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Answer by Sabrina Ali, former investment banking analyst:
Here are a few reasons I chose to become an investment banking analyst out of college that I think are broadly applicable:
Learning experience and pace: In investment banking, you learn a lot, and you learn fast. This is because a) you’re immediately staffed on deal teams and are responsible for a significant and specific portion of the work; b) you’re working 80-100-plus hours per week, so you’re exposed to a lot of volume very quickly; and c) people have high expectations and will let you know if your work product isn’t the way they want it to be. This culture can be appealing because you develop a broad and in-demand skill set in a short period of time.
Understanding of how businesses “work”: Many people go into investment banking as a first step in a business career. In banking, you’re learning how companies make certain types of decisions (i.e., should they raise capital, sell themselves, buy a competitor, etc.). While you aren’t the ultimate decision-maker (you are merely facilitating the transaction), you still get a reasonably in-depth view of how “think” about their value, their strategic goals, their competitive positioning, etc. Many people start out in banking to get this perspective and then move on to investing or other business roles where they can build on this knowledge base.
Intelligent and motivated peer group: You’re working with and for smart people who also opted into this demanding, sometimes crazy culture. I learned a ton from the other junior people in the “bullpen” and from the senior people I was working for. Clearly there are a lot of jobs that attract smart and driven people, but I think investment banking would be truly insufferable without this feature, given the long hours and demands of the job.
No significant prior experience required at the junior level: Lots of similarly skilled career paths require very specific credentials (i.e., a certain undergraduate major) or an advanced degree. Investment banks definitely look for certain traits and types of experiences in their junior hires, but they take people straight out of college from various academic backgrounds. Some people end up in investment banking because they are looking for a rigorous, skilled job that doesn’t require a graduate degree, specific work experience, or specific academic experience.
But really, it would be disingenuous to ignore the elephant in the room: salary. It’s not just that investment banking exposes you to a high concentration of really smart people; it also gives you the opportunity to make an impact and a ridiculous amount of money.