Wall Street Mastermind

Ranking the Best 10 Investment Banking Internships!

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Sam Shiah

May 9, 2024

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Before you can work for top investment banks like Goldman Sachs, Morgan Stanley, or Evercore, one of the first prerequisites is you need to build a stellar resume with as much highly relevant internship experience as possible.

But given all the different types of internships that you could be doing out there, you really have to think carefully about what internships to pursue with your time.

After all, applications for the top investment banks open up as early as halfway through sophomore year of college these days, which means that you really only have the first 1.5 years of your college career to rack up these internships.

This means that even if you diligently did one internship every single semester, plus another one during your freshman summer, you would only have 3-4 opportunities to add relevant internships to your resume before it’s time to apply to your dream firms.

So in this newsletter, we are going to rank the top 10 most relevant internships for you, so that you can make sure you’re targeting the right opportunities with the limited amount of time you have.

Please keep this in mind…

So before I reveal our rankings for the top 10 most relevant internships you should be going after, please keep this in mind: generally speaking, the higher we rank something on this list, typically the harder it is to land the internship as well.

But that’s not always the case as there are some exceptions as well.

Also, keep in mind that these rankings are not absolute.

For example, if you are interning for a firm that’s in a lower-ranked industry on this list, but it’s for a very well-known brand name firm within that space, that could still be a more impressive experience than interning for a no-name firm within an industry that’s ranked higher on this list.

Basically, sometimes it’s better to be the big fish in a smaller pond, rather than the other way around.

So OK with those disclaimers out of the way, let’s dive in.

I’m going to start with #10 on this list, which is valuation firms.

These are firms that perform valuation analysis for different types of scenarios – M&A transactions, fairness opinions, private equity portfolio company valuation, employee stock ownership plans, litigations, and estate planning, just to name a few.

Now it should be obvious – but doing valuation related to M&A transactions, fairness opinions, or private equity portfolio company valuation is going to be more relevant than doing it for things like litigations and estate planning.

So if you do go down this path, make sure you still try to pick the more relevant valuation opportunities.

The reason these are considered relevant is that valuation is a core part of the job in investment banking.

Whether you’re working on an M&A transaction, or trying to raise capital through an IPO or follow-on equity offering, a big part of the work you will have to do comes down to valuing the company that you’re doing the deal for.

Working at a valuation firm will teach you how to do things like discounted cash flows, comparable companies analysis, and precedent transactions, amongst other things. These are all valuation methodologies that you will use on the job daily as an investment banker.

Next, at #9 we have small hedge funds/family offices.

I lump these two together because from an intern responsibility standpoint, they’re very similar.

But the difference between hedge funds and family offices is that hedge funds raise outside capital and charge a management fee and profit share, usually called “2 and 20” which means a 2% management fee on the assets under management, plus 20% of the profits generated.

Family offices, on the other hand, do not raise outside capital and instead manage money for ultra-high-net-worth individuals and/or families.

These funds could invest in a variety of asset classes, or sometimes they could even be more of a “fund of funds” model where they just invest in other funds who are then in charge of doing the direct investing.

But if you go this route, ideally you want to look for a fund that is doing the direct investing themselves, and ideally into individual stocks or even private companies, as opposed to just investing into another fund.

This is because if the fund is investing in individual companies, you will have the opportunity to analyze and value those same companies.

That gives you the same valuation skill set we’ve already talked about, which makes it relevant for investment banking.

Next, at #8 we have equity research internships.

Equity research firms write equity research reports on companies they cover.

Typically an equity research report will have a “buy”, “hold”, or “sell” rating on the company’s stock, along with a price target for what they think the company’s shares should be worth.

Usually, the buy/hold/sell rating is determined based on where the stock price is trading at currently relative to where the equity research team believes it should be trading at.

Equity research analysts will typically have a 3-statement operating model built for each of the companies they cover, which then gets updated once a quarter as companies announce their earnings and provide guidance on the forward-looking outlook.

Equity research analysts will also use the same valuation methodologies that you use in investment banking to figure out the price target for these companies, so you can get very relevant modeling experience in this role.

The similarity between these first three types of internships is that all three involve a lot of valuation work.

So the bottom line is if you can find an internship that allows you to get valuation experience, you can consider that to be relevant experience for investment banking.

But next, let’s talk about another category of internships that I think would be even better than these valuation-related roles we’ve talked about so far.

And that would be what I call “transactional finance” internships.

All of these internships involve working on deals – typically M&A deals or capital-raising deals.

Needless to say, that’s exactly what you’ll be doing in investment banking, which is why these internships are highly relevant.

So at #7, we have search funds.

You can think of search funds like small private equity funds, but they make much smaller investments than the traditional private equity firms you think of.

Search funds typically raise anywhere from seven to low eight figures and invest all of the capital raised into just a single business.

On the other hand, private equity firms typically raise at least eight to nine figures of capital and allocate that across a portfolio of 10-20 larger investments.

As a search fund intern, you will help the fund manager go out and find potential acquisition targets that fit the fund’s investment thesis and criteria.

In the earlier stages of this process, there’s typically a lot more sourcing work, as you’re canvassing certain industries to try to find interesting businesses worth digging deeper into.

If you are fortunate enough to work for the search fund during the latter stages of the deal process, after they’ve already narrowed it down to one or two firms that they have serious interest in, then you’ll get to help with the due diligence process and potentially even touch the financial model.

Because you’re helping out with the acquisition process, this can be considered M&A experience, which makes it highly relevant for investment banking.

Search fund internships also have a lot of other benefits – because they don’t always require you to already have prior finance experience, and most of the internships can be done remotely with a lot of schedule flexibility.

#6 on the list would be growth equity firms.

These are similar to search funds in the sense that most growth equity firms that hire interns typically have them assigned to sourcing-related tasks.

Growth equity is similar to private equity, but rather than using debt to buy out the entire business, growth equity firms will typically take a partial stake in the business, and typically in an industry that’s high-growth such as technology.

The businesses are sometimes not yet cash flow positive, but have already found product-market fit, and are looking for growth capital to help them scale the business, typically by investing in their go-to-market strategies and building out their sales and marketing functions.

In growth equity, you’ll get to evaluate a lot of different businesses, but there may not be as much time spent on analyzing the companies if you’re mostly doing sourcing work so make sure you get really clear on your role and responsibility before you accept such an offer.

OK now we’re getting into the top 5 – if you can get anything from these next few categories, then you’re in really good shape.

#5 is corporate development.

Corporate development is when you do M&A work, but you do it in-house for a specific company, as opposed to investment bankers who are external 3rd-party advisors that are simultaneously helping multiple clients at once.

It’s typically the bigger, more mature companies that have in-house corporate development teams – examples of companies that are really acquisitive include Apple, Microsoft, Alphabet (also known as Google), Amazon, and Meta (the parent company of Facebook and Instagram).

These companies hire former investment bankers who want to go in-house and enjoy a better work-life balance, but still get to work on high-profile and interesting deals.

As an intern, you will be helping these companies evaluate potential acquisition targets, which makes it highly relevant for investment banking.

Next, at #4 we have lower middle market private equity firms.

We’ve already explained private equity earlier when we talked about search funds – but I put lower middle market private equity firms higher than search funds because these are PE firms that typically have fund sizes that are anywhere from $100 million on the low end, all the way up to $1 billion on the high end.

In other words, these are very legitimate funds that manage a significant chunk of capital, and they don’t invest all of their money into just one small mom-and-pop business.

Rather, they’re looking for 10-20 businesses that they can write bigger checks for, which naturally also makes the due diligence process a lot more involved.

That in turn typically means a better learning experience for you as an intern than you would get at a search fund.

Next, at #3 we have regional boutique investment banks.

For the vast majority of candidates, this is probably the best and most relevant internship you can do.

Most people know the household names in investment banking, but regional boutiques are smaller investment banks that typically only have anywhere from a handful of investment bankers on the low end, to maybe a few dozen bankers on the high end. They also typically have more of a regional focus, likely only working with companies that are close by geographically.

And the deal sizes are typically smaller, in the seven to eight-figure range, although occasionally getting up to the low nine-figure range.

There are literally thousands of firms in the United States alone that could qualify as a regional boutique, so the opportunities are definitely out there.

The tricky part is that most of these firms are smaller and don’t have a structured recruiting process.

Many of them also don’t post their jobs online even if they do hire interns, so you have to rely on your networking efforts to find these opportunities.

Why these internships are relevant to investment banking should be pretty self-explanatory, so I won’t say too much more about this.

Next, we have #2 – which is diversity programs at the top 50 investment banks.

These are basically early insights programs or sophomore summer internships that are offered by bulge bracket, elite boutique, and middle market banks.

They are typically reserved for diversity candidates because most of the top investment banks on Wall Street want to hire more diverse candidates.

So if you’re female, LGBTQ, Black, Hispanic, Native American, disabled, or a veteran, some or all of the top investment banks will likely have some sort of diversity program that you’re eligible for.

These diversity programs are used as a recruiting pipeline for the junior summer and summer associate internships, and you basically get first dibs on those opportunities as long as you do well.

But keep in mind – if you’re still in college, you usually have to be an underclassman to qualify.

And if you’re an MBA candidate, the diversity program recruiting typically happens before you start your first year in business school.

In other words, make sure you look out for these opportunities early on so that you don’t miss the boat.

Having an investment banking internship from one of the top 50 investment banks on Wall Street is pretty much a golden ticket to getting future interviews for almost any junior summer or summer associate internship you want.

Last but not least, at #1 we have internships from the top buyside firms.

In this category, I would include any summer analyst programs from megafund private equity firms like Blackstone, KKR, and Vista Equity Partners, just to name a few.

I would also include top-tier hedge funds like Citadel, Point72, and Millennium, all of which are also known to have internship programs for undergraduates.

These internships are by far the most prestigious out of everything we’ve covered because there are very few buyside firms that offer these, and the ones who do also hire much smaller intern classes than the top investment banks.

For example, we helped one of our students get into KKR’s private equity group for his junior summer, and that group accepted six interns in the entire country.

We also helped another student get an offer from Blackstone’s private equity team for his junior summer, and he was one of five interns in the entire country.

He turned down an offer from Goldman TMT to go to Blackstone, and Goldman TMT is widely viewed as the best possible offer you can get in all of investment banking. That’s how prestigious these internships are.

To be honest, if you’re getting these types of internships, your plan is probably to skip the two years of investment banking altogether and just go straight to the buyside. After all, these are the exit opportunities that most investment banking analysts can only dream of, so why not?

OK, so at this point, we’ve gone through the top 10 most relevant internships you can get if your goal is to break into investment banking.

Based on our observations of having worked with over 1,200 students on their investment banking recruiting process, at a minimum, you need to have at least one such internship on your resume, and ideally as many as three or four.

Wall Street Mastermind interview database

To help you out, I want to introduce you to the brand new Wall Street Mastermind interview database, where we’ve compiled the applications for a lot of the internships that we’ve discussed today.

If you want to get access to this database for free, please go to the URL: https://www.wallstmastermind.com/jobs-database/

And if after reading this article, you decide that you would like some help with securing these types of internships, so that you can turn yourself into the most competitive candidate possible, please don’t hesitate to reach out to our team.

We’ve helped hundreds of students secure internships like these, and oftentimes they are able to find their first relevant finance internship in as little as just 1-2 weeks after starting their work with us.

Need help navigating through this process?

If you’re someone who’s struggled to break into investment banking on your own but you’re still holding out hope, I hope I gave you more clarity on some of the different paths you might want to consider.

If you ever need help navigating through this complicated process — please don’t hesitate to reach out to our team here: wallstmastermind.com/apply

Wall Street Mastermind, Banking on Success Event NYC 2023

About me

As a former Morgan Stanley banker, my mission through starting Wall Street Mastermind—the original and premier Wall Street coaching program since 2018—is to help our students secure the highest-paying, most prestigious jobs on Wall Street.

Connect with me

📍Linkedin www.linkedin.com/in/samshiah/

📍Youtube www.youtube.com/@SamShiahTalksFinance/

📍Instagram www.instagram.com/wallstreetmastermind/

Talk to our team to get help with your investment banking recruiting process


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