Paths After Investment Banking (and Why Bankers Leave)

💡 Get the #1 Private Equity recruiting course, which comes with 3-statement LBO model tests, mega fund case studies, and headhunter coverage: bit.ly/PF-Priv...
📚 Free recruiting resources: peakframeworks...
Investment banking is an incredibly popular career for people coming out of school. But most people really just use IB as a platform to break into other fields. Out of my entire investment banking class, only one person is still at that firm five years later!
The vast majority of people stay in finance on the buyside. 2/3 of people go to private equity right after investment banking. However, as time goes on, more and more people are leaving finance to pursue great careers in politics, sports, entrepreneurship and more.
0:00 - Intro
1:17 - Why do people leave investment banking?
2:50 - Investment banking paths (using my class as an example)
Peak Frameworks is a business career prep service started by Matt Ting and Patrick Fong, who have each spent several years working in investment banking and private equity in New York and Silicon Valley. Matt and Patrick met at Evercore, a top tier investment bank, and over the years have tutored and coached dozens of candidates to land their dream business job.
Matt Ting: / matthewting
Patrick Fong (HBS 2021): / patrick-fong-0b773041
#InvestmentBanking #PrivateEquity #Careers

[@The1dyslexic1meerkat]

Here's a suggestion for an interesting topic: what do investment banking analysts really do? That is, how is time distributed between things such as turning comments on pitch decks, spreading comps, realigning logos etc. Keep up the great work Matt!

[@PeakFrameworks]

Cool suggestion, we'll add it to the list!

[@InvestorCenter]

This channel always puts out really great content.

[@alanmv5]

Great video. I want to tackle into investment banking but im scared, there are not many oportunities here in mexico and even though I have good grades I feel like im not enough for the elite of finance.

[@jackwilmer5940]

Love your content, could you do a video on top masters programs for breaking into PE? MS in Finance? MS in Quantitative Financial Engineering?

[@PeakFrameworks]

MBA. Harvard >> Stanford / Wharton.

[@hawkeye4469]

Matt- Great content. Thanks.

[@carlostellez1858]

Keep up the good work!

[@upstateNYfinest]

Im looking at that other category myself

[@peterlee6803]

Thank you so much for your videos! I actually used your tips on my interview for a bulge bracket interview in HK. But I still got challenged a lot on 'why IB' question, I previously did PE internships and got challenged for questions like "how can we know you're not just gonna go to PE after 1year of banking?" and I honestly don't the answer to this.. It would be great if you could give me some advice on this!

[@tomyduong3178]

Hi Matt - very informative video. Thanks for the content! What roles in politics have your peers moved to?

[@PeakFrameworks]

They tend to become interns / assistants for members of congress.

[@the-zc4mu]

I think that there should be a caveat: because Evercore is so prestigious, many people are able to exit into hedge funds. But ouside of a few firms, this is not the case. Therefore, that 25% would be more like 10% at most firms.

[@PeakFrameworks]

I personally think this would hold at most of the top firms (Goldman, PJT, Morgan Stanley, etc.). I think hedge funds recruit from all of the top investment banks. I don't have the data though so you could definitely be right.

[@samwhaddad]

@@PeakFrameworks what type of funds did they go to? Multi managers (hire from anywhere if you’re good) or SM/Tiger Cubs?

[@RandageJr]

Great video! I wanted to ask you, are banks aware that people work there just to get experience? What would be the reason of staying at IB? I love the videos, keep it like that

[@PeakFrameworks]

Yes, they're aware. It's an understood part of the system for both parties. That's why seniors don't mind grinding analysts as hard! You stay in IB if you prefer client servicing and sales. Some people are real deal sharks and have that instinct. PE and HF tend to also be increasingly stressful the higher you climb up. Many cities also don't have great PE / HF industries, so IB becomes a relatively more attractive option there (e.g. Toronto...). TBH though, I've found that most analysts at the top banks stay in IB because they couldn't successfully recruit.

[@RandageJr]

​@@PeakFrameworks Interesting thought. Thanks, keep it up with this great content, it motivates me a lot to pursue a career in IB, I'm from Bogotá, Colombia and next year I'm going to start looking for internships at some bulge brackets and boutiques. Thanks again for this great content!

[@eatsleep8688]

2 yr IB 2 yr PE 2 yr business school

[@tintocherian7715]

How much do people who've worked less than 2 years in ibanking really understand about the industry? In that limited time, there's no way that an analyst will get exposure to every type of deal or fully comprehend how the entire ecosystem fits together. Or is it just that we as viewers are wrongly assuming that ex analysts think they know as much as someone who spent a decade or more in banking? Would you say there are many things you only figured out or realized after your analyst stint?

[@PeakFrameworks]

Yeah, there's no way that investment banking analysts know everything about the market. There's no way any one banker is going to understand everything about the industry. People specialize pretty early, so it's highly unlikely you'd get meaningful exposure to every industry group and every kind of deal. Analysts accrue a lot of technical skills extremely quickly and are probably years better at financial modeling than people in other fields. I was still learning a ton in private equity. I always kinda viewed investment banking like learning how to skate; investing is like playing hockey.

[@Daniel-ls1gb]

Amazing content man

[@noahfarrell7082]

so if u dont get good jobs not going to a top 10 school whats the point of going to business school?

[@PeakFrameworks]

I generally don't think it's that worth it to go to business school unless it's a top one. Way too expensive for potentially no improvement in short-term career prospects. It might still be reasonable if you're coming from a completely different background and desperately want a career switch.

[@shedo7275]

Thank you

[@lucag4402]

Could you make a video on how to break into IB from the very start like just after high school or secondary school

[@PeakFrameworks]

This is pretty much it: kzbin.info/www/bejne/omrRoWWuhL6kndE Just do your best to get into a good school right now.

[@lucag4402]

@@PeakFrameworks thanks

[@nidashaikh1009]

Thanks for the video bro..I was searching and finally got good and honest content..just a suggestion if you can..I am in IB,and want to leave because of long work hours as I love my family...kindly assist me seeking more ways to get into sound job that value my IB experience..

[@PeakFrameworks]

Pension funds, family offices, corp dev are the better lifestyle paths for you. Good luck!

[@33shab]

Hey man - thanks for the video. I know your knowledge on this may be limited, but could you or a friend talk about corp dev / strategy / bizops opportunities and how that process works? I know a lot of corporate companies use the some of the same headhunters PE uses now. I’m an incoming analyst next month and recently decided I don’t want to do PE but like Evercore, my bank also sends like 65% of analysts to PE and I’m afraid the name isn’t heard too often outside of finance or corporate development departments, and I’ve noticed a lot of Corp dev associates at larger firms have 4+ years of either banking or banking + PE experience

[@PeakFrameworks]

Corp dev relies a lot more on off-cycle and ad-hoc recruiting. Most people that go into corp dev stay for a while, so there's less predictable attrition. You can recruit for it as an analyst no problem. You can also wait and recruit for it as an associate or higher up. Corp dev is a bit more of a career place to be than PE, which is why you get more senior people going. Generally speaking, these roles are a bit less traditionally competitive, so I don't think the rules and requirements are as strict. I would say a lot of people end up finding corp dev opportunities after working directly with companies on a specific deal. E.g., you represent them as their banker and then you impress their team. For that reason, I think industry group tends to matter a bit more as you're seeking out corp dev expriences. One last thing, I think it's tough being picky for different corp dev teams. The hiring can be really infrequent that it can be really tough holding out for a specific company.

[@leopoldvanstotch437]

I've realised IB is too difficult for me right now. Whats theBest way to get into finance with a masters degree in politics and 2x finance digital internships?

[@PeakFrameworks]

Study more finance jobs and figure out what attracts you the most. Do you want to invest? Do you want to public or private? What sort of assets do you want to invest in? Coming out of school if you don't want to do IB, you could do valuation, Big 4, or investing at a boutique.

[@SacredAces]

Hey! Loving these videos Matt, as a finance aspirant these are extremely helpful and insightful, thank you for the effort. So I wanted to ask you, assuming a situation: My school is a target for Investment Banking but a non-target for MBB consulting. But I want to break into consulting. If I recruit for banking, will a shift to consulting a year or two down the line be possible/realistic? MBB specifically. Please let me know what you think! Thanks a ton in advance.

[@PeakFrameworks]

I would do IB summer and then go all in for consulting FT. There are so few consulting internship spots, it's generally not a great expected value to go all in on it for the summer in my opinion. MBB does majority of its hiring full time. Worst case with the IB route is that even if you whiff on MBB you can still generally find a decent finance thing.

[@SacredAces]

@@PeakFrameworks thank you for the detailed response! I’m so sorry I forgot to include this in my original comment, Whats the better path to take and why, MBB Consulting or BB IB, if the goal is to break into PE?

[@hvtarun7030]

@PeakFrameworks What did you major in grad school before getting into investment banking or private equity???

[@PeakFrameworks]

Business administration at Ivey in Canada. No grad school. Most people do economics, business, finance.

[@hvtarun7030]

@@PeakFrameworks ok thank you. Can a student majored in accounts or commerce get into investment banking or private equity?

[@OMGz1122]

how rare is it for people who have loyalty as a trait and stay with a IB firm because they have made friends there.

[@Jazz-gb9lp]

They die / hate their life

[@PeakFrameworks]

Extremely rare at the analyst level, because most of their friends will also have left after a few years. I think more possible at the mid level, but there's less and less camaraderie as people start competing with each other for the same spots. I don't know anyone who stayed in IB "for the friendship". You can be friends with those people even after you leave the firm.

[@SatyamSingh-yu7bc]

Please make on how to get into job ib

[@PeakFrameworks]

Sounds good, we'll add that video soon!

[@carter181]

Great video - a unique insight into a real class of analysts. I'm a US/UK dual citizen living in the UK - do you think it would be possible to switch to private equity in the US from 2 years at an investment bank in London?

[@PeakFrameworks]

US dual citizenship helps a LOT. UK is probably the best place to be outside of North America to break into the US. It'll require more effort in crafting the right story and reaching out to headhunters proactively, but definitely possible. If you want a slightly more reliable path, you may want to recruit for UK based funds that have US offices, then lateral over. I think either path will work though.

[@carter181]

Peak Frameworks Thanks for the reply! The problem with the second option is, from my research, private equity funds here typically take the IB analysts which have originally come from countries other than the UK and therefore are bilingual. In some cases, even trilingual+ as learning multiple languages is a very common thing in Europe (except in the UK). There is no reason why a PE fund would take an English speaking only candidate over a polyglot when they are both equally skilled. These funds are working across many countries, as opposed to the US where it is mostly English. I’m still in high school so technically I could learn a language, although I think it will be difficult balancing that with a rigorous university education. You definitely have more knowledge in this field though so possibly you could provide some insight into whether not being bilingual would be a disadvantage or not.

[@salinna6731]

Great video! What's your view on private credit at MF out of undergrad? Would that places someone at a disadvantage comparing to banking (exit opps, career trajectory, earning potentials)? Would it be possible to recruit for banking later on if decided to switch to sell side? Appreciate your response!

[@PeakFrameworks]

Exit opps yes, but career trajectory probably better if you want to stick with credit. The roles you're talking about would be with firms like KKR, Apollo, Blackstone GSO. If you join out of school you can really fast track your path. I think if you summered there, you would be able switch to banking for full time pretty easily. After that, I think it'd be kind of unlikely (and not that desired) to switch to banking. One downside is that a lot of PE / HF roles are not going to look at credit people to hire. They'd prefer to hire from IB / consultants still. So credit can be a really good fast track, but it can funnel you a bit.

[@salinna6731]

@@PeakFrameworks Thanks for that and it makes sense. It's with something along the line like Ares, GSO (best in credits). What's your view on how would the current pandemic/recession situation affect the switch from credit to FT banking next year? I was thinking more along the line of distressed PE/HF for exits but appreciate your perspective! Thanks for being helpful :)

[@hazikamin546]

Mind if I ask what is credit?

[@minanagui8354]

Hey, do you know if it is possible for an egyptian (studying in egypt) to get into spring insight programme for ib at a bulge bracket in the us/uk or not?(egypt doesn't have bulge brackets offices) Do they even recruit international students i feel like the chances are already so low for americans and being egyptian makes it even harder

[@PeakFrameworks]

No idea for Egypt, I would say generally not though. Maybe better luck in Europe or other parts of the world, but U.S. seems to focus on U.S. schools for most of the programs.

[@spenndoolie]

2 years of KZbin

[@Kellychr]

Feasibility to move from ER to PE? Would you say the best bet is to break into IB and then PE? Only worry is I'll be too old for IB (assuming Analyst 1 entry). Currently in 2nd year of ER out of school

[@PeakFrameworks]

Don't think you're too old, just might take a few moves. I would say first try moving to IB or advisory role a year or two. ER is decent breaking into hedge funds, but you tend to not have enough deal experience so it's hard doing a straight jump to PE.

[@Kellychr]

​@@PeakFrameworks Appreciate the reply - and yeah that makes total sense. Thanks!

[@mikhail3272]

When people leave for “sports” does that mean sports management or agencies? Do you personally know anyone that has done that?

[@PeakFrameworks]

I meant business roles at sports companies and agencies. So like the NBA, WME / IMG. It still tends to be corp dev and business development type roles.

[@mikhail3272]

Peak Frameworks thats still cool

[@DK-ox7ze]

How much do buy side firms pay at senior levels?

[@PeakFrameworks]

Depends on firm, but by mid 30's you're probably consistently getting around >$1mm at the largest firms.

[@DK-ox7ze]

@@PeakFrameworks Out of ibs, hedge funds, PEs, what pays the best?

[@grains6002]

@@DK-ox7ze depends on the firms, but a top performing hedge fund will outrank all

[@suhaskishore1615]

Can you get into investment banking with a degree in computer science?

[@PeakFrameworks]

Yes, I know plenty of people with a comp sci background. Takes a bit more effort and posturing (e.g. finance clubs), but definitely possible.

[@suhaskishore1615]

@@PeakFrameworks can you please tell me how it's done? Like step by step

[@dxiao3196]

anyone go into venture capital?

[@PeakFrameworks]

Some did growth and are moving towards VC, but no one in my year is doing early stage VC (yet). A lot more bankers on the west coast end up in it typically.

[@4everLarose]

Why did you leave?

[@PeakFrameworks]

Wanted to try building something of my own and wanted more control over my days!

[@4everLarose]

@@PeakFrameworks Very inspiring! Best of luck

[@samwhaddad]

How long did it take for you to get jaded from IB? For me it was 10 calendar days

[@PeakFrameworks]

For me it was Memorial Day Weekend of my second year when my friends from out of town visited me. I spent the entire weekend extremely inefficiently turning some stupid deck that got scrapped Monday morning while my friends were partying.

[@AliKhan-tf6lc]

can you go into P.E or hedge funds if you go into ib first post mba?

[@PeakFrameworks]

Yes for sure. Most MBAs can't break directly into PE / HF and do IB first. Might take a bit longer, but still viable.

[@AliKhan-tf6lc]

@@PeakFrameworks Hey man your videos are great. I have one last question. If you didn't study finance or business or accounting in undergrad, (i was a science major), would you recommend IB as a career switch through the MBA? The money and the work is interesting to me but I'm not really sure I can handle all of the finance information I may need to know.

[@naniLULW]

A shame going from an IBanker to Making videos on KZbin 😭😭

[@PeakFrameworks]

Haha, tough times man!

[@prithakshrestha]

@@PeakFrameworks but why

[@virx7944]

Everyone has their own path, take a look at Deliveroo's CEO. He is an ex-IB at Morgan Stanley.