Even with AI, junior bankers nonetheless want the grind | USAEMALL.com

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Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.

The writer is a former global head of equity capital markets at Bank of America and is now a managing director at Seda Experts

The rise of artificial intelligence in investment banking has ushered in a familiar ritual of hand-wringing. If machines can automate the grunt work — compiling pitch books, crunching financial models, triangulating data — what happens to the juniors?

A recent FT report on AI start-up Rogo’s $50mn funding round, led by Josh Kushner’s Thrive Capital, has added to the debate. The company claims its tech can replicate some labour-intensive junior tasks in minutes.

The anxiety is understandable — but misplaced. It rests on a romantic notion of training that bears only a passing resemblance to reality. Popular lore imagines young analysts refining their craft through brute repetition: building models, tweaking slides, fine-tuning pitch decks. It’s a vision lifted straight from Groundhog Day, where Bill Murray’s weatherman attains mastery of piano and ice sculpting via endless loops of practice. Do it enough times, the logic goes, and expertise follows. Mastery emerges from monotony.

The appeal of the model lies in its simplicity. But it does not account for the uncomfortable, ambiguous reality of professional growth: that competence is more often absorbed than taught and rarely develops on a schedule.

Consider the recent Wall Street Journal report on the bank Robert W Baird, which cited claims that some juniors allegedly toiled through 110-hour weeks, only to be rewarded with a pizza party at 4am and a pep talk about “stepping up”. The bank said afterwards that some allegations posted online that featured in the report were misleading and incomplete, and unfairly characterised its business, leaders, team members and culture. But a long-hours culture is far from unknown on Wall Street. And when long hours are taken to extremes, they cease to be training and look more like hazing disguised as professional development, misconstruing suffering as commitment.

Yet a system of long hours has some merit. It forces immersion, and those who skip it altogether may miss the muscle memory that only comes from living through the detail. Analysts who skip the drudgery may also miss the rhythms and reflexes it instils, however wasteful the process may seem.

I entered investment banking relatively late — at age 30, after a stint as a lawyer — and missed most of the all-night formatting drills. Still, I learned, not by memorising Excel keyboard shortcuts, but by being in the room: watching senior bankers in meetings; observing how they pitched, pleaded and pivoted; seeing how they managed clients and massaged messages. The real apprenticeship was ambient. It happened in conversations, in silences, in small adjustments in tone, in the unspoken protocols around client service.

That said, bypassing the early grind unquestionably came at a cost. There were days when I wished I’d learned the basics the hard way, if only to avoid learning them the harder way later. There are no shortcuts, only trade-offs.

This is the paradox juniors face: the work they resent is often the scaffolding for the judgment they’ll need. AI may spare them some tedium, but it can’t simulate the slow, accretive development of instinct — the bit of intuition that only comes from having made mistakes or having seen them made.

This raises a deeper question: are the tasks AI is now automating ever the best way to train juniors? Or simply the most convenient? AI may eliminate the rote work, but it cannot replicate the experience of watching, listening, and learning on the margins.

And that, really, is the limit of the current technology. Even Rogo’s founder admits the true challenge is approximating senior-level judgment, asking whether AI can “be as thoughtful” as a partner at investment firm Tiger Global. That feels a far way off.

For all its focus on numbers, investment banking is not purely or even primarily analytical. It’s interpretive. It requires narrative instinct, emotional intelligence and strategic timing. These skills can’t be downloaded or surgically implanted in your brain. They must be earned and learned.

AI may trim the fat from investment banking. It may even give junior bankers their weekends back. But it won’t replace the apprenticeship. If anything needs revising, it’s the belief that formatting slides at 3am is what moulds junior bankers into trusted advisers. The truth is subtler and more human: some friction is essential and mastery requires showing up, putting in the effort and sometimes staying late. In the end, the best bankers aren’t the ones who can build a model. They’re the ones who know what to do with it.