To M&A bankers

I am considering whether to summer in M&A or a coverage group. I have fairly strong quantitative skills, but they are by no means stellar. I am a varsity athlete, and I am pretty on top of my shit. Does M&A require its analysts to be A students in math and stat classes, or will a B B+ performance at HYPS in those classes be good enough? I have been told M&A isn't rocket science, but that it is certainly the most challenging group at an investment bank. What makes it most challenging? The hours? The deadlines? I know I can handle both of those. I think I would like to do M&A but I just want to make sure that I am not getting myself into something I am not ready for, innate ability-wise.

Thanks.

 
Best Response

If you got into banking at all, you can do M&A. It's that simple.

TYPICALLY (and I really emphasize typically because all banks differ on this), with M&A you will be more focused on deal execution and will learn more modeling skills and more about diligence/negotiation vs. an industry coverage group where you will be doing more pitching and working on different products.

Obviously this does not apply to all banks - Goldman for example does not have product groups, only industry groups.

Hours will typically be more intense in M&A because there are more live deals and execution to work on. I don't know that deadlines are significantly different, you have deadlines in any group really, even for pitches and non-deal work.

Trust me you have what it takes to do M&A... I would actually laugh if someone told me they thought anything in banking was below their ability levels (at least at the junior level).

I would just go for it and see what you think, sounds like you are leaning in this direction anyway.

 

Having only done M&A, I can't make a good comparison to other groups. However, I can say there are a few aspects of M&A that make it challenging that may not exist in other areas.

1 - You're on a tight timeline and you don't get to set it. There is a ton of work to be done and it is all crammed into a short time period, so inherently the process is going to require you to bust your ass (more so at different stages in the deal).

2 - Not only do you have to deal with the client, but all of the buyers as well. Later in the deal when you got a number of groups chasing your company, you have to play moderator for communication between your client and all the different buyers, which takes some degree of organizational skills. Huge pain in the ass, maybe not so challenging.

3 - General mathematical aptitude is a must. Not only are you going to have to model out all of the company's financials, but you will have to slice and dice their operating metrics three ways to Sunday. Depending on the company, this can be very painful. Also, if the company has a ton of different divisions or completed a number of recent acquisitions, pro-forma'ing the numbers can take some time to do right. Not entirely complex, but does require some level of fluency with math.

That's all I got at the moment. I would say this, if you aren't very comfortable with math, you're probably going to have a bit of difficulty in many different groups. What this will mostly translate to is just more hours at the computer due to your needing more time to go through the numbers. In an environment where your capacity is already stretched extremely thin, it may prove too much for you. Again, it isn't that anyone could do the job, it is that the job needs to be done right and fast.

CompBanker’s Career Guidance Services: https://www.rossettiadvisors.com/
 

"it is certainly the most challenging group at an investment bank" In terms of hours maybe. Go talk to the structuring guys in markets, now THAT is the most challenging group in terms of quantitative ability, I don't know a single person who wasn't a genius in quant who got in that type of job. But by far the most challenging group in a bank has to be the S part in S&T. How hard do you think it is to transform horse shit into candy in the ears of the buyer?


Remember, you will always be a salesman, no matter how fancy your title is. - My ex girlfriend

 

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