1. Financial Careers: Introduction
  2. Financial Careers: Qualifications and Credentials
  3. Financial Careers: Finance Employers
  4. Financial Careers: Investment Banking Jobs
  5. Financial Careers: Trading Jobs
  6. Financial Careers: Financial Advisory Jobs
  7. Financial Careers: Analytical Jobs
  8. Financial Careers: Financial Media Jobs
  9. Financial Careers: Analyst Jobs
  10. Financial Careers: Portfolio Management Jobs
  11. Financial Careers: Conclusion

Our first deep dive into one of the broader types of financial institutions will focus on investment banking. Employees at investment banks typically work with corporations, governments, and other large financial institutions in order to help them raise capital or to advise them with regards to strategy. It’s common for investment bankers to begin their careers as generalists and to hone in on particular sectors or industries over time. In turn, their careers tend to become more specialized as they continue on.

Where the Jobs Are

Investment banking jobs are available with a number of institutions. Most prominent, perhaps, are the large global investment banks. These include bulge bracket banks like Goldman Sachs and Morgan Stanley, but they also include separate investment banking departments within commercial banks like Citigroup. Investment banking jobs also exist at smaller banks which are either regional or boutique in focus. These include Lazard, Jefferies, and other similar institutions. Further, investment bankers work at alternative asset management companies, including venture capital firms and private equity institutions. Lastly, many large companies may have an in-house staff which works in a similar capacity to an investment bank, providing evaluations of strategic opportunities, corporate mergers, and the like. A major company like General Electric is an example of this final category. (Learn more in Getting An Investment Banking Job In A Recession.)

How to Get an Investment Banking Job

For better or worse, investment banking has long held a reputation for being a blueblood profession. Historically, many investment bankers have enjoyed prestigious academic backgrounds at top-level universities and colleges. This is not exclusively the case, but it is common for individuals to enter work in a large global bank directly out of undergraduate work. They typically work for two to three years before returning to graduate school to secure an MBA degree. Those individuals often then return to their previous employer in a new capacity, or they move to a new firm at a higher-level position. It’s less common for investment bankers to seek out professional certifications like the Series 7 or CFA as compared with some other types of finance jobs. Still, competition for investment banking positions is rigorous. It’s virtually required that a successful candidate have a strong academic record and an appropriate degree in a finance-related field, or ample coursework in that area.

Types of Investment Banking Jobs

There are many different types of investment banking jobs, but here are some of the most common:

  • Mergers and Acquisitions (M&A)

Bankers focusing on mergers and acquisitions specialize in providing strategic advice to companies that are looking to merge with their competitors or to buy smaller companies. M&A bankers utilize financial modeling in an effort to evaluate these large-scale potential deals. They must also be able to successfully interact with clients, as these jobs typically require interactions with high-profile executives, and M&A specialists must be able to convince these executives of their ideas. As with many other investment banking positions, M&A specialists tend to work exceptionally long hours and receive ample compensation. It’s common for senior-level bankers (managing director level and above) often bring in seven-figure compensation levels.

  • Underwriting

Investment banks often involve themselves in assisting corporations and governments with raising capital. In practical terms, this function is part of a bank’s underwriting department. Underwriting specialists typically focus on debt or equity and often have an industry-based focus as well. These bankers commonly serve in client-facing roles, working with outside contacts to determine capital needs while at the same time working in-house with traders and security salespeople to find the best options. Underwriting is not limited entirely to investment banks, and in fact has spread to larger universal banks to a great degree in recent years. These major banks have increasingly used their large balance sheets in order to gain market share over their smaller rivals, especially when it comes to debt underwriting. (To learn more, see The Rise Of The Modern Investment Bank.)

  • Private Equity

Private equity jobs are among the very most prestigious in all of finance. Many investment banks have private equity arms, although private equity jobs are typically found at smaller, specialist firms. Like most other investment banking jobs, the hours and workload in private equity tend to be brutal, but the compensation is proportionally high as well. Private equity firms traditionally keep a portion of any profits that they are able to generate through deals, meaning that successful firms tend to have wealthier employees, particularly at the highest levels. This means that competition for jobs at the most venerated private equity firms is especially intense. It’s common for successful applicants to have prior experience at investment banks, as well as outstanding academic credentials. (For more, check out Learn The Lingo Of Private Equity Investing.)

  • Venture Capital

Venture capital firms tend to specialize in providing new capital to emerging companies. These new companies are usually small and have not yet been taken public. As the name of the industry suggests, the investments are a venture, and many of the target companies eventually fail. Nonetheless, owing to the fact that venture capital firms get their investments in at the earliest stages of development, the gains produced when a company gets huge are massive enough to outweigh the poor odds of success. It’s common for venture capital firms to focus on rapidly-developing industries, including tech, biotech, and green technology. Employees of venture capital firms are typically both adept at number crunching and deal making and clued in to new technologies and ideas. They usually get a sense of thrill from the prospect of discovering “the next new thing.” Recently, venture capital has become more broadly distributed among the public via crowdsourced funding in initial coin offerings (ICOs), at least in the area of digital currency. Still, venture capital firms support companies in all areas. (Check out The Top 9 Venture Capital Interview Questions.)

Summary

Investment banking jobs can be grueling; it’s common for them to be fiercely competitive and extraordinarily demanding. On the other hand, though, the compensation can be tremendous. The most common path to a career in this area is a related degree from a top university and, eventually, an MBA, but there are exceptions as well. If you have a strong desire to work as an investment banker and believe that your skill set aligns with one or more of these positions, you should continue to explore these careers regardless of what your career history and educational background is.


Financial Careers: Trading Jobs
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