What Does an Investment Banking Analyst Do?
Most people have the wrong idea about what you actually do in investment banking as en entry-level Analyst or Associate.
At a fundamental level, investment bankers are just salespeople – they’re just like real estate agents, or sports agents, but they sell companies rather than houses or baseball players.
The top-level bankers – Managing Directors – are responsible for winning clients, managing relationships, negotiating prices, and making sure their clients are always pleased.
Investment banking analysts, by contrast, don’t do any of this – they keep things running by working with Excel, PowerPoint, and Word and supporting senior bankers. Their work falls into 3 broad categories: clients and deal work, pitching for clients, and administrative tasks.
You want to be working on deals as much as possible, for 2 reasons: 1) When you’re interviewing for private equity or hedge funds, all they care about are the clients you worked with and what kind of deal experience you had. 2) You learn the most when working on deals, especially when unusual situations come up.
Pitching for deals, by contrast, should be avoided or at least minimized. You’ll always have to do some pitches, but the work involved usually consists of researching an industry, creating a company valuation, and then administrative tasks like making your bank’s credentials look more impressive.
Interestingly enough, there’s also a fair amount of administrative work on actual deals when you’re working with real clients – you have to keep your team updated, keep track of what different buyers have said, and create Word documents that all look very similar.
But the difference with deals is that you also get exposure to financial models and the negotiation process, and you can learn a lot from both of those.
Finally, you will also receive a lot of administrative tasks and “random” assignments as an investment banking analyst – researching markets, looking up information on companies, printing out information, and chasing down people over email. You should avoid this work as much as you can, because it doesn’t teach you much and it’s not good to speak about in interviews.
To succeed as an investment banking analyst, maximize your exposure to deals and minimize pitching and administrative tasks.
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