Corporate Finance Attracts Class of '95

Many Seniors Pick Investment Banking

Investment banking is something of a tradition at Harvard.

Every year, about 45 percent of the senior class goes through February recruiting. Of the more than 300 companies which come to Harvard to recruit, half are consulting firms or investment banks, according to Assistant Director of the Office of Career Services (OCS) Marc Cosentino.

Like the QRR or Expository Writing, many students could not imagine preparation for the real world without going through the rigorous interviewing which screens those seeking access to the high-paid, highstress world of investment banking.

This year, however, was slightly different from previous years.

A downturn in the financial world made the job market more competitive than it has been in the past.

"Wall Street is traditionally a great resource for us. But this year was a bad year," says Cosentino, who is the OCS business counselor.

"Firms did about 20 to 25 percent less hiring this year than last year," he adds.

Nonetheless, a new crop of investment bankers will head to New York and San Francisco this June to begin training for the exciting world of finance.

According to OCS Recruiting Coordinator Judith Murray, Wall Street's downturn does not seem to have adversely affected the opportunities of Harvard students.

"With 13 companies making 66 offers, that indicates [graduating seniors] are getting a lot offers," Murray says, citing information collected to date from OCS surveys.

Graduating seniors say investment banking allows recent college graduates an opportunity to assume a high degree of responsibility.

"It's just an exciting and fastpaced industry. The job offers a lot of challenges that are really enjoyable," says Adam L. Berger '95, who will work at Goldman Sachs next year. "You get a lot of responsibility when you're very young, and you certainly learn a lot."

"You get more responsibility than you would getin a lot of jobs right out of college," saysMeredith E. Bagby '95, who will work at MorganStanley next year.

Students also describe investment banking as away to try something completely different from theacademic world they are leaving behind.

"I think there's maybe a desire to learnsomething really practical, after four years ofliberal arts," Bagby says. "I didn't want to goback to school any more. I was sort of burned outafter four years."

Burned Out, Now?

Tired graduating seniors should get ready formore long hours. According to Harvard graduatescurrently working at investment banks, analystsroutinely spend about 100 hours in the office eachweek.

"On weekdays, the time I'm not sleeping, I'mhere. I try to stay away Saturdays, then I come inSunday afternoon," says Esteban Piedrahata '94,who works at Salomon Brothers.

"There are lots of demands on you. It's thekind of situation where you can't make any plansbecause you're often times called on a project orassignment at the last minute," agrees David P.Ross '94, who works at Merrill Lynch.

Ross, who says he usually works from 9 a.m. tomidnight, says he has a friend at Merrill Lynchwhose girl-friend broke up with him because of thelong hours his job required.

"She decided there must be another woman, butthe poor guy was at work all the time," Ross says.

The prospect of spending so much time on thejob may strike fear into the hearts of graduatingseniors.

"The schedule is something I was forewarnedabout," says Charles S. Woo '95, who will work atMorgan Stanley next year. "I can't say I'mpsyched."

"When I started, I was worried about theintensity of the workload, the terrible, inhumaneworking hours you hear about," says Bo Hong '93,who works at Bear Sterns.

But graduates currently working on Wall Streetemphasize that the work schedule is manageable andnot the 24-hour commitment it is rumored to be.

"At the beginning, they hold your hand and takeyou through training...and they allow a certainmargin of error," Hong says. "The environmentturn[ed] out to be far more friendly than Ithought it would be. It wasn't the slave camp thatone might have imagined."

"I don't think it's a terribly stressfulenvironment but a lot of that is how you deal withit," says Richard Shah '94, who works in sales andtrading at Salomon Brothers.

Most future analysts in the Class of 1995 saythey look forward to the challenge of managing ademanding schedule.

"In order to get something out of something,you've got to put a lot into it," says Kenneth A.Caplan '95, who will work in real estate at LazardFreres next year.

"Learning how to de-stress will be good forme," Bagby says.

"I think the fun is going to outweigh thepain," says Daniel S. Gordon '95, who will work atDonaldson, Lufkin & Jenrette next year.

Spending four years at Harvard seems to havegiven graduating seniors experience in jugglingdemands on their time.

"[Investment banking] is not a nine-to-fivejob. There are lots of hours. It's not easy work.[But] if you go to Harvard, you're exposed tothat. I don't expect it to be more than what I'vealready expected of myself here," Caplan says.

"I'm kind of used to a high level of activity.I think Harvard students are used to performingunder lots of stress," says Hamilton Chan '95, whowill work at J.P. Morgan in Hong Kong next year.

"I'd much prefer a job that's too exciting thantoo boring," he adds.

"I think a lot is expected of you, but at leastin my case, it's not going to be more than I'mable to do," Berger says.

Despite the tales of tremendous workloads andmarathon hours, soon-to-be investment bankersdon't seem too worried about burning out.

"When I'm older, I'll have time to be tired. Ithink I'll be OK," says Oliver P. Weisberg '95,who will work next year at SBC Warburg.

"I think I'm looking forward to it. I thinkit's time for a stressful job," agrees ShivashishChatterjee '95, who will work at BlackrockFinancial Management next year.

"From one perspective, I'm young. Now's thetime to put in hours," Gordon says. "I'm notunduly concerned."

Big Bucks

Undergraduates may be willing to trade the longhours and high stress for the large salaries ofthe financial market.

According to many graduating seniors, workingat an investment bank is one of the most lucrativejob options available.

"You have a base salary between $30,000 and$50,000 a year. Then there's the bonus which youget at the end of your first working year, maybe30 to 60 percent of whatever business yougenerate," says Sara M. Mulholland '95, who willwork at Robertson Stephens in San Francisco nextyear.

"[Investment banking] and consulting are theonly areas where they will hire you without anyskills, just for your diploma, and pay you enoughmoney to afford a middle class lifestyle whenyou're 22," says Gregory Shlionsky '95, who willwork at Lehman Brothers next year.

Many graduating seniors say the high pay wasone of the reasons they were originally drawn tothe field.

"It's a good way to cut the financial umbilicalcord," Mulholland says. "My parents paid for myeducation here, and I'd like to be able to pay forthings now."

"People are attracted to more money becausemore money means more flexibility," she adds.

"I don't think anyone's particularly enamoredof consulting or investment banking...You get paidwell, and you feel like you already have somestatus at this early stage," Shlionsky says.

Money is not the only attraction.

Harvard students heading to Wall Street saythey like the idea of spending two years in NewYork with an already-established social circle.

"A lot of people in our class are going to NewYork. Maybe there's a desire to stay withfriends," Bagby says.

"[It will be] fun being young and being in NewYork. One of the things I look forward to isthere's going to be a whole group of my friendsdown there," Gordon says.

Recruiting

If work at an investment bank is strenuous, theprocess of securing a position at one is equallydemanding. Candidates usually go through anintense recruiting period in February and earlyMarch.

It is not uncommon for candidates looking at upto 50 companies to have at least one interviewscheduled every business day for the entiresix-week period.

Many students say the grueling interviewschedule interfered with academic work.

"The interviews themselves were not toopainful, they just made it difficult to go to allmy classes," Chan says.

"It takes a significant time commitment. Youdon't get to classes much," Bagby says.

"I had an interview every day the first coupleweeks. It was tough balancing [the interviews]with school and my thesis," Gordon says.

"I think it's the most hectic time I've everexperienced at Harvard," he adds.

What one is asked during an interview can besomewhat bizarre, students say.

"Interviews can get pretty funny if theinterviewer knows a friend from previous years.You spend the entire time [talking] about yourfriend," Chatterjee says.

"Then you get asked really strangequestions...sort of brain teasers," Chatterjeeadds.

Bagby says one company she interviewed withgave her a "psychological exam [which was] made upin the '50s or '60s."

"They had questions like, `Would you ratherread the Bible or watch TV? Would you rather holda flower or hold a gun?'" Bagby says. "I guessit's to see what kind of moral character youhave."

"Then they had word associations. [Thequestion] would say, `tall people, short people,or small company, large company,' and you fill ina blank," Bagby adds.

Caplan says Monitor Company in Cambridge alsotested applicants' mental skills.

"There's an I.Q. test that's part of the secondor third round that a lot of people felt was a bitinappropriate," Caplan says.

According to graduating seniors whoparticipated in recruiting, interviews aresometimes designed to put candidates on the spotto see how well they can handle pressure.

"It's stressful....They tend to ask you why youare fit for this job...why you are interested insuch an area," Caplan says.

"Sometimes the questions simply involve adefense of your resume--why you did this, why youdidn't do that," Weisberg says.

It is often hard to figure out what aninterviewer is looking for, students say.

"You really cannot gauge how well you did bythe interviews. One firm, I walked out of therethinking, `Wow, that was the best interview I'vedone,' but the firm never called me. Anotherinterview, I thought I really bombed it, but Imade it to the final round," Gordon says.

"Recruiting is a Darwinian process. It'sbrutal. It's not always very clear as to thecriteria," Weisberg says.

But if students don't know what recruiters arelooking for, Cosentino does.

"During recruiting, two questions are alwaysasked...that a student never gets to hear. Thefirst is the Pittsburgh Airport Test. [Theinterviewer asks himself] how [it] would feelbeing snowed in at the Pittsburgh airport for ninehours with this person," Cosentino says.

"The second question is how [the interviewer]would feel bringing this person in front of aclient," Cosentino says. "The interviewer askshimself does [the candidate] have the poise,articulation and sophistication to persuade aclient."

"If the answer to these two questions is yes,the chance of moving on in the process is verystrong," Cosentino adds.

Beating the System

Interviewing for a job at an investment bankusually takes place in three rounds. The structureof the first round depends on whether theprocedure is "closed" or "open."

In a "closed" interview process, students say,a firm may sift through as many as 300 resumes andpick 70 people to interview for the first round.

In an "open" interview process, all interestedstudents are allowed to sign up for first-roundinterviews.

Firms then use the first two interview rounds,which usually take place on campus, to narrowtheir choices down to a group of top candidates.

These final candidates are interviewed in thelast round, usually at the site of the company.

"If you're going to the site, you usually havea 50-50 chance [of getting a job offer]," Weisbergsays.

Interviews aside, investment banks may alsohave other things in mind when examiningcandidates.

"There are a couple things investment bankslook for. They look at how well you've done[academically]...at campus activities and whetheryou've reached leadership positions...atanalytical skills...at past work experience,"Cosentino says.

"They're looking for bright people they cantrain," he adds.

Bank recruiters also look at "how hard you'veworked on a team," according to Cosentino.

According to graduating seniors, recruiters mayregard students who balance numerousextracurriculars as capable of coping with aninvestment banker's hectic schedule.

"I think the company feels better about giving[students] offers because they know they're ableto handle it. People who are busier have anadvantage in that they're used to being busy,answering to a variety of different bosses andworking on teams," says Mulholland.

Mulholland, a sociology concentrator, wrote athesis, directed Harvard Figure Skating, taughtaerobics and was central coordinator for the Houseand Neighborhood Development Program (HAND).

"[As an analyst], you work 90 to 100 hours perweek. Some people don't get jobs because they'renot able to convince recruiters of their abilityto do that. You have to do something that provesyou don't just sit around," Weisberg says.

Weisberg, an East Asian studies concentrator,played varsity squash and traveled in China toperform research for his thesis.

But participating in mass recruiting is not theonly way to secure a position.

Some graduating seniors obtained jobs afterapproaching firms on their own.

Mulholland says she wasn't happy with theoffers she obtained through recruiting and wasaccepted at Robertson Stephens after Harvardrecruiting was over.

"I found [recruiting] educational but a bitfrustrating because it was so time-consuming,"Mulholland says. "If I had to do it again, Iwouldn't do it again."

One student, who asked not to be identified,says he received an offer from J.P. Morgan aftercontacting the bank.

"I didn't use OCS. I just called J.P. Morganand asked for people in human resources," he says.

Officials at OCS say they encourage students tocontact firms outside of the recruiting process.

"We always encourage students to job hunt ontheir own, so that they'll have more options,"Murray says.

"There are always employers who don't come torecruit on campus. The employers who interview oncampus are a small sampling of many employers inthe industry," she adds.

Harvard's Role

Students say OCS is a helpful resource duringthe recruiting process.

"I give OCS a thumbs up. I think they did agood job," Weisberg says.

"OCS is useful just by being aclearinghouse--you don't have to bother a lotabout minor details," Chatterjee says.

At the beginning of the recruiting period,students send applications to OCS, which gives theinformation to the companies in which each studentis interested.

Students say this procedure saves them time andhassle.

"For a lot of other places that I know, thestudents themselves have to get in touch withcompanies. Here you just send everything in toOCS, and they take care of it," Chatterjee says.

And the career forum sponsored by OCS inOctober helps students get in touch with firms,graduating seniors say.

"The one thing [OCS] does very well is try toget companies to reach you. It opens up a lot ofopportunities. You can explore types of companiesto get the right match," Caplan says.

Graduating seniors also benefit from the factthat so many investment banks come to recruit atHarvard.

According to Murray, 77 investment banksrecruit at Harvard every year.

"I think people at Harvard have an advantage inthe sense that it's Harvard," Caplan says. "Firmslike to recruit here. Very highly regarded firmslike Goldman Sachs like to have Harvard people ontheir payroll."

"In investment banking and in consulting,Harvard is pretty much unbeatable as a place wherefirms come," Woo says.

According to graduating seniors, firms areattracted to Harvard because they believe they cancount on high-ability applicants.

"I think the Harvard name really, really takesyou so far. Employers know Harvard has alreadyscreened out people," Gordon says.

"A lot of banks like to concentrate theirefforts on Harvard," Chan says. "I think theythink they can count on the Harvard pool beinggood."

Firms may also keep coming back to the Collegebecause past Harvard hires have performed well.

"Harvard analysts are considered to be some ofthe best," Chan says. "The positive experiencefrom past analysts definitely helps us a lot."

The sheer number of firms who recruit atHarvard and the large number of graduates who gointo investment banking influences even morestudents to enter the field, some seniors say.

According to Woo, entering the field ofinvestment banking is "kind of encouraged" atHarvard.

"I don't think I would've been introduced to itas much had I not gone here," he says.

"It's definitely a Harvard thing. You tend tofind out more about the industry than you would atother places," Chatterjee says.CrimsonSusan A. Chen