Different Credentials for an Investment Banking Job?

We focus a lot on skill sets for an investment banking job in this column. We’ve talked about how important it is to know the numbers, to be able to crank out Excel spreadsheets and financial models with your eyes closed. But there is apparently another skill set that can earn you a pile of money in an investment banking job in a short period of time: the golden rolodex.

Former White House Chief of Staff Rahm Emanuel has come under fire lately in his campaign for Chicago mayor for his 2 ½ year stint in investment banking. In 1998, as Emanuel left his post in the Clinton White House, he was recruited by Bruce Wasserstein, a major donor to Clinton and other Democrats, to join the Chicago firm of Wasserstein, Perella & Co. 

Despite having no previous experience in investment banking, Emanuel became managing director at the firm and reportedly had a hand in several major deals, according to an article in the Chicago Sun Times. One was an $8.2 billion merger between Chicago Unicom and Philadelphia Peco, that created Commonwealth Edison, one of the leading energy companies in the Chicago area. Emanuel also oversaw GTCR Golder Rauner’s purchase of SecurityLink from SBC Ameritech. His firm, Wasserstein, Perella, was sold twice during his tenure, as well, which added to Emanuel’s profit.

All told, Emanuel ended up earning $18.5 million dollars as an investment banker in the 2 ½ years he spent at the firm. But that’s not surprising or unusual for the handful of individuals who can connect business leaders at the very highest level.

“Look, he’s a smart guy, he knows a lot of people — he’s got a golden Rolodex, incredible access, great recognition, he can get the right people in front of the decision-makers,” said Jeffrey Golman, head of investment banking for Mesirow Financial.

Others concur: “You don’t need any special training to be a good banker,” agreed John Canning Jr., chairman of Madison Dearborn Partners and an Emanuel supporter. “He understood synergies and he understood business. He had the interpersonal skills, and he also had the smarts, and he’s aggressive.”

So clearly there are two paths to the top of investment banking. Either the hard slog of working your way up from analyst and slowly developing your network. Or parlaying a golden rolodex into a position of deal-maker at a top firm.

Fair or unfair? Or just reality? Add your comments below.

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{ 1 comment }

sensitive875 February 22, 2011 at 11:58 pm

Really great and informatory post. Thanks for the helpful info about how to get investment banking job.

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