Consulting vs. Banking: Which Industry is Right for You?

Written by Sanjana Kucheria

It’s recruiting season, and with recruiting season comes sharp suits, the clacking of heels and murmurs of company presentations occurring later that day.

“Will you be going to the Goldman presentation tonight? It’s firm-wide,” a student asks. “I’ll be going to the Deloitte consulting presentation instead” another student responds.

Resumes in hand, business cards readily available, these students enter these information and networking sessions with big ideas and even bigger dreams of the prestige that these top tier companies bring.

More emphasis and concern has not been placed on career choices than this time of the year when students, especially juniors and seniors, grow anxious over recruiting and networking with employees of investment banks, accounting firms, consulting firms, PR firms, and many others.

While a majority of Stern students concentrate in finance, there is certainly a going debate between a career choice. The answer to the question, “consulting or i-banking” is an endless one. Of course, the other business fields and areas of expertise are not to be discredited, yet consulting and investment banking seem to be on two sides of the same coin.

What draws some Stern students to consulting? Tim Spencer, a senior in the BPE program, believes in seizing opportunities. “For me, when looking at most career paths, it’s about what opens the most doors while closing the fewest”, said Spencer

While recruiting, Spencer kept an open mind and recruited for all positions including investment banking positions, government-type positions, and start-up positions, yet he decided that consulting was the best choice for him as someone who had varied interests and was not sure what he wanted to do in ten years.

The skills gained as a result of consulting are much more applicable to every industry, finance and non-finance. While students will learn how to do financial models in consulting, though not quite in depth as banking, they will gain skills that can be applied to a variety of situations. “To give you an example, the overarching thing you learn about in consulting is business models – what works, what doesn’t, and that itself can be applied to absolutely anything”, said Spencer.

So what then draws students to investment banking?  Christopher McLaren, a senior concentrating in Finance and Management, worked at Rothschild over the past summer doing Mergers and Acquisitions, and now has a full time offer to the company.

“For me, one of the things that really interested me in the field was that, while it is fairly specialized in that you learn a trade in mergers and acquisitions or restructuring, you get to see a lot of different companies, and it provides a lot of opportunities just to see businesses and different business situations”. For McLaren, this was especially ideal because he was uncertain as to what he wanted to do after graduation, and investment banking seemed like a choice in which the skills gathered are transferable later on in students’ careers.

The difference really seemed to come to the level of understanding. The level of understanding in banking is more financial whereas in consulting it seems to be more about seeing and analyzing the operations.

Vijay Sumal, a recent graduate from the Stern School of Business with a double concentration in Marketing and Finance had the opportunity to experience both investment banking as a summer analyst and now works full time as a consultant at Deloitte. For both Sumal and Spencer, a major concern was a lack of work-life balance that came with investment banking. “While investment banking is really interesting, I value seeing my friends and family, and my life out of work, so that’s why I wasn’t keen on continuing it full time because I realized over the summer that I worked at McCoy, I did not have enough time outside of work,” said Sumal. As far as exit opportunities go for investment banking, they seem to lead more towards private equity firms and hedge funds, places that would be a little harder to get into from consulting. “The best thing about both of these jobs is that you get a wide experience about a lot of different things and industries like energy, technology, media, or strategy and M&A,” said Sumal.

While it seems common for students at Stern to enter investment banks straight out of college, there is a growing voice that is leaning towards consulting. Of course, neither consulting nor investment banking is superior than the other, but the decision comes down to what students are looking to get out of their career.