How to become an Investment banker
An investment banker is a highly paid professional in the financial industry. Their main job is to assist companies and clients with their investments, helping them raise capital, manage mergers and acquisitions, and make informed financial decisions.
What is investment banking
- An Investment Banker is a financial institution that helps clients — including governments, companies, and individuals raise money by issuing stocks, bonds, and managing their investments and major financial deals such as IPOs and equity offerings.
- Example: Goldman Sachs is one of the most well-known investment banks in the world.
- In simple terms, investment banking is primarily about sales and financial advisory, helping clients buy, sell, and grow their assets strategically.
Investment banking
- Corporate finance
- Mergers and Acquisitions
- Develop Financial Models
- Eqiuity
- Analyzing Risk
What does an investment bank do?
A regular bank is where people have their savings or current accounts. It accepts deposits and provides loans to customers. For example, a regular bank might offer 5% interest on deposits and charge 10% interest on loans. By acting as a middleman between depositors and borrowers, regular banks earn their profit from this difference.
An investment banker, on the other hand, helps clients and companies raise money, manage profits, and handle equity, shares, and IPOs. It also acts as a middle agent, connecting businesses with investors to facilitate large financial transactions and investments.(8 Powerful Steps to Achieve Financial Freedom Before You Turn 30)
However, their main income source comes from providing services related
Capital Market transaction and consulting services
Imagine a company needs a loan. It has two main options — it can either take a loan from a regular (commercial) bank or raise capital by issuing bonds to the public.If the company decides to borrow from a commercial bank, it must agree to the bank’s terms and conditions, including the interest rate, which is set and controlled by the bank.
According to their own choices.
However, if a company chooses to raise funds from the public instead of taking a bank loan, the interest rate may be slightly lower. This is because when a company borrows directly from the public, it usually reflects a high level of credibility, meaning there’s a greater chance the company will repay the money.
Another way to raise capital is through equity financing — for example, by approaching a large investor (like on Shark Tank) and offering them shares of the company in exchange for money. However, finding the right individual or group of investors can be challenging, and in many cases, these investors may dictate their own terms and conditions.
To overcome this, a company can choose to go for an IPO (Initial Public Offering), where it raises funds from the general public by offering shares in exchange for ownership equity. Since such large-scale transactions involve the public and regulatory processes, they are typically facilitated by investment banks, which manage and oversee the entire process.
How to Become an Investment Banker — Step-by-Step Guide
1. Education & Qualifications
- Bachelor’s degree in Finance, Economics, Business, Accounting, or a related field.
- Useful advanced qualifications / certifications: CA (Chartered Accountant), CFA (Chartered Financial Analyst), MBA — these boost credibility and job prospects.
2. Key Skills You Need
- Financial modelling (building forecasting and valuation models)
- Microsoft Excel (advanced skills: pivot tables, VBA basics, complex formulas)
- PowerPoint presentation (create clear pitch books and client presentations)
- Valuation techniques (DCF — Discounted Cash Flow, comparable company analysis)
- Communication & interpersonal skills (presenting deals, negotiating with clients)
- Sales & client-management skills (winning mandates and maintaining relationships)
3. Entry-Level Roles & Experience
- Start in entry-level roles like financial analyst, research analyst, or investment banking analyst.
- These roles teach you deal analysis, modelling, due diligence, and presentation skills.
4. Career Path & Progression
- Typical progression: Analyst → Associate → Vice President → Director → Managing Director.
- After a few years as an analyst, many professionals do an MBA or obtain CFA to advance faster.
5. Practical Steps to Get Started Today
- Build a strong CV focused on finance projects, internships, and modelling experience.
- Create sample financial models and case studies to show in interviews.
- Network with professionals (LinkedIn, alumni, events) and apply for internships.
- Prepare for technical interviews: valuation, accounting, Excel tests, and behavioural questions.
6. Extra Tips
- Learn industry-specific knowledge (M&A, capital markets, debt vs equity deals).
- Keep up with financial news and market trends — investment banking depends on markets.
- Be ready for long hours and high-pressure work; resilience matters.
