Industry Specific Guide: Technology
By SuperdayReps · Wharton MBA · ex-Greenhill · investment banking interview coaching
14 min read · updated September 11, 2026
Most of a technology banking interview is not about technology. It is the same first round everyone else gets: the three statements, a DCF, terminal value, WACC, enterprise value against equity value, and the valuation methods. That material is covered in the range of technicals and the lessons under it.
What changes is that a sector layer sits on top, and candidates skip it because it is not in the standard guides. This lesson is that layer.
A student of ours collected the question list from analysts and interns at the firm before a software banking interview. Eighteen questions came back, and fourteen were the standard set that every first round asks whatever the group: tell me about yourself, why banking, the three statements, the depreciation walk, a DCF, terminal value, WACC, the valuation methods, enterprise against equity value. Four were specific to the sector.
- Why tech, or why software
- Walk me through the revenue model of a SaaS company
- Why is retention an important metric for a SaaS company, and how is it measured
- What is one SaaS company you find interesting
Four out of eighteen is about the right ratio, and it is why the sector layer is worth one focused session rather than a week. The other fourteen still decide the interview, and if they are not solid the sector answers will not save you. Those four are what the rest of this lesson answers.
Why tech, and why software
This is why this bank narrowed to a sector, and the same rule applies: a reason that could be said by anyone is not a reason. "Tech is innovative and fast moving" is the sector version of "your firm has a great culture."
A real answer names a mechanism you find interesting and ties it to a thing you did. Three that work:
- The economics. Software costs almost nothing to deliver one more copy, so gross margins run in the seventies and eighties and the whole question becomes whether a customer stays. That makes it one of the few sectors where the interesting analysis is about retention rather than cost.
- The buyer set. A software company can be sold to a strategic buyer building a platform or to a private equity firm taking it private, and those two run completely different processes at different prices. Sitting between them is unusually interesting advisory work.
- Something specific you followed. A product you use, a company whose numbers you have read, a deal you followed through to its close.
Then land it on evidence: a class, a club pitch, a project, a job where you saw the model from the inside. The STARI structure works here too.
Saying you want tech because you love technology. Nobody is hiring you to love technology. Say what about the business model you find analytically interesting, then prove you have looked at it. An interviewer's follow-up is almost always "so what have you read recently", and a candidate who cannot name a company at that point has said nothing.
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There's about 10 more minutes of Industry Specific Guide: Technology below this, plus every other lesson in Interview Guide. Free account, no card.
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Frequently asked
- What questions do technology investment banking interviews ask?
- A tech or software banking interview is the standard first round plus a sector layer. The standard part is the three statements, a DCF, terminal value, WACC, enterprise versus equity value and the valuation methods. The sector layer is why tech or software, the revenue model of a SaaS company, why retention matters and how it is measured, how an unprofitable software company gets valued, and one recent deal plus one SaaS company you find interesting.
- What is the Rule of 40?
- Revenue growth rate plus profit margin, usually EBITDA or free cash flow margin. A software company at or above 40 is considered to be balancing growth and profitability well. Bankers use it as a first screen, then take it apart: growth from new customers is worth more than growth from price rises, and margin from real efficiency is worth more than margin from a hiring freeze.
- Why is retention the most important metric for a SaaS company?
- Because recurring revenue is only recurring if customers stay. Net revenue retention above 100 percent means the existing customer base grows on its own, through upsells and price rises, before a single new customer is signed. That turns sales spending into growth on top of growth, and it is the number that most moves the multiple a software company trades at.
- How do you value an unprofitable technology company?
- Two routes. Use a revenue or ARR multiple against a peer set, since there is no meaningful EBITDA or net income to divide by. Or run a DCF with a longer forecast, far enough out that the company reaches maturity, and accept that almost all the value sits in the terminal value. For very early companies bankers fall back on non-financial multiples such as enterprise value per user.
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