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Good reasons to point to here:
• You’ve enjoyed the analytical / finance work and following the markets, but you want to work with companies rather than individuals.
• You’re more passionate about deals rather than following individual companies and asset classes.
• In the future you see yourself as more of an Investor or Advisor to Companies as opposed to working with high net worth individuals.
Sample “Good” Answer: “Sure – I’ve definitely enjoyed my time in wealth
management at Smith Barney and have gotten a lot out of it, but in the future I want to work on transactions and learn that process in-depth rather than advising high net worth individuals.
What I like about wealth management is how there is some analytical work and how you have to understand the markets to properly advise clients – but I’m looking to do that on a much bigger scale, and I’m more interested in how transactions such as M&A deals and debt and equity financings work. I’ve followed a few recent deals such as ABQ Corporation’s $5 billion acquisition of DCZ Corp’s mining interests in Canada with great interest, and I’m eager to work on deals like that.
Also, while I’ve enjoyed advising individuals and contributing to the work that
financial advisors at my firm do, in the long-term I want to develop relationships with management teams at companies instead – and investment banking is the perfect way to get there and eventually take on that trusted advisor role. So that’s why I’m so
excited about making the switch and having the opportunity to join your firm: the work itself, my own personal interests, and how it lines up with my future goals.”
Why It’s a Good Answer: He goes through a few of the good reasons above that explain the motivation to move from wealth management to investment banking, and then talks about a specific deal he followed – this shows that he’s “the real deal” and can point to examples that back his interest rather than just speaking in generalities.
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Then, he concludes by going into his long-term goals and restating how the firm and group line up with his own work goals, personal interests, and long-term career goals.
7. I see you’ve practiced law at Wilson Sonsini for the past 4 years – if you’ve been there that long, you’re probably on the Partner-track by now. Why would you want to leave a lucrative career in law and go back to being an entry-level Associate in
banking?
Here’s your set of good reasons to cite:
• You want to be involved with the entire deal process, from beginning to end.
• You want to become a trusted advisor to management teams, not only on legal issues, but also on strategy, financing, and M&A.
• You want to combine your legal background with your finance skills and advise companies in a group such as Restructuring where there’s significant legal overlap.
With this type of move, it is very tempting to go negative and say thing like, “As a lawyer, you just do paperwork and check the facts – you don’t drive deals or influence business!”
You need to stay away from that type of reasoning because it won’t help you. The formula is the same as always: you like some of what you do, but you’re missing something, and banking is the way to get there.
Sample “Good” Answer: “Right – it’s certainly not a transition that you see often, but it makes a lot of sense given my background and interests. I’ve enjoyed my time at Wilson Sonsini, but over time I’ve become more and more interested in the finance and
business side of deals, and I’m interested in leveraging my background to eventually advise companies on more than just the legal parts of deals.
I had always had an interest in finance and took several classes in university, but went the law route because at first I was really interested in public prosecution – but then
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after several internships, I was drawn increasingly to the corporate side, and ended up practicing corporate law at my firm.
I’ve enjoyed the deals that I’ve worked on so far, but I’ve also realized that I want to work on the financial side of deals as well – going back to my original interest – and after seeing firsthand the analysis that took place with clients such as Exxon Mobil and their $1 billion acquisition of WTG Energy. I’ve been studying the technical side on my own, and look forward to doing more of that work and learning the entire deal process in the future.
In the long-term, I want to leverage my legal background and the finance skills I’ll gain in investment banking to become a trusted advisor to companies – and your firm is the perfect place for me to gain those skills and work toward that eventual goal.”
Why It’s a Good Answer: Not only does he explain the points above well, but he also points out how he was interested in finance from early on, and also that recently he’s been learning more on his own – which sets him apart, since most lawyers cannot claim either of those.
He is also smart to name drop a recent acquisition and relevant client here – this example is fictional, but you should definitely do this whenever possible and point to the specifics to prove your interest.
8. You worked at McKinsey last summer. Why are you trying to get into investment banking now, when you could easily go back to any management consulting firm?
Here are good reasons to cite:
• You like advising companies, but want to do more quantitative and financial work as opposed to the mostly qualitative work in consulting.
• You want to make more of an impact with deals where something concrete happens, as opposed to making recommendations that may or may not be implemented (be careful with this one because deals often
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fall apart).
• In addition to advising companies on strategic issues, you want to work on financing and acquisition-related issues.
It’s not a great idea to point out how you don’t like the constant travel in consulting, because it’s more of a “lifestyle” point and less of a “the work itself” point.
Sample “Good” Answer: “Sure, that’s true and I do agree with you – I could go back to consulting quite easily, but I’m not doing that, which shows how committed I am to making this change. I’m very interested in going into investment banking instead because I want to do more quantitative work, and make more of a concrete impact by working on deals.
While I definitely learned a lot working with consumer / retail and Internet companies, I got more and more interested in quantitative work and financial analysis along the way – with one client, we handled much of the customer due diligence for a pending M&A deal, which made me more interested in the whole process. In university I had participated in a number of case competitions sponsored by large banks and really enjoyed it, and that type of work – where you combine the finance with the bigger picture – is what I want to do.
The other big reason I’m interested in banking is that your work makes more of a concrete impact, since companies get sold, go public, or raise debt or equity. In consulting, by contrast, in the majority of cases you never get to see your
recommendations implemented. I know that many deals do fall apart, but the ‘finished results rate’ is still higher in banking.
So that’s why I’m so excited about the opportunity to join your firm – the financial advisory work is exactly what I’m looking for, the concrete results are there, and in the long-term I want to become an advisor to companies in a consumer-facing industry like retail or Internet.”
Why It’s a Good Answer: He mentions all the points we suggest above, but more than that, the interviewee also does a few other things very well here:
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• He shows that he has been interested in finance for quite some time, referencing the case competitions from university.
• He also talks about getting more interested as a result of his work on the due diligence in an M&A deal in consulting (yes, consulting firms are sometimes hired for that).
• Finally, he acknowledges the subtle point that deals do fall apart – so he doesn’t have unrealistic expectations – but points out that the “success rate” is still higher in banking.
9. You’ve worked at a few prop trading firms and also in Sales & Trading. They get paid pretty well and work market hours – so they have it a lot better than us. Why
would you want to switch to investment banking?
Good reasons to use in this case:
• You want to contribute to transactions and work on high-impact deals rather than just handling day-to-day trading and client orders.
• You want to work on extended projects rather than short-term investment ideas and client requests.
• In the long-term, you want to develop relationships with companies rather than generating trade ideas.
Stay away from negative points such as having to stare at 8-10+ monitors all day, the repetitive nature of the work (if you worked in agency trading), and so on.
Sample “Good” Answer: “Well, I do agree with you that the hours in sales & trading or prop trading can be more regular and the compensation is also attractive, but ultimately I think you have to look at the work itself and your future goals when deciding on careers. While I enjoyed my time in trading, I want to work on deals rather than following public companies and develop relationships with companies rather than generating trade ideas.
I had always been interested in deals, back from when I worked at a local M&A
boutique in my 2nd year of university – but afterward, I thought I was more passionate
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about the public markets so I went into trading. But I found myself spending most of my time following deals and looking for arbitrage opportunities to trade, and realized over time that I should be working on transactions instead.
And while trading is great in some ways, it is not the best field for developing relationships with companies over the long-term – and that’s what draws me to banking. Having seen other friends and family members go into the field and become trusted advisors to companies, it’s something that really appeals to me and is my long-term goal – and that’s why I’m so excited about the opportunity to join your firm.”
Why It’s a Good Answer: He acknowledges and reframes the objection in the
beginning, saying that the hours are more “regular” but not necessarily shorter (which is true in many cases). Then he cites the main two reasons that he wants to switch:
getting to work on deals and developing long-term relationships with companies and management teams.
He also drops in a good bit about finding merger arbitrage opportunities and mentions how that developed his interest in M&A further, and concludes by saying that he
knows the benefits of banking firsthand because of friends and family members – which proves he has more direct knowledge than someone who has only read about the
industry.
10. You’ve worked in marketing before, which is arguably more “fun” and creative and which also has better hours. Why do you want to move into investment banking?
You know the drill – here’s your set of good reasons coming from this background:
• You enjoy getting to influence companies’ business decisions, but you want to work on more than just the marketing side and also contribute to financings and acquisitions.
• You want do something more quantitative / analytical in nature.
• You want to do something where you can see specific results, which are often hard to assess when you contribute to companies’ marketing efforts.
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And no, you can’t talk about the money or advancement opportunities, even though both of those are significantly better in banking. Sorry!
Sample “Good” Answer: “I’m happy to explain. I’ve definitely enjoyed my time in marketing, but I see myself as more of a quantitative person, and I’m interested in getting to work on larger-scale decisions at companies and to also do work where I can see the results.
While marketing has been interesting because of the insight you gain into companies’
businesses, I want to do something more numbers-oriented because of my past coursework in math and finance. And while it’s great to offer input into marketing decisions, I want to do more than that – on one client engagement, for example, they were in the middle of a major expansion and were considering debt vs. equity financing, and that piqued my interest and led to me doing my own research and learning more about the field.
What appeals to me about banking is how your work has a direct and concrete result: a company getting sold, raising additional funding, and so on. Deals do fall apart, but overall it’s easier to measure your impact there compared to what you do in marketing.
And in the long-term, I want to become an advisor to management teams and work on acquisitions and financings – so your firm is the perfect for me.”
Why It’s a Good Answer: Once again, she cites some of the “good reasons” suggested above for wanting to move into the field. The key part here is how she also mentions one client engagement she was on where the company was in the middle of a deal, which sparked her interest – and is a story that few other people will have. And then she concludes by stating how her long-term advisory goals make the bank a perfect match for her.