Pay At Small, No-Name Boutiques (deals <500 M)
Hi,
So basically, I was wondering what the pay is like for the small, no-name boutique banks that work on deals worth less than half a billion dollars at various levels? Does anyone have any clue about this, or does it vary too much to make a reasonable estimate? Obviously these guys will probably take a hit compared to BB analysts/MDs, but do they still make decent money relative to the rest of the population?
Also, I guess we can include small time PE shops in this equation as well.
Thanks
It varies way too much to generalize. Many small but well regarded MM M&A shops can pay their analysts above street for both base salary and bonus. However, I know of a ton of tiny 10 man firms that pay poorly. Totally depends.
Further - $500m is still a pretty high threshold. Show me a "no name" bank that gets $400mm mandates. At that level you're pitching against pretty much everyone you've ever heard of in the middle market.
I would consider most No-name boutiques to be doing <$75mm deals. And I promise you the economics at these shops usually don't work out to get comp anywhere close to street.
Bout $ 9.75 per hour + 50% of all clothing & accessories (except name Brands)
I might be cranky or just a dick, but whenever I hear someone asking about pay at a boutique I automatically think they are ungrateful.
If you are looking at a no name boutique for a job it is because all else has failed. You should be smiling and worshiping the ground the MD's walks on to get paid 30K and get IB experience. You do a year or two in the trenches and then go to a larger firm and make some decent cash.
I mean if you don't like the idea of doing banking for 30K you could always go make 60K at a BB in their back office. When you phrase it like that pay really isn't an issue now is it.
Shut up you dumb bitch
Bruh
ya agreed with above....500M is a pretty big number when you say no name boutique I am thinking of 20 - 50 MM deals. If you look at the market you have been getting GS/JPM being Bookrunners on $100-200MM IPO's.
Oh damn, my bad guys. I must have misjudged how big deal sizes are even at BBs (I'm still a noob, so apologies), In retrospect, I probably shouldn't have mentioned deal size since I clearly have no idea what I'm talking about, but whatever you consider to be small deals, what do you think salaries are like at firms that handle those?
Anthony: You're fine man, and I hope I didn't offend you. Yes, I am looking at these shops as a last resort, but given my background and since I might never be able to break into a BB, I was just wondering if I can still have a decent career (to me, first year analyst + bonus at a BB is a lot of money) if I have to stay at those firms and never make it to a big bank. Believe me, I'm not a "models and bottles" chasing banker like a lot of people here, but in case my career doesn't allow me to exit, I should at least know what I'm getting into, right, or is that not a fair question still?
No Name boutiques are a last resort for many people. Im sure the MD's know that and use it to their advantage. You are getting in for the experience and hoping that a sheer stroke of luck will land you an interview at Piper Jefferies. Anyways as Anthony said, Back office pay will most likely be 1.5 to 2x what you would get paid at a boutique. However the IBanking experience is pretty much priceless.
cool - I was being a little bitch, its cool. Know what your getting into and all. Just saying that I see a lot of threads asking about pay and people being real concerned about the issue yet they do not understand that the experience is priceless. Boutique IB pay might be lower than street, but as Guest1655 said, the experience is priceless.
Yeah, I know that the experience is really what matters, which is why I'm checking into these shops, and that itself is worth its weight in gold. For example, working at a small shop for 30k (even if it never increases) but learning a lot will be better salary-wise and in terms of job satisfaction than doing ops at a BB and eventually making above 6 figures. But in any case, I hope that no hard feelings were exchanged during all this. Maybe it's a good idea to lock this thread before it gets out of hand, especially since there is no concrete answer really?
First of all, small shops rarely hire anyone. They don't need analysts. Senior bankers/owners/partners do everything themselves.
I know a guy who does ONLY $5-$25MM M&A deals (sell-side start-ups). He is 38, works from home, and puts in about 40-50 hours/week. He makes more than any Senior VP @ BB-level. Let's call him John.
Every week John gets 5-8 e-mails from start-up guys asking for help. John is the only guy on a deal, and he charges 4-7% in fees. Sometimes the number goes up to 10%. That's anywhere from $350k(low end) to $1MM(high end) per deal. His fees are 1-2% higher than street's rates, but he has a solid record of selling companies. He does 3 (bad year) to 6 (good year) deals annually (still working 40-50 hours/week; he has kids and wife). He sells start-ups to other companies, ranging from no-name low-MM company to worldwide news publishers to manufacturers There is one downside: John is not only banker, but also an "entrepreneur". He eats what he kills: he doesn't have base/guarantee salary.
WSO is so fukking delusional it's ridiculous. VPs/MDs at BB make a portion of what VPs/MDs at comparable boutiques make. More prestige and fame? Yes. Higher pay? Unlikely.
Think about it. If "MM" shop closes an $800MM deal, even with 2.5% fees thats $20MM in cash. As my friend said once, "there is a reason why most talent eventually leaves BB."
That being said, BBs do offer prestige and name recognition. Everyone knows GS/MS/JPM, even farmers from cold Siberia, but outside of Finance world even Lazard/Greenhill/Evercore are unknown.
great post, thank you for taking the time to clear this up for the people with no clue about how very small boutique shops function
I see this is in 2010, but if 'John' is still doing this, would you mind connecting me? I am deal sourcing for a buyer looking to do a roll-up of tech startups, and would find a list of sellers very useful. Could save both parties time, so lmk if you can.
Agreed, this happens so much more than people think
My ex college roommate works for a no name boutique that deals with companies ranging from 10mm-250mm and his starting salary was $55,000 two years ago. He recently got promoted to Associate at the same firm and they upped his salary to $90,000.
When he was an analyst his bonus was 50% of his salary (keep in mind these were the really shitty off years) and he worked about 50 hours per week (very little face time needed). Not too bad if you want to make more money than the majority of your college counterparts and also maintain somewhat of a work/life balance.
I will echo this, I have seen 50-70K at the analyst level with about 50% bonus, bringing all income for analyst to 80K-110K
Associates are usually 90K-110K with bonuses - ranging much more but never eclipsing 60% so pay is 115K-170K
really? these total comps seem pretty low for 2023 even with the bad deal flow?
It 100% depends on the bank. One thing to take note of is that small banks often have very lean deal teams. Typically with only an MD and 1 or 2 analysts/associates. The associates are often promoted from within without mbas. Also, a small bank has much more limited overhead. So if each MD is closing 2/3 deals a year with fees of 500k - 1mm per deal, that's a lot of money for not a lot of people. I worked at such a boutique and a few years ago, when the market was good, the young guys were getting equal to or more than bb guys in bonuses, with slightly lower salaries. However, recently with the down turn, bonuses have been pretty bad. The MDs know that you aren't working at GS but at the same time if you are good and have been at the firm for a while, they don't want to lose you. Once you have proven yourself you have way more value as a good analyst/associate at a smaller bank, meaning more leverage. They don't want to deal with the headache of you leaving and having to rehire and retrain someone. Its not like there is a system in place with a constant turn and training program.
The pie is smaller but there are a lot less people eating from it. Everything is relative.
i want to be "john"
Well, ke18sb is right - Everything is relative!
Ask somebody who is doing real estate math for some chit guy! If u don't understand number, u fall for such guys.. Compounding n discounting is what get you learn where to invest your time / money / energy for what Pay off..
But, i feel StartUps r kool. . m loving it..
Anthony is kool..
My two cents - worked at what most people would call a no-name boutique for a year...dc based ..about 20 bankers....1st year analysts in 07 pulled in north of 150k all-in (60k base) ....A3s hit 500k ...the same analyst promotes barely hit 100k all-in in 2009. The group primarily focused on M&A, so business was good during the good times ($1MM+ per banker) but when shit hit the fan in 2009, we were down to barely $200k per banker. So yes its very relative! I doubt if the swings are that much in BB though...
Get me some boutique! No one gives a shi* where you work other then people on wso. You say your an investment banker and its all the same. Why not go work at a boutique, work a lot less, and only make a little less. Sounds pretty ideal for me.
This just isn't true. Maybe if doesn't matter to your family and maybe people on WSO care more then they should about prestige and whether or not GS would kick MS's ass in a M&A-off, but where you come from certainly matters just like the previous responsibilities you have had, just like the name of the firm you come from.
Given, at certain levels, the name carries less weight and has a diminishing value, but most 1st year analyst from a 5 man boutique shop are NOT getting scooped up by BB IBs because they are "investment bankers".
If I'm not mistaken, you are the same kid that says it doesn't matter at all whether you go to a target or a non-target because targets are just an editing tool by HR..which is silly also.
Regards
Deal flow is what matters when it comes time to jump ship or move to a larger bank. You could be an associate at a smaller firm and come in as a seasoned analyst at a bigger one because of your limited experience.
Boutiques are fine and if you want to do banking at all costs then go for it and forget about the salary. As long as you get some exposure and do typical analyst job duties you will be able to lateral to another bank after a while. Granted, it will take you longer to do whatever you want to do than say the kid who went right to Morgan Stanley, but it is a lot better than taking the back office job and coming on here whining every day.
What i was saying is people who dont work on wall street dont care. Obviousely if you are in the industry it matters. I would just prefer to work in a boutique, work my tail off, and be able to communicate with everyone of all levels as well as having an actualy work life balance. If the only ft i get is with a bb, done, I go, but rite now I am really enjoying the boutique I just started interning at. We all want differnt things. I wish you luck in your first year in pe and that it continues to be a good provider for you cph
Thanks and best of luck at your internship.
My intent is not to be the internet Nazi here, but just to point out that what you previously posted was misleading. You stated that no one gives a shit...when in fact it matters a lot. I see the point you are trying to make, but some people that come here looking for advice might not see, especially if they are new to the industry/site. Those that work in or are familiar with the industry know that what bank you work at doesn't matter to Joe Six-Pack because he doesn't even know what an investment banker is or what an investment banker does. Everyone here knows they have some simplified version (real estate agent) to explain to their aunts and uncles at Christmas time who just want tax advice or stock tips, lol.
You can do really well for yourself at boutiques, especially if NYC isn't really your style. You can get paid really well, live in lower cost cities, have a better work/life balance, etc. I'm at a boutique PE shop and enjoy it a lot. I BS with the 2 principals and 1 of the partners everyday. We talk about politics, sports, strippers, grab lunch, whatever and its great. With that said, I do realize the difficulties that lie ahead if I want to get into bigger, more prominent shops and people should just be aware that is a potential drawback along with some of the aforementioned advantages.
Regards
My friend works at a boutique that works on 50 - 400MM, with the vast majority in the 50 - 100MM range. First year analyst @ 50K + 10 - 50% bonus. He said ~60 hours a week, so significantly better hours, and given the location in denver, a significantly better lifestyle. I would argue that 70k in NY is 50K in Denver. Bonus #s of course skew this analysis.
Sounds like St. Charles or possibly GMB? Either way, that's pretty accurate as far as compensation is concerned in Denver for a boutique. Hours seem a little low though - would have guessed 65-75 on avg. Q-Advisors has hours probably closer to 60 on avg.
St. Charles and Green dont exist anymore. but do agree and can confirm most of the firms in Denver have pretty poor pay.
I'm going to be interning at a boutique with at or near street numbers, great deal flow, better lifestyle etc. Not all boutiques are like that. Some are poorly paying sweatshops. Boutique does little to describe the reality at these places which are highly variable.
Don't listen to anyone, ibanking is a great accomplishment no matter where it is. Just do well and stick with the boutique. and you'll go far.
JD Ford possible as well if in Denver
"No-Name" boutiques do extremely small deals. $500M is too big for MMs these days, that's the bulge range now. "No-names" have a lean team and might be happy with 2-3 deals a year. They are more likely to do private placement raises, which involves a lot of investor tracking, calling potential investors, doing memos, PPMs, etc. They also do some small M&A, though occasionally get lucky with bigger deals.
Their work hours are usually much better because so many of them make you (the analyst / associate) do sourcing (i.e. cold call for prospects), and there's not that many calls you can make after-hours. There are other boutiques who have tremendous deal flow and not as much pitching, but they're volume shops. All depends on the MDs.
The pay is almost always smaller overall. Usually not by a whole lot, but there are a couple of shops that notoriously screw you over.
In the recent environment, many MM analysts were able to move up to BBs as hiring has improved and the BBs realized they underhired. This has made many MMs look at replacements at the regional boutique level because these guys would at least be grateful to move up. So lateral moves are always a possibility.
Bump --
Pay at boutiques with deals
bump
Know someone who's going to be at a 5-man boutique in a mid-sized, fairly inexpensive city. Comp is supposed to be ~50+5 then perf bonus 15-30k.
Not BB money but you can do pretty well and as others have said eventually lateral to somewhere else as a 2nd or 3rd year analyst.
Sounds like a good deal. I wonder how the hours are like at these shops.
About 60 a week. 830-830 on average. Nice for banking and that comp package takes you far somewhere that isn't NYC. The big difference IMO is exit ops.
I'm at a tiny shop and the hours are great. 9-8 most days. If we're waiting on something hot 9-12. But rarely any weekend work (unless you really need to catch up on some shit). I'm an intern BTW.
But I think i'd take a BB for a few years just to have it on my resume, and if I hated it, I'd probably lateral into a small shop.
I'm at a similar sized shop with only one analyst but most of the guys are out by 6:30-7:30 sometimes 8or9 with a a weekend here or there....not sure how this is at other firms with similar size deals.
the starting pay here is 50k+around 50%-60% bonus..maybe more on good years. and i think bonuses are paid out after each deal close.
I worked at a smaller MM (50 man shop), there is a huge difference in culture between that and the bank that my cousin works at. If you're going to be a lifer working at an MM in DC/Boston/Miami/Atlanta or fill-in the bigger non-NYC-LA-SF-Chicago market it can be great, better people, good pay on a relative basis and a better environment imo.
An "acceptable" discount to street pay at a no-name boutique? (Originally Posted: 03/06/2007)
For analyst, 60+10 seems to be street for '07 judging by the other analyst pay thread. I assume a MINIMUM bonus of 30k up to maybe 80k. This gives a range of 100k to 150k for STREET.
As a result, for those of us trying to "break in" to IB, what is an acceptable discount to street FROM A NO-NAME BOUTIQUE pay before you start raising red flags? By red flags, I mean if a bank offered 35k in salary, I am pretty sure that would create a problem, not because of the pay, but because I would say "what exactly am I going to be doing for this company?"
So what is acceptable for salary? 45 + 0? 50 + 5? Is there any POSSIBLE way to discuss potential bonus and/or a bank's discount to street BEFORE accepting an offer?
Would love to hear from some boutique bankers...
35k is really low, man. I'm no expert on no-name boutiques, but I've heard that base salary should be similar to street. Bonus would be the part that is less, and I think there should be a 25% discount or so from street.
Im throwing 35k out as a number that is OBVIOUSLY really low, and WOULD raise red flags. What is a range or a number that would still be an acceptable discount to bonus/salary/total?
Zala is correct. The boutique I worked at last summer paid salary at street, and bonus at a 20% discount to street.
some boutiques didnt raise base to 60k so they still pay 55+10k, ive also heard of 55+5k
Is a sign on bonus standard at boutiques?
Does anyone have any information on compensation at the associate level?
I am at a no-name boutique, 2nd year analyst. Base is better than street. Bonus has been at or better than street historically but is much more sensitive to deal flow. It has been a slow year for our group due to some MD's leaving so bonuses have not been paid yet. I wouldn't take less than street, there are plenty of no name boutiques out there. Find one willing to pay you what you're worth.
What?!
See, this is why you're working at a no-name. They can't even pay you on time and probably not even consistently. If anything, the uncertainty warrants a slight premium (being sarcastic).
Well, I would think for most analysts at no-name boutiques, what they are worth is a substantial amount less than what a BB analyst is worth, and my qualifications are no exception.
Anonymous, why would you say they pay you above street? Are you THAT qualified? Do they work you harder than BB? Do you have more client exposure and thus value added?
I've seen it happen before. A guy from a no-namer got hammered where I worked before. Nice guy, just didn't have the horsepower.
I'm at at no-namer - same base, 10% discount on bonus but about 10 hours less per week!
I have seen some smaller (but still legit non-NY firms) paying down to $50k + relocation. I would really consider that to be the absolute lower limit. Below that point, I would simply start looking into other finance jobs.
Thats probably true, optical. But how many of them would jump ship after a few months? Kids who have not had an at least semi-intense education would probably get frustrated easier at the material and not be used to the hours. Now you have got to retrain a whole new class every year (or worse, mid-year), and the work quality of the entire firm suffers. Saving a few 100k in bonuses (for a boutique) is not worth that.
Very true and I agree... if I ran a boutique, I'd pay street b/c the headaches saved would be incalculable. You need to find the "right balance" between pay and quality. But then again, you if you pay 80K/YR (all-in) @ 70hrs/week, which is LOW pay & hrs, you could do it. So, does being at the boutique warrant a premium (probably not)?
What would you guys say a bonus might be for boutique that makes less than $10 billion? (Originally Posted: 06/26/2015)
Just trying to get an idea here
What do you mean by "boutique"? If you mean EB, Greenhill had revenues of $274 million in 2014, and I am pretty sure they pay street. These small "no name" boutiques probably pay less. I worked at one for a year and know people who have worked at others. Expect $70,000-$80,000 all in. Base salary is usually $50,000 to $60,000 with bonuses being $20,000 to $30,000. Some pay less.
Sil It's a well known boutique. Not top of the class but has great deal flows. When deals come through in the space they are in, they are one of the names that come to mind
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