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From accounting to investment Banking

Banking Investment / January 8, 2014

“It’s tax time. I know this because I’m staring at documents that make no sense to me, no matter how many beers I drink.”

-Dave Barry

Got “stuck” in accounting or auditing and now you want to break into investment banking?

I recently discussed this exact topic with a reader and covered what to do.

So here’s your step-by-step plan:

What You’re Up Against

Think of every recruiting effort as a battle. Depending on your background, you’ll have some advantages and some disadvantages over the enemy.

  • Consultants: You can deal with crazy people and work long hours, but can you count? Do you know how to use Excel without the mouse?
  • : You can communicate, but can you crunch numbers and burn the midnight oil?
  • Engineers: You can stare at computer monitors without sleeping for days at a time, but can you talk to people? Are you really interested in finance?
  • Lawyers: You can deal with psychotic people and work until you bleed, even tracking your time in 6-minute increments, but do you know how to value a company? And give up your career?

If you’re coming from an accounting or auditing background, here’s your challenge:

“I know that you know accounting inside and out, and that you’re an Excel wiz. But are you motivated enough to work 100 hours a week? Why didn’t you do investment banking from the start if you’re really interested in it?”

So you need to have good answers to those 2 questions, because they’ll be the key “objections” that any banker speaking with you will have (keep reading for suggested answers).

In Your Favor

On the other hand, you do have some things in your favor:

  • They know you know how to “count” because accountants are pretty good at that.
  • You “get” what any professional services business is all about – doing menial work for annoying and high-maintenance clients and changing periods and decimal places in documents.
  • You may have better access to networking opportunities, depending on what firm you’re at and what group you’re in.

Telling Your Story

Before you even start recruiting, you need to lock this one down.

You want to use a variation of the following answer:

“I was really interested in accounting and finance all throughout school, and the opportunity to work at [FIRM NAME] just fell into my lap. I liked the [exposure to clients / culture / group], so I took the offer and have done very well over the past year there. But during that time, I’ve gotten increasingly interested in investment banking, because I’ve [been exposed via clients / heard a lot about it from friends / met bankers at such-and-such event]. I’m eager to move into something faster-paced that lets me actually work on transactions instead of just handling the paper-work and fact-checking afterward.”

You might expand on that (interviews) or shorten it (networking) depending on the context, but that’s the basic sketch you want to use.

Similar to any “Why investment banking?” question, specific events or people are almost a requirement. So if you had a revelation one morning after going to an alternative investments conference and meeting the top brass at a hedge fund, make that part of your story.

Bankers love to think they are important and lead interesting lives, so play on their egos and emphasize how fast-paced it is and how you would get more responsibility / meaningful work.

Networking Ninja Tactics

Once you figure out what you’re going to say, you need to figure out who you’ll say it to.

Even if you’re working full-time, networking is not much different from what MBA/university students do: you still use alumni, referrals, and possibly cold-calling depending on what you’re aiming for.

The difference is that you’ll have a lot more co-workers, former co-workers, and clients/former clients that you can use for networking purposes.

You do have to use discretion, but all of these sources give you a big advantage over students who need to network to get in.

Unless you have amazing connections at bulge bracket banks, don’t waste your time applying there. Go for boutiques, middle-market firms, and any group where in-depth accounting knowledge might come in handy: Financial Institutions / Restructuring – you bet. Technology – not so much.

If you truly have no alumni connections, no professional referrals you can use, and no other links to finance, then you’ll need to get them.

Join professional societies, go to conferences, and look up events on nearby campuses if you want to start building these connections.

Otherwise you’ll need to do a lot of cold-calling, which is covered in, in, , , , and probably other places I’m forgetting about right now.

Transaction Advisory Services

Networking is great, but there’s another method available to accountants as well: get into the Transaction Advisory Services (TAS) group at your firm.

Not all accounting firms have these, but the and some smaller companies certainly do.

In the TAS group you work with bankers and client companies on transactions, assisting with valuation, due diligence, and sometimes effectively acting as the M&A advisor on the deal.

This helps you in two ways:

  1. Your work looks much closer to banking.
  2. You get better access to contacts in finance.

Do you transfer to TAS first, or do you try to move into investment banking from another group first?

If it will take 1 year+ to transfer, test the waters right now and see what response you get from banks.

But if you can do it more quickly than that, make the transfer first and then think about banking after you’ve been there for awhile.

Spinning Your Resume

So now you have your story down and you’re in the midst of networking and working the phones.

Almost everyone will ask for your resume, so you need to get that right.

The number one mistake you can make as an accountant is writing too much about accounting and not enough about finance.

If you start going into details on general ledgers, journal entries, SOX controls, and other accounting topics, any banker looking at it will think, “Ok, he’s accountant material. PASS.”

Instead, you need to .

Use the “Experienced” template here and make every client into a “Project” entry on your resume – but remember that you are applying for finance jobs, not accounting jobs.

  • “Performed Sarbanes-Oxley testing and found that client’s controls were sufficient; reviewed journal entries and determined that client’s reserves were appropriate, which allowed them to project prices of raw materials for upcoming construction project.”

This would sound much better if you titled the entry “Raw Material Price Prediction Model” rather than “SOX Testing” and wrote:

  • “Worked with client to develop Excel model that allowed them to project prices of raw materials based on previous historical patterns and proven reserves; client later used this as supplement to financial statements and in own internal projections to validate potential return on new construction project.”