How to land a job in Investment banking? (Part 2: The interview)

O'hare airport

Photo credit: tanakawho

The fit interview

They call it the O’Hare airport test, the Atlanta airport test, or the whatevercity-you-happen-to-be-applying-in airport test. They also call it the fit interview or the behavioral interview. It means: “Could you stand to be stranded in an airport for eight hours with this person?”

Generally, while your performance in the fit interview partly depends – as the airport test suggests – on your personality fit, it also depends on your “career fit,” or your ability to portray yourself as a good fit as an investment banker, asset manager, and so on. In other words, interviewers will try to figure out what your attitude towards work is like, how interested you are in a career in the industry, and how interested you are in the job for which you are applying.

I’m a hard worker

As a general rule, you should emphasize how hard you have worked in the past, giving evidence of your ability to take on a lot of work and pain. You don’t have to make things up or pretend that there’s nothing you’d want more than to work 100-hour weeks. In fact, interviewers are sure to see through such blatant lying. Says one I-banking interviewer, “If somebody acted too enthusiastic about the hours, that’d be weird.” If you ask investment bankers and others in finance what they dislike most about their jobs, they will most likely talk about the long hours. Be honest about this unpleasant part of the job, and convince your interviewer that you can handle it well. For example, if you were in crew and had to wake up at five every morning in the freezing cold, by all means, talk about it. If you put yourself through school by working two jobs, mention that, too. And if no experience applies, at least acknowledge the hours as a necessary part of a career path you are choosing.

Got safe hands?

As with all job interviews, finance interviews will be focused on figuring out whether you can handle the responsibility required of the position, understandable considering that in many cases with finance positions, that responsibility may mean making decisions with millions or billions of dollars. An interviewer will try and figure out if you’ve got safe hands and won’t be dropping the ball. “This is a critical I-banking concept,” says one banker about safe hands. “The idea is: ‘Can I give this person this analysis to do and feel comfortable that they will execute it promptly and correctly?’ The people with safe hands are the ones who advance in the company. They are not necessarily the hardest workers but they are the most competent.” Make sure you bring up examples of taking responsibility and getting complex, detail-oriented jobs done right.

A mind to pick things apart

The world of finance involves a lot of number crunching and analytical ability. And while you don’t have to be a world-class mathematician, you do have to have an analytic mind if you are going to succeed. Explains one insider at a numbers-heavy Wall Street firm, “you can’t be any old English major. You’ve got to have a really logical, mathematical head.” Make sure you have examples of your problem-solving and analytic strengths, particularly those involving quantitative analysis.

T-E-A-M! Go team!

Teamwork is a popular buzzword for employers of all industries. Every finance position (except, perhaps, for research) requires that an employee work closely with others – whether in investment banking deal teams or in cross-functional corporate teams such as the finance officials working with marketers at a large corporation. Interviewers will ask questions to make sure that you have experience and have excelled in team situations. Sure, you can break out those glory days stories about the winning touchdown pass, but hopefully there are more poignant situations which can also help describe your teamwork ability – previous work experience, volunteer activities, or school work in teams, to name a few.

Preparing for finance interviews

When you review career options, don’t discount the amount of time it takes to prepare for finance interviews. First of all, you should evaluate whether you actually want to be in finance. In short, you should know what you’re getting into. Not only should you know this for your own sake (this is your future, after all), but your interviewers want to know that you understand the position and industry. You should use the opportunity of non-evaluative settings (i.e., not an interview) to ascertain if finance is for you. These are questions to which we strongly suggest you have answers to before interviewing. Make a point to attend recruiting presentations by firms. Informational interviews with alumni and (for those in business school) second-years are also good ways to get answers to some of your questions.

As for written materials, you can start with general business publications like The Wall Street Journal, The Economist, BusinessWeek, and the Financial Times. From there, you can move on to trade publications that will give more industry-specific news and analysis. American Banker, Institutional Investor, Investment Dealers’ Digest and The Daily Deal are some examples. Your interaction with alumni can have direct results. The results can be good if you prepare properly before contacting them, are sufficiently informed, ask good and sincere questions, and show proper respect. You can also assure yourself a ding if you don’t handle a meeting or phone conversation correctly.

Here are some questions about finance positions you should ask before you have your first interview:

• What is a typical day like?

• What are the hours in the industry really like? Are they 100 hours every week or every other week? Is it the same for every firm?

• How do people cope with the lifestyle issues in the industry?

• What kind of money do people make in the industry?

• What are the things I-bankers (or commercial bankers, venture capitalists, etc.) like about their jobs? What would they like to change?

• What is the future of the industry for the next few years? How will the industry change? How will the margins change? The return on equity?

• What is the career track in the industry? What skills are required at what stage?

• What is so exciting about this job?

• What is the culture of an I-banking firm as compared to a Fortune 500 company? Compared to a startup?

• What are the exit opportunities after 10 years in the industry? After two years?

Research individual firms

Once you’ve answered questions about the industry, you should begin to narrow your research to specific firms – both to know which firms to target, and to be knowledgeable for your interviews. Good sources for research are easily accessible publications like The Wall Street Journal, BusinessWeek and Fortune. If you have the resources (perhaps at a school library), you can also read through recent issues of trade publications like Investment Dealers’ Digest. And of course, to get the inside scoop on culture, pay, and hiring at top firms, read the company profiles on http://www.vault.com, as well as Guide to the Top Financial Services Firms.

Insiders at business school who have gone through the recruiting process suggest that you form research and interview practice teams. There is a lot of material to cover, and it is not possible to do it all by yourself. Form teams for researching industries and firms. Later, you can use the same teams to practice interviews. If you are an undergraduate, you should try to see if your school has an investment banking or finance club. If you are in business school, your school will undoubtedly have such a club, or you may want to team up with other students who are looking into finance careers. Teams of four to six work quite well for this research process.

Practice your interviews

As you read this guide, you should prepare answers to common questions given at finance interviews – whether they be fit questions, technical questions, or brainteasers. While this may be easiest for technical questions and brainteasers (after all, we can help you to nail those questions with the right answers), it is also important to prepare for fit questions even if there are no right or wrong answers. We can steer you onto the right path with these questions, but you’ll need to fill in the blanks. What’s the hardest thing you’ve ever had to do? Can you give me an example of a time when you came up with a creative solution? You don’t want to be cursing yourself after an interview, thinking about what you should have said, or examples you could have brought up.

One of the best ways to prepare answers to these questions is to use mock/practice interviews. You can practice by role-playing with your friends and classmates, or by taking advantage of interview training offered by your school. Most MBA career centers, and many undergraduate career centers, offer students the opportunity to perform mock interviews, which are normally videotaped. These practice sessions are conducted either by professional career counselors or by second-year students. The mock interviewees are given the videotape of their critique to watch at home (again and again). Students may choose what kind of interview they’d like to receive: finance, consulting, etc.

What mistakes are commonly unearthed by the videotaped interview? One business school career counselor says that he finds that “most MBAs don’t have their story down. They can’t elaborate on why they came to business school, and why they want to work in the industry.” The best candidates are able to describe their background and career history, and make a pitch about why they are interested in a firm, all in a minute or less, career counsellors say. Another problem is that many students apparently “can’t elaborate their strengths. They have them, but can’t sell them. They are too modest.” While there’s no use demurring when explicating your good points, career center professionals warn that “there is also a danger of tooting your horn too much” – so make sure you’re not making any claims for competency you can’t back up with relevant experience. To take full advantage of their mock interviews, career counselors say, you should take them as seriously as possible. Dress professionally “to get into the interviewing mindset.” Afterwards, the interviewer will go over the session, assessing your strengths and weaknesses. It’s a good idea to take notes on this feedback. “ Good luck, I am sure you can make it!

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