Investment Banking Lateral Recruiting: A Guide

Lateral recruiting in investment banking refers to the process of hiring experienced professionals, typically analysts, associates, or vice presidents, from other firms. Unlike on-campus recruitment which targets fresh graduates, lateral hires bring valuable experience, established networks, and immediate contributions to the team.

Why Lateral?

Banks utilize lateral hiring for several reasons. Filling specific skill gaps is paramount. For example, a bank might need someone with expertise in renewable energy transactions. Lateral hires provide immediate solutions, avoiding the extensive training required for junior staff. They also enable quick scaling of teams to handle increased deal flow or new business initiatives. Finally, lateral moves can be strategic, aiming to acquire talent from competitors and bolster the firm’s reputation.

Who Laterals?

Individuals seek lateral opportunities for various reasons. Promotion stagnation at their current firm is a common driver. Others might be looking for better compensation, a stronger firm culture, or a chance to specialize in a different industry or product group. Location is another key factor, with many candidates seeking opportunities in different cities or countries. Furthermore, individuals seeking a more prestigious firm or a better long-term career trajectory often explore lateral moves.

The Lateral Process

The lateral recruitment process is more streamlined than entry-level recruiting but still rigorous. It typically starts with networking and reaching out to recruiters or directly to individuals within the target firm. Referrals are highly valued, significantly increasing the chances of landing an interview. The interview process usually involves a combination of behavioral questions, technical assessments (modeling, valuation), and case studies. Demonstrating deal experience and a strong understanding of the relevant industry or product are crucial. Unlike campus recruiting, lateral candidates are expected to articulate specific reasons for their interest in the firm and how their skills will directly benefit the team.

Key Considerations

Successfully navigating the lateral recruitment process requires meticulous preparation. Tailoring your resume and cover letter to each specific role is essential. Practicing technical skills and case studies is critical, as interviewers expect a high level of proficiency. Networking within the target firm and industry can provide valuable insights and potential referrals. Understanding the firm’s culture and recent deals is crucial for demonstrating genuine interest. Finally, clearly articulating your motivations for leaving your current role and why you are a strong fit for the new position are key to success. Landing a lateral role in investment banking requires proactive effort, strong technical skills, and a well-defined career strategy.