So I've searched through this site quite a bit, and have seen lots of questions and usernames related to Texas and energy. Unfortunately, there isn't that much info on either. As a native Texan, I would eventually like to live/work there. Im sure many others are also interested in working in Texas or energy, so I created this thread to serve as a comprehensive guide to everything about Texas/energy banking (plus the exits). I'll start with some basic questions:
- Pay compared to NYC, elsewhere.
- Hours.
More Importantly-
-
If one does there analyst stint in energy banking, are they pidgeon-holed to energy specific roles for the rest of their career? Or can you move on to non-energy HFs, PE, IBD?
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What kind of exit opps are there located in Texas? Specifically HF's, but also PE, other buy-side stuff. Also, are most all of these exits energy related. How hard is it to get into these from a non-energy background?
I realize these are a bunch of questions, but if anyone has personal experience or a friends experience, answers to any of these would be great. Thanks in advance.
Interested in this area too. Who are the leading advisers in the field? Credit Suisse's Global Energy team looks pretty solid, do they position well in the energy tables?
I know a while ago Wachovia/Wells Fargo Energy was ranked pretty highly in Houston. Some of the other big ones were Citi and Barcap. Some of the good boutiques to check out (so I've heard) are Simmons and Co and Tudor Pickering.
strong energy presence on here guys. also, make sure you check out the groups.
Is it a good idea to transition to the South from NYC, for energy-related work?
I'm not from Texas, but the idea of getting out of the NYC rat-race seems attractive - is it remunerative as well? How big a pay cut would you take, if at all?
Houston is energy and Dallas is PE hub just like Silicon valley is for VCs, NYC is for IB, Greenwich is for HFs and Boston is for AM.
Houston seems to have more PE funds while Dallas has more HF's. Dallas has Carlson, HBK, Maverick, Highland, etc. Most PE shops in Dallas are generalists although Natural Gas Partners and Energy Spectrum Capital focus on oil and gas. Other decently sized PE shops in Dallas are HM Capital and Brazos.
In Houston some of the energy PE funds are First Reserve, Quantum, Quintana, Lime Rock Partners, SCF, Riverside has an office, and some others I am forgetting.
Looking at Associate's profiles at some of the top PE funds most come from Barclays, Credit Suisse, Simmons, UBS and then some from Merrill Lynch and JP Morgan. Not sure how the UBS energy group is doing lately and there are some strong boutiques like Tudor Pickering which has been doing well lately. Greenhill and Evercore also opened up offices in Houston not too long ago.
hey girl! long time no see
How you doin???
doing good boo doing good
in houston
Anyways... to get this back on track, I'll post some basic stuff I've already found out around the site.
It sounds like the pay in Houston is very similar to NYC, maybe a little less but it works out pretty equal considering cost of living.
Also, Houston is the place for IB in Texas, while Dallas has most HFs, and there are PE in both. Anyone know about Austin or San Ant?
If anyone has some experience with questions 3 or 4, I would really appreciate an answer.
houston kills nyc on cost of living.. KILLS
I answered your question number 4. In Houston pretty much all of the exit ops are energy focused PE funds. There are a couple that focus on other stuff like The Sterling Group. HF's in Houston are mainly commodity traders.
In Dallas exit ops are PE and HF's. Most of the PE funds are generalists and there are several hedge funds that I listed above. The Dallas PE shops and hedge funds seem to have a mix of people who either did energy banking in Houston or were in New York. Houston PE shops are mostly Houston bankers, although there are obviously exceptions.
Austin has some venture capital firms and a few small PE shops. Austin Ventures is a pretty large fund that does VC, Growth Equity and some buy-outs.
San Antonio.. nothing really.
Thanks Shaniqua. So it sounds like there are some non-energy HFs in Texas. Good to hear.
Anyone know how much people get pidgeon-holed in energy? Reason I ask is that I am somewhat interested in energy, but just don't know if I will like it enough to spend my whole career on it.
I'm in a similar state of mind.
Also, not too sure if I would be keen to work in Texas. What type of deals on in NYC for energy related stuff (if any??)?
screw nyc, Texas kicks ass
222-It looks like Wells Fargo has some Energy/Power in Charlotte (Might just be power). Still not NYC, but closer.
Thanks for the reply Ibintx.
ibintx I believe that the Wells Fargo in Charlotte is just power (assuming I heard it correctly).
O ok, I saw the same thing somewhere so you are probably right
make some money as NYC at 1/3 the cost to live
In English please.
work it out bud
Monty, do you work in Houston? If so, can you comment on question 3? (or any others)
no they are not but I will say at a slight disadv to their peers in NYC for non energy exit roles. You may need to go to b school for a natural break in career or really make some moves on your own. I will say this... do not plan the next 20 years of your life. I tried and failed. Take it one year at a time and look no further then maybe 24 months..
Houston energy analysts are at a HUGE disadvantage compared to NYC analysts for non-energy exit opps outside of Texas. The vast majority of buyside exit opps, especially those that are non-energy focused, are in NYC, SF, and Chicago, not in Texas. It makes no sense for these places to recruit Houston energy kids, and they don't. Like it or not, energy is considered specialized, especially the Houston scene where most of the banks (not all though) simply have converage groups and the execution is done out of New York, leaving analysts' skill sets even more specialized. Also, from a logistical standpoint, it's far easier to meet, screen, interview and hire NYC kids than Houston kids. Why interview a kid from Houston, when there are hundreds more with identical resumes across the street in NYC?
I'm specifically talking about post-analyst exit opps. Sure, after an MBA everything changes. But if you want the most opportunities following your banking stint, chose NYC over Houston. It's not even debatable. Look at the websites of good, non-energy private equity shops. You might find a few in Dallas, but that's it.
Houston has its advantages though, which are mentioned above. Cheaper costs of living, lower taxes, etc. But if you want to maximize your oppportunites, choose NYC over Houston.
and yes I live in Houston
Can verify what Monty says. Worked in Houston last summer and will be returning there for FT. Actually made more in Houston than most of the SAs that I knew that worked in NYC over the summer.
Had a very nice place on a 3-month lease that I got absolutely screwed on, with only 1 roommate, and only paid $850 / mo. Good luck doing that in NYC.
Oh, and you gotta love that TX has no state income tax. In NYC, from what I've heard, you'll lose half your pay to taxes.
The pay really is bigger and better in TX.
Yeah, it's definitely cheaper living. Unfortunately it's still Houston, with its infamous heat, humidity and traffic.
thats easy to fix... I wipe the sweat off my forehead with $100 bills while waiting in traffic in my new BMW.
Haha well played Monty.
And thanks for the info. Seems like about what I would expect--definitely possible, but maybe a little harder. In regards to planning my next 20 years..I completely agree with you. That's exactly why I wanted that question answered. I have no idea whether I will want to spend 20 years on energy, which is why I want to make sure my option are open if I do start there.
I am going on five and have really enjoyed it..however I am going to b school so take my advice with a grain of salt.
TexasIB- I noticed that you mentioned the huge disadvantage "outside of Texas." As far as non-energy in TX (especially HF's), would you say that there is still a "huge" disadvantage, or more of an even playing field?
Thanks for the input.
Good question. I'd say it evens the playing field a little more, though a lot of the non-energy shops in TX still recruit heavily out of NYC. This is true for PE, thought I'm not as certain about hedge funds. On the PE side, the big players in Texas are energy focused. Not many $1 billion plus shops that are non-energy focused.
From what I've heard/seen:
1) Pay is the same.
2) Hours compared to...? I'd say overall, hours are a little better in Houston than New York, if that's what you're asking.
3) TexasIB answered this pretty thoroughly, but to reiterate, yes you are pretty much stuck to energy specific exit opportunities since it is pretty specialized. However, a wise man once said, "Impossible is nothing."
4) I don't think exit opps to hedge funds are very common; most exit to energy PE funds, and as said before, getting out of the energy industry will be an uphill battle. Your exit opps will be highly dependent on which group you join. You have to join a group that has good deal flow and does all the execution work in the Houston office. Here's how I would rank the groups:
Rankings are based on deal flow, execution, and historical placement. I would say 1-3 are not really debatable, but under that could shift here and there (Tudor is a good shop, but I'm not really sure where they fit in).
I would say trying getting into an energy PE shop coming from a non-energy background is significantly tougher than trying to get into a non-energy PE shop from energy banking. I personally don't think it's possible. Does anyone have more insight on this?
I surprised you would rank JPM at or below UBS/Simmons/BAML. They have been slaying it this year. (Note: I work for a JPM competitor and do not like JPM as a result of said 'slaying') The others I would have to generally agree with, but Tudor Pickering is somewhat of a specialized fairness opinion monster so it's hard to rank against the traditional banks that also throw their own balance sheets around in a deal. I really know nothing about DB, I tend to only see them on capital markets stuff.
I would love to see a (relatively) unbiased deal breakdown by subsectors like E&Ps, MLPs, Integrateds, etc. I think you'd see some interesting specialization patterns emerge.
I can't remember the last time I saw a non-Energy background listed in someone's PE site bio. It's presumably possible, just very uncommon. I suspect that energy is just such a large space (its really several completely different subsectors, for those of you following at home) that the coverage knowledge is probably more difficult to pick up quickly compared to things like RE or Power. Not saying the information's more difficult, just that there's more of it.
The way I ranked was based off deal flow, execution, and historical placement. The reason why I have JPM there is not because of deal flow issues, but how the group is structured (execution). O&G personnel is split between Houston and NY, with, to my understanding, most of the important stuff going up to NY (ex. BP/Apache). Since we're talking about Houston only, that is a huge negative for them. Even if it wasn't straight up sent to NY, analysts in Houston would still most likely be working with a NY analyst, and when you're on a deal, you want to be the only analyst on it. Whether they plan to move everyone to Houston remains to be seen, but if you want to do energy/O&G at JPM, right now you should try to go to NY.
I would also really like to see a ranking based on subsectors. Anyone have any insight on this?
From what I know, UBS does a lot of equities...Barcap has many E&P clients
FunkMonkey-Can you explain what you mean by "a specialized fairness opinion monster"? (in reference to Tudor Pick.)
I've seen some Houston rankings on this site very similar to Gordon Growth's.
also does anyone know which banks execute out of Houston vs NY?
I know, Barclays, CS, and UBS do 100% of execution in Houston, and JPM, GS, and Citi have split operations. Not really sure about the others.
In other news, Houston rankings are about to change:
http://www.bloomberg.com/news/2010-09-15/citigroup-said-to-hire-ubs-ene…
In my opinion, this move will drop UBS all the way to the bottom and Citi will move way up, unless UBS starts poaching some serious rainmakers. I speculate that Trauber will want to move all oil and gas operations for Citi to Houston as well.
So is Citi gonna start doing there own execution in Houston then?
Who knows. Time will tell. I speculate it will since Trauber is the head of the Houston office now, and that's the way it was at UBS.
Pay will about the same, could be even higher if your group has an awesome year (energy has been for past several years).
Hours are a little better than NYC from first hand accounts from acquaintances I know that work there. Definitely still working long hours and weekends though.
I think MrGordonGrowth has it right for exit opps. My friend's brother just got a PE offer in NYC, while I haven't heard of anyone getting an energy PE job without having an energy background.
Most of the exit opps are in Texas, but there are some East Coast opportunities as well. Bigger funds like First Reserve & Lime Rock have offices in NYC, and I know Lime Rock has an office in Aberdeen, Scotland as well.
I am hosting steak night for houston finance folks on 1/28
Anyone have thoughts
Citi for deal flow. Will they be executing out of the Houston office like UBS was or continue to split with NY? I assume Trauber will carry that over but it could affect your decision. A buddy turned down Lazard, thought they didn't have much deal flow. Liked the guys he met though. Not sure as far as the M&A vs BB experience at the associate level.
How are interviews going?
i like the C set up and team. I think they will quickly be up the league tables.. lazard has had a lot of change ups in leadershi[
Not sure how the whole Bilger thing is going.
Does anyone know about BAML and whether or not they execute? Out of curiosity, does anybody know about BAML's O&G group out of Denver? It's a very small office and I am speaking to them regarding an analyst spot they have open (supposedly they mostly do sellside deals out of there).
BAML executes out of Houston.
BAML is strong. no idea on denver
Be careful with Houston IBD groups. Some execute out of Houston, some out of NY.
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