Stand Out To Break In

By Joel Cohen, September 2021

What I learned from one successful investor about how he initially broke into the investment industry without traditional credentials or connections

Not long ago, I was speaking with a very interesting person who had been highly successful at a larger investment shop, ultimately managing his own portfolio there. We met for lunch, hit it off, and kept in touch. I later asked him about how he broke into the investment industry in the first place, right out of college and without the help of pre-existing connections or qualifications. He took the time to write out over email what he had done, and his answer was extremely interesting.

While most of what I write and share is aimed at current or soon-to-be emerging managers, I wanted to share his answer in order to be helpful to a slightly different demographic. Perhaps we could call them “pre-merging managers” — such as this person was when he graduated from college approximately ten years ago. I hope to shine a light on how a person might go about breaking into the industry even starting without an extensive network or traditional credentials. To those looking to do exactly that: I am rooting for you, and I hope you find the below helpful!

Note: if you happen to know who this individual is, please keep it to yourself! He graciously allowed me to share his experience in order to be helpful to the next generation, but requested anonymity and I want to respect that.

Here is his narrative, in his own words (with identifying details removed for anonymity):

I graduated from a state university after the financial crisis and started at a large institutional investment firm about a year later. When I was in school, I knew I wanted to work professionally as an investor, but I knew it was a difficult field to break into. I remember doing a phone call with well known hedge fund GP during my senior year. He told me it would be virtually impossible without investment banking experience (he said I should give up). Unfortunately, at my school, investment banking recruiting is very regimented, and almost all of the candidates come out of a program within our business school. I stumbled onto investing as a career path too late for that — my school does not allow you to transfer into the business school after a certain number of credit hours.

Sometime during my senior year, I read an interview with an investor based in the city where I grew up. Before I graduated, I sent him a handwritten note, an investment idea, and a box of See’s Candies asking if I could meet and intern with him after graduating. He said he would be happy to do that, and we met up soon after I graduated. The experience was my first time interacting with an investment manager in person, versus through my blog or phone calls. It was an informal, unpaid internship, consisting of his suggesting companies for me to work on and then meeting up later to discuss. The most interesting aspect of the experience was working on the companies he suggested. Many of these did not appear optically cheap (or feature a catalyst), but they featured unique business attributes. I knew the experience with him would not convert into an employment opportunity, he was intent on running a one-person investment organization, but I thought it would add real analytical experience that would help me find an entry-level analyst job later on.

At the same time, I continued to post on my blog and self-study investing. I came across Cal Newport’s post on Steve Martin (“Be so good they can’t ignore you”) towards the end of my time in college and the concept resonated with me. If I produced good, thoughtful content, I might improve my odds of finding an investment manager who was looking for an analyst. Eventually, that began to happen. I never advertised on my blog that I was looking for an analyst position. I only wrote on the blog’s sidebar that I was a graduated from the state school I attended. Eventually, funds began to contact me, asking what I was up to and if I’d be interested in interviewing with them. Through my blog, for example, I had communicated with a well known and highly successful venture capital GP. I did phone interviews with the GP and his colleague, and they flew me out to meet the rest of the partners and interview for their analyst program. I did not get that position, but my current firm contacted me a little while after asking to get on the phone to chat about investing. They then flew me to their offices for two rounds of interviews in August and September of that year, and I received a position to start in January.

While this was an untraditional path to getting an investing job, I was able to see a lot of steady proof points along the way, which gave me the confidence to maintain my approach. I kept my expenses low by living at home. All I wanted to do at the time was learn about investing and work on companies. I did not incur any material expenses in pursuing that.

Note: this essay was originally posted to www.emergingmanagers.org, a site for emerging manager stockpickers.