How To Create Something From Nothing

Between a person’s first and last name, the name of their employer, and a little LinkedIn sleuthing, it doesn’t take a genius to come up with an email address for anyone in the world.

In theory, that means getting into anyone’s inbox, from the CEO of Goldman Sachs to a former head of state.

Of course, that rarely happens in practice. There are executive assistants and filters in place to ensure folks like David can focus on doing God’s work.

But not everyone’s inbox is so heavily guarded, certainly not mine. At least a few times a week, I get an email from folks with (mostly) a tenuous connection to me, asking for a phone call to get advice on lining up an investment banking job.

Usually, I hit delete right away. Nothing personal really. Just that between a never-ending to-do list at work, writing on this blog, and a desire to spend more time with the family, I simply don’t have the time.

And yet, sometimes I engage. Mostly for students in the same undergrad and MBA programs I went to. Definitely so for someone from the old country, looking to follow a similar career path. And every so often, I simply respond to a well-written email that lands in my inbox when I have a bit of free time.

It all works out to about an hour a week. 52 hours a year. And roughly full twelve workweeks since I first moved into investment banking a decade ago.

Short Circuit

Looking from the outside-in, it may seem that HR has got a complete stranglehold on hiring these days. Every single CV has to be screened and approved by them before it goes to the “business”.

And yet, both within and outside investment banking, that process is short-circuited every single day.

Bright candidates make an impression – whether through their intelligence, personality, or sheer willingness to do whatever it takes to succeed.

CVs end up being forwarded to HR (“make sure to have a close look at this one”), referrals made to friends across the network, interviews lined up – and jobs secured.

At first glance, the efficacy of the process is pretty low. Of the 1,000-odd conversations I’ve had, perhaps twenty folks have ended up securing an offer they wouldn’t have received otherwise.

A ~2% “success rate” is far from impressive. Except for the simple fact that if you reach out to a sufficient number of people, you can get it pretty damn close to 100%. And there’s really nothing stopping you from doing so.

Well, other than that little thing called fear of rejection.

The Other End

It may seem like a one-way street – and in many ways, it is, certainly on a short-term basis.

How can a first-year analyst EVER be helpful to seasoned bankers who helped him through the door five minutes ago? And why would I even bother to spend three months of my life to talk to random people who just happen to send me an email?

The trick here, of course, is to recognize that life is a long game.

Over the years, those freshly minted analysts gain experience and move up the ranks.

Two years in, the brightest bunch moves on to private equity, where they often make mid-level Principals / Directors by the age of 30. Others end up with corporates. Many simply continue their climb within the banking industry.

And in the vast majority of cases, they remember the people who have helped them at critical junctures along the way.

A well-placed piece of advice about a possible “dream deal” between two companies. A tip of the hat towards a specific bank for a role on an IPO.

Or simply a friendly face across the table when you are trying to get an M&A deal across the line at 4 o’clock in the morning.

Ten years in, I’ve had all of the above happen on multiple occasions – and with increasing frequency.

And if it doesn’t happen – no problem. There’s enough inherent satisfaction in helping someone along to remove any need for a quid pro quo.

Free Money

The fundamental building block of any financial independence advice is to avoid debt. Perfectly sound – when it comes to financial debt.

It’s a different story when it comes to what some people call “social debt”.

A series of favours, with very limited cost to the “lender” – and yet highly valuable to the “borrower”. No obligation or enforcement to repay. No obvious immediate financial gain to be had.

Issuing – and taking on social debt pretty much characterizes the informal relationships I’ve described above.  As the old saying goes:

“Ask for money – get advice. Ask for advice – get money twice”.

You don’t have to be at the very beginning of your journey either – because most successful people understand the power of writing such informal IoUs and go out of their way to do so.

Just over two years ago, Gavin Patterson lost his job as the CEO of BT. Cue in a rush of activity, as investment bankers across the board tried to reposition themselves around his replacement.

Important – no doubt. But someone I know has actually gone the other way – and doubled down on time with Gavin.

Took him out for dinner. Helped line up potential job opportunities. Generally tried to be as helpful as possible in a very challenging period.

Two years and a couple of wobbly, interim steps later, Gavin is the president at Salesforce – with a clear upward trajectory.

You are welcome to guess where his loyalties will lie as he re-enters the pinnacle of the business world.

Beyond Banking

As expected, most of my writing stems from my experience as a banker – but it’s clear that the principles apply well beyond.

When I was just starting out, Leif from Physician on FIRE featured me on his blog, giving me a much-needed confidence (and traffic) boost. He has recently done that for Fire and Wide and I am sure countless other bloggers as well.

Pretty easy to figure out why I’m a fan of his – and will go out of my way to be helpful in any way I can.

In another example, Indeedably gave me some valuable advice about getting Cloudflare installed on this blog to help with security.

When I struggled to implement it, one of the long-time readers here kindly helped guide me, saving me a ton of time in the process.

Can I reciprocate? Unlikely. But I can pay it forward – which is why I take the time to answer every single Twitter DM, respond to every single blog comment I get, and engage in the comments sections of new blogs when I have the time.

It doesn’t matter whether you are on the giving or receiving side. At the end of the day, every single request for help is a chance to create something out of nothing.

There’s nothing to lose – so don’t be afraid to take the opportunity.

About Banker On FIRE

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Banker On FIRE is a London-based M&A (mergers and acquisitions) investment banker.  I am passionate about capital markets, behavioural economics, financial independence and living the best life possible.

Find out more about me and this blog here.

If you are new to investing, this is a good place to start.

10 Comments

  1. Morning BoF,

    Well that was a surprise to find my name on your blog as I sip my morning cuppa! Made me smile – cheers!

    You are so right though, it was the best vote of confidence from Physician on Fire which meant as much if not more tbh than the resultant crazy traffic boost. It’s just awesome when people take the time to give others a helping hand.

    Back when I was still working, after 15 years you end up with a lot of influence and a great network, so I was the one helping others. Coaching, mentoring, introductions, recommendations, the lot. I loved doing it and helping bright people who just needed a bit of a hand to be seen by the “right” people. Seeing them then go on to fly as I knew they could if just given a way in.

    I’m way more comfortable helping others than getting help myself. So it’s been a really interesting learning experience being on the other end of it now as a new blogger. It’s actually one of the reasons I’m loving it. Starting something from scratch without the benefit of the huge network & social debt – which btw is just the perfect expression for how the city works for sure..

    Good to see you taking the time too – it’s tough with all the commitments I know but always so worth it.

    Cheers – & thanks again!

    • Cheers Michelle!

      Plenty of similarities indeed. Funny that once you’ve been around a while, you realize that the same set of principles applies across vastly different areas of life.

    • Okay, I’ve got to say I now have even more appreciation for Coelho.

      I’ve read and really enjoyed The Alchemist but I had never come across the book/excerpt above. Thanks a lot for sharing – really enjoyed it!

  2. Paying it forward is an interesting concept.

    Many people decry the “insidious” old boys’ network, where “who you know” appears to matter as much or more than “what you know”. Such things can have a self-perpetuating quality that keeps insiders incumbent and outsiders on the outside. And these things can all be true. Sometimes.

    The way I prefer to view the concept is as an investment.

    There is a cost in terms of social capital and reputation when introducing or recommending someone. Greasing the wheels, opening the door, or shining a spotlight on their work. When they do well, that investment can pay dividends as you eloquently describe here. It is rewarding to see folks seize an opportunity and run with it, soaring to heights they may not have been able to reach (at all, or perhaps as quickly) without the helping hand.

    It can be lucrative too!

    There is risk however. Should those seeking help blow themselves up, exercise poor judgement, flame out, quit, or simply fail then this reflects back on the person who made the recommendation. Their judgement questioned. The value of their own network diminished.

    Failing to build such a network is self-limiting. For example, it is virtually impossible to become a Managing Director at an investment bank or to make Partner at a Big4 firm without a well established network, as this is a key enabler for being able to getting things done. Access. Budget. Favours. Information. Knowledge. Power. Wisdom.

    In my business, nearly all the new work comes from a network of past clients and former staff. They like working with a known quantity, and have confidence that their expectations will be exceeded. Constructing such a network is the work of a lifetime, and much like reputations, such things are hard won but easily lost.

    If gaining access to these networks feels difficult, that is because it is. And as it should be. They are precious and valuable things. Doing good work, being generous with your attentions, and consistently reliable demonstrates the value of inclusion in those networks. Providing the opportunity to “pay it forward” in turn. It costs little to be nice, or be helpful, but there is a cost. The rewards can be immense.

    • Great perspective.

      You could frame it as the “risk profile” of extending credit, which in this case happens to be of social nature. Those who are better at managing their “portfolio” of favours end up ahead, while others see a detrimental hit to their network.

      This plays out in an interesting way in investment banking recruitment. Someone nudges a candidate forward. Others have a closer look and agree/disagree. A consensus-building exercise of sorts, with broad-based positive feedback required before a candidate is offered a job.

      In most situations, the process is robust enough to screen out subpar candidates. And yet in some situations, they get in – and it takes a long time to manage them out of the system. No one wants to admit they’ve made a collective mistake.

  3. What a nice blog to read today. Thanks for such a positive message! I agree that helping someone else or being asked your views on something can give you a great feeling. I really liked the story about Gavin Patterson too. A move to Salesforce from BT is certainly a move in the right direction!

    • Thanks Alan. Yes, I’m sure Gavin isn’t missing the days of “hand to hand combat” (his own words) with the regulators!

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