Creating my own Boutique Investment Bank with no direct experience
Hi, new to WSO, thanks for readinig this, I would really appreciate your comments.
I am an Economist with MSc in economics from the best reputed university in Colombia, South America. U had relatively good grades (4.1 / 5) I am 35 years old, just passed CFA level 3. I also lived in France and studied Business for a year at ESC Toulouse, and did 3 years of Philosophy, I plan on getting that degree someday (I feel I am a Philosopher by nature, although not a very good one!!!).
Right out of Economics schooI I worked as an economic and financial journalist and won 2 prizes, and the second place in the Citibank financial and economic journalism prize in Colombia.
Later I worked at the economic office of the President of the Republic of Colombia, and got connected with some of the elite. Many of whom I had met at the University.
In 2007 I decided to change carreer into finance and started the CFA Program. I landed a job at a local Brokerage house where I started with a minimum wage assisting an Analyst, and worked my way to be an analyst and later into sales and trading, finally got to be Head of Equities.
In 2012 my dad, a Physician owner of a Vascular Surgery Practice (google "clinica vascular de Bogota" for a quick reference) with 6 Surgeons and a staff of 20 people was going broke, I know his business well, and persuaded him of giving me a 49% stake and I would get the business going. I quit the Brokerage Firm and got full time into turning around the business.
I doubled sales in these two years and the Clinic is going well. Many problems but I just hired a good manager so I have 1/3 of free time. I also passed the level 3 CFA exam so no more studying!!!!!!!!
I am looking into starting a financial advisory firm part time and in 2 or 3 years get in full time. I have a trusted friend from the University with whom I worked at the brokerage house who has some IB experience. He would be willing to help me out on the sidelines and later on join me on the business.
I hope that by starting as an advisor to firms I can build a good name, make contacts and get to know companies. As years go by, I may accumulate enough knowledge and capital, as well as persuade a group of trusted investors, so I can ultimately buy significant shares in companies.
My dream is to own many successful businessess, no different than Warren Buffet, only less talented.
I also must mention my wife is a talented lawyer admitted to the New York Bar, with an LLM in NYU. She works for a prestigious firm in Bogota, and does nice and large corporate transactions. Her field of expertise is debt structuring, she writes the contracts when huge banks give tailor made loans for huge projects, she also does some M&A but she hates it, many of her work is also paperwork + advising firms on specific legal issues.
We figure if I can get my Boutique Investment Bank going, we can get some nice economies of scale going and leverage our networking and knowledge.
I am also considering an offer by a foreign boutique investment bank who might let me use their brand name in Colombia, it is a very small london-based Advisory firm. They do require me to take an investment banking analyst course and pay 3K pounds.
I plan on getting into the CFA UK Society, since there is no CFA Society in Colombia, and I feel the UK has a well organized CFA Society, I also feel it will give me more prestige than the Brazilian or Mexican one when talking to potential clients here. I plan nevertheless on networking quick to get the Colombian Society going and being very active politically, assuming leadership positions in the Colombian CFA Society someday.
I am learning golf, I have taken lessons since very young but have never really been disciplined. I really like it a lot. No way to learn squash since I had a horrible water ski knee injury, and still suffer from knee pain.
Any comments welcome!! Thanks for reading this.
seems to me you like PE more than IB
You are all over the place my dude!
I also agree with the above poster. Seems like you're more VC/PE than IB. Are you sure you really want to go the IB route?
Don't understand the European and Asian cultural tendency to get as academic designations as possible, yet have absolutely no idea how the real world works.
If you think a CFA and a good squash game will somehow enable you to source deals, nobody will take you seriously.
This is too real. I was at an info session at my university tonight and it seriously baffles me how these people hire asians with absolutely no real world knowledge. I was seriously cringing at the questions this girl was asking the MD.
Wait an investment bank is going to let you use their brand?...Provided you take an analyst level course and pay them ~$5000 bucks?
Some answers:
I do like PE more than IB. There is not much PE in Colombia. While of course I would like to work in PE, I don't see a real possibility of landing a job in PE, much less of starting my own PE firm. I do see a real possibility of starting my own Financial Advisory firm.
I do have approximately 10 years of "real world" work experience including government and financial in managerial, analyst and trading.
I am not European or Asian. I don't value academic designations as much as I do the knowledge I get while pursuing them. After my undergraduate degree I have always studied while working, for me education is a lifelong choice, unlike some who swear not to open a book after graduating.
I do strongly believe having a CFA designation, participating in CFA Societies, and doing social activities and sports will help build a network and ultimately help land deals.
Many people do take me seriusly right now even if this is what I think, apparently not BT Banker.
Yes, a person who runs both a small Investment Banking Boutique and an investment banking training course offered me to use their brand in Latin America. I wouldn't want to say his or his partnernship's name here but it is true and sounds very serious.
Finally I would add that I do appreciate your honest advice but not mean comments based partly on poor reading.
Go the PE route, like others have said it's what you're actually looking for, not IB. Find a target company that's underperforming, in a generational transfer with the next generation not interested, as a platform to make acquisitions in a roll up strategy, or just something that interests you that you think you could buy for a good price and help grow it. Raise equity from your network of government connections, the elite, whomever. Leverage up the acquisition through you and your wife's contacts. You don't need to build up your own capital so that you can buy companies yourself, you need to use other people's money.
Run, fix, grow, acquire...profit.
Do a few of these types of deals and you may be able to raise a blind pool in the future. I don't know about Colombia in particular but other countries where I've done business with less mature or developed financial systems typically lend to non-traditional routes into things like PE or VC. It's a lot more about who you know than it is about going the traditional US route: go to an Ivy League school->IB analyst->PE->MBA->post MBA PE so it's not as crazy as it may sound.
Personally I think the IB route would be more difficult if the business doesn't largely exist already in the country for companies under the equivalent of the Fortune 500. You'll have a harder time convincing companies/people to pay you fees for you to do something that they don't really understand than it would be to convince someone to sell you their company for cash.
OP, I'm not sure you even fully understand the difference between IB and PE? Sourcing deals seems like it would be next to impossible with a shaky resume without IB experience and no brand name behind you.
I think @"Dingdong08" gave some quality advice on what would be a better path for you.
Thanks Dingdong08 for the enlightening comment. I appreciate your clarity.
My overall startup plan is to continue my current self-employed job 30 h/week at the Vascular Clinic, and simultaneously:
I believe this plan has quite a good upside, with a contolled downside.
To answer Adapt or die's comment, yes, I understand the difference between IB and PE, I just don´t believe such clear cut categories apply to my case. In my job at the Clinic I do all types of work. Any entrepreneur knows he must sometimes be the cleaning lady, sometimes the accountant, sometimes the lawyer, and mostly, the lateral thinker to solve all the grey zone problems that appear day to day. So if I was a rigid this (IB) or that (PE) kind of thinker, I would have not accomplished what I have.
I don´t believe my CV to be "shaky", nor to be all over the place (as Broadstbully comments). I have just played my cards the best way I could, I have both strengths and weaknesses and in general, I am very proud of my CV. I am just figuring out my next moves right now. Also Adapt or die, it may be possible that I get a brand name behind me, would you think that may turn the odds to my side? Maybe, with hard and persistent work I could create my own brand name eg Adapt or Die Capital or Please dont Kill me you frustrated Bankers, Inc.
I do plan to remain in Bogotá, my home city. Believe me if this is the Oasis, I wouldnt want to be in the wall street desert. Some of you are very hostile. Of course I don´t really care, provided it helps me advance my goals, but in real life I do prefer to be in a more friendly environement. I had the pleasure and torture of living 1 year in France, and I know how humilliating and painful it is to live abroad within mean, discriminating and sarcastic colleagues who think they are better than me. I also know the sweet feeling of owning my company, and having loyal and trusted people around. Of course being a boss also has its tough moments, and decision making may be very happyness consuming but I do prefer to be in the top of the pyramid.
Thanks anyway you bullies, as Oscar Wilde sais "The only thing worse than being talked about is not being talked about." I prefer your harsh comments rather than no comments at all. Since you have given me some advice, and knowing that you haven´t asked for any, I will be so daring as to give some of you a couple of tips: Be more gentle and try to read well. Those comments reflect bad on you specially when you have not read or when you generalize about others, such as "asians or europeans". It makes you sound pretty ignorant.
If you're still around can you tell us what you ended up doing?
Or you could just build a time travel machine and convince your mother to marry a billionaire.
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