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Investment Banking Interview

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This booklet is an introduction to Mark Hatz’s “Investment Banking Interview Preparation Pack” (www.investment-banking-interview.com), that was designed to help, in a mentoring-style, undergraduate and MBA students secure analyst or associate positions in M&A at top financial institutions, whether bulge bracket or boutique investment banks. The author’s unique approach to investment banking interview preparation is to have candidates focus on the interview questions they are guaranteed to be asked at some point of the interview process, and offer insider advice on what professionals would expect to hear in the candidates’ answers for their performance to be considered successful.

MARK HATZ is an entrepreneur. He has worked four years as an investment banking professional focused on M&A advisory at top financial institutions including Goldman Sachs and Perella Weinberg Partners in London, Paris and Dubai. He holds a Masters degree in Management from ESCP Europe, a Bachelors degree in Law from the Sorbonne University, and has passed the two first levels of the CFA examination.

Mark has a solid understanding of the investment banking interview process. He participated in recruiting interns at Perella Weinberg in London as well as full-time analysts and visiting associates most recently at a boutique investment bank in Dubai. His recruiting experience also draws on the dozens of interviews He got out of college with various financial institutions such as Moelis, Greenhill, Evercore, Blackstone, Rothschild, Morgan Stanley or JP Morgan, to name a few.

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Investment Banking Interview

  1. 1. www.investment-banking-interview.com INVESTMENT BANKING INTERVIEW Brutally Honest Insider Advice for Success MARK HATZ 1
  2. 2. Copyright © 2013 by Mark Hatz. All rights reserved. No part of this publication may be redistributed, copied, photocopied or duplicated in any form or by any means, including electronic information storage and retrieval systems, without Mark Hatz’s prior written consent. While the publisher and author have used their best efforts in preparing this booklet, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. The strategies and advice found herein may not be suited to your situation. The author and publisher of this book shall not be liable for any profit or loss or any personal or commercial damages. 2
  3. 3. 1 A positive attitude and strong technical skills are what will get you hired  Attitude is 70% of your overall assessment - Think about it. Juniors work the longest hours. Associates in the recruiting team will essentially look for flexible, enjoyable personalities; people they will continuously be able to load with work and they will enjoy being around 15 hours a day – contrary to what you may have heard, they do not look for over-confident people with great intelligence who cannot fit in a team  In comparison, answering fit questions correctly is secondary - You can be weak at answering fit questions and still be successful, but you can never show the wrong personality  If on top of a positive attitude you can show strong technical skills, you are almost guaranteed to get the job - This job is all about reputation, and a solid financial knowledge will make you respected 3
  4. 4. 2 Smile  This probably is the number one advice of this book - This is because juniors are essentially recruited for their personality - Talking from experience, smiling alone can get you the job  If you were on the other side of the table, you would be surprised at how many candidates, because of stress, forget to smile  Smile genuinely - Enjoy the moment, it is nothing more than an exercise - And at the end of the day you may be very close to joining the firm you have dreamed to work for 4
  5. 5. 3 Show humility  This means four things: - Remove any mark of over-confidence (show respect, and A never give the impression you know more than your interviewer – contrary to what you may have heard, investment banking remains a very hierarchical industry, do not let your motivation / ambition make your interviewer feel uncomfortable) -B Be as short and concise as possible in your answers (always summarize and let the interviewer ask for the details she needs – the interview is a short exercise and show maturity in understanding that juniors, given their workload and lack of sleep, will always get to the point) -C Speak slowly - Listen to the interviewer, try not to interrupt her D  Looking at senior professionals, you would be surprised at how successful low profiles are in the industry 5
  6. 6. 4 Be confident  You can be confident about what you are saying and still be humble  Be confident because: A - All you will be saying is what you really think: successful candidates are those who are honest about what they think, regardless of what the interviewer may think (this, done in an intelligent way, will make you stand out as honest and mature) -B Your interviewers are not more talented than you are. They are just older, with more experience -C As an analyst candidate you do not need to know everything about the job (e.g. forget modeling skills). If you have started interviewing with several banks, you will realize investment banking interviews are always the same. The same questions come up every time: your preparation of the fit and technical questions, as well as brainteasers, is enough 6
  7. 7. 5 Come to the interview with a story about yourself that will make your application attractive and that you already know you will be talking about  A short story (3 minutes, as if you were in a lift with the interviewer) that sums up your application in 4 points: A - Why the industry, -B Why the firm, -C Why the region, and D - Why specifically you  That is all they need to hear from you in the fit interview  Do not wait on the interview to go well and the interviewer to bring up the right questions - In your preparation, ask yourself the 4 questions above, try to be honest in your answers, but still include the very reasons why they will hire you (arguments you must include are explained in the next two pages) 7
  8. 8. 6 You must include in your story one main source of motivation: you want to learn  Professionals in the industry consider juniors do not bring much to the table, but rather come to learn  This is also in line with the expected humble personality we have discussed and must be part of your answer to the question “why the industry?” - You will indeed learn twice as much as in any other industry: working hours are long and you will be learning from the experience of top management you will have as clients 8
  9. 9. 7 The only reason why you apply to a specific bank is because of its people (forget league tables): you have spoken with some of them and you feel you will be able to learn from them and would enjoy working alongside them  The top 10 banks in the field you have applied are all the same - They advise on the same type of transactions, all have the same culture and the same type of people - Never mention league tables, transaction sizes, corporate culture or the intelligence of its people as an argument to “why our firm?”, they are irrelevant - The best answer is to say you have spoken with a few people from the firm and you are eager to learn from their experience and work alongside them - Speak with professionals from the firm through your school alumni network, your Linkedin network or in recruiting forums - If you have not had a chance to speak with any, talk about the people from the firm you have already had interviews with 9
  10. 10. 8 You must include in your story two qualities: that you are a team-player and that you can work hard - Additionally for boutique investment bank applications: that you would not require training and could start the next day on models and presentations  “Why specifically you?” Because you interact well in a team and you have a strong work ethics - You cannot avoid mentioning those two qualities, they are the only reasons why they would hire you - Boutique investment banks do not have training capabilities, and are more interested in juniors that have had a prior experience in investment banking and that could start on projects immediately. If that is the case, you must also mention it  Someone who does not mention those qualities, even if she does not actually have them, has not understood the nature of the job 10
  11. 11. 9 Know that half the technical interview is on accounting questions  The M&A technical interview is not only about valuation (DCF, multiples or LBO), a large part is also on accounting questions (essentially the interaction between the three primary financial statements)  They will not give you a chance to answer any accounting question incorrectly - This is because accounting is at the core of any modeling exercise 11
  12. 12. 10 Do not neglect brainteasers (and mental math)  If during the interview you struggle with brainteasers and mental math (this can easily happen under stress), no matter how strong you have been at fit and technical questions, you will be out  Brainteasers can be role plays (“what would you do in a given situation”), market sizing questions (“how many marriages are there every year in China?”), logical problems or mental math - Practice makes perfect 12
  13. 13. Sign up now for the full preparation course that will help you master the investment banking interview! Get started at www.investment-banking-interview.com 13
  14. 14. This booklet is an introduction to Mark Hatz’s “Investment Banking Interview Preparation Pack” (www.investmentbanking-interview.com), that was designed to help, in a mentoring-style, undergraduate and MBA students secure analyst or associate positions in M&A at top financial institutions, whether bulge bracket or boutique investment banks. The author’s unique approach to investment banking interview preparation is to have candidates focus on the interview questions they are guaranteed to be asked at some point of the interview process, and offer insider advice on what professionals would expect to hear in the candidates’ answers for their performance to be considered successful. MARK HATZ is an entrepreneur. He has worked four years as an investment banking professional focused on M&A advisory at top financial institutions including Goldman Sachs and Perella Weinberg Partners in London, Paris and Dubai. He holds a Masters degree in Management from ESCP Europe, a Bachelors degree in Law from the Sorbonne University, and has passed the two first levels of the CFA examination. 14

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