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How to make it in M&A: Follow your passion and always have an eye on the next career move

(Photo credit: Assaulted Peanut)

If you’re a student trying to break into a role in M&A in Europe, you’d have every reason to believe that prospects were a little bleak. Investment bankers are an optimistic bunch by nature, but the worst start to a year for more than a decade for M&A, syndicated loans an IPO on the Continent will surely have many thinking that employment prospects aren’t great.

However, according to a panel of senior investment bankers speaking at an M&A Outlook 2014 event organised by Cass Business School today, junior level hiring will be exempt from any slowdown.

“We’re still hiring and are not about to cut back graduate recruitment like in previous downturns,” assures a senior Credit Suisse managing director, who cannot be named due to the event reporting rules. “If you cut back, you end up with a very big gap, a desert of bankers three years down the line, so we’ve maintained our commitment to hiring graduates and offering them the right training.”

This is not huge news if you’ve been following the machinations of the investment banking job market. While headcount has been curtailed at the senior level, junior recruitment has been maintained – 500 people at Credit Suisse for the class of 2013, for example. What’s more, after the debate about junior investment bankers’ working hours exploded in the wake of intern Moritz Erhardt’s death at Bank of America Merrill Lynch last year, firms have been offering their juniors extra time off and promising to hire more people to take up the slack.

What’s more, the new tendency for banks to hire ACAs from Big Four accounting firms for corporate finance positions – even if that means training them in financial modelling – demonstrates that investment banks have gaps to fill after cutting back on graduate recruitment during the crisis.

So, what will make for a successful and happy career in M&A? Well, for a start, choose something you’re passionate about, believes another senior investment banker at the event: “Don’t just jump into an M&A position – find something you, whether that’s a particular sector or business area, and then apply this passion to investment banking.”

Fundamentally, banks want to see people who can demonstrate enthusiasm for the sector, rather than technical prowess - although if you have an MSc in Finance you should be able to manage a discounted cash-flow valuation, Professor Scott Moeller, director of the M&A Research Centre, was keen to point out – with most banks priding themselves on their ability to train up raw talent.

“You’d be surprised how many people stare blankly back at me when I ask which of the bank’s recent deals they’d have liked to work on, or what interests them about working in M&A,” said the Credit Suisse MD. “It’s more what interests you about banking and why, than your industry know-how.”

However, despite the need for a demonstration of enthusiasm to get a foot in the door, any student should have a view as to what their next move is. Once you’re in a job that requires around 90 hours a week and, perhaps, giving up most weekends you're unlikely to have much time for career planning. Know your objectives before you get into banking.

“If you want to move into private equity know what exposure you need within the M&A job in order to achieve that,” said another senior banker. “What kind of exposure do you want – clients, or executives in the firm who can aid your career. Position yourself accordingly; use the job as a stepping stone for whatever you ultimately want to achieve.”

AUTHORPaul Clarke

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