What to do if you can't get an investment banking summer internship

It's for many of us.

Summer internship recruiting is over.

Bankers have come to your campus, conducted interviews, finished recruiting, and now they’re back to their pitch books.

But you don’t have any offers.

What now?

No Summer Offers vs. No Full-Time Offers

There are 3 main differences:

* Timing: You have more time to find your Plan B with full-time recruiting – sometimes a year vs. only a few months with summer internships.
* Options: You have more options if you come out of full-time recruiting empty-handed: delaying graduation, going for a Master’s program, moving to Thailand…
* Seriousness: While the lack of a good junior year internship will hurt you, it’s less of an emergency than having no post-graduation plans.

Worst-Case Scenario

You find no real internship, so you become a life guard or work in retail for the summer.

Which means that you don’t have to work 100 hours per week, you won’t get horribly out of shape, and hey, you might actually have fun for a few months.

So it’s not that bad.

But it also won’t put you in a good position for future internships, or for full-time recruiting.

Fortunately, it’s pretty easy to avoid this scenario – even if it’s the last-minute and you don’t appear to have options.

What Went Wrong… Does It Matter?

If you didn’t get a full-time offer, you need to look at what went wrong to plan your next steps: Was it your resume? Your (lack of) networking? Your interview skills?

You can still do this if you’re applying for summer internships… but it’s not as helpful.

A few problems can prevent you from getting summer internships:

1. Your GPA, especially at more competitive schools.
2. Lack of networking or lack of networking-in-advance.
3. Interview skills / resume or too much preparation.

The first 2 are difficult to “fix” on 2-3 months’ notice.

And even if you can “fix” these 2 problems – or even #3 – you can’t get a second chance to prove yourself.

So don’t fall into the trap of analysis paralysis.

What NOT To Do

We’ll start with what not to do, because that’s easier to define.

Nothing

I’ve run across some people who just expect an internship to fall into their laps even if the magic 8-ball points to “no.”

While miracles are possible, don’t hold your breath: the harder you work the more your “luck” will improve.

Study for the CFA / Get Other Certifications

You probably already know my views on the CFA, but just in case…

While studying is a better use of time than doing nothing, that’s like saying that death via the electric chair is better than drowning: you’re dead either way, but one is slightly less terrifying.

The problem with studying or getting certifications over the summer is that you can’t write anything on your resume under “Work Experience” to describe what you did – so you’ll have a big gap on there.

All you’ll get is another 1-2 lines at the bottom of your resume: not a great reward for 500 hours of study time.

If you’re really set on doing these over the summer, you could still do them – but only if you treat them as a side project and you spend the bulk of your time on something that you can actually list as “Work Experience.”

Back Office

If you’re in your 1st or 2nd year in university, the back office isn’t as terrible as some would have you believe – if you can get a middle or back-office role at a well-known bank, that’s much better than a summer spent at Best Buy.

This one gets less attractive if you’re looking for junior year internships, because a back office internship won’t turn heads if you’re trying to move to front-office banking in full-time recruiting.

Filling the Gap: Possible Solutions

So how do you fill the gap, find something worthwhile to do over the summer, and make sure you don’t have a gaping void on your resume?

Delaying Graduation… Again

This is certainly one option – and if you have your heart set on a bulge bracket investment banking summer internship you might want to give it another shot.

But it doesn’t solve our original problem here – what you should do this summer.

So don’t make any decisions until you have summer plans in place – and keep pursuing Plan B options on the side.

If nothing works out, delaying graduation may actually hurt you because banks will say, “So, what did you do last summer? How have you improved since we saw you last time?”

Options Within Finance

If investment banking doesn’t work out, your next best option is something else in finance – sales & trading, prop trading, wealth management, public finance, or corporate finance – to give a few examples.

The only issue here is that many of these also finish summer recruiting the same time that investment banking groups do – so if you didn’t get into investment banking at Morgan Stanley and it’s March, your chances of getting an S&T summer internship there aren’t much better.

The further away you move from large investment banks, the easier it gets to find something else in finance at the last-minute: I’ve been conducting dozens of interviews with readers, and many of them pulled this off against all odds.

How do you find these options?

The same way you find a normal summer internship: job postings at your school (if they exist), alumni networking, and cold-calling, with a focus on smaller places.

Outside of Finance

These options are a notch below the finance ones, but they still beat studying for the CFA or working at Best Buy by a long shot.

In this category, you might think about marketing, sales, or accounting-type roles at “normal” companies, Big 4 firms, or anything else that’s out there.

I’m not going to “rank” any of these because it’s impossible to quantify and because “ranking” is one of my least favorite topics (just after the CFA and GPA rounding).

Just like a lawyer, accountant, or engineer trying to break into finance, you want to get experience that can be spun into sounding relevant.

So if you do accounting at a Big 4 firm, working with financial services companies or helping out with due diligence on transactions is better than auditing Wal-Mart’s 10-K.

At F500 companies it’s still hard to get something at the last-minute, but overall competition is far less than in investment banking.

Keep At It But Adjust Your Focus

You should be doing this no matter what option you decide to pursue – it’s still worth spending at least a few hours per week cold-calling banks and emailing alumni just to see if anything turns up.

If it’s May and you still have nothing, you shouldn’t decide to suddenly spend 80 hours per week cold-calling – at that stage, no amount of effort will produce miracles.

But if you still have a few months left, continuing to network is always worth it.

Go Off the Beaten Path

This is a great idea if you have some time before you start your full-time investment banking job, but it’s not so great if you’re looking for a solid internship.

Banks are biased toward anyone with previous corporate finance experience – so if you’ve done something that looks completely unrelated they’ll be suspicious of you.

If you really want to start your own surf shop or you want to spend the summer climbing mountains, go ahead – but be aware that it’s not much better than the “doing nothing” option in the eyes of investment banks.

This is stupid and unfair because you often do more work and get more responsibility with these options, but that’s just how banks work.

The one exception here: if you can spin this experience into sounding relevant to finance, it may be a good idea. Certain fellowships, study abroad programs, and research opportunities may qualify.

Brand Name vs. Quality Experience

One issue that comes up with all these options is the the brand name of a firm vs. your experience.

Some people think it’s all about brand name, while others say it’s more about the experience you get.

If you’re interested in investment banking (or private equity, or hedge funds…) then you should think about it like this:

For summer internships, brand name within the same role matters more than your exact experience.

So a front-office internship at a boutique will still beat a back-office internship at Goldman Sachs.

But a front-office internship at Goldman would beat a front-office internship at a boutique, even if you work on a dozen deals at the boutique and learn advanced modeling and all you do at GS is fetch coffee for people.

It’s just the way things work: bankers scan resumes very quickly and have a strong bias for brand names and anything that reads “Investment Banking Analyst.”

Attack!

So, what’s your plan of attack?

First, figure out how much time you have left before internships begin and what the lowest-hanging fruit is: Have you already done a lot of networking in one industry? Do you have good contacts at one firm, or are there a lot of alumni in one field of finance?

Then, start reaching out to your contacts in other fields while you continue to spend at least a few hours per week calling and emailing bankers. You can up this if you have a few months left.

If you’re not getting good results, keep broadening your search to consider anything that’s even tangentially related to finance.

And if nothing works out, find something else cool to do and spin it into sounding relevant to finance.

Or you could just work at Best Buy.

(Kidding, don’t do that).

from M&I