I’m currently a VP at a boutique where the MDs are extremely supportive of people below the MD level sourcing their own opportunities and gradually building a book of business. The structure at my firm is pretty entrepreneurial. If you originate a deal, you receive 40% of the fee. This is separate from my base salary and year end bonus.
I know this type of structure is not common at the BB / EB level for VPs, but I’m curious how common it is across smaller boutiques and lower middle market firms.
I’ve been leaning pretty heavily into origination over the past two years and now have several deals that I personally sourced and helped convert into signed engagements.
Two are currently under LOI and should close by year end:
• ~$30M growth equity raise with a 3% success fee
• ~$50M EV sell side mandate with a 4% success fee
I also have two additional deals that I sourced where we have signed engagement letters and are about to go to market:
• Payments / gateway processing business doing ~$70M of revenue and ~$7.5M of EBITDA, with a 3% success fee
• Medical supply manufacturing company doing ~$130M of revenue and ~$30M of EBITDA, with a 2% success fee
One other piece of context is that I’m also basically running these processes myself from beginning to end. My MDs are involved and provide guidance and oversight where needed, but on a day to day basis I’m the one driving the process.
That includes building the financial model, putting together the CIM, developing the investor / buyer list, managing outreach, running investor calls, coordinating management calls, handling diligence requests, managing follow ups, and generally keeping the process moving from launch through closing.
Curious how this compares with other boutiques and whether anyone here has had a similar experience.
For those who have worked under a similar model:
• Is 40% of the fee unusually high, or have you seen similar structures?
• At what level did you start receiving meaningful fee participation, VP, Director, or MD?
Would especially be interested in hearing from people at lower middle market / middle market boutiques where bankers are encouraged to develop their own client relationships before reaching MD.
I really like the entrepreneurial aspect of the model and the opportunity to start building a book earlier in my career, so I’m curious whether this is relatively common in the boutique world or more unique to certain firms. It’s one of the reasons why I haven’t pivoted to MM / BB / EB platforms (I’ve gotten offers at top MM firms but rejected it because of the deals that I brought in)
Also happy to answer any questions about what the experience has been like on my end. If anyone else is in a similar position at the VP or Director level, originating deals while also running execution, I’d definitely be interested in comparing notes and learning how others have approached it.
Based on the most helpful WSO content, your experience at a boutique with an entrepreneurial structure and significant fee participation is not unheard of, but it is relatively unique compared to larger platforms like BBs, EBs, or even some MM firms. Here's a breakdown addressing your questions:
1. Is 40% of the fee unusually high, or have you seen similar structures?
2. At what level did you start receiving meaningful fee participation, VP, Director, or MD?
3. How common is this model across smaller boutiques and lower middle market firms?
4. Your role in running the entire process:
5. Why this model might be appealing:
Final Thoughts:
Your experience highlights the benefits of working at an entrepreneurial boutique, especially for someone with a knack for origination and a desire to build a book of business early. While this model isn't the norm across the industry, it aligns well with the culture of smaller, more flexible firms. If you're thriving in this environment and enjoy the autonomy, it seems like a great fit for your career goals.
Sources: Regional Boutiques are vastly overlooked in IB, Negotiating Participation - Boutique SoCal Development shop, boutique v BB, Q&A: MD in M&A and Capital Markets with Bulge Bracket and Boutique experience, 2017 Commercial/Corporate Banking Bonuses
What are you looking for here, for us to gargle your balls? “Hey guys I’m about to clear $1.16M as a VP, is that good??”
Yes 40% is uncommon. Would say MM MDs are typically not clearing this much.
I'll gargle
This is pretty impressive at that title. Before getting to signed ELs, can you walk through in more detail how these deals were originated? How did you build the relationships, which roles within client firms did you network with, did you need to / how did you nurture those relationships over time, even down to specific things you'd say in conversation that helped get you to convert?
A lot of the deals I originated came from relationships I already had with business owners through family, friends, relatives, and people I’ve gotten to know over time. I also spend time connecting with accounting firms, law firms, and other advisors that work closely with business owners. I’ve been in the industry for 4+ years now, and some of these relationships were built over 2+ years before there was ever a real transaction discussion.
More recently, I’ve been spending a lot more time building relationships with financial sponsors in the LMM, both for current processes and longer term origination. I also spend a ton of time in APAC / SEA, so I’ve been building out my network there across business owners, investors, and intermediaries. Our firm has closed a few transactions in the region, which helps with credibility.
Before my MBA I worked in wealth management, so I was already familiar with building a book of business and staying in front of HNW clients. A lot of that transferred pretty naturally to IB. Staying in touch, being useful, understanding what someone is trying to accomplish, and not making every conversation feel like a sales pitch.
As an associate, I also got lucky because my MD brought me into a lot of pitches, networking calls, conferences, and client meetings. I got to see how he built relationships, positioned the firm, handled pushback, and ultimately got clients comfortable enough to sign an engagement. That helped a lot once I started doing it myself.
Most of the people I’m talking to are founders, owners, and CEOs. I usually don’t open with “are you looking to sell your company?” It’s more about learning the business and understanding what they want to do over the next few years, whether that’s raising capital, bringing in a partner, doing acquisitions, taking liquidity, or eventually selling.
If there’s actually a need there, the conversation becomes much easier because you’re not trying to force a deal that doesn’t exist.
At the end of the day, it’s a sales job. You have to build trust and give someone a reason to believe you can actually help them. Having relevant deal creds helps a lot too. If we’ve done something similar, I can point to an actual transaction, explain how we ran the process, who the likely buyers or investors were, and what valuation looked like. That’s much more effective than giving someone a generic pitch about the firm.
We also have a pretty lean team of 5 bankers and usually work on deals in the ~$20M to $500M EV range. Because we’re lean, we can still make the economics work on smaller deals that a larger bank probably wouldn’t spend much time on.
At least for the deals I bring in, I also don’t charge a retainer, which lowers the barrier to entry. I think that helps with owners because there’s a lot of alignment, and I can genuinely tell them I’ll be one of the people actually running the deal from start to finish.
The biggest thing for me has probably just been patience. Some of these people knew me for years before there was ever a conversation about hiring us. I try to stay in touch, learn their business, send relevant info when it makes sense, and not constantly ask them if they want to do a transaction.
Then when the timing is right, it’s usually something pretty simple like, “If this is something you’re thinking about, happy to give you our view on valuation, what the buyer or investor universe could look like, and how we’d run the process.”
I’ve also watched a lot of Jim Donovan’s content, and I think a lot of his approach to relationship building and sales has shaped how I think about origination.
Still learning a ton on the origination side myself, but happy to answer anything more specific.
Just say your dad's network.
Good on you. 40% is uncommon, unless you own a small boutique.
40% quite high. 20-30% is market
Is it typical for VP's to need to do everything on their own like OP has to? Or would they generally get support from the team?
I’d say at most other firms, you’d typically have junior support and a senior banker involved throughout the process. I’ve worked on and closed 15+ deals over the last four years, so at this point I’m pretty comfortable running most of the execution process on my own.
That said, I actually like being hands-on with the marketing materials and outreach. From my experience, the most tedious part of any process is usually the outreach and managing the investor/buyer universe, especially all the follow-ups.
You’re in a great spot. Many MDs would have tried to steal your deal.
I've seen 50% at the top end of the range, but this is for MDs at boutiques. As a VP hitting 40% sounds great, but like you said you gotta run the deal. A simple referral/finder's fee where you don't do anything past the intro is much, much lower.
Sounds like you need to hire a few analysts to build the models etc.
Rejecting MM offers to keep your own book makes sense if the deals keep coming. The real question is whether the firm keeps that 40% structure as you get more senior or starts clawing it back.
It was a difficult decision to turn down those MM offers (think firms like WB / Jefferies / HW / Baird), especially because part of me does want the structure, resources, and platform of a larger organization.
At the same time, the economics are hard to ignore. Based on just the deals I mentioned in my original post, the 40% origination upside could potentially equate to 7+ years of base + bonus at those firms.
Plus I can always lateral at anytime if I choose
Has this been stress tested? Have you heard from other people if the 40% was truly paid out as promised?
Almost sounds too good to be true, and as another alluded to, huge moral hazard of the leadership swooping in.
Just to note, this is explicitly included in my employment contract. For any deals that I source, I am entitled to 40% of the transaction fee, so I have this in writing.
Nice flex
You’re 100% at CG
What's cg? Never heard of this no name shop
Gotta be canacord genuity
whatever you do, don’t fucking leave
I don’t plan on leaving. I like my gig, and I value the independence and ownership over my deals. Also I'm fully remote (but I travel a ton to visit clients, conferences etc.) so I enjoy that flexibility rather than being stuck in an office.
I worked at a BB before and hated spending so much time on mindless, low-probability pitches and busy work that didn’t really contribute to top-line revenue.
This is similar to comp at a boutique where I was as a VP. It was 33% each to the deal sourcer, 33% for admin/salaries/bonuses, 33% to the partners. They were fine with me sourcing starting as an associate, and due to the economics I did a lot of that. I left to start a company. They asked me to stay as I was creating the company, but I wanted to focus 100% on my startup. A deal I sourced came back to life (thought it was dead), and I ended up leaving $2M on the table that I would have gotten if I took their recommended path of staying on and building at the same time. Bad call on my part...
20-30% of the fee is market at boutiques that offer anything at all, 40 is top of range. the details matter more than the headline number though - whether it's paid on signing or on collected fees, whether there's a hurdle before the % kicks in, whether you keep sourcing credit if an md takes over execution. plenty of firms advertise origination participation and then pay it on collections over 18 months. and yeah it's basically nonexistent below md at bb/eb, your upside there is just a bigger bonus number. on the support question - sourcing is the solo part. once it's signed you get a normal deal team, nobody expects a vp to run a sell side alone.
In my employment contract, I get 40% of the fee whether I only source the deal or source it and work on the execution as well. Ideally, though, I’d want to run the deals I bring in since I built the relationship myself and already have that trust with the client.
I also get paid the full 40% once the deal closes and the wire hits the firm’s account. From what I’m seeing, 40% is definitely on the higher side, but I also have more responsibility on managing the deal process, which is a trade-off I'm willing to take.
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