Why Investment Banking? 10 Ways To Answer The Interview Question
Banking is a challenging industry, that has its positives and negatives. It comes with the allure of fame, money, status, and prestige. Widely recognized as the most grueling, and difficult industry to make it in, for a good reason. The hours are incredibly long, the environment is filled with pressure, and the expectations are sky-high.
The reason why people pursue Investment Banking is different for everyone. Each person has a different reason or explanation as to why they see Investment Banking part of their future.
Just getting into the industry is a rollercoaster of its own. Filled with cups of coffee, super days, and networking events for students and candidates companies take a liking too. It’s an exclusive industry that you’ll need to prepare heavily for and work hard just to break into it.
If you’re going to be trying to break into the Investment Banking industry, you’re going to have to be prepared with an answer to the question, why investment banking?
Answers to the Question, “Why Investment Banking?”
The First Answer: You want to learn more about the industry.
This answer is a bit generic, but if you could pair it with evidence or a story that’s unique to you, it could be a good one.
If it’s genuine, and you truly are interested in the Investment Banking industry, then tell them why. The more reasons you have for it, and the more you can explain why you’re interested in it, the better your answer is going to be.
The Second Answer: You want to learn the skills Investment Banking teaches
This answer is great. Investment Banking teaches you a lot of skills and a lot of different techniques that no other industry does.
The work ethic, knowledge, and experience is second to none. If you’re able to learn, produce, and be successful in banking, you’ll put yourself in a good position for your future.
The Third Answer: You feel this industry is the best for you
This one is a good one if you’re able to back it up in the right way. If you’re someone who thrives under pressure, in a fast-paced, high pressured environment, this could be the industry for you.
Hopefully, you’re the person who likes to take the last shot or wants the ball in your hands, If you are able to show stories or examples where you’ve performed or excelled in the tensest, or most daunting of circumstances it could pay off. Try to show you have the confidence in yourself to take on the challenge and perform at a high level.
The Fourth Answer: You want to learn or work in a certain sub-sector
Investment Banking is separated into a few different categories, mergers and acquisitions, equity capital markets, debt capital markets, and restructuring.
If you feel you’re interested or, want to pursue one of these sub-sectors as a career, it can be a solid answer. Once you get your foot in the door of an Investment Bank, you’ll have to choose which area or sub-sector you’ll want to work in.
This answer has the ability to show that you’ve done some research, understand how an Investment Bank is structured, and know where you want to work.
The Fifth Answer: You want to dig underneath the company’s finances
Banking is where you’re evaluating and understanding the financials behind small and large companies. The way Investment Banks analyze and evaluate the company’s businesses and financials is unique.
You’re able to learn how and why one company is valued higher than others. You’re able to see what metrics are truly important to the success and operation of the company. You’re also able to see what structures or angles are the best to use in regards to the Tax, Regulatory, and Political landscape.
The Sixth Answer: You want to work in a field that challenges you
If you answer the question this way and have stories or evidence to back it up, you might be golden. This is a great way for Athletes to answer the question. For people who love to take on a challenge, and push themselves to their limits, if you can convey that point truthfully, you’ll be in good shape.
Banking is 100% going to do that, and if you truly are looking for something that is going to be challenging, and difficult, you might be in the right place.
The only thing to keep in mind is the investment banking analyst position will be a grind like you’ve never experienced before.
The Seventh Answer: You want to learn from the best of the best
The best way to become one of the best is by learning from the best. If you truly want to become one of the best people in finance, then Investment Banking is the place for you.
This answer shows you’re trying to become a great employee and a great professional. Wanting to learn from the best is something all Investment Bankers should respect, and acknowledge by you pursuing Investment Banking.
It’s a good idea to try and speak about why you respect certain people, why you want to be the best, and what you’re willing to do in order to become the best.
The Eighth Answer: You want to build a strong foundation
Any great building or house has to be built on a firm and solid foundation. The bigger the building or house, the more sturdy the foundation has to be, and the more weight it has to support. If your career is going to be a long term one, with great heights, it’s going to need a strong foundation.
If you give this answer, it shows you’re thinking long term. It’ll show you’re thinking about your career, more so than the initial upfront work, which in banking is difficult.
If you’re looking for a career in the world of finance, Investment Banking is the best place to build a solid foundation.
The Ninth Answer: You want to become an investment banker
This answer, if said correctly, and with enough confidence has to ability to show you know what you want to do with your life and career. As long as you’re willing to put in the work, and you have the determination, you can make your way up the investment banking ladder with enough experience and expertise.
If you want to be one of the hotshot, elite investment bankers you hear about, you’ll have to start somewhere. The path to becoming one starts with the investment banking analyst position.
Keep in mind, those investment bankers have put in years of hard work, and made sacrifices to get there.
The Tenth Answer: You believe in the Investment Banking industry
If you feel the investment banking industry is poised to grow and is one of the more secure industries to work in, it can do the trick. Part of the career you choose is an investment in and of itself.
You want to choose wisely, and in a field, you believe is going to be around for a while. This way you know your work experience will always have value to someone or some company.
There are a variety of different ways you can try to answer the question. Each one can be great, and make the impression you’re looking for, it all depends on how you deliver it, the data or evidence you provide to back it up, and any stories you might have that show you’re interested or like the industry.
The Ways Not To Answer The Question, “Why Investment Banking?”
First Way To NOT Answer: You want to make the most money
Some people might be ok with this, but it kind of sends off the wrong vibe. Even if you are only in it for the money, it’s probably not the best way to answer the question.
The way you answer the question shows what you value, and where your priorities are. If you answer it with money, the company will know you’re a money-driven type of employee. And if you’re starting out in investment banking, the investment banking analyst position isn’t a sales-driven role where this answer might be good.
Odds are you’ll be making less than minimum wage per hour, and be forced to work harder for the money you do earn in the beginning.
Second Way To NOT Answer: You want the status and prestige of being in Investment Banking
If the reason you’re going into Investment Banking is the status, you’ll be in for one tough road ahead. When the hours long, and the days are difficult, if what’s driving you is what other people think, or what other people might think of you, it’s going to be difficult to keep going.
Investment Banking interviews are there to try and give a glimpse into the type of person you are, what you’re trying to do, and where you’re trying to go.
All of these are going to require significant sacrifice and hard work, and if your “why” is for status, there’s a good chance you’ll have a hard time getting it.
Third Way To NOT Answer: All my friends are doing it
This answer is a great way to NOT get the position you’re interviewing for. If you’re just doing something because everyone around is doing it, it’s not going to sit well with Investment Banks.
Banks are going to push you to the limit, and work you to the bone. If the reason you’re in it is that you didn’t want to feel left out, or you didn’t know what else to do, it’s not going to bode well for your chances of getting that position.
Fourth Way To NOT Answer: Someone told me to
Will that person be there to do the work you don’t want to do every night of the week at midnight? Probably not. If you’re going to make it through Investment Banking, then you’re going to have to truly believe in what you’re doing.
And if you’re only doing it because someone told you to, or you want to listen to whoever, the likelihood of you getting through Investment Banking is not very high.
Fifth Way To NOT Answer: You want to see what all the hype is about
The Investment Banking industry has a reputation for a reason. It’s not an easy industry or area to work in because of how the industry is structured. Take our word for it, there’s good reason why it has the reputation it does.
Answering the question just wanting to find out more, or see what all the fuss about is not a great way to build your candidacy or a good reason to go into an industry that’s brutally difficult.
The Analysts in Investment Banking do the work no one wants to do almost all hours of the day. It’s going to require you to make sacrifices in your personal, social, and family life week in and week out.
Conclusion
This guide is here to give you different ways and help create a mindset for you that is going to prepare you for Investment Banking. Ultimately we want to help put you in the best situation possible for you to succeed. One of the most important parts of success is the mindset you have.
Investment Banking is an industry that requires you a strong level of commitment, and an even stronger desire to see the process through. Going into the industry for the right reasons, is something you truly want to have, not only to answer the question of why investment banking? But to know you’re going into a field you truly want to pursue.
The interview process, analyst process, and industry as a whole is the most competitive one out there. Not to mention it’s in the most competitive field there is finance.
Banking is going to challenge you, and push you to places you never thought existed. The best way to push through those hard times is by having a strong reason as to why you want to pursue a career in the field.
