The "Why Investment Banking?" Interview Question – How to Gi…

The "Why Investment Banking?" Interview Question – How to Gi…

In a sea of overachievers who are equally talented, likeable and prepared, the Why investment banking? interview question can be the only differentiating question left for bankers to ask; making it both a popular & decisive question.

Whilst for college students who dont look like aspiring bankers on paper (i.e. no fin/acc major, business degree or applicable work experience) its of epic importance. After all, you guys need to be able to explain why you want to do investment banking when your past decisions dont suggest anything of the kind.

How do you give a 10/10 answer to the Why investment banking? interview question?

Theres a huge selection of points you could make, but keep it short and sharp. Generally a good answer will contain 3-5 substantial reasons why youre interested in IB.

Typical examples like world class education, skills development, kind of work, the challenge, real responsibility in billion dollar transactions etc. are all permissible.

But try not to trot out the same BS as everyone else.

Importantly, avoid reasons that are self-centered in a bad way

Let me explain. As a banker interviewing you Id be OK if you mentioned investment banking attracts you because of the learning opportunities, as this is a selfish reason that also, and ironically, benefits the bank – passionate 24 year olds put in 100-hour work weeks with ease after all.

But if I heard you wanted to do IB simply in order to build your begin again and/or to obtain an exit opportunity I would – in my mind at the minimum – throw you out the freaking door and then proceed to lay a BlackBerry beat down! Being made to feel like a halfway house for financial vagrants, a insignificant stepping-stone, is not my idea of good times you see. So already though everyone knows investment banking is attractive for the begin again & exit oops dont say it!

What can help you avoid a BlackBerry Beat Down? Well, you would get me extremely interested if you answered the Why investment banking? interview question by talking about how you have older friends in banking who have over the years shared with you what its really like to be a banker – both the good and the bad.

And then how thats made you realize 3 specific things about banking which make it stand out above any other graduate job.

Not only will I believe you nevertheless love banking despite the war stories, but that youve truly given it some thought beyond I need a salary of Blankfein dimensions if Im ever going to pay off these student debts.

What Im trying to say is that a great answer will list rare and specific reasons why investment banking and it will connect them to the supplies you learned them from whether they be friends, professors, books etc.

Want 6 specific reasons Why investment banking that are sure to work? Try talking about how you love the…
Cornerstone role investment edges play in deals and/or the role they play more broadly within the world of business – IBs are to business what the White House is to the world…central center HQ! And this is why bankers are called masters of the universe. So bring up this point, albeit laced in more formal language and without ever mentioning masters of the universe!! Coalface exposure to industry and financial markets, which is rare to IB – theres not a graduate job on the planet that puts you closer to the action than banking. Results-pushed deal-oriented approach – this point distinguishes banking from so many other professions like law, consulting etc, where players often get paid for simply doing, as opposed to achieving. And by specifically mentioning this point you will show bankers that youve got the right mentality and that youre not an increment-fiend like lawyers. PS Once again be sure to phrase this in a more specialized kinda way! kind of people that work in banking – talk about this from both a learning and enjoyment point of view, and most importantly reference people you know in banking (particularly at that bank) to avoid looking like youre simply shining shoes and kissing ass! character of the work – analyzing, problem solving, real-world focused. If you are going to talk about this then make sure you bring up a handful of examples in passing; eg 10k examination, spreading comps, deal structuring etc. The specific industry/product group you are interviewing with – this is a must! By talking about why IB by the lens of that specific group, youll really thin the reasons down to specific, tangible, relatable ones – and that method bankers are more likely to believe you and like you. eg If you say to Goldman Sachs TMT that you want to do investment banking because you find the business/investing side of the tech industry fascinating after working as an unpaid intern at a social media start up over summer, then youll hit the Why investment banking? question out of the park!

at any rate you choose, be sure you can talk intelligently about it if probed by the bankers.

Special observe for those of you with non-banking experience

If you have work experience in accounting, consulting etc. then tell the bankers that whilst your time at KPMG or BCG or wherever you worked was a terrific experience, it didnt offer…[reasons why you love IB].

This is a hidden opportunity to further explain your story, point out why you want to change into banking now and assure them again that IB is what you truly want above all else.

Any comparison you make should be delivered subtly though. Not because your interviewer might have worked at KPMG or BCG, but simply because it looks unprofessional to blatantly badmouth others. Negativity in any form doesnt look good.

Special observe for aspiring investment banking analysts

PS for those of you who get this question in an investment banking analyst interview (ie not a summer internship interview), youll need to push your story of why IB already harder to convince bankers to take you on. This is because bankers hate offering long-lasting spots to candidates who might quit the minute things get tough.

Passion is a bankers best insurance policy against this – so make sure you show it guys!!

If you want to go one step further and really impress the bankers with your answer, then tell them how you became interested in IB years ago and point to the real life things youve since done that have confirmed your passion; studies elected, college clubs joined, people met, friends talked to, books read, jobs taken.

Showing a long and considered journey to get into investment banking is the idea here.

Whats the final secret to a magic answer here?

Recognize the downers of banking, not just the uppers. Bankers you see, want to hire students who arent being drawn to banking based simply on Hollywood-hype or CNBC-glamor. They want to know you are realistic about the job, prepared to do grunt work, and in addition nevertheless super passionate.

After all, the Jimmy Cramer fan club and the Gekko Wannabe students will never be able to hack it when they find out what investment banking really involves – and this sort of drop out costs the edges a bomb.

So with all that in mind, during your answer briefly mention how your friends in banking have clued you in on the realities of the job too – the long hours, sacrifice and other downers which well talk candidly about in the Inside Investment Banking System when it comes out this fall.

Of course, dont end your question on a downer – meaning be sure to follow up any reality checking with your 3 main reasons why IB repeated in very very short form, kind of like …but of course banking is an easy choice for me, because of….

Now that youve conquered the Why investment banking? interview question, check out our advice on other shared investment banking interview questions and answers now.

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