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How to Become an M&A Analyst

Kison Patel
CEO and Founder of DealRoom
Kison Patel

Kison Patel is the Founder and CEO of DealRoom, a Chicago-based diligence management software that uses Agile principles to innovate and modernize the finance industry. As a former M&A advisor with over a decade of experience, Kison developed DealRoom after seeing first hand a number of deep-seated, industry-wide structural issues and inefficiencies.

CEO and Founder of DealRoom

The presence of so many investment banks in the list of the companies that receive the most applications from recent grads confirms something we already suspected: M&A analyst roles are among the most in-demand of any for college graduates.

With the help of M&A practitioners at M&A Science, we look at the ins and outs of the role of M&A analysts, and what you’ll need to find your way to the top of the applications.

What is an M&A Analyst?

An M&A Analyst is the most junior role at an investment bank or the M&A department of an organization involved in mergers and acquisitions.

What does an M&A Analyst do?

An M&A Analyst assists more senior investment bankers in the early stages of M&A deals.

The M&A Analyst is usually an all-rounder that takes on a range of roles. Typical tasks include:

Valuations

Valuations are the bread and butter of M&A Analysts. These days, there is simply no way that someone will gain an M&A Analyst role without at least some capability in company valuations. A good chunk of the M&A Analyst’s time is therefore tied up in Excel spreadsheets.

Check out our list of the best M&A valuation courses to help you further your valuation skills.

Research

Investment memorandums tend to be full of information from databases and online sources such as Thomson Reuters Datastream and Capital IQ. The M&A analyst will often be responsible for retrieving and organizing this information for M&A associates.

Analysis

Analysis is a broad term, but accurately describes much of what the M&A Analyst does. The list is long here but includes an analysis of a company’s recent quarterly reports, an analysis of a company’s industry peers, an analysis of industry reports, and an analysis of previous transactions in the client company’s industry segment.

Investment memorandums

Although investment memorandums are usually the responsibility of M&A Associates, certain aspects will be delegated to M&A Analysts. The ability to communicate well, both written and orally, is central to the career progress of the M&A Analyst.

How do I become an M&A Analyst?

Because of the number of applicants that investment banks receive on an ongoing basis, becoming an M&A Analyst can be a considerable challenge, but not an insurmountable one.

In a catch-all answer, the best way to become an M&A Analyst, whether or not you’ve completed a relevant degree (more of which later), is to be prepared. That means ensuring you tick all of the hard skills and soft skills boxes mentioned in the previous section.

On a more practical level, becoming an M&A Analyst involves:

  • Applications: Send as many applications as possible, refining the message about what a good candidate you are. The blue-chip investment banks have grueling application processes designed to fend off casual interest. Use them as preparation for interviews, even if you’re not called to interview with them, as the questions remain relevant.
  • Interviews: If called to interview, you can expect a minimum of three interviews - one with an HR chief, one with a mid-level investment banker, and one with a senior banker and/or president. There is also a good chance you’ll be given a test of some form, which is likely to involve an aspect of accounting and valuations.
  • Open days: If you’re still in college, many investment banks will run open days, whereby they present their offering to students, outlining what they can expect by working at the banks. These are typically only held by big banks in more high-profile schools, but there’s nothing to stop you from gatecrashing (they’ll admire you for it, even if the school won’t).
  • Networking: The ability to network is highly valued in investment banking, so don’t be shy about getting on LinkedIn, and sending some direct messages to relevant people in the industry. Focus on people hiring in the industry rather than the dealmakers themselves, and put yourself top-of-mind for their next hiring round.

What education do I  need to become an M&A Analyst?

The biggest quantity of M&A Analysts are pulled from a handful of college majors - business, economics, finance/accounting, mathematics, and engineering. There are exceptions, however.

For example, investment banks with a specialty in a certain industry will often pluck M&A Analysts from those industries for the valuable insights that they provide. But they’ll need to get to grips with accounting and valuation fast.

If you’re looking to become an M&A Analyst but you haven’t graduated from one of these disciplines, your best bet is to complete a professional qualification, whilst honing the skills required to become an M&A Analyst. A good place to start would be a CPA qualification or better still, becoming a CFA holder. This is likely to be a 2-3 year journey, but there’s nothing to stop you from applying for roles after passing the first level.

Check out the M&A Career Path to see what lies beyond the analyst role.

Day in the life of an M&A Analyst

The typical day of the M&A Analyst will depend to a large extent on how many deals the bank is working on, and what stage each of those deals is currently at (i.e., the beginning of the process, due diligence, close to closing, etc.). A general outline of the M&A Analyst’s day might look something like the following, however. Note that we’ve included a 12-hour day, as this is close to being an average day for most at this stage of their investment banking careers.

  • 8 am: Arrive at work. Check emails received overnight, and address any issues raised in those emails.
  • 9 am: Work on a valuation for a client to be presented in the afternoon. The latest iteration may include some new detail on the cost of capital or growth projections that need updating.
  • 10 am: Present valuation to M&A associate, who will be joining the client meeting. You explain the rationale for some of the decisions taken in the valuation.
  • 10.30 am: You return to work on an investment memorandum in conjunction with a different M&A associate. They’ve already sent you a mail outlining what’s expected from you.
  • 12.30 pm: You receive a call from the team presenting the valuation telling you that they’ve changed some of the assumptions, so the presentation needs to be updated.
  • 1 pm: Lunch with colleagues at a local diner.
  • 2 pm: You return to work on the investment memorandum that you were working on in the morning.
  • 3 pm: A VP has an important meeting with a prospective client tomorrow morning (“sorry that it’s last minute”) and wants you to pull up some relevant data - recent deal multiples, industry trends, and anything else that he should be aware of going into the meeting. This will take a while.
  • 5.30 pm: After their meeting with a different client, the team returns to you with some questions for the client that involve your input.
  • 7 pm: You use the last hour of work to finish various tasks that you were drawn from during the day, and answer some emails, telling colleagues that ‘it will be on your desk first thing in the morning.’
  • 8 pm: You check out of the office for the final time today.

M&A Analyst Salary Information

An M&A analyst's salary is one of the highest of any graduate starting their first post-college position. Furthermore, it also leads to extraordinarily well-paid positions further up the investment banking pecking order.

The table below outlines the salary progression that the M&A Analyst can expect:

M&A Analyst Interview Questions

In a previous article, DealRoom looked at the M&A Analyst interview process in some detail.

This article provides a good primer for anybody looking to prepare for the interview, and what questions they should look out for.

A good place to start is by breaking the components of the interview into four separate sections:

  • Technical questions
  • Valuation questions
  • Due diligence questions
  • Know the company

By doing this, you do not give yourself a better chance of seeing in which areas you’re the weakest (for most people, it’s the technical questions), and spending more time on preparing for the questions which could arise in those areas.

Continuing Education for M&A Analysts

Whether you’re already an M&A Analyst or one of the many looking to get on the investment banking ladder, it’s a good idea to complement your college studies with some thought leader material.

M&A Science has a rich trove of materials for the M&A profession, covering everything from deal origination to negotiation tactics, and how to time deals well. This material is provided by experienced industry experts and is updated on a regular basis.

How do I find a job as an M&A Analyst?

Resilience is key when looking for a job as an M&A Analyst. This is borne out by the number of rejection letters that even some of the most senior investment bankers received before eventually being accepted.

Not everyone starts at a blue-chip investment bank. And it’s silly to limit yourself to these top-tier banks when there are so many opportunities elsewhere.

In this regard, the best ways to find jobs as an M&A Analyst are:

1. LinkedIn/Job sites

Use filter criteria for M&A Analyst that sends relevant new jobs to your inbox every day.

2. Company websites

Spend time on investment banks’ websites, getting to know their culture, their deals, and where they’re located. Many accept direct applications, so don’t be afraid to apply when you feel you’re ready to interview.

3. Networking

Networking is a powerful tool, but so rarely used by junior applicants. It’s a difficult balance to strike between coming across as desperate and merely wanting to look keen. Experiment with a few banks you’re not entirely interested in, hone your networking skills with their HR managers, and you may even find yourself in an M&A Analyst role by chance.

Wrap up

Becoming an M&A Analyst is the path to a challenging and rewarding career. The growth of M&A transactions over the past decade suggests that this is a career that continues to provide new opportunities to those looking to enter the industry.

Visit M&A Science, use all of the materials at your disposal, and you’ll maximize your chances of capitalizing on those opportunities as they arise.

The presence of so many investment banks in the list of the companies that receive the most applications from recent grads confirms something we already suspected: M&A analyst roles are among the most in-demand of any for college graduates.

With the help of M&A practitioners at M&A Science, we look at the ins and outs of the role of M&A analysts, and what you’ll need to find your way to the top of the applications.

What is an M&A Analyst?

An M&A Analyst is the most junior role at an investment bank or the M&A department of an organization involved in mergers and acquisitions.

What does an M&A Analyst do?

An M&A Analyst assists more senior investment bankers in the early stages of M&A deals.

The M&A Analyst is usually an all-rounder that takes on a range of roles. Typical tasks include:

Valuations

Valuations are the bread and butter of M&A Analysts. These days, there is simply no way that someone will gain an M&A Analyst role without at least some capability in company valuations. A good chunk of the M&A Analyst’s time is therefore tied up in Excel spreadsheets.

Check out our list of the best M&A valuation courses to help you further your valuation skills.

Research

Investment memorandums tend to be full of information from databases and online sources such as Thomson Reuters Datastream and Capital IQ. The M&A analyst will often be responsible for retrieving and organizing this information for M&A associates.

Analysis

Analysis is a broad term, but accurately describes much of what the M&A Analyst does. The list is long here but includes an analysis of a company’s recent quarterly reports, an analysis of a company’s industry peers, an analysis of industry reports, and an analysis of previous transactions in the client company’s industry segment.

Investment memorandums

Although investment memorandums are usually the responsibility of M&A Associates, certain aspects will be delegated to M&A Analysts. The ability to communicate well, both written and orally, is central to the career progress of the M&A Analyst.

How do I become an M&A Analyst?

Because of the number of applicants that investment banks receive on an ongoing basis, becoming an M&A Analyst can be a considerable challenge, but not an insurmountable one.

In a catch-all answer, the best way to become an M&A Analyst, whether or not you’ve completed a relevant degree (more of which later), is to be prepared. That means ensuring you tick all of the hard skills and soft skills boxes mentioned in the previous section.

On a more practical level, becoming an M&A Analyst involves:

  • Applications: Send as many applications as possible, refining the message about what a good candidate you are. The blue-chip investment banks have grueling application processes designed to fend off casual interest. Use them as preparation for interviews, even if you’re not called to interview with them, as the questions remain relevant.
  • Interviews: If called to interview, you can expect a minimum of three interviews - one with an HR chief, one with a mid-level investment banker, and one with a senior banker and/or president. There is also a good chance you’ll be given a test of some form, which is likely to involve an aspect of accounting and valuations.
  • Open days: If you’re still in college, many investment banks will run open days, whereby they present their offering to students, outlining what they can expect by working at the banks. These are typically only held by big banks in more high-profile schools, but there’s nothing to stop you from gatecrashing (they’ll admire you for it, even if the school won’t).
  • Networking: The ability to network is highly valued in investment banking, so don’t be shy about getting on LinkedIn, and sending some direct messages to relevant people in the industry. Focus on people hiring in the industry rather than the dealmakers themselves, and put yourself top-of-mind for their next hiring round.

What education do I  need to become an M&A Analyst?

The biggest quantity of M&A Analysts are pulled from a handful of college majors - business, economics, finance/accounting, mathematics, and engineering. There are exceptions, however.

For example, investment banks with a specialty in a certain industry will often pluck M&A Analysts from those industries for the valuable insights that they provide. But they’ll need to get to grips with accounting and valuation fast.

If you’re looking to become an M&A Analyst but you haven’t graduated from one of these disciplines, your best bet is to complete a professional qualification, whilst honing the skills required to become an M&A Analyst. A good place to start would be a CPA qualification or better still, becoming a CFA holder. This is likely to be a 2-3 year journey, but there’s nothing to stop you from applying for roles after passing the first level.

Check out the M&A Career Path to see what lies beyond the analyst role.

Day in the life of an M&A Analyst

The typical day of the M&A Analyst will depend to a large extent on how many deals the bank is working on, and what stage each of those deals is currently at (i.e., the beginning of the process, due diligence, close to closing, etc.). A general outline of the M&A Analyst’s day might look something like the following, however. Note that we’ve included a 12-hour day, as this is close to being an average day for most at this stage of their investment banking careers.

  • 8 am: Arrive at work. Check emails received overnight, and address any issues raised in those emails.
  • 9 am: Work on a valuation for a client to be presented in the afternoon. The latest iteration may include some new detail on the cost of capital or growth projections that need updating.
  • 10 am: Present valuation to M&A associate, who will be joining the client meeting. You explain the rationale for some of the decisions taken in the valuation.
  • 10.30 am: You return to work on an investment memorandum in conjunction with a different M&A associate. They’ve already sent you a mail outlining what’s expected from you.
  • 12.30 pm: You receive a call from the team presenting the valuation telling you that they’ve changed some of the assumptions, so the presentation needs to be updated.
  • 1 pm: Lunch with colleagues at a local diner.
  • 2 pm: You return to work on the investment memorandum that you were working on in the morning.
  • 3 pm: A VP has an important meeting with a prospective client tomorrow morning (“sorry that it’s last minute”) and wants you to pull up some relevant data - recent deal multiples, industry trends, and anything else that he should be aware of going into the meeting. This will take a while.
  • 5.30 pm: After their meeting with a different client, the team returns to you with some questions for the client that involve your input.
  • 7 pm: You use the last hour of work to finish various tasks that you were drawn from during the day, and answer some emails, telling colleagues that ‘it will be on your desk first thing in the morning.’
  • 8 pm: You check out of the office for the final time today.

M&A Analyst Salary Information

An M&A analyst's salary is one of the highest of any graduate starting their first post-college position. Furthermore, it also leads to extraordinarily well-paid positions further up the investment banking pecking order.

The table below outlines the salary progression that the M&A Analyst can expect:

M&A Analyst Interview Questions

In a previous article, DealRoom looked at the M&A Analyst interview process in some detail.

This article provides a good primer for anybody looking to prepare for the interview, and what questions they should look out for.

A good place to start is by breaking the components of the interview into four separate sections:

  • Technical questions
  • Valuation questions
  • Due diligence questions
  • Know the company

By doing this, you do not give yourself a better chance of seeing in which areas you’re the weakest (for most people, it’s the technical questions), and spending more time on preparing for the questions which could arise in those areas.

Continuing Education for M&A Analysts

Whether you’re already an M&A Analyst or one of the many looking to get on the investment banking ladder, it’s a good idea to complement your college studies with some thought leader material.

M&A Science has a rich trove of materials for the M&A profession, covering everything from deal origination to negotiation tactics, and how to time deals well. This material is provided by experienced industry experts and is updated on a regular basis.

How do I find a job as an M&A Analyst?

Resilience is key when looking for a job as an M&A Analyst. This is borne out by the number of rejection letters that even some of the most senior investment bankers received before eventually being accepted.

Not everyone starts at a blue-chip investment bank. And it’s silly to limit yourself to these top-tier banks when there are so many opportunities elsewhere.

In this regard, the best ways to find jobs as an M&A Analyst are:

1. LinkedIn/Job sites

Use filter criteria for M&A Analyst that sends relevant new jobs to your inbox every day.

2. Company websites

Spend time on investment banks’ websites, getting to know their culture, their deals, and where they’re located. Many accept direct applications, so don’t be afraid to apply when you feel you’re ready to interview.

3. Networking

Networking is a powerful tool, but so rarely used by junior applicants. It’s a difficult balance to strike between coming across as desperate and merely wanting to look keen. Experiment with a few banks you’re not entirely interested in, hone your networking skills with their HR managers, and you may even find yourself in an M&A Analyst role by chance.

Wrap up

Becoming an M&A Analyst is the path to a challenging and rewarding career. The growth of M&A transactions over the past decade suggests that this is a career that continues to provide new opportunities to those looking to enter the industry.

Visit M&A Science, use all of the materials at your disposal, and you’ll maximize your chances of capitalizing on those opportunities as they arise.

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