If you are an investment banking (IB)/private equity (PE) professional, an MBA is always a natural step to the next level, a pivot, a refocusing, or even a restart of your professional career. Whether you are still an undergrad navigating the recruiting process, within the first several years of your firm’s analyst/associate program, currently applying for business schools, or in need of a change of pace, there is an MBA option for you. Even if you are a middle manager without an MBA, there are part-time MBA programs available.
The MBA Market
The great news is that no matter where you are in your IB/PE career, MBA admissions committees are always looking for candidates from your industry—and they often find those of you from top schools with a few years of training in bulge bracket firms and successful private equity shops.
On the other hand, the application pool of individuals with a background in IB and/or PE is more competitive than ever at top MBA programs. The pool is still filled with those who have fulfilled their analyst/associate duties and are going back to business school to retool and build their networks; those who want to pivot out of the profession; and seasoned professionals who want to focus on certain deal types or industries. However, they are now joined by many of those affected by the post-COVID fundraising market, where deal flow slowed and many firms overhired. I have heard from several candidates who spent their first two years out of college at a firm where they did not work on a single successful investment proposal. Some admissions departments I spoke to believe this is part of the reason for an uptick in applications this year.
This leads to the question: why should an MBA program pick you over the person sitting next to you? Well, there are several ways to differentiate yourself.
Your Scores (GMAT, GMAT Focus, GRE)
While your professional experience can position you as a quantitatively comfortable individual who will be able to handle the analytical rigor of a top business school, it is important to back that up with a strong test score. However, your scores are more muddied than ever, with admissions committees now having to review applicants across three different primary standardized tests (GMAT, GMAT Focus, and GRE).
In the past, an average GMAT score of 730 was perceived as reinforcement of an IB/PE professional’s quantitative aptitude, especially if they had a business undergraduate degree and had taken quantitative classes in such areas as finance, economics, and statistics. Compared to the GMAT in its old form, the equivalent GMAT Focus score is roughly 665–685. The GRE was thought of as an alternative test for those who did not have a quantitative background and helped to attract a more diverse population that maybe had a hard time with the quantitative rigor of the GMAT. It also allowed schools to accept those who did not test well without adversely affecting the school’s published GMAT averages.
With the GMAT test change in 2024, the GRE has become a more prominent alternative. While not all schools have yet to publish an established record, a score of 325+ is generally considered exceptional, and more importantly, a Q score of 164 would be expected (160+ at minimum).
Given the details above, for IB/PE professionals, if your score is not quite at the average for the school but close (700+ GMAT/645+ GMAT Focus) and you have strong professional finance experience, you will have earned your propeller-head status. Generally, finance “jockeys” have above-average GMAT scores. While the average GMAT score at top b-schools is around 730, for finance folks, it is probably over 750. This isn’t mandatory, but it definitely cements your status.
What does this mean? In some circles, it is believed that IB/PE “quant jocks” and/or strong business undergrad majors should take the GMAT Focus because they presumably are not afraid of standardized tests. While, no doubt, you are smart, business schools need some sort of metric to determine who are the “smartest” people. And, rightly or wrongly, the GMAT Focus gives you the added leverage that tells them that you academically have the chops. Although many schools are accepting GMAT alternatives such as the GRE, you—as a professional in a quantitative analysis position—are expected to take the GMAT Focus and validate your quant skills. For those of you who have been out of school for a bit, we highly recommend taking a test prep class and/or online practice tests.
About You
While test scores show the admissions committees that you can walk the walk, the rest of the application shows whether you can talk the talk as well. Remember, in the world of IB/PE, you are not the only wizard with spreadsheets, PivotTables, and financial programming.
Given that most investment banking and private equity folks have starkly similar backgrounds and experiences, be prepared to tell a story in your essays that only you can tell. This means not a lot of discussion about that last deal you worked on or repeating your resume. There is no automatic acceptance for the individual who has worked with the most billion-dollar businesses. Share something unique about your background, college experiences, or something you do outside of work. Tutoring underserved kids, organizing a conference, or any life-changing experiences you had on a trip with family? All are good fodder for a unique and potentially compelling and memorable essay.
We know that most in your profession will say that they have very little time for extracurricular activities or interesting experiences outside of work, but some good “non-business” introspection will surprise you—as well as help the admissions committee understand what makes you tick and see show how uniquely grounded you are. Almost every top business school asks you in some variation to share what you do outside of work, so be prepared to answer them. If you’re stuck, ask your friends and family what they enjoy about spending time with you.
Your Reason for an MBA
Many of the biggest banks and finance companies have moved away from requiring an MBA to progress in one’s career. Given that you may be able to succeed without an MBA, it is important to explain why you need one, why you need it now, and why you need it from each particular school to which you are applying. For well-regarded top MBA finance schools, be sure you can differentiate in your own words between Booth, Wharton, and CBS, for example.
If you intend to return to a similar function, what does your progression look like with an MBA versus without an MBA? Or maybe you are looking to change industry or function—a good reason to get an MBA, but you have to explain why you need an MBA to make this career decision. Be prepared to know what it is you need personally and match it to the institution in your application.
Your Professional Tool Kit
Building off your reason to get an MBA, you must be very clear about what skills you need to develop to be a success in the future—and the answer is not “more of the same.”
If you are already a quant jock/maven, don’t say you want an MBA to study more finance. Why would you want to spend two years studying something you already know? If it doesn’t make sense for you, the admissions department will see that. The answer may be along the lines of “Well, I have been successful in private equity as a generalist, but my favorite deal was a small deal around climate change tech. I want to focus on that market, learn more about the industry from experts in your faculty, and join the Social Change Club at your institution.” That is a more compelling answer.
Of course, remember to include why you want to focus and how knowing about financing projects in a particular industry will lead to success in your desired post-MBA role. Perhaps that is required in more of a management role in your next stop.
In addition, make sure you can explain your short-term (post-graduate) and long-term plans. Once you do that, detail specifically how those plans fit with your MBA school of choice (based on classes, clubs, alumni you’ve spoken to, etc.).
Your Strengths
We know you have excelled utilizing your quantitative skills in a highly desired profession. Rather than explaining what you need from business school, explain what you can bring to business school and to your classmates.
Maybe your strengths will allow you to support your number-phobic teammates. Or perhaps you can leverage your senior contacts to bring speakers to campus. Be willing to be a resource for others; this can be compelling.
In the end, a quantitative background has both its pluses and minuses when it comes to MBA admissions. In some ways, it enhances your candidacy, as business schools know what they’re getting from someone with your pedigree. In other ways, it diminishes your chances, as there are a lot of candidates who “look” just like you and are successful because of their innate intelligence—so you have to show your drive professionally and personally to set yourself apart.
Remember, though, business schools are looking for unique people, not profiles. How do you NOT look like another Wall Street or Silicon Valley geek? When asked what they were looking for more of in the applicant pool, one admissions associate said they’d like to see more people looking to do social impact investing—while at another school, one department head said that it is a fad and they see too much of that.
The answer is to create an application that lets the admissions committee know you are not just your resume; you are someone who is unique with a clear view of what your future is and how business school fits in both personally and professionally with your long-term goals. The school is your friend. If you can clearly communicate to the admissions committee where you want to go in your career, and you help them understand how you think the business school will help you get there, you could be an appealing candidate.
For more guidance on your MBA admissions journey, contact Stratus today for a free consultation!