What Do Investment Bankers Actually Do?

Investment bankers are financial advisors to companies, governments, and institutions -- they help clients raise capital (by issuing stock or debt) and buy, sell, or merge with other businesses. In practice, the day-to-day work is building financial models, preparing pitch books and presentations, conducting research and due diligence, and executing transactions. The popular image of bankers shouting on a trading floor is wrong; that is sales and trading. Investment banking proper is an advisory business built on analysis, relationships, and very long hours.

This guide explains what the job really involves: the core functions (M&A advisory, capital raising, modeling, and pitching), how responsibilities shift from analyst to associate to VP to managing director, how product groups differ from coverage groups, what a realistic day looks like, and who the job is actually for.

If you are weighing whether to pursue it, pair this with our guide on how to break into investment banking.

The Core Job: Advising on Big Financial Decisions

At its heart, an investment bank sits between companies that need capital or strategic advice and the markets and counterparties that can provide it. Clients pay banks for expertise, execution, and access. That work falls into a few main buckets.

1. Mergers and Acquisitions (M&A) Advisory

When a company wants to buy another company, sell itself, or merge, it hires bankers to advise on and run the process. The bank's job includes:

Valuing the target or the client's own business.
Identifying and approaching potential buyers or acquisition targets.
Negotiating price and deal terms alongside the client and lawyers.
Managing due diligence and shepherding the deal to close.

M&A is the highest-profile work in banking and a major driver of fees. It is also where junior bankers spend enormous time on valuation models and presentations.

2. Capital Raising (Equity and Debt)

Companies need money to grow, refinance, or fund operations. Bankers help them raise it in two main ways:

Equity capital markets (ECM): Helping a company sell ownership -- for example, taking a private company public through an IPO, or running a follow-on stock offering.
Debt capital markets (DCM): Helping a company borrow money by issuing bonds or arranging loans.

In both cases the bank advises on structure, timing, and pricing, then uses its relationships with investors to actually place the securities.

3. Building Financial Models

Financial modeling is the analytical engine behind every deal. Junior bankers build models to answer questions like "What is this company worth?" and "Does this acquisition make financial sense?" The core models include:

DCF (discounted cash flow) -- valuing a company by its projected future cash flows.
Comparable companies and precedent transactions -- valuing a business against similar public companies and past deals.
LBO models -- analyzing whether a private-equity-style buyout pencils out.
Merger models -- testing whether an acquisition is accretive or dilutive to earnings.

If you want to understand these in depth, the concepts library walks through each one.

4. Pitch Books and Presentations

A huge share of junior banker time goes into pitch books -- the polished decks banks use to win business and present analysis to clients. A pitch book might lay out a valuation, a list of potential buyers, market context, and the bank's recommendation. Bankers also prepare materials for live deals: management presentations, board decks, and offering documents. Formatting standards are exacting, which is why "fixing the deck at 2 a.m." is a banking cliche rooted in truth.

Who Does What: Analyst to Managing Director

Investment banking has a rigid hierarchy, and the work changes dramatically as you climb it. Understanding this is essential before you recruit.

Analyst

The entry-level role, typically straight out of undergrad. Analysts are the builders and doers:

Build and update financial models.
Create and format pitch books and presentations.
Pull data, run research, and manage due diligence materials.
Handle the administrative backbone of every deal.

Analysts work the longest hours and do the most hands-on technical work. Hours are notoriously heavy -- commonly in the range of 70-90 hours per week, sometimes more during a live deal. For a closer look, see our analyst day in the life.

Associate

Usually post-MBA hires or analysts promoted after a few years. Associates:

Review and check the analysts' work for accuracy.
Manage the day-to-day execution of deals and direct the analysts.
Take more responsibility for the narrative and structure of pitch materials.
Serve as the bridge between junior staff and senior bankers.

Associates still do real technical work but spend more time managing and reviewing.

Vice President (VP)

VPs are the project managers of banking. They:

Run deal execution end to end.
Manage the deal team and the workflow.
Interface heavily with clients on the day-to-day.
Begin to take on relationship and business-development responsibilities.

Director / Senior VP and Managing Director (MD)

The senior bankers. MDs are, above all, salespeople and relationship owners:

Source new business and own client relationships.
Set strategy and provide senior judgment on deals.
Carry the responsibility for bringing in revenue.

By MD level, the job is far less about spreadsheets and far more about origination -- winning the mandate that gives everyone below something to build. Compensation rises sharply with the hierarchy; see our analyst salary guide for the entry-level picture.

A Realistic Day in the Life of an Analyst

There is no truly typical day, but a deal-stage analyst day often looks like this:

Mid-morning start: Roll in late morning after a late night, clear overnight emails, and check comments from the associate or VP on last night's work.
Midday: Update a model with new financials, build out a new section of a pitch book, or dig into a company's filings for a valuation. Quick check-ins with the deal team.
Afternoon: Internal meetings, calls with the client or other advisors, and incorporating round after round of edits to the deck.
Evening: This is often when the real production happens. New requests come in ("can we add a sensitivity to the LBO?"), and the analyst builds and revises into the night.
Late night: Final turns on the deck, send to the team, and wait to see if more comments come back before signing off -- frequently well past midnight.

The work is intellectually substantive but unpredictable: a planned quiet evening can vanish the moment a client calls or a deal heats up. The lack of control over your time is the hardest part for most people, more than the raw hour count.

Product Groups vs. Coverage Groups

Banks organize their bankers in two ways, and which type of group you join shapes your daily work.

Coverage groups (industry groups)

Coverage bankers specialize by industry -- technology, healthcare, consumer/retail, industrials, energy, financial institutions, and so on. They become experts in their sector, own the client relationships within it, and bring in deals. A coverage analyst develops deep knowledge of a specific industry and works across all deal types for clients in that space.

Product groups

Product bankers specialize by transaction type rather than industry:

M&A -- mergers and acquisitions execution across sectors.
Equity Capital Markets (ECM) -- IPOs and equity offerings.
Debt Capital Markets (DCM) / Leveraged Finance -- bond issuance and loans.
Restructuring -- advising distressed companies and creditors.

Product groups partner with coverage groups on live deals: coverage owns the client, product brings deep transaction expertise. As an analyst, your group shapes your skill set -- a leveraged finance analyst lives in debt and LBO analysis, while an M&A analyst lives in valuation and merger models. Group choice also influences your exit opportunities down the line.

The Skills Investment Bankers Use

The job rewards a specific blend of skills:

Financial and analytical: Modeling, valuation, accounting fluency, and comfort with numbers under time pressure.
Attention to detail: A formatting error or a broken formula in a client deliverable is a real problem; precision is non-negotiable.
Communication: Translating complex analysis into clear recommendations, both in decks and in conversation.
Stamina and time management: Juggling multiple deals and long hours without dropping quality.
Relationship-building: Increasingly important as you move up -- senior banking is fundamentally a relationship business.

The technical foundation is what you are tested on in recruiting, which is why interview prep leans so heavily on accounting and valuation. Our interview prep guide maps exactly what you need to know.

Who Is Investment Banking Actually For?

Banking is a high-reward, high-cost path. It tends to fit people who:

Want a fast, structured start to a finance career and accelerated learning.
Are willing to trade their hours -- genuinely -- for compensation, skills, and optionality.
Enjoy analytical, detail-heavy work and can stay sharp under pressure.
Value the doors it opens: banking is one of the best launchpads into private equity, hedge funds, venture capital, and corporate roles.

It is a poor fit for people who prize predictable hours, autonomy over their schedule, or a slower pace early in their career. The compensation and exit opportunities are real, but so is the lifestyle cost. Going in clear-eyed about both sides is the whole point.

If banking does sound like your path, the next step is preparation. IBFlash (IB Flash) gives you 5,000+ practice questions and AI mock interviews across IB, PE, HF, VC, and consulting, so you can master the technicals long before your first superday. IBFlash turns the accounting, valuation, and modeling concepts in this article into drillable practice. Start at ibflash.com, or explore the guides and tools to build a study plan.

Frequently Asked Questions

What do investment bankers do all day?

Junior bankers spend most of their day building financial models, preparing and formatting pitch books and presentations, pulling research, and managing due diligence -- punctuated by team meetings and client calls. Senior bankers spend their day sourcing deals and managing client relationships. The common thread is advising clients on raising capital and on buying, selling, or merging businesses.

Is investment banking the same as trading?

No. Investment banking is advisory work -- helping companies raise capital and execute M&A through modeling, analysis, and relationships. Sales and trading is a separate division that buys and sells securities in the markets. The trading-floor image most people picture is sales and trading, not investment banking.

How many hours do investment bankers work?

Analysts commonly work in the range of 70-90 hours per week, and more during a live deal, including late nights and weekends. Hours generally improve as you move up to associate, VP, and beyond, but the lack of control over your schedule -- rather than the raw hour count -- is what most people find hardest.

What is the difference between a coverage group and a product group?

Coverage groups specialize by industry (technology, healthcare, consumer, etc.) and own the client relationships in that sector. Product groups specialize by transaction type (M&A, equity capital markets, debt capital markets, restructuring). On a live deal, coverage owns the client and product brings deep transaction expertise; they work together.

What skills do you need to be an investment banker?

Strong financial modeling and valuation skills, accounting fluency, exceptional attention to detail, clear communication, stamina for long hours, and -- increasingly as you advance -- relationship-building. Recruiting tests the technical foundation heavily, which is why interview prep centers on accounting and valuation.

What Do Investment Bankers Actually Do? (Day-to-Day Explained)