Nature didn’t select me. I selected myself by harnessing my nature.
– Bobby ‘Axe’ Axelrod in Billions, Season 5, Episode 3: Beg, Bribe, Bully.
Despite the endless cycle of economic crises, it seems that the appetite for a position within investment banking is as insatiable as ever.
Recruitment numbers have bounced back up to the pre-COVID-19 level, increasing by over a third in the past year alone.
This subject resurfaced during a panel session I participated in at the Financial Literacy Carnival at a shopping mall last month.
My assigned focus was Malaysia’s small and mid-cap stocks—a subject I initially thought would draw a niche audience.
But when the floor opened for questions, the discussion took an unexpected turn.
Almost every query honed in on my career in investment banking.
Apparently, many in the audience were regular readers of my column—or so I was told afterward.
“How did you get into banking?”
“What should I prepare for interviews?”
“What skills do I need?”
“What’s a day like?”
One question followed another in rapid succession.
While I am more than happy to share advice with young, hopeful students, here are a few things to consider before declaring your life’s goal as an investment banker.
This isn’t meant to discourage anyone but rather to open your minds to other opportunities that haven’t been highlighted the way that banking has.
I say this not as an outsider but someone with some credibility— 14 years leading a team of analysts in Goldman Sachs’ investment banking division.
The demand for new talent might be on the rise but getting into investment banks isn’t just a case of having superb academics and the ‘right’ degree from the ‘right’ university.
Given the depth of the global talent pool the investment banks select from, there is still too much talent.
Straight As at A-level or 40+ points from the International Baccalaureate (IB) may only be the first rung on the ladder.
Investment banks are always looking for intelligent, hard-working, proactive and intuitive talent.
Make no mistake—our ability to be extremely selective means stellar academics are merely the baseline for most top-tier investment banks.
This requirement is an effective macro-screener of talent – one way of trimming the population into a manageable sample to recruit from.
However, it’s not enough.
The interview process will assess intuition, practical ability as well as intellectual talent and will aim to find out what drives your ambition.
True intellectual talent isn’t the ability to retain facts and regurgitate on-demand textbook answers.
Frankly, we’re quite allergic to hiring those types.
We call them “plug-and-play” candidates.
Sure, they have the track record, but they’re not exactly inspiring.
What we’re really after are the outliers—the ambitious, the unconventional, and yes, even the borderline crazy profiles.
Intellectual talent for me is the ability to view A and B, analyse the link and then derive what possibilities could get us to C, D and E.
This kind of cognitive agility is rare—less than 1 per cent of the 300,000 applications we screened recently demonstrated it.
It is this elusive talent that has become the holy grail of investment banking recruiters worldwide.
Applying the skills learnt in education is not always straightforward.
In a working environment, the application of the appropriate method or skill is often judgement based and dependent on the personal characteristics of the applicant.
So the most crucial insight I can give is to learn by understanding and develop by applying your skills to real-life deals and transactions.
Do not be afraid to develop and share a view or an opinion.
Playing it safe simply because it’s conventional or popular won’t take you far—trust me on that.
After all, investment banking is, at its core, an advisory profession.
It requires a high level of judgment, strong opinions, decisive actions and the courage to stand by them, no matter what.
While this is a skill that develops over a lifetime, you should start conditioning your thinking now.
Don’t just learn the A to B links – understand the links and what drives them.
Consider what C, D and E derived options could be.
Consider if there are any other ways of getting to B – rather than just using established principles.
Change your angle or perspective of the thought process.
Often learning at school is focused on progressing past the next exam hurdle.
But once you are accepted into the ranks of an investment bank, there is going to be a great deal of learning.
As the learning is now applied to a new direction – demonstrating a vocational skill rather than just passing an exam, it forces a change in the approach to learning.
Retention of facts or processing information is not an advisory skill.
The brain needs to be re-tuned to adapt this approach.
In other words, don’t process—think.
If you find yourself learning through forcing knowledge into your head (I think back to university finals – late nights – last minute exam cramming and re-reading the same paragraph again and again – each time feeling like it’s the first time you’ve read it), you’re probably going down the wrong route.
If you understand an issue, you understand the key drivers and are able to follow the mechanism that pulls the issue together, then the likelihood is that there is little for you to learn – you understand it and you can apply it based on rationale.
A good place to start is to study econometrics, mathematics and interpret the financial press.
Many would-be analysts read the financial press – which is great and should only be encouraged.
But the error is that they often attempt to absorb the factual detail rather than examine and understand the drivers of the news.
It is a massive advantage to anyone attempting to enter into the profession to be able to discuss why a transaction took place, what drove the deal, and why it was financed in a particular way – rather than just regurgitate a deal term sheet.
Also, news flows over a period – sometimes days, often weeks.
There is little value to be added by picking up a financial daily once a week – it’s got to be a regular habit.
What else can you bring to the table?
Never underestimate the value of a life outside of academics.
In this field, teamwork is everything.
Each analyst, with their unique specialisation, is quickly integrated into a team or group upon arrival.
This is why we also hire a lot of individuals with lives outside of spreadsheets.
Our teams include everyone, from Olympic swimmer Kate Douglass to David Solomon, who moonlights as a DJ.
You don’t need to be interested in finance from year dot, but you do need to be incredibly competitive for a cause.
Lastly, be yourself.
The recruiters will be assessing your fit into their existing team dynamics.
You cannot fake your whole professional life to fit into a role.
On the flip side, flair, creativity and individuality can be very attractive attributes during the recruitment process – you’ll be remembered – hopefully for the right reasons.
The views expressed here are those of the columnist and do not necessarily represent the views of Sarawak Tribune.
