proofreading, and publishing a note in such a short time frame, these notes are generally pretty simple. They include high-level takeaways from a company’s earnings results and include a variance table. Get On the Earnings Call - After an earnings release, a company’s management hosts an earnings call where they discuss the results of the previous quarter, issue guidance, and answer questions from the equity research analyst community. As a junior, you’ll be using this time to update the model based on any new insight you can gather from the call, and take copious notes which you’ll use to write a final note to wrap up that company’s earnings season. Your senior analyst will be using that time to come up with engaging and insightful questions to ask the management team on the call. You’re likely to do some of this part of the job too, even at the junior level. Update the Model and Publish a Final Takeaways Note – Finally, you’ll write a key takeaways note to summarize the company’s earnings release and management call, and highlight any changes to your modeling or investment thesis. These notes generally include price target revisions, and upgrades or downgrades to the overall rating when warranted. Conclusion Overall, the responsibilities of an equity research analyst can vary quite a lot on a day-to-day basis but still follow a predictable pattern over the course of a quarter. The main responsibilities include keeping up with relevant news and events to inform your views around a group of stocks or industries, which are shared with clients through research reports and live interactions. If you're interested in breaking into equity research, check out our course, which will teach you all of the modeling, valuation, stock pitching, and recruiting strategy you need to get the job.