I have been asked the question "What do I need to do to get into Investment Banking/Corporate Finance/Equity Research?" by lots of people looking to make the move, so I thought it good time to write a bit about how I broke into the field.
If you look at any job advertisements for Investment Banking, Corporate Finance or Equity Research roles, you will generally see four things on the job add that are required:
Let's talk about these 4 criteria in a bit more detail (in reverse order):
Top Undergraduate Grades: Some firms are stricter on this than others, and as an undergraduate applying for a graduate program, to break into the bulge bracket this is basically a necessity. If you don't have top marks my recommendations are to either network like crazy and try and meet someone in a position of power at the firm you are targetting, do something entrepreneurial that is impressive enough to overcome the lack of grades, or look at heading into a Commercial Bank to start with and apply for one of their Corporate Finance programs (easier on the grades than IB by a long way...). Otherwise you will need experience or a Postgraduate degree to help your resume along...
Relevant Experience: I started out in a Commercial Bank as I studied Law at University and didn't initially have the Finance knowledge to get into an IB. Once in the Commercial Banking graduate program I quickly identified which parts of the company did similar work to an Investment Banking role and made my way to a job in Credit Research and Deal Structuring within an Institutional Relationship Banking business. This strategy paid off as a large part of the analysis done in the Institutional Relationship Banking business (in Credit Research and Deal structuring anyhow...) is about understanding the value and debt capacity of a business, which is also a core component of Investment Banking, Corporate Finance and Equity Research roles. From there moving into Corporate Finance and Distressed Debt was not a big jump. Generally junior analyst roles in IB, Corporate Finance and Equity Research require a couple of years experience, and Relationship Banking can be a great place to get this experience.
Post-Graduate Studies: Two key things about my resume helped me make the numerous jumps I have made in my career, 1. Financial Modelling skills and 2. CFA study. I cannot recommend enough how big a boost to your resume the CFA study program can be. After I passed the Level 1 exam I began receiving calls from recruiters asking me about moving roles (albeit they had my resume earlier, only they started actually being quite interested then...). After I passed the CFA level 2 exam I received more calls, and started getting straight-up serious offers from Investment Banks and even a Hedge Fund, and after having passed the CFA level 3 exam I have literally received a phone call from a recruiter at least once a month asking me to move roles to Investment Banks and various buy-side roles. There are lots of jobs out there that require either CFA study or progress through a Post-Graduate (usually Masters level) degree for candidates. My experience has shown that the CFA is probably the most highly regarded post-graduate program for the Investment Industry in the world, and I cannot recommend it enough to anyone looking to break into the industry. It is a hard program, but that is why it is so worthwhile. The only deficiency with the CFA program in terms of training you for Investment Banking is that it doesn't teach you how to use the theory you learn in the way you will need to in an Investment Banking job. That's where we come in:
Financial Modelling Skills: For any entry level job in an Investment Bank or brokerage, you will need Financial Modelling skills. Every job I have had in finance, I was asked about my financial modelling skills in the interview, and on two occassions I was asked to submit models as part of the interview process. Having financial modelling skills as an entry-level candidate will demonstrate a pro-active attitude and differentiate your resume from the crowd. When you are a junior analyst a large part of your job will involve building and updating financial models so having actively sought these skills shows you know what you are getting yourself in for and that you will be able to contribute from day 1. In general the options for obtaining these skills are:
So there you have it, if you want to break into the industry, do the following: