Sample Co-op Trajectories:​ Business

# Co-op Blog Addendum Part Two

This part two of my addendum on sample co-op trajectories, this time for business roles. The information is relevant as of 2021. You can find part one where I talk about tech internships here and the original co-op experiences blog here.

# Accounting

This role is one of the most secure career paths to take, for now. The job, especially at the entry level, is at a high risk of automation due to the rules-based nature of the role. There are, however, many avenues one can take after one has their CPA, making this role a potential strategic stepping stone for other positions. Despite this, I would caution against taking up accounting because before you get your CPA (and in most cases even after you get your CPA), you will likely be overworked and underpaid compared to your peers in finance.

There are several paths one can take in accounting; in terms of education typically one has to attend a business school, and oftentimes having some sort of postgraduate education helps streamline the CPA certification program the Master of Accounting at UWaterloo or the Accounting Graduate Diploma at Laurier are some examples of such programs. One can also become an accountant by attending a college as well.

The largest employers of entry-level accountants are the big accounting firms (the infamous “Big 4” are Deloitte, KPMG, EY, and PwC) as well as large corporations. These firms are typically associated with the CPA program and allow one to accumulate working hours towards the CPA designation during co-op. There are various different types of accounting, the most common ones are tax and audit, but there are some cooler streams like forensic or fraud accounting. Regardless, you’ll mostly be doing grunt work (reading financial statements, checking their validity, etc) so the role doesn’t change too much at the entry level.

One thing to be cognizant of, however, is your ultimate end goal. If one stays in accounting, the career path usually starts at the bottom where you do menial and thankless work until you get your CPA, then you become a manager of people who do menial and thankless work. Finally, if you stay in a firm for long enough you might make partner or if you’re at a corporation you can get to VP. Most people, however, leave accounting after they get their CPA. In many cases these people enter finance; having a role in accounting that applies to the actual role you want afterwards can be helpful. For instance, if you want to work in investment banking after accounting then it would be immensely helpful to get a placement on a relevant team, such as transaction service advisory or something to the like.

If you’re working at an accounting firm or in the accounting division of a large company, you’ll most likely work at the local office of the firm or in the closest major city (such as Toronto or Vancouver). It’s unlikely for accounting firms from abroad to hire Canadians but it’s possible to transfer internally to a foreign country within the firm once you start work full-time.

Because the role only requires basic math, many accounting employers start hiring from the first year; accounting is one of the most widely available co-op positions earlier on. In many cases, seniority in accounting matters; one’s responsibilities during the first co-op will be drastically less than one’s responsibilities during the second or third co-op at the same company. This is why, if you’re risk-averse and don’t want to explore other career opportunities, it may be a good idea to work at the same organization for all co-op terms.

This role is also seasonal, with several busy seasons throughout the year; the busy season varies between teams so one’s co-op experience can be drastically different depending on the time of the year as well as the team.

# Actuarial Science

Actuaries apply math and stats methods to assess risk; they’re employed in various large corporations but mainly in insurance and reinsurance industries. One can think of actuaries as a more mathematical accountant. As with accounting, actuaries are at high risk of replacement by AI; many of my actuary friends have pivoted into tech, especially data science, and even those still working as an actuary have to learn how to code.

Actuaries, like accountants, also have a busy season. Actuaries typically make more than accountants (but less than tech). You'll need at least a relevant undergrad (in math, stats, etc) in order to be an actuary; you also has to take exams outside of school in order to get the most competitive jobs. The exams require extensive studying and are expensive to attempt; most companies will reimburse parts of the cost and also allow time off work for interns to take the exams so it might be wise to time your exams with your co-op terms. As with accounting CPA certification, being certified with the Society of Actuaries is crucial for career success and advancement.

Many of the actuary jobs are domestic but, unlike accounting, there are ample opportunities to work in the States during co-op. Like with tech, most of the top actuary roles will be in American cities such as NYC or Chicago and the American pay will be much higher than comparable Canadian pay. The co-op roadmap is to gain experience in Canadian insurance co-ops, and eventually land an act sci job in the States.

From my understanding, most act sci roles fall within either life, health, and pension or property and casualty insurance. Most people choose property and casualty because it pays better but some people might find life, health, and pension more interesting and exam progression is also easier on the life, health, and pension side as well.

# Operations

Operations was a sleepy field but after COVID, there has been a surging interest in hiring for operations. You won’t have to have a university degree to work in operations, in fact many colleges offer programs specifically for people who want to work in operations.

Operations is a widely varying field; I’ve heard of anything from people working on the factory grounds with hardhats, to people working with data analytics trying to optimize business processes. For most co-ops, however, it’s probably going to look like the former. Most likely you’ll have to do a great deal of ground work such as merchandising for CPG companies or walking around the factory floor for manufacturing companies; in some companies, this is almost considered a rite of passage where you learn the operations chain from the ground up.

The roles are all Canadian and the most sought after roles are often those for large corporations, such as multinational CPGs or domestic retail chains. These companies often have training programs as well as ample room for career progression once you're working full-time.

# Marketing

There are two routes to take for marketing: working at a marketing firm and working at a large company. As someone who has interned in marketing for a large company, I recommend working at a marketing firm if you prefer the more creative Mad Men type of marketing, where you create innovative marketing campaigns to impress bigwig business clients. Working at a large company, at least at the entry level, feels more like a regular business job, where you crunch spreadsheets and follow procedures. One thing to keep in mind, however, is that large companies generally hire more positions than marketing firms and generally offer better career growth for full-time hires.

You do not need a university degree to work in marketing, but having relevant courses either in university or college is a plus. While traditional print marketing is still huge, many marketing firms nowadays are pivoting into digital media, so having an understanding of SEO, digital advertising, and how to use CRM software such as Hubspot and MailChimp is critical to landing good placements.

# Human Resources

This is another role which does not require a university degree; you can also go to college or complete the CHRP certification. Again, relevant courses in school can help but much less so than Operations or Marketing.

As with marketing you can either work for a large company or for a recruitment firm. From what I’ve been told, working for a large company has to do with both acquiring human capital and managing said capital, and much of the time is spent on clearing internal organizational processes, such as assessing internal transfers and completing paperwork. Recruitment firms are focused solely on acquiring human capital for their clients and oftentimes it can feel like a sales job, such as cold-emailing potential applicants and messaging strangers on LinkedIn. Working as a recruiter both for a large employer or for a recruitment firm is generally more desirable as the full-time pay will be based on bonus or commission, usually a percentage of the salary of the role you helped place, which can become very lucrative.

Working for a tech or finance company or a recruitment firm whose clients are tech and finance companies is the optimal move. This is one of the fastest-growing and most lucrative areas of recruiting, especially tech. Executive recruitment is also lucrative but it’s unlikely that an entry level recruiter will be assigned to such a role. Acquiring skills such as using HRM software such as applicant tracking systems can increase your value as a recruiter. Furthermore, if you acquire some technical skills such as basic programming or finance and becomes a technical recruiter, then your value (and compensation) will increase drastically.

# Sales

This is one of the oldest professions in business and requires little to no formal education. From what I understand, grit and perseverance trumps a university degree. Soft skills such as understanding and getting along with people are crucial; being extroverted and being talkative are common traits I’ve noticed in successful salespeople.

Entry level sales is brutal from what I’ve heard; you should expect to do menial tasks such as cold-calling, cold-emailing, or cold-messaging potential clients. You will most likely get rejected or ignored countless times and what little leads you generate will be passed onto full-time salespeople. For most people this will be soul-crushing, but for some, this is experience on getting thicker skin. You may also be expected to do many customer service tasks such as fielding client complaints.

Tech sales is one of the most lucrative and fastest-growing areas of sales, in particular enterprise tech sales. Having some technical knowledge on the product will be immensely helpful and having knowledge of CRM software such as Salesforce is a massive plus. The top sales jobs, such as working for big tech companies, are competitive, so networking outside of school is crucial to landing them.

Another lucrative area of sales is real estate, although there aren’t many real estate co-op placements. There are some certifications you can get as well as some real estate specific programs in some colleges.

# Administration

Administrators also do not need any formal education; while administration is one of the easiest co-op placements to land, I would highly recommend against doing an internship as an admin. Many traditional aspects of the role, such as file management, are increasingly being digitized and automated.

# Project Management

I’ve covered PM roles in tech but there are also more traditional product/project management roles in non-tech businesses. They can range from planning for projects for legacy industries such as construction or manufacturing, to managing a product line for a CPG company. The responsibilities for a co-op can vary greatly depending on the industry or company so doing due diligence is warranted.

# Consulting

Business consulting is one of the most popular career choices for business school grads as you'll get to work on interesting and often impactful problems, get compensated very well, and travel frequently for work. The exit options into fields such as private equity and business strategy for large companies, are also very desirable. There are many notable consulting firms, many with a niche, such as Accenture for IT consulting. For generalist firms, the “Big 4” accounting firms hire many consultants but the top consulting internships are with the “Big 3” consulting firms (BCG, Bain & Company, and McKinsey & Company) and the in-house strategic teams of large corporations such as George Weston.

Consulting jobs are some of the most competitive out of business roles and demonstrating strategic thinking skills by winning case competitions or having some sort of extraordinary background such as knowing how to code or having a competitive hobby can help you stand out from the rest. The interviews will most likely be verbal cases, where you'll be tasked with solving a business problem verbally with the hiring managers; understanding the case method by repeatedly doing cases is probably the best way to prepare. There are also some books you can read and courses you can take but experience is the best way to learn.

Consultants typically have an industry that they’re very knowledgeable on; while it’s important to be broadly knowledgeable, having some specialized knowledge can help greatly in landing a role and also receiving a return offer for full-time. It's important to know that consultants are service roles, meaning they'll have to serve their clients. I have heard anecdotally of some nightmare engagements where the clients are rude or choose to disregard the recommendations put forward by consultants.

As with accounting, many people treat consulting as a stepping stone to another role; having a career goal and expectation on how long you plan to remain in consulting matters greatly. If you stay at a consulting firm, you can expect to progress through the ranks to manager (where you'll manages teams and client engagements) and eventually make partner; many people also have lucrative exit opportunities along the way, such as being an in-house strategist for large companies (oftentimes former consulting clients) as well as exiting to high finance. Being strategic with your consulting internship is crucial; for instance, if you want to work in venture capital after consulting, then you should aim to be placed on assignments related to tech companies or mergers and acquisitions.

# Finance

Along with consulting, finance yields most if not all the other competitive business placements. I’m also most intimately familiar with finance co-ops as I’ve completed many of them myself. Before diving into the specifics, it’s important to understand some of the distinctions.

# Front vs Back Office

An important distinction to make is front vs back office. Front office roles are those which are revenue-driving and usually client-facing while back or middle office encompasses roles which support and make front office roles possible. Back office roles are in many cases just normal business roles such as accounting, IT, or operations but at a finance organization.

Due to the front office roles being the revenue-center in finance organizations, they’re in many cases more prestigious and better compensated than their middle or back office peers within said organizations. They also tend to be more stressful, have less job security, and offer worse working hours and work-life balance. The section on finance roles will focus on front office positions as they’re the roles dealing solely with finance.

# Buy Side vs Sell Side

The buy side refers to firms whose role is to allocate capital and acquire securities and assets. Buy side includes firms such as hedge funds and pension funds. The sell side refers to firms who issue or facilitate the transaction of securities and assets. Sell side includes brokerage firms and investment banks. With regards to co-ops, there tends to be more sell side roles available but many of said sell side roles, such as investment banking, are some of the most competitive placements to land as they’re excellent stepping stones into other roles, including buy side roles.

Both sides require similar skills for a co-op, such as financial modeling, and both sides value similar things from applicants such as relevant courses in school and relevant extracurricular activities. Said activities include participating in one’s school’s finance clubs and societies and running the university’s in-house investment fund if available.

There are some organizational differences between the two; buy side firms tend to have flatter organizational structures while sell side firms tend to have more hierarchy, this is especially the case with investment banking. There are also some semantic differences; in buy side firms, one typically starts as an associate and works their way up to an analyst, while in sell side firms, one typically starts as an analyst and works their way up to an associate. In buy side firms, due to the lack of hierarchy, career advancement is more idiosyncratic and based on performance (and luck) whereas for many sell side firms, there are more fixed advancement tracks for entry-level personnel.

Each firm has a different approach but typically buy side roles tend to require tasks that are more open-ended, such as analyzing a company by building models and interviewing management, whereas for the sell side (at least for internships), the roles tend to be more organized, requiring tasks such as making specific models or PowerPoints. Buy side firms generally have better work life balance and workplace culture, but one is often expected to be self-driven while sell side firms tend to have a more stressful culture for interns, including sending interns to do tasks such as picking up coffee or work well past midnight. You can think of buy side work as a marathon, where you'll be at 80% capacity consistently, while sell side work is more akin to a sprint, where you'll be close to 100% capacity for periods of time but have downtime in between such periods. Buy side is also much better with weekends, whereas most sell side jobs will expect full working hours on at least one of the weekend days.

The upside is that sell side intern pay is usually higher than buy side intern pay but full time pay for both buy side and sell side are similar for entry positions; entry buy side full-time roles tend to have a higher base salary while entry sell side full-time roles tend to have a higher bonus, so the two roughly equal out at the end, with a slight advantage to entry sell side analysts. Buy side pay can be widely varying depending on the firm, however, so certain entry buy side roles can pay much more than the sell side banking pay bands. Buy side tends to offer more career advancement opportunities, including a higher pay ceiling, so many people tend to leave the sell side after a couple of years to work on the buy side.

Job security for interns is the same for both, because it’s too much trouble to fire them and they’re relatively cheap to employ. For full time roles, however, while entry-level roles for both buy side and sell side are relatively safe, anecdotally, buy side generally offers better job security due to the generally smaller team size (and hence the relative importance of each member of the team). I have heard of some banks letting juniors go due to financial issues, but I have yet to hear of juniors at investment firms being let go without cause.

For co-ops and interns, most of the buy side firms (except pensions funds, insurance asset management, and bank asset management) are typically too small to have a formal recruitment funnel like the banks. The lack of formal recruitment funnel means that while many firms hire interns consistently, there are much less buy side internship job postings and having professional connections matters greatly more to secure those positions.

In essence, buy side entry roles focus mainly on finance, in particular using numbers to uncover the truth; sell side entry roles focus on sales but with a financial focus, in particular using numbers to tell a story in order to push more products and services. There are also roles, such as corporate finance, which don’t fall cleanly into the two categories.

# Deals vs Markets

Generally, finance roles deal with one of two categories of transactions, deals (private) and markets (public). Almost all types of companies receive financing through the two methods; private deals tend to have a longer time horizon than public transactions due to private deals’ illiquidity, but some public transactions can last a long while also.

Deals tend to rely on relationships and they are more idiosyncratic while public markets are fast-moving and the frequency of transactions is typically higher. While the two can require similar skill sets for an intern, the roles quickly become more specialized and people tend to remain within their respective streams. For instance, investment bankers, when transitioning to the buy side, typically work in private equity due to PE’s deals-based nature.

The work-life balance mirrors that of buy side and sell side; public markets tend to be a marathon while deals tend to be sprints with rest inbetween. Furthermore, also akin to buy side versus sell side, public markets tend to be less hierarchical than deals.

Another important consideration is the Chartered Financial Analyst certification; for people working in public markets the CFA is a big plus but it’s less crucial for people working with private deals, as each deal can drastically vary and skill comes largely from experience.

Here’s a quick summary of the generalization of different career options:

Working hours is self-explanatory and is a measuring stick for related work metrics such as job stress. Hierarchy determines the layers of bureaucracy at a firm; for entry-level personnel, firms with low hierarchy means you'll get more responsibilities, more autonomy, and more open-ended assignments, while firms with high hierarchy means you'll get more specific responsibilities and assignments. More hierarchy can also mean more bureaucracy and more organized career progression for entry-level full-time employees.

Quick Generalization of Entry Finance Roles	Buy Side	Sell Side
Deals-Based	Examples: Private Equity, Venture Capital Hours: Moderate to Long Hierarchy: Moderate	Examples: Investment Banking, Debt Capital Markets Hours: Long Hierarchy: High
Markets-Based	Examples: Hedge Funds, Mutual Funds Hours: Moderate Hierarchy: Low to Moderate	Examples: Sales & Trading, Equity Research for Banks Hours: Moderate Hierarchy: Moderate

Here are some of the more common specific roles in finance:

# Quantitative Analyst/Researcher

One of the best ways to guarantee high pay is to have a differentiated skillset, something that is very difficult for entry-level finance (unless you have family members in senior positions within the organization). Everyone tends to take the same courses in school and participate in the same extracurriculars and as a result, soft skills tend to be the differentiating factor between candidates and actual financial skill only differ in the margins.

One concrete way to differentiate oneself is to learn code; I’ve written about quants in my blog about tech co-ops. Algorithms are automating (and improving) upon many aspects of finance, primarily within public markets at the moment but increasingly in private markets as well. There’s an acute shortage of competent personnel to research, design, and implement systems for these algorithms. I won’t lie; the learning curve will be steep, especially for non-technical people. With enough perseverance and initiative (taking courses outside of school or pursuing post-graduate degrees), it’s certainly possible for a finance professional to learn the additional skills to be a quant.

# Corporate Finance

Corporate finance is concerned with how a business operates financially and focused on maximizing revenue while minimizing costs. It also deals with the day-to-day financial operations of the business, such as managing the capital structure. You can almost think of corporate finance as a strategic accountant.

Mostly only large companies hire corporate finance co-ops and for many of the roles, the responsibilities are akin to that of an accounting role and in fact, many company’s finance internships qualify for CPA hours. Some companies, however, give corporate finance interns more decision-making responsibilities and those are the roles you should look for in corporate finance.

There are also more niche finance-related roles in large corporations, such as investor relations, which is a role for liaising with bondholders and shareholders, but the vast majority of the co-op positions will be for general corporate finance roles.

# Sell Side

# Investment Banking (IB)

This is one of the most sought-after and prestigious roles on the sell side. Investment bankers are concerned with raising capital as well as facilitating services such as mergers and acquisitions (M&A) for their clients (mainly corporations). This role is sought after because it’s one of the highest-paying entry-level roles in finance and it often confers credibility for exits into other prestigious roles.

Most of the co-op roles will be from large banks, and the amount of co-ops (as well as entry-level full-time roles) will be cyclical, as investment bankers tend to have more work during bull cycles and less work during bear cycles. The most lucrative and prestigious opportunities will largely come from working at a bulge bracket (very large and well-known) bank such as Goldman Sachs or Morgan Stanley as the reputation of a bank helps drive business and deals.

There are smaller banks such as Houlihan Lokey and Jefferies who focus on mid-market deals (deals for less than $500 million). These banks are generally thought of as less prestigious than the bulge brackets and compensation for entry-level personnel will also be less than the bulge brackets. Internships at these banks, however, will be less competitive to land and it’s possible that interns can get more responsibilities due to the potential smaller teams.

Finally, there is a class of elite boutique banks that focus mainly on core investment banking activities such as M&A and corporate restructuring. This means that, unlike bulge brackets such as Bank of America Merrill Lynch and JPMorgan Chase which have complimentary businesses outside of core investment banking (lending, commercial and consumer banking, etc), elite boutiques are often much leaner (less personnel) and they have small balance sheets (they don’t hold alot of capital themselves and in many cases they don’t have a full capital markets team). Due to the fact that these elite boutiques don’t have a large balance sheet, they usually don’t offer services such as IPO origination and underwriting. Top boutiques include Centerview Partners and Evercore; oftentimes boutiques tend to have a field of specialty that they focus on, such as the tech industry for Qatalyst Partners. The boutiques don’t hire as much as the bulge brackets and are oftentimes unknown outside of the finance industry; despite this, these elite boutiques offer some of the entry-level roles with the most responsibilities as well as the highest compensations.

The best place to work as an investment banker is by far NYC, followed by other international financial centers such as London, as the top banks and activities will be centered around those locations. It’s very difficult, however, to land those placements from Canada without prior experience or close direct connections (alumni network, family connections, etc). It is thus advisable to first work and accrue experience within Canada before attempting to go abroad. While many bulge brackets, and even some elite boutiques have satellite offices in Canada, the top employers in Canada are the big five banks: RBC, TD, Scotiabank, BMO, and CIBC. Within said banks, investment bankers are split into groups, often along industry lines, such as media and telecom, and technology. Certain groups within certain banks get more dealflow (more learning and experience opportunities for entry-level positions); RBC’s M&A team and BMO’s Minerals and Mining team are notable examples. You'll most likely work in Toronto where many of the banks have a headquarter; you can also work at a satellite office, such as in Vancouver, Montreal, or Calgary but career development and networking are much more limited in those cities.

If you do decide to pursue investment banking, you ought to be prepared for long and grueling hours. Recently many banks have been trying to lighten their work atmosphere by enforcing mandatory time off or limiting working hours but the effects are questionable. You will get worked to the bone in banking; forget 9 to 5, you will be working 100 hour weeks with few weekends and as an intern, you’ll be tasked mainly with menial tasks such as making PowerPoints and pulling comparable company datasets. Yes, investment banking is one of the higher paying entry-level jobs but you have to consider whether it’s worth the opportunity cost to sacrifice most, if not all of your free time (which you would otherwise be able to use to pursue other interests) as well as some of your peak productive years to pursue the high pay. The tradeoff is that you receive a prestigious title on your resume (if you work at a prestigious bank) and a solid network for exit options (again, only if you work at a prestigious bank).

The majority of people entering investment banking stay only for a year or two before leaving for an exit option; popular exits include private equity as well as corporate finance.

# Corporate Banking

Corporate bankers often work in the same large banks as investment bankers and while the two divisions oftentimes work closely together, corporate banking is much less transactional and corporate banking is focused on helping clients with ongoing concerns such as risk management and offering lines of credit.

Entry-level corporate bankers also make a lot of PowerPoints but due to the long-term nature of the relationship with clients, much of their job will be updating existing models and presentations. As such, corporate bankers work less than investment bankers; they still work more than a normal 9 to 5 but not by much.

Corporate banking is considered to not be as prestigious as investment banking and the pay and exit options are both worse, but it could be a compromise for someone who wants to work on the sell side but doesn't want to sacrifice their entire existence to work.

# Sales and Trading (S&T)

S&T is one of the core functions of a large investment bank; I’ll break down the category into two: sales and trading.

Sales is self-explanatory; the role focused on selling products and services to clients. As with most sales roles, job security is not ideal but there is the chance of making large bonuses with good quarters. Institutional finance is still relationship-based, so a great deal of a salesperson’s job for a bank is building and maintaining client relationships. The role isn’t as extravagant as it used to be due to new compliance rules and limitations, but top salespeople still receive massive budgets to wine and dine clients.

Trading at a bank is primarily for executing a client’s wishes; traders help facilitate client demands by buying and selling assets for their clients as well as offering services such as hedging and providing liquidity. Clients can be large corporations or investment firms. Traders at a bank don’t aim to make money through trading directly but through commissions on the trades they execute, usually a small percentage of the trade volume that traders add to the transaction (often denominated in basis points, or bips, which are equal to 0.01%). For trading, back when everything was done physically or over the phone, it used to be that you needed to be tall and have a loud voice to be a good trader. Nowadays, with the speed and scope of electronic trading, traders today often have advanced degrees in areas such as mathematics and econometrics. Of course, the degree of sophistication in trading depends on the specific asset class and market being traded. Oftentimes, traders are split into different desks on the trading floor, each desk has a specific asset class they specialize in, such as equities or forex, or a specific geographical region, such as LATAM or EU. The culture and day-to-day activities of each desk can greatly vary. For instance, for more complex assets such as derivatives, the desks tend to be more cerebral, as pricing and creating derivatives often require complex math, whereas desks trading fixed income tend to be more client-facing, as fixed income is still a largely relationships-based business.

Sales and trading are often bundled together as the two roles work intimately together; usually salespeople sell to their clients and traders execute the sales. In many cases, S&T roles can be a mix of both selling and trading.

In terms of internships and co-ops, the experience and expectations can greatly vary. Unlike in the past, where formal education was optional, most banks expect some form of post-secondary education. For sales-heavy desks, soft skills matter more than the degree you’re pursuing, however, for highly technical desks, having or pursuing a math-heavy degree is often a prerequisite. Unless you work on a highly technical desk, interns and co-ops will most likely be focused more on the sales side of the operation rather than actual trading. By sales I don’t mean glamorous galas and fancy dinners for clients; for interns, sales means manning the phones, answering client questions, and supporting traders by performing basic analysis or by grabbing coffee.

It’s also important to note that S&T often have a more crass and more brunt culture compared to investment banking and traders are known to make offside jokes and banter. Unlike investment banking, S&T typically have long, albeit fixed working hours; oftentimes traders have to start their day early to prepare for the market opening but some desks, such as FX, may need to work around the clock. Most traders I know also get their weekends off.

Entry-level S&T will generally make less than investment banking because the bulk of a trader’s salary will be from their performance bonus and entry-level personnel don’t have as many opportunities to earn for the firm. There also isn’t as much organized career mobility as the investment bankers earlier-on but later on, depending on a one's luck and skill, top traders can earn multi-million dollar bonuses. The downside of easy to measure performance is that traders often have less job security than their investment banking peers; a couple quarters of bad performance, either caused by market conditions or by other members of your desk may jeopardize your bonus and potentially your career.

While investment bankers often exits to deals-based buy side positions, there’s less of an obvious exit path for traders. Many traders remain in the banking industry their entire careers.

# Equity Research

The main role of a sell side equity researcher is to write and publish thorough research reports on different companies. Typically a researcher has a coverage area, which can be an industry or even a specific company. Researchers are expected to have deep insights and a buy/sell/hold recommendation for their company's equity. It is important to know that sell side equity researchers don’t generate revenue for their firms through their analysis directly; they generate revenue through selling the research to their clients, mostly institutional investors.

Equity researchers are expected to be excellent financial modelers and good writers. Being able to think outside the box to generate novel insights will be one of the determinant factors between an average researcher and an amazing one. Equity researchers may also need to interview the directors of the companies that they’re covering, as well as liaise with their institutional investor clients.

Although the research is supposed to be independent, there is quite a big deal of politics that occurs behind the scene; there can be a conflict of interest between the researcher and the firm that they work for. For instance, a researcher may want to issue a sell recommendation on a company’s equity but said company may be a large client of the researcher’s firm; the researcher may then be pressured to revise their rating upwards. Due to this, while sell side research is helpful, few good buy side investors base their investment decisions solely on sell side research. Equity research is oftentimes bundled with other offerings of the bank, such as trading services. Due to the fact that few people purchase sell side research directly, while investment banking and S&T are viewed as profit centers for the firm, equity research is often viewed as a cost center for the firm.

While entry-level equity researchers make comparable amounts as their trading or investment banking peers, senior researchers make much less than their peers in trading and investment banking. Equity researchers, however, have excellent exit opportunities to markets-based buy side firms, such as hedge funds or mutual funds.

Equity research culture tends to be less stressful than investment banking or trading, with predictable busy times (such as during earnings season, the times of the year when the companies the researcher covers releases their latest financial statements). Overall equity researchers work less hours than investment bankers and around the same as trading. One upside of working in equity research is that even entry-level researchers often get visibility for their work as they’re often credited in the published research reports.

# Buy Side

# Public Markets

Public market buy side firms are firms which transact with securities on markets where almost anyone can participate, such as NYSE in the US and TSX in Canada. These firms include hedge funds and mutual funds. Many of said funds employ quantitative strategies and some funds, such as many exchange-traded funds, are passive instruments that aim to duplicate performance of market indices. These quant strategies don’t typically hire many people and the people they hire are mostly tech professionals, so for this blog, I will only focus on fundamental buy side public market roles.

Public market buy side roles are very similar to equity research roles on the sell side. The main task is to make investment recommendations on different companies or industries trading on the public markets. Public market buy side analysts will analyze and model the financial data of a company and they will try to gather supporting data through means such as purchasing it from data providers (Bloomberg, Factset, etc), and interviewing company management.

The big difference between sell side equity research and buy side public market investing is that the recommendations have direct consequences on how the firm’s assets are allocated for the buy side analyst. Many buy side analysts’ compensation will be based on the accuracy and performance of their recommendations.

Public market buy side firms do not hire many interns. This is because unlike the banks which have thousands of employees, most public market investment firms have a headcount from the tens to the low hundreds. In fact, in my first ever public markets buy side internship, there were around a dozen people in charge of managing assets in excess of $20 billion. Many people might prefer sell side internships; intern pay is generally lower in public market investment firms compared to internships at the banks and banks are oftentime better known than public market investment firms. Furthermore, there is generally also less formal organization for internships; one’s internship experience can drastically vary. The upside is that, due to the smaller team size, interns will be given actual responsibilities and will be treated like full-time employees; this means that if you're a self-driven individual with good work ethics, you can gain much more from a public markets buy side internship in terms of networking and learnings.

# Private Markets

Buy side private markets include industries such as venture capital and private equity. These investments are often long term and there is often much more work involved per investment than public markets investing. Oftentimes the data required to perform due diligence and make an investment decision won’t be publicly available; it’s an analyst’s job to hunt down data from different sources to complete the thesis, and to make assumptions where the data is incomplete. Even after an investment decision has been made, the execution of said decision is often much more complex than just buying the security on an exchange; each deal is different and legal and regulatory hurdles have to be met for the deal to go through. In many cases, after completing a deal, there is still great deal involvement with the company being acquired, which can range from running the entire company to acting as an advisor to the company.

Experience and reputation thus matters a great deal in private transactions; this is why it’s much more difficult to land a buy side private markets role right out of school than a sell side or even a buy side public markets role. Buy side private market pay is some of the highest in finance and the culture is very similar to that of investment banking, as most of the professionals in private markets come from investment banking. The hours will be long but will generally be a bit shorter than investment banking. If you plan on working in buy side private markets directly out of school, you'll most likely have to stand out greatly to compete against professionals with 1-2 years of experience in banking.

# Asset Management

In view of the fact that this blog post is targeted towards Canadians, it’s important to mention the large asset management industry. Asset management is a broad term and it essentially means maintaining and maximizing the value of a portfolio over time. Canada is home to some of the largest pension and insurance funds in the world; large behemoths like CPPIB and Manulife manage assets totalling hundreds of billions of dollars each.

These organizations are the largest employers on the buy side and they hire for a broad variety of mandates both in public and private markets, as well as supporting personnel such as portfolio construction and risk management. These organizations are thus excellent ways to join the buy side right outside of school. Understanding each organization, in particular their risk appetite and culture is crucial for determining the best fit for your skills and career aspirations. Some organizations, such as CPPIB, are semi-private entities that have additional constraints on both operations (especially hiring) as well as investments. Some organizations, such as OPTrust and OTPP, are private and more open to riskier investments (I’m working on a crypto mandate in my current role).

Job security is often much better in these large asset management behemoths compared to their smaller singular-focused peers. The downside is that these asset management organizations tend to be more bureaucratic than smaller firms that focus on less mandates and there is much red tape in the form of committees and processes to get things done. The pay is solid for Canada but pales in comparison to US pay as well as pay for firms which focus on less mandates. The tradeoff is that these asset management firms have near limitless resources and reach; if you are in the front office at these firms, your work will be very impactful. These firms also provide excellent learning and experimentation opportunities at the beginning of your career due to the broad scope of the mandates being deployed.

These are some of the most common roles available for co-ops and interns; the one you pick should be a role that interests you and is (hopefully) relatively automation proof. If you’re unsure about what you want to pursue, management consulting and finance are both prestigious industries that will give you more optionality after working in them; these industries also allow broad learning and critical thinking opportunities.

While this list of business roles is by no means exhaustive (I’m unfamiliar with certain industries such as law), I hope it gives you a good baseline for further learning and research.