To become an IPO underwriter, one must complete higher education, obtain financial certifications, and have sales and networking skills. Investment banks recruit from top universities and expect postgraduate degrees. Gaining an internship or junior position can lead to becoming an IPO underwriter.
When a company issues shares on public markets for the first time, an investment banker takes the lead in the initial public offering (IPO) underwriting process. To become an IPO underwriter, you need to complete a higher education and continue to attend graduate school. Certain financial certifications will likely be required. Getting into an investment bank with some capacity can lead to becoming an IPO underwriter.
An underwriting manager, or investment banker, in an IPO deal leads the process of trading shares in the stock market. A banker who specializes in IPO deals is responsible not only for the price and timing of the new issue, but also for bearing the financial burden of selling these shares to the public. In addition to the tactical skills needed to become an IPO underwriter, a successful candidate must have sales capabilities.
An IPO underwriter must be able to read the market and economic environment and have the communication skills to successfully market a new stock to potential investors. You must demonstrate an aptitude for working long, hard hours, as the demands on financial markets exceed more conventional career pursuits. When choosing an IPO underwriter, clients often turn to a previously established relationship with an IPO underwriter, which is why networking skills are so important.
The first step to becoming an IPO underwriter is to obtain a college degree. Successful applicants must specialize in mathematics, accounting, economics or another financial field. The biggest investment banks often recruit candidates from the best universities in the world, so attending an Ivy League college helps your chances if possible. Earning a high grade point average also helps the candidate to get into the company. Investment banking hires expect a candidate to also earn a postgraduate degree, such as a master’s in business administration.
Large investment banks often recruit employee candidates from the most successful schools. It is also helpful for potential employees to proactively seek out a recruiting firm to become an IPO underwriter. Networking and relationship building is vital in the financial services arena, and gaining an internship can be the first step towards becoming an IPO underwriter. It may be necessary to accept another position at a financial services firm, such as a junior or associate banker, before moving on to become an investment banker underwriting new issues. If that’s the case, you can still work with senior bankers on IPO deals and learn valuable skills for the future.
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