 In this video we are going to take a look at the 19 different reasons why anyone is crazy enough to go into investment banking and being one of them I can definitely say that some of these reasons are going to surprise you and some will definitely shock you because these aren't going to be reasons why you see on television or why you read on books these are going to be real reasons why people go into investment banking and the benefits that you can get when you work in investment banking now before we begin I just want to take a quick second to remind you to check out our investment banking interview and recruitment guide which is the easiest and simplest way to break into investment banking we go over all of the interview and application answers that you need as well as teach you how to build financial modules step by step under the guidance of an experienced investment banker and if you prefer to read up on the 19 reasons why anyone will go into investment banking then check out our website where we have a full-length article breaking down each of these reasons okay so now let's get started and for reason number one now this might shock you but it's not the salary and it's not the bonus in fact it's the exit opportunity the number one reason why you should go into investment banking isn't for investment banking itself but it's what you can do after you leave investment banking after you've accumulated enough experience in investment banking what can you do with that after you leave and I'll let you in on a secret investment banking pays peanuts compared to private equity or hedge fund or other buy side roles but you need that investment banking experience in order to get into private equity and some hedge funds so the number one reason why junior investment bankers go into investment banking isn't to stay in investment banking isn't to have a long lost in korea and investment banking but is to make the jump into private equity which is far more lucrative than investment banking so now let's move on to reason number two and it's as you would expect the pay the salary and the reality is investment bankers are some of the highest paid employees in the field of finance and that's because they work on large-scale transactions as well as getting bonuses every six months but the reality is it's not that great when you look at the salary and then you divide it by the number hours that they're working it doesn't turn out to be that great the only good thing is because you're working insane hours you're not going to have time to actually spend your paycheck and that's how investment bankers manage to save up a lot of money because they just don't have the time to spend it now let's move on to reason number three which is being able to pay off your student loans pretty quickly now for those of you that have to borrow money via student loans or regular loans to finance your higher education then paying back those loans are going to be an issue but they won't be an issue if you are on a high salary and getting bonuses every six months in fact you'll be able to pay off your student loans in a fraction of the time that it will take others to be able to pay them off and now let's move on to reason number four which is investment banking provides one of the best education in the field of business you will pretty much learn more in one year working in investment banking than you would have learning 10 years at the best business school and that's because again depending on the area of investment banking you're in you will get to interact with the senior management team at some of the world's largest corporations you will interact with the new cutting-edge startups that are redefining an industry you will get to be in meetings in phone conversations that are shaping the next generation the next industry the next marketplace every single day you're going to learn something new about the business world whether it's from a client it's from a project you're working on you will never stop learning about business working in investment banking so if you do enjoy learning about business the business world the finance world then investment banking is definitely for you now let's move on to the fifth reason why you should go into investment banking and that is investment banking can be your oyster into any field of finance and investment and again this is what happens after you leave investment banking and the reality is most junior bankers they don't actually stick out and stay within investment banking for the next 30 40 years they tend to leave after 2 to 3 years and personally if you were to ask me what is life like after investment banking it's just freedom freedom because you no longer have to put up with the insane schedule of being an investment banker but freedom because you can also write your own ticket into any career path you want in the field of finance and investment so personally after I left investment banking I tried accounting audit risk compliance tax treasury management consulting and I was able to get into all those fields easily because I had that experience in investment banking not because I was this super genius I'm not but because I've had that grueling training of being an investment banker that skill that I've developed was universally applicable to any field of finance okay so now let's move on to the sixth reason and that is every single day is different and you've probably heard this for almost any role out there that every day my job is different every day we do something new but personally speaking having been in investment banking and in other field of finance investment bankers take this to a whole different level one day you could be going through legal documents the next day you could be chasing your managing director in an airport with an updated presentation the day after you could be doing nothing it really is different every single day so you're not going to get stuck in this routine of doing end of month reporting like in accounting or you're not going to get stuck doing the same task over and over and over again so now let's move on to number seven which is the work that you do does matter contrary to popular belief but the role of an investment banker is pretty crucial to an economy if we just take a look at the debt capital market for example western governments and pretty much every government are pretty much famous for running huge deficits they're always having to borrow money in order to maintain their current spending levels so in order for government to build new roads build new schools build new hospitals build new infrastructure which is essential to the data running of the economy and again they don't have any money because they're not actually collecting enough via taxes so they have to borrow the rest so they have to go to an investment bank or they have to go to other parties in order to actually borrow the rest to actually make up for the shortfall so investment bankers help regional and local governments get the funding that they need in order to maintain their operation in order to maintain the current stability and smooth running of a government now I know what you're thinking investment banks don't do this for free of course they don't they charge a fee and sometimes you do get bad actors for example the famous scandal of when Goldman Sachs bankers took advantage of the Malaysian sovereign wealth fund and that's true that those things do happen but they're isolated cases they don't happen every single day that's just one aspect of it other aspects of investment banking is the restructuring department say for example you have a company that has over borrowed and they're on the verge of bankruptcy either they close up shop and fire 12 000 people or they go to investment bank and restructure their balance sheet and instead of firing 12 000 people they only need to fire 3 000 people so when you're in restructuring it's all about saving a company it's all about making the best of a work situation and it does matter the fact that you're able to save 12 000 people from losing their job it does matter reason number eight and that is making lifelong friends and possibly even finding your spouse the reality is when you start working in investment banking your schedule your lifestyle is going to change because you're now working in a very demanding industry and you are pretty much working a lot of hours and your old friends who are not in that industry or who are not in a similar type of demanding career field they're not going to understand that and after a while after cancelling on them so many times you are going to drift apart but don't worry you are going to make new friends in investment banking and people who are in a similar career stream as you also as a result of working side by side with people for a prolonged period of time you are going to develop friendships or even become even closer go into any investment banking office space and you'll hear tons of stories of how couples met as a result of working long hours side by side and now let's move on to reason number nine which is one of my least favorite and that is building a tremendous amount of discipline in order to get the work done and not to fall asleep it's a skill that you will develop working in investment banking whether it's a skill that you want to develop or not that's completely up to you but you will get that skill so now let's move on to reason number ten which is investment banking is a career and not a job the difference between a job and a career is pretty starking a job is a nine to five type of gig you don't really have any upward mobility you're not guaranteed job security and you're easily replaceable now some people prefer that others want more of a stability want more job security which is a career a career under the hand like investment banking is tough especially the earlier years but at the moment you are in a career you're on a corporate ladder so if you start out as being an analyst then you're expected to eventually become an associate then a vice president then an md so you are on a corporate ladder and you are expected to eventually progress up that ladder so as a result you get job security but there's a cost to that job security and that is a lot of hours in the beginning but that's pretty much common for any career whether you want to career in medicine in law in banking junior staff in any career path tend to work a lot of hours so now let's move on to reason number eleven which is deal making what separates investment banking from pretty much any other area of finance is the fact that investment banking it's all about deal making it's all about connecting someone who wants to buy a business to someone that wants to sell their business someone with capital someone who needs capital investment banking is deal making you're working on deals every single day you're pretty much working on deals that's your bread and butter but other areas of finance or high finance whether it's work management you depend on the market the market dictates your profit and loss now although the markets has an indirect impact on investment banking appetite investment banking it's purely about relationship building maintaining your connection maintaining your network getting people together and structuring a deal and that's a challenge and some people enjoy that type of challenge they enjoy the deal making process and if that's something that you really enjoy then investment banking is definitely for you so reason number 12 building financial models there are some people who are very techie and they like building financial models they like to play with numbers they like to play with excel well if that's you i have good news and bad news the good news is you will be playing with excel a lot you will be moving numbers around you will be building financial models one after the other grinding away and building financial models till the end of the night and honestly till the next morning but the bad news is that you don't have the freedom to build the kind of financial models which you want now although in our financial modeling course i will show you exactly step by step on how to build a full fledged financial model which is exactly what you will be doing in investment banking but in investment banking you are under strict guidance of your client your client is going to give you specific information and it's going to be your job to portray your client in the best light possible and to fight it to get your client the best deal and the best valuation so you don't have full freedom in order to build the kind of financial models which you want and if you want that kind of freedom then you have to go over the buy side so in private equity for example that's when you can pretty much go crazy and build a super ridiculously complicated financial model and pretty much add every single bell and whistle you want make it a hundred excel slides however you want to build it but you don't have that kind of freedom in investment banking so now let's move on to reason number 13 which is getting a skill in financial modeling as a result of working crazy hours building financial models on excel one after the other till the next morning you are going to get good at building financial models you're going to get accustomed to different types of capital structures you're going to get used to dealing within a specific industry and you're going to know the norms of that of that industry and again you're going to get really good really quick really efficient at building financial models on excel which is great because you can use that skill and leverage that skill in order to move into specific area in private equity or hedge fund or wherever you want to go or wherever that skill is worth something and it will pay you for that skill so now let's move on to reason number 14 which is being surrounded by extremely motivated and talented individuals the very first thing you're going to realize when you start investment banking is that you're going to be surrounded by extremely motivated intelligent and savvy individuals pretty much everyone that gets through the grueling investment banking recruitment process are high achievers it's still one thing they all have in common they might not all have the same education background experience background but everyone is a high achiever you're no longer going to be the smallest person in the room if anything is pretty humbling and it's also going to push you to do the best work possible now even though you're all in competition with one another there is still this strong sense of camaraderie so whenever you are in need of assistance or whenever you're out of the office but you need someone to send an email on your behalf because you've overslept like it will happen to pretty much everyone you can always call upon your friend that you trust that will that will pretty much send an email for you so let's move on to reason number 15 which is credibility in the startup world this is something that i've just recently realized after speaking to a friend that works in the vc world and that is whenever you have an investment banker within a team or by themselves whenever they're trying to pitch to try and raise capital for a startup then investor banker as a result of working within the investment banking world building financial models knowing exactly what investors look for what criteria is what metrics what kind of numbers that they look for in order to judge whether it's a good investment or not because they have that knowledge we can pretty much use that in order to communicate with vcs and raise capital and it's much easier for an investment banker to raise capital because they know exactly how to market themselves as a result of building countless marketing materials and knowing exactly the type of metrics and criteria investors look for whenever they're trying to judge a startup whenever they're trying to value a startup or a potential investment opportunity so if you fancy starting your own business after investing in banking then you will definitely build the skills and the knowledge that you need in order to build a pitch deck which you can present to vc funds and they will definitely receive it a lot better so now let's talk about reason number 16 and this is something that i completely did not expect back in 2014 i had an intern working under me and originally on day one he was extremely introverted really quiet really shy didn't say a single word and after a while he became a lot more confident he became a lot more assertive and i'm not sure if it's as a result of investment banking over something else but i've spoken to a few candidates and a few of my seniors and they and they have said that they've observed the exact same thing and maybe it's because when you work in investment banking you're pretty much stretched to your limits you're you realize that you are capable of doing things that you never thought you would have been able to you never thought that you'll be able to work 24 hours straight but investment banking it will push you to do that you never thought that you'll be able to get a lot of work done in such a short amount of time but in investment banking you will learn how to do that investment banking will literally push you to your limits and it will make you someone that's a lot more efficient and a lot more effective and that might be a reason why you become more confident in yourself and as a result after three months he just wouldn't shut up anymore now on day one didn't say a single word after three months would not stop talking just would not shut up it was the most strangest thing i've ever seen but it's not but it's not the only story like that there have been a few like that so investment banking can give you confidence in yourself maybe i'm not 100% sure on this one but i have seen it one or two times on the theme of being more confident let's talk about reason number 17 which is learning how to work with difficult people in investment banking you are going to meet a range of people and you're going to have to work beside them whether it's working beside a finance rock star or working beside a skeptical private equity associate that just wants to discredit your work you're going to have to learn how to work with every single one of them and you're going to develop communication skills you're going to learn how to stand up for yourself it's something that's naturally going to come to you because you're going to be forced and pushed into that position so those are key skills which are pretty much useful in any situation and you're definitely going to learn those key skills in investment banking now let's move on to reason number 18 which is developing rock solid work ethic when you're working in investment banking you're pretty much working on multi million dollar transactions billion dollar transactions even so every little detail counts the smallest error on your work can cast doubt on your ability to do the work on your deal team and it will pretty much reflect badly on the bank's reputation so every little detail counts you have to produce error-free work and that is a lot harder than you might think because again we're all humans we're all susceptible to making mistakes and this is why there is a lot of controls in order to make sure there are zero errors when the analyst does the work it's then checked by the associate after it's checked by the associate it's then rechecked by the VP and after that it's then sent to the MD for final approval or sent directly to the client so there are a lot of controls just to make sure that there are zero errors on the work that's how important producing error-free work is in investment banking but that level of pressure that level of stress is always going to be there and it's going to hover over you so whenever you are working on excel working on a power point presentation you're always going to be mindful to always double check your work triple check your work and that level of work ethic it's going to be something that you're going to develop working in investment banking and something which is going to be very very useful so now let's talk about the final reason which is number 19 and that is networking when you join investment banking you're not just going to be a generalist you're going to join a specific industry and product group so for example when I joined investment banking I was in the mergers and acquisitions team but specifically I was in the TMT group so within mergers and acquisition all of our deal flow or the area which we specialized in was in technology media and telecom all of our clients were tech related and all of our deal flow were tech related so as a result we would develop a good relationship with a lot of the private equity firm which had a lot of appetite for technology firms and we would develop a lot of relationships with companies that would acquire smaller tech companies and as a result of that networking that constant relationship building we can pretty much monetize that relationship either by leaving investment banking to become a consultant to those clients to those private equity firms to those companies or you can pretty much start your own investment bank and servicing a handful of companies which you know have a huge appetite for m&a or you can pretty much jump ship and join the companies who you are once selling companies to and now you can pretty much jump ship and go to them and be their advisor and be on the buy side so that was my 19 reason as to why you should go into investment banking again these are real reasons why I think people should go into investment banking there are lots of websites lots of blog posts out there detailing lists as to why you should go into investment banking but they're pretty much the exact same thing just reworded and it's not really something which I would consider to be real real reasons are pretty much the exit opportunity and pretty much the experience that you'll get working in investment banking so don't forget to subscribe and I'll see you in our next video where we'll talk about the nine different reasons as to why you should completely stay away from investment banking don't forget to hit subscribe like and I'll see you in our next video