In the Business World

The following article is the eighth of a series written for the Crimson by W. W. Daly '14, University Secretary for Student Employment, on the various fields of endeavor in business open to college graduates.

Professor G. H. Palmer used to say, in discussing the Christian religion, that that was the one philosophy which affected every one of us and toward which all of us had to take a positive stand, either for or against. This same necessity is very nearly the case as regards the investment banking field as I doubt if there is a man who goes through Harvard College who at one time or another does not have it suggested to him that he enter the field of investment banking, or as it is perhaps better known--selling bonds. At a reunion, one Class advertised the fact that out of some five hundred members, four hundred and ninety-nine of them were bond salesmen.

Harvard Men Prevail

Aside from the obvious meaning of the last statement, there is a very definite reason for the prevalence of Harvard men in the Investment field. Bond selling requires certain very definite characteristics in the way of background, education, and training, most of which most Harvard men may be assumed to possess. The technical requirements at the start are nil; a man entering the field can learn whatever is required of him, and as he progresses, his actual knowledge of investments will increase in direct proportion to the amount of effort he puts into learning his subject. Above all, a certain intelligence, ability to master a subject and the ability to inspire confidence based on knowledge of the subject, are the primary requisites.

The old question of personality, of course, enters, but there again personality is such a varied attribute that it is difficult to do more than generalize on such a theme.

Personality Counts

A perusal of the list of the Classes which graduated fifteen or so years ago, and a comparison of that list with the names of men who are doing "very well" in Wall Street, State Street, and elsewhere, will show that there are many names identical on both lists; that is to say, ten or fifteen years in the investment banking field has brought success in a large way to many Harvard men.

In this field the opportunities for large earnings do not come early. The man who starts in will get probably a little less than he would in any other field. With some Companies, decidedly less. Instead of the $25.00 or $30.00 a week that Insurance or Telephone Companies offer, the novitiate in investment banking will get $15.00 to $25.00, and his chances for an increase do not make themselves manifest for something like an entire year. At the end of several years, however, his earning capacity has probably passed that of the men who have entered the other industries.

Earnings Small at Start

The reason for this is not difficult to see. At the start, the runner, messenger, or Junior clerk is doing work that requires no more intelligence than a bright boy just out of grammar school and his services are worth no more than the same bright boy. While he is performing these lowly tasks, however, he is getting the "feel" of the business, which is most essential. He is learning not only what investment banking is all about, but he is learning the way in which it ties into other industries; not only the difference between a stock and a bond, but who buys stocks and why; the meaning of speculation, long pull, and other terms which are the flesh and blood of the investment field.

He is at the same time, probably studying during the evening, or taking extension courses under the direction perhaps of men who have themselves trod the same path. Once he learns and understands the principles, he is then in a position to do a little selling, and once he reaches the stage where he can call on banks, bankers, and other investors, he will be able not only to understand their requirements and give them the service that they need and the information about securities which his House can offer, but he is also able year by year to increase his volume of business, and also to make himself materially valuable to his House.

Begins at Bottom

Once he begins to reach the point where his earning capacity is large, his income is in direct proportion to his ability to sell and to reach those who have the funds. His rewards then may become extremely large, but to a great extent they are the rewards of years spent learning what the field is all about. After ten or fifteen years a partnership, a position as department manager, or some similarly remunerative work should be within his grasp.

In addition to this sales work, there are many other functions in investment banking that are carried on by college men. Some work in the cages, statistical department and buying department often requires college men. Most frequently, however, men who start in this field are expected to start in sales work and then progress into the other fields as they develop and their abilities become more evident.