Investment Banking (2 Viewers)

[pomsky]

All the questions above have been covered in previous topics so it might be worth searching around rather than discussing again.

While both attract similar calibre of people they're still different roles and arguably set you up for different opportunities in the future - it all comes down to the individual regarding preference.

Currently am searching around, but I wonder if you could direct me to some more links? (The ones I'm finding give quite vague answers)


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[Jinks]

Likewise, also have a few questions to ask.

I've talked to several commerce students and they've mentioned the other desirable graduate job aside from investment banking was management consulting. Does management consulting offer the same breadth and exit opportunities that Jinx mentioned IB gave? Are the hours similar? And what would you prefer given the choice between the two?

Finally, would combined commerce / law be any attractive to IB? (In comparison to the double degrees Kaido listed)

Happy new year guys!

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Few points:

- MC also offers a variety of exit opportunities, there is usually a lot of overlap between consulting/IB exit-opps (corp dev/strat, pe etc.) but there are also opportunities where one or the other might be preferred, for example very unlikely you could get a gig in an infra fund coming out of consulting.

- I currently work in banking (although not for very long) and know people who work in consulting (MBB), hours are usually a bit longer in banking, consulting typically won't include much weekend work either BUT you'll be travelling a fair bit in consulting depending on your case

- Degree doesn't matter as much as people think, obviously Commerce is a smart choice if you want to do banking but I wouldn't be picking your second degree based purely on what you think people want to see. I'm studying a single degree and haven't done honours so possible to crack in without it anyway.

Given the choice... depends on the person, banking hours are a bit longer, pay is better, obviously more technical from a finance perspective. Consulting on the other hand is more travel at the junior levels, more opportunity for client secondments, some financial work but no where near as technical, plenty of qualitative work.

Fundamentally you'll be using a lot of powerpoint and excel in either job and I wouldn't say the tasks vary in difficulty between the two greatly (with my very limited experience).

 

[seremify007]

You work in banking now Jinks? I'm slow on the news

And good to see our alumni Vagabond is back. Sort of.


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[Chronost]

Apart from what Jinx said , MC in the first few years definitely allows for more client interaction - you'll be regularly meeting with management and other higher-ups whilst there's a few office meetings with the client from time to time for IB, it's definitely not the same level - I also find MC has more individualised work compared to IB.

Law is generally a good second degree to do for IB/MC although you'll be hard pressed to do enough to get into IB/MC with a single Commerce degree unless you have exceptional marks and get a bit lucky with finding experience/leadership positions through your friends (or you have daddy connections), orrrr do a cadetship/similar which lengthens your degree to allow more time for other stuff.(plus the exp)

Both have good exit opportunities - I find MC allows you to move more into start ups(IB can as well,but MC is just easier to with), your own consulting gigs, getting a high level management role (senior management,CFO,COO, etc...) at almost any company.(generally big companies who can pay for an ex - MC)
Whilst IB has more exit opps in the finance unit of big corps and/or other banks, and the lucrative chance to work in PE(if you got into top-tier consulting there's a chance to go into PE as well) or HF

Generally MC has a wider range of opportunities but IB definitely has its own (and bigger potential at the highest end of the spectrum)

 

[Chronost]

I am! Decided it was something I wanted to try while I had the chance, interning for the summer and we'll see what happens from here!

ooft Commercial or Investment bank? I always thought you end up somewhere there - Internship stage is definitely the stage at to find out if you're going to commit.

 

[Jinks]

ooft Commercial or Investment bank? I always thought you end up somewhere there - Internship stage is definitely the stage at to find out if you're going to commit.

Investment banking, also just for reference i'm doing straight comm and have no daddy connections haha!

 

[Chronost]

Investment banking, also just for reference i'm doing straight comm and have no daddy connections haha!

Nicee - M&A? Sales and trading?

na i wasnt targeting you, just some others i personally know, even then im just saying it happens (lucky them). i know you've done a cadetship and i mentioned it as one of the possibilities with a straight comm

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[RishBonjour99]

Haha I know, just thought I would mention it. Working in the M&A team which I'm really enjoying

Plenty of kids dropping their big 4 cadetships to get into IB. Probably worth it. For a little more hours, you're literally getting tripple the pay in yout firdt year and substantially better exit opportunities in finance (specifically finance).

 

[seremify007]

Plenty of kids dropping their big 4 cadetships to get into IB. Probably worth it. For a little more hours, you're literally getting tripple the pay in yout firdt year and substantially better exit opportunities in finance (specifically finance).

Yeah there's quite a few - although I'd hazard a guess here that whilst it may only be a little more hours, there is probably a difference in the intensity of those hours which some ex-cadets may struggle with. I know that it took me a while before I was able to reign in my 'focus' at work vs just being able to rack up billable hours.

 

[Omnidragon]

IB is a great stepping stone.

Mind you, I didn't enjoy working at an BB very much and found the work very menial. Of course, that was many years ago as you can probably tell from my join date.

 

[Nailgun]

IB is a great stepping stone.

Mind you, I didn't enjoy working at an BB very much and found the work very menial. Of course, that was many years ago as you can probably tell from my join date.

I'm familiar with your distaste for big law; out of curiosity what specifically did you find better in IB versus Law?

 

[Omnidragon]

I've done both. I seriously did not enjoy big law. I was briefly in a bit of M&A and tax. The former is very documentation focused, process driven. Doesn't get much more boring than legal DD in a takeover.. It could hardly be described as 'law'. The latter was just very niche - some people love it, bit like scientists who love what they do.

Banking was pretty menial too especially at junior levels, but it was much better pay. My first year pay was above probably most SAs. Let's be honest ibank gets the hype because of its pay, and at my age I won't pretend otherwise. Sure experience etc is important but would you do it for 40k? That said junior years involve pitchbooks that go nowhere or no one who matters will read, models produce numbers that mean nothing at the end of the day. It gets a bit more interesting at my level because you start running deals etc, but you're basically a glorified business agent.

Not that I have any issues with either of these gigs if they put bread on table. And therein lies the problem. At the end they both struggle from the same problems. The grad salaries and in fact salaries at all levels haven't changed from when I started almost a decade ago. What's an ibank grad getting now? Probably marginally above 10 years ago. In the meantime the single biggest asset for most people, and probably most other things, have tripled in value. Diminishing value of money. And your currency has tanked 30%. Generally times are different and the heydays of earning a big x00k pay cheque means a lot less today...

 

[Omnidragon]

Here's the way to think about it. If you're in it for the long haul, and want to be a CEO one day after 40, it doesn't matter whether you do consulting, banking or law. They're all good starts, good experiences and over 35, no one really cares which one you do.

If you want to make a bucketload before 32, never work again, none of them will probably get you there although the extra money from banking puts it at a slight advantage, but at diminishing returns in recent years.

 

[Nailgun]

Here's the way to think about it. If you're in it for the long haul, and want to be a CEO one day after 40, it doesn't matter whether you do consulting, banking or law. They're all good starts, good experiences and over 35, no one really cares which one you do.

If you want to make a bucketload before 32, never work again, none of them will probably get you there although the extra money from banking puts it at a slight advantage, but at diminishing returns in recent years.

I guess this begs the magic question, what will get you there?

 

[Omnidragon]

Get you where? Magic carpet ride?

 

[Nailgun]

Here's the way to think about it. If you're in it for the long haul, and want to be a CEO one day after 40, it doesn't matter whether you do consulting, banking or law. They're all good starts, good experiences and over 35, no one really cares which one you do.

If you want to make a bucketload before 32, never work again, none of them will probably get you there although the extra money from banking puts it at a slight advantage, but at diminishing returns in recent years.

EDIT: I understand that obviously the number of ways to get to the point that you describe are limitless. To be more specific, if you could do it all again, how would you do it - or at least, where would be your starting point if not IB or big law

 

[Omnidragon]

That's hard to answer because it's in hindsight so I would know what worked and what didn't.

Generally speaking I don't think it's an issue of what you do as a job or what you study. It's more about what you do outside of things that everyone else is doing, be it studying or working. If financial success was your goal - and it shouldn't be your only goal - but if it were, the most successful people I've seen so far are those who aren't afraid to do things differently. Getting a high ATAR and a great degree and getting a top tier corporate gig is nice, but that's just doing what everyone else does, except maybe doing it a better.

 

[Nailgun]

That's hard to answer because it's in hindsight so I would know what worked and what didn't.

Generally speaking I don't think it's an issue of what you do as a job or what you study. It's more about what you do outside of things that everyone else is doing, be it studying or working. If financial success was your goal - and it shouldn't be your only goal - but if it were, the most successful people I've seen so far are those who aren't afraid to do things differently. Getting a high ATAR and a great degree and getting a top tier corporate gig is nice, but that's just doing what everyone else does, except maybe doing it a better.

Much appreciated. I see what you're getting at - do what everyone else does, and you get what everyone else does. It's something that really does warrant further consideration.

 

[Chronost]

Basically you either really dedicate yourself to your job and find success in it or find a side project which you'll dedicate yourself to that can eventually generate a good income (investing etc..) and/or eventually come into fruition (e.g. not as much income but can be sold for a good lump sum later on e.g. successful start-up/business) - that's assuming you'll have nothing else in your life.

Once you get older you have to juggle a variety of things in your life such as family, friends,health and other things - to find success in one thing you probably need to cut down on another and that's where people aren't willing to make sacrifices for the sake of money. The good thing is as time goes by we naturally gain more knowledge and wealth (all things being equal) so you don't need to make many sacrifices to find good wealth, it's rather how quick you will/want to get there and your definition of being financially sound enough that, you can retire happily.

 

[Omnidragon]

Absolutely. These days I get up when I feel like it, although I make an effort to go to work by a certain time. I do what I like to do at work, only look at things that interest me or I think have meaningful payoffs. Of course, I can bust my chops and increase my odds and chase every opportunity, but that's what my first 8 years were for.