Tag Archives: i-banking

Take a Risk, Take a Chance, Make a Change*

* Yes, the title is from a Kelly Clarkson song.  I’m not ashamed.

During the summer before my senior year of college, I did an internship at a large investment bank in New York.  To get the job, I professed my love for DCF models and calculating betas.  I made myself sound like the most interesting person in the world: “I enjoy reading Reuters.com, making data tables in Excel, and taking nonlinear walks along the beach.  I don’t always drink beer, but when I do, I prefer A&W.  That company’s got quite the cash flow.”

I suppose it worked.  I accepted an offer from a prestigious bank in midtown Manhattan, working in equity research for the summer of 2006.

salesI thought I would need a few weeks to determine whether I’d find my calling in finance.  But after just a few days, I already hated it.  I hated the dress code, the formality, the hierarchy, and the Big Brother-ness of it all.  I hated the work, which teetered between mundane and soul-sucking.  Most days, I just felt like a highly-paid supermarket cashier, plugging in numbers and being rude.  I quickly learned that there were three tenets of business: 1) Jerkiness is a coveted personality trait…  2) “Fuck” can be used as a noun, verb, adjective, adverb, insult, directive, and occasionally, term of endearment…  3) Lastly, in order to fit in, you have to be strongly opinionated about HR, women leaders, and taxes.  (The opinion must also be negative, although you can “support them in concept.”)

Throughout the summer, I felt like I was part of a giant sociological experiment, where you throw fifty impressionable college kids into (what I would consider) the worst job in the world (except, maybe, dairy farming) and record their reaction.  The people who loved it also seemed to hate it as well, but they had all accepted that hatefulness was part of the job — therefore it was palatable.  And for a summer at least, it was palatable, especially given the fact that we were well-paid, well-fed, and living in New York with an unlimited reign over the four-letter word dictionary.

lincolnNearing the end of my two-month stint, I had to meet with HR (ugh) to discuss full-time opportunities.  The bank was well-known for only hiring first-years from its summer intern class.  Even though I knew, deep down, that I didn’t want to do this for two full years, I still wanted to get an offer.  I still wanted to have a job lined up, even though I swore I wouldn’t take it.  I wouldn’t.  Even though it was a prestigious firm.  I wouldn’t.  Even though I’d built up a strong network.  I wouldn’t.  Even though I’d get to live comfortably in New York City.  I wouldn’t.  Or would I?

During my session with HR, I was bombarded with a barrage of questions that I hadn’t prepared for: “What are your three biggest weaknesses?  What would you title your autobiography?  Which historical figure do you identify with most?”  To the last question, I blurted out “Abraham Lincoln,” after a long, awkward silence in which I contemplated whether Chairman Mao had any redeeming qualities.  (For some reason, he’s the first “historical figure” that pops into my head.)  After trying to justify to HR that Abe was a perfectly legitimate answer (“I see myself in him through his honesty…his passion for humanity…his log cabin roots”), I realized that I would always be better at BS-ing about Lincoln than modeling cash flows.

So when I got my full-time offer, I turned it down.  I took another job, still in finance, but at a media company where I could learn to hone my creative talents.   And now, two years later, as I’m coming to the end of my term, I have to make another decision — whether to stay in my backup plan, or to go ahead and do something crazy, like compare myself to Abraham Lincoln.  Like eschew a stable finance career for the peripatetic life of a starving writer.  I’m leaning towards the latter, because I’m finally ready to give it a real shot now.  And I do truly believe that all things will work itself out in the end…

After all, the full-time offer I turned down, in the winter of 2006, was from Lehman Brothers.

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Wall Street vs. Main Street? I’ll Take Main Street

It’s pretty easy to get caught up in the hype. There’s the wining, the dining, the company-sponsored boozing, the free meals, the car service home, and most alluring, the potential of making six-figures right out of college. Of course, there are also the 100+ hour weeks, the requisite face time, the Blackberry taking over your life, the tacit no-vacation clause, and the fact that your six figures all depends on your bonus (and thus, the volatile market).

Ah yes, the life of an investment banker on Wall Street is a charmed one indeed.

The opposite of investment banking.

Yet, even with the soul-sucking work and grueling hours, there are still thousands of recent college grads scratching and clawing for i-banking jobs every year. Some may want to put in their two years to land a cushy PE/corporate job. Others may want to prove to themselves that they can survive the torture. Still others may just want to hit on girls with the line, “I’m an investment banker”… which, oddly enough, seems to work just as well as “secret agent,” and much better than “consultant”.

But now, given the recent financial crisis, many of the remaining investment banks are cutting their recruiting budgets and giving out fewer full-time offers and coveted internships. Plus, with the plethora of ex-Lehmanites floating around in the pool of unemployed, getting that entry-level banking job will be much tougher than in previous years. Unless you’ve spent your summers running DCF models or honing your valuation skills, you may want to abandon your childhood dream of becoming an i-banker. So, here are some (mildy exaggerated) tidbits about the Street life that may help you cope:

  • Accounting for hours worked, an investment banker probably makes about the same hourly wage as the IT tech support guy in Mumbai. With an annual coup of $120,000 a year ($60K base salary + 100% bonus), 100-hr work weeks, for 52 weeks of the year = $23.08 average hourly rate.  And this is before taxes.
  • On a related note, Brooks Brothers suits start at $898, and you’ll still look cheap compared to your MD, your clients, and the club owner at Lace.
  • At most bulge-bracket firms, Big Brother will be keeping tabs on your email and web searches for signs of insider trading. Swearing is strictly prohibited through email messages (but strongly encouraged in everyday conversation). Most websites will be blocked as well, so not only will you never get to see your friends, but you won’t be able to keep up with their status updates on Facebook either.
  • If you are female, prepare to enter a world where men are vulgar and crude by default. If you are male, prepare to enter a world where there are no females.
  • Asking about work-life balance is akin to putting on a tutu and galloping through the office singing “Somewhere Over the Rainbow”. That is, it’s frowned upon.
  • You will likely spend the majority of your 15-hour days sitting in a chair, sitting in a black car, or sitting on the toilet from scarfing down your latest SeamlessWeb order. So, if you don’t gain at least 20 lbs in your first year on the job, then la cocaina must be working wonders.

Finally, one last reason why i-banking on Wall Street may not be the best move? Two words: job security.

Isn’t Main Street starting to look more attractive?

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Damn…It Doesn’t Feel Good to Be a Banker

Traditionally, finance professionals on Wall Street have gotten a bad rep. They’re the greed-filled, money-hungry, soulless types who exist only to make the rich richer. They embody Gordon Gekko and the ruthless, shadowy banker from Deal or No Deal. They’re the ones who work eighteen hour days, order limo service for their mistresses, enrich nudie clubs and liquor stores, and spend thousands on a night out…just because they can. They’re coke fiends, adulterers, anti-humanitarians, and scums of the earth…

This is the negative perception of Wall Street as a whole–which doesn’t lead to much sympathy when thousands of bankers and traders and brokers are on the brink of losing their jobs.

Many of us may feel little compassion for those who are now clearing out their cubicles and polishing their resumes. After all, they chose this field–and the risks and rewards that come with it. We have come to denigrate the Wall Street types because of their enormous salaries and lavish lifestyles. We typically assume that people who chose the finance life embody all the negatives that we associate with the heartless Gekko. But like any other career path, we all choose our profession based on what it will yield us, either personally or financially. Not everyone is suited to becoming a teacher, or a doctor, or some other “noble” occupation–and not everyone can afford to take a low-paying job either, because of their family background or other personal situation. Some may go into finance because they truly love making DCF models and calculating IRRs on a daily basis. Some may do it because it’s a springboard to other opportunities within the private or public sector. Some may look at their job as a temporary means to an end–more hours now, but a better life in the future. And then there are some who are just good at it… and who can blame someone for wanting to be in a career that they’re good at?

Of course, there are many dirty i-bankers who make all finance professionals look bad–and perhaps there are more jerks per capita on Wall Street than in the nonprofit sector. But for all the greed-mongers that pass through the field of finance, we may find a great philanthropist (Warren Buffett) among them. So when thinking about the shocking fall of Lehman and Merrill, consider all the good, non-scum people you know at those firms… even though Gekko may have no sympathy for them, we should.

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