Do Lawyers Become Investment Bankers and How to Prepare for a Career in Banking

Lawyers and investment bankers may seem like vastly different professions, but they can overlap in interesting ways. For instance, a lawyer can bring a unique set of skills to a career in investment banking.

To prepare for a career in banking, one should consider gaining experience in finance and accounting, as well as developing strong analytical and problem-solving skills. This can be achieved by taking courses or pursuing a degree in a related field.

Some lawyers may find that their skills in negotiation, contract review, and regulatory compliance are highly transferable to a career in investment banking. This is evident in the fact that many investment banks have lawyers on staff to advise on complex deals and transactions.

In fact, some law firms even have dedicated financial services groups that work closely with investment banks on major transactions.

Few law students move directly into investment banking, so it's not a straightforward career path. You'll typically work at a law firm for a few years, ideally in a highly relevant area like M&A, securities, or capital markets.

To increase your chances of transitioning into investment banking, you should be at a top law firm that does a lot of work in corporate and securities law. Think Cravath, Skadden, Kirkland, Latham, and others in the top ~15-20.

Having at least 1-2 years of deal/client experience is crucial, as you'll need to discuss that experience in interviews. The quality of your law school matters, but the quality of your current firm is more important.

If you're looking to make a career transition, going to business school might not be the best plan, unless you're willing to spend $200,000 and give up 2-3 years of work experience.

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To prepare for a banking career, you'll want to start by understanding the typical career path for lawyers. Most lawyers enter investment banking as an associate, usually after 1-3 years of experience, although some may join as a vice president with 6-7 years of experience.

You'll likely take a pay cut at first, but it's essential to accept the offer and focus on compensation and promotions later. Your biggest advantage as a lawyer is time – you don't need to make the transition within 1-2 years, unlike students who just finished undergrad.

Here are some key steps to prepare for a banking career as a lawyer:

Remember, learning accounting and finance is not rocket science, and it's never too late to make the transition. Take your time, and don't be afraid to ask for help from former lawyers in the industry.

Crafting your story and resume is a crucial step in preparing for a banking career. Your story and resume are linked because your story should reflect most of your resume.

To create a compelling story, use the usual template with four sections: Beginning, Spark, Growing Interest, and The Future and Why You're Here Today. For example, your Beginning might include where you're from, your university and original major/career plan, and your law school.

Curious to learn more? Check out: Sample Career Change Cover Letter

Your Spark could be banking and finance-related classes at law school, a law internship, or activities at law school that made you more interested in investment banking. Explain why banking appeals to you more than law.

In the Growing Interest section, describe how you started taking finance-related classes, learning the technical side on your own, and networking with bankers.

Finally, in The Future and Why You're Here Today, explain why you want to combine your previous industry background with law and finance and advise companies in a certain industry or on a certain deal type.

When crafting your story, avoid including too many negatives. Instead of saying something like "I want to switch because we're not responsible for anything clients care about", restate it as "In addition to advising on the legal issues, I want to contribute to the actual deal process and move transactions forward – which you have the opportunity to do in banking."

Your resume should match your story closely. Ideally, you'll have 2-3 deal or client experiences that sound relevant to M&A and capital markets. You should also have evidence of other jobs, internships, classes, and side projects that are relevant to finance.

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Here's a checklist to help you spin your work experience:

Remember to be prepared to be quizzed on any deals you list, and make sure you know the financial stats, the deal terms, and the strategic rationale.

You'll be hired as an Investment Banking Associate in most cases, which could be a 1 Year Associate, 3 Year one, or even a Vice President if you're a 6 or 7 Year Associate with a lot of deal experience.

It's rare to join as a Vice President, but it's possible if you have extensive experience.

You might take a pay cut at first, especially if you're a 7 Year Associate in law earning more than 1 and 2 Year IB Associates.

Accept the offer and worry about compensation and promotions later, as you have little to no negotiating power.

Preparing for a Banking Career requires patience and a strategic approach. You don't necessarily need to make the transition into investment banking within 1-2 years, as law students often take a few years to gain relevant experience.

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Learning accounting and finance is not rocket science, and you can spread out your studying over a longer period if needed. It may take you 6 months instead of 1-2 months, but it's worth the time investment to get it right.

Networking and interviewing are crucial steps in the process, and knowing the material is essential before you start. One of the best sources of information is former lawyers from your firm, who can provide valuable insights and guidance.

The hiring market and economic conditions can affect the length of time it takes to make the transition, but it's never too late to move into IB as an Associate at a law firm.

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