How to Switch from the Sell Side to Buy Side – Interview

Many analysts aspire to switch from the sell side to buy side. The work is similar, but the buy side offers more rewarding work, a portfolio to measure your performance, and a higher compensation trajectory. Making this switch is competitive, especially if you have a perceived weakness going into recruiting season.

When I walked into each buy side interview, I was always ready to talk about my college major. I pursued a computer science degree and had no finance-related extracurricular activities or internships in college. I had to sell my passion for investing to each interviewer.

For Asif Khaja, the challenge was to network his way into investment banking from a non-target school. He not only broke into investment banking from a small school in New Jersey, but also successfully jumped from the sell side to buy side. Asif’s been on the buy side for 3 years now, and today he shares his recruiting experience and lessons with us. His story is inspiring to those who are looking for encouragement to make the jump to the buy side.

Interview Profile:

Asif Khaja

Asif Khaja is the Senior Analyst at a global alternative asset manager, responsible for credit investing in media, entertainment, and gaming. Prior to that, Asif was a Credit Analyst with a Connecticut-based credit fund covering the same industries. Prior to switching to the buy side, Asif was an Assistant Vice President in High Yield Research at Barclays, covering Media & Entertainment. Asif has also held various leveraged credit roles at J.P. Morgan, where he analyzed the creditworthiness of potential borrowers in broadly syndicated loan deals. He holds a B.S. degree from the College of New Jersey.


In this interview, you’ll find:

  • Concrete advice on how to switch from the sell side to the buy side.
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  • A networking action plan for non-target school candidates.
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  • How much do education credentials matter on the buy side.
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  • Essential elements to highlight on your resume.
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  • How to approach an investment pitch.


Let’s get started.

From Sell Side to Buy Side

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Buyside Focus: Tell us your story. What’s your current role?

Asif: I’m a senior credit analyst at a global alternative asset manager, where I invest in leveraged loans and high yield bonds in the media, entertainment, and gaming space. I’ve been on the buy side investing in credit for over 3 years. Prior to switching to the buy side, I spent 5 years on the sell side in various roles, both in sell side research at Barclays and in investment banking at J.P. Morgan.

Buyside Focus: You worked on the sell side for 5 years before making the jump. How did you make that jump to the buy side, and what did you find most challenging in your buy side job search?

Asif: My initial jump to the buy side was through a Bloomberg posting, and a very traditional process. I applied for a job, went through 3 rounds of interviews that ended with a case study. At the end I was given an offer.

The biggest challenge in jumping from the sell side to the buy side was conveying that I could think like a principal vs. just covering names. When you interview at buy side firms, they really focus on the idea generation portion of your role, and whether you are comfortable in sticking your neck out to recommend ideas and living with uncertainty. So conveying that was particularly challenging. The truth is that on the sell side, I wasn’t responsible for a book of investments. I didn’t really have decision-making authority. So talking through my decision-making abilities and having conviction in ideas was difficult.

Buyside Focus: What advice would you give to those on the sell side to help them get into the mindset like a principal?

Asif: As a junior person at a bulge-bracket bank, whether you are in sell side research or in investment banking, your responsibilities are predominantly about producing presentations and documents, and less about decision-making. If you have the goal of jumping over to the buy side, when working on deals or reports, make sure to understand the big picture – why this company makes sense, whether you like it or dislike it, the underlying thesis of why the company is being purchased or recommended, and additionally the risks of investing in the company.

On the investment banking side, understand the drivers for why a deal is happening, and the motivations for the parties involved, outside of your individual responsibilities. Make sure you know how value is being extracted and form independent opinions and thoughts on whether you believe the deal make sense.

On the research side, I would say the attitude is similar. If your senior analyst makes a recommendation, be cognizant of why he or she did it. Ask yourself whether you agree or disagree with your analyst, and why. When you have an idea, don’t be afraid to suggest it to your analyst. Be open to thinking about these things and use your senior analysts as resources.

From a Non-Target School to Investment Banking

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Buyside Focus: You broke into the finance industry from a non-target school. Can you talk about your education background? Was it more difficult for you to get into investment banking than to the buy side?

Asif: I went to a small school in New Jersey called TCNJ, which really had no formal recruiting process to investment banks in New York. Truthfully, investment banking was not on my radar when I was in college. When I began to consider it, my career management office suggested that I look for other career paths that are easier to get into. TCNJ had very little track record in sending people to banking.

But I wanted to give it a try. So my first step was going to schools near me like UPenn and Princeton, to attend the investment banking company presentations and to meet people. After the presentations, I followed up with contacts to build relationships. By being close to New York, I took trips into the city whenever I could, just to meet people and have informational interviews wherever they were available to me.

Eventually, I got an internship at J.P. Morgan. It was interesting because despite TCNJ not being a target school, there were a couple people who went to the bank through networking as well. I made sure to get to know who those people were and built relationships. The good thing is, when there are fewer alums who have done it, they are more receptive to helping people their school.

My overall advice for people not from target schools is that, while it’s a challenge and there’s no formal recruiting process, utilize all the resources that you have available. You have more resources than you think. Don’t be afraid to put yourself out there and ask for favors. Definitely do well in the classes that matter, and act as a leader in your extracurricular activities as well. These are the points that will distinguish you from others, especially in your networking.

Networking Tips

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Buyside Focus: At the beginning of the interview, you mentioned that location was a huge factor for you. So even though you were from a non-target school, you had the location advantage of being close to New York. How about advice for folks who are outside major metro areas? They would be networking more via emails and phone calls, so let’s talk about your experience on networking through email/phone.

Asif: I will concede that it’s more difficult to build rapport with people over phone and email. I think similar to other types of networking, if you are going to contact people through e-mail, try to use a referral if possible. People will pay attention to an email from someone referred to them by even a distant contact. I think people respond to those emails better.

In terms of over the phone – the interesting thing is that the first internship I ever got, which probably helped me to get to where I needed to go, was actually through a cold call. I was literally cold-calling people in New Jersey and finally got through to a financial adviser at Morgan Stanley in a town next to me. Sometimes people can under-rate the ability to reach the potential decision maker via cold calling.

After applying to job postings, it also helped to pick up the phone, dial the company’s general line and ask to speak to someone about the job. In some situations, people were very receptive and appreciated the initiative. It doesn’t always work, so you’d have to be willing to accept some rejections. But don’t rule it out – it’s certainly effective as long as you are prepared for the conversations when they come.

Buy Side Interviews as a Non-Target Candidate

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Buyside Focus: For buy side recruiting, was being from a non-target school also a challenge? Has that fact come up regularly in your interview? If so, how did you address it?

Asif: A lot of people in interviews did ask about my school because they’ve never heard of it. They always asked, “what made you choose it?” I spoke honestly about the reasons. But usually in asset management interviews, it’s much, much less about credentials. If you are exploring firms that invest in public equities and debt, I think it’s less relevant. If they feel comfortable with your baseline level of intelligence and aptitude, I think the conversation quickly shifts to the skills you bring to the table, the investing ideas you have, and your reaction when ideas don’t go well, etc.

While your school is something that buy side folks look at, the conversation will quickly shift to investing. So don’t be discouraged if you went to a non-target school and are trying to get into a hedge fund. As long as you have the aptitude, the conversation will quickly shift to your passion, your skill set, and your investing acumen.

Buyside Focus: So from your experience, the buy side interviews are much more focused on your actual skill set and your experience rather than your credentials.

Asif: Absolutely. You have your exceptions, but most funds are very meritocratic.

Resume Tips

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Buyside Focus: In terms of demonstrating your skills on your resume, what areas of strengths did you highlight to make yourself stand out?

Asif: When I switched firms on the buy side, I tried to highlight the good trades I’ve made. Switching from the sell side to buy side, I focused on current responsibilities that would be similar at a buy side firm. For me, it was highlighting the consistency of covering companies and pointing out the technical skills.

If you are more senior, pointing out the technical skills matters less, because people would expect that you have a certain baseline of technical abilities by then. Make sure to highlight that you can think like a principal. Highlight the times where you’ve contributed to investment decisions. Any contributions to decision-making that you can speak to will stand out.

Buyside Focus: You mentioned that as you progress in your buy side career, the elements you want to highlight changes over time. How has your role changed over time as you moved from a research analyst to a senior role?

Asif: The shift from junior to senior role is two things: the additional breadth of coverage and increased autonomy. For breadth of coverage, you’d want to highlight the sub-sectors you’ve looked at over time, and how you’ve applied general principals across different spaces.

Secondly, it’s showing that you have the autonomy and the knack for decision-making. I wouldn’t say I’m the primary decision-maker right now, but I’m an integral part of any investments in the sectors I cover. My opinions are heavily valued and my suggestions are taken into account. When I was in a more junior role, I was more the information gatherer. I was getting up to speed on names and had less comfort with pounding the table. So the things that show growth are the breadth of coverage and decision-making.

Case Study Tips

Speaker at Business Conference and Presentation. Audience at the conference hall.

Buyside Focus: Moving onto the final piece, how did you prepare for your interview case studies? Can you walk through how you found your investment idea, and how did you approach it?

Asif: From the sell side to buy side, I looked at the universe of what I covered and picked my best idea. In my cover letter, I included a short summary of the thesis to get people interested in reading more about my pitch. For the actual pitch, the first page was describing upfront the key points of why I liked the investment. It was an in-your-face, quick summary of what my thesis was. Later in the document, I give a full analysis of the business – where the business sits in its market, where the growth opportunities are, its valuation, and what the risks are.

For my initial jump to the buy side, I remember I ran the idea by my friends on the buy side. I asked them if they had suggestions on what to add or edit. I also asked them to describe their experience in pitching, in terms of what worked and what didn’t.

Buyside Focus: So having a mentor was very helpful for you.

Asif: Absolutely. Not just formal mentors, but having friends on the buy side have been helpful.

Buyside Focus: That’s all I got. Thanks for taking the time! Where can folks find you?

Asif: No problem. I hope people will find it helpful. You can find me on LinkedIn.


Asif's LinkedIn Profile

 

Takeaways:

     
  • Sell side to buy side: convey that you can think like a principal vs. just covering names.
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  • Investment banking to buy side: Make you sure understand the big picture of your past deals: why is the company being purchased, whether you agree with the thesis, and what are the risks to the deal.
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  • Networking tips: You have more resources than you think. Use your alum network and extracurricular contacts. Email and cold-call using referral, however distant.
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  • Non-target school: Education credentials matter more for investment banking, but much less for the buy side. buy side interviews focus on your investment acumen.
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  • Resume tips: Highlight that you can think like a principal, and give examples of your decision-making. For more senior roles, focus on your comfort with the breadth of coverage and increased autonomy.
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  • Case study tips: Pick a name you know well. Give a quick summary of your pitch in your cover letter. Have a friend on the buy side critique your pitch.

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