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Investment Banking:
Life as an Associate

An associate is typically a recently graduated MBA or an analyst who gets promoted after three or four years. You will usually stay an associate for three years or so. An associate still has to do a lot of grunt work and may even have an analyst to call on. Your hours
The "City" - Square Mile in London, A Major Global Financial Center
Deutsche Bank Place, Sydney Australia
will still be miserable and you haven't really become a human being yet. Like a good analyst, your job is to make your boss look good and to understand what's going on. Your boss may abuse you from time to time and you aren't supposed to complain really. This is a job where you can really start to shine. If you add value to transactions or help get things done in some other meaningful way, you can expect to be paid a reasonable bonus and have a shot a promotion to AVP.

Associate level pay in New York firms runs roughly $90,000 in your first year (including bonus). If you are good and stay awhile, expect to go up to roughly $130,000 to $150,000 before you hop up another level. In London expect a salary of roughly 60,000 to 80,000 Pounds (all-in).

Key Skills

In investment banking / corporate finance / M&A, key associate skills include:

  • the ability to do DCF valuations
  • the ability to use Excel in your sleep
  • the ability to arrange client meetings and get the logistics right
  • the ability to deal with horrendous egos
  • the ability to find comparable companies
  • the ability to network within the firm and befriend key people like librarians, IT gurus, messengers, lawyers, compliance etc.

In debt and equity capital markets positions, key associate skills include:

  • the ability to massage league tables
  • the ability to price up new deals (e.g. bonds, convertibles, preferreds)
  • pretend that you know what's going when clients call in and the boss is not around
  • the ability to track past deals and pricing to sense where the market is going
  • check and generate weekly newsletters (weeklies)
  • the ability to fill in silences in meetings with insightful comments (while making sure your boss controls things)
  • coordinate due diligence
  • prepare document on debt and equity deals
  • make sure analysts get burgers from the right place
  • generate pitch books with your eyes closed while talking to clients and screaming at syndicate

In sales and trading positions, key associate skills include:

  • the ability to watch your bosses blotter
  • the ability to know where prices are
  • the ability to work options pricing models
  • the ability to bluff a little when needed
  • the ability to eat endless fattening food without getting fat
  • the ability to golf, play tennis, drink and joke around with clients
  • the ability to make clients feel comfortable with you

Success Factors

Key success factors include (i) getting your job done well, (ii) getting many things done in a chaotic environment, (iii) dressing well, (iv) having a beer and a good time every once in awhile, (v) always making your boss look good, (vi) being a total whiz with computers, (vii) being able to spin bad news into ok news and (viii) network within the firm. Other good things to do include figuring out when a job could be done better and going out and doing it. For example, create a database to track the results of an equity tender offer. Initiative is key. Also, getting to know clients is very important since you will be using those relationships later on.


As an associate you are in. Your job now is to prove you have what it takes to make in investment banking. You may not always like the environment and culture you are in, but your job is to survive and eventually excel. You are only a few years away from getting your own clients, initiating your own deals and making some good money.

Play your cards right and you'll be happy you did the time. Big time.

Recommended Books and Resources

Vault Career Guide to Investment Banking
Guide covers the basics of financial markets, including walk-throughs of equity and fixed income offerings, and M&A private placements and reorgs, and dissects career paths and job responsibilities at departments such as corporate finance, sales and trading, research, and syndicate.

Finance Spreadsheet Programs
Free from Aswath Damodaran.

Valuation: Measuring and Managing the Value of Companies
by McKinsey and Company
A classic that should be in the cube of every analyst and associate on the Street. Another fabulous valuation book is Damodaran on Valuation: Security Analysis for Investment and Corporate Finance

Applied Mergers and Acquisitions
by Robert F. Bruner and Joseph Perella

Handbook of Fixed Income, Frank Fabozzi (editor).
This is the bible for any job involving fixed income sales, trading, underwriting or derivatives. If you are headed for sales and trading you should know this material.

Job Search Success

Getting a job as an associate isn't so easy and we have put together a number of resources that should be helpful to you as you contemplate entering the market. These include:

Another important resource to have is access to specific contacts in the field. To ease this process we have assembled several lists that should be helpful to you. These lists cost between $19.99 and $49.95 and include:

Investment Banking:
  Top Firms

"All I ask is the chance to prove that money can't make me happy."

Spike Milligan

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