Centerview Advisory X Factor?
Hi y'all. Very confused/curious about CVP.
I recall reading here that CVP prides itself on providing "less commoditized" advice. I'd like to learn more about what that means. I also recall in Effron's interview with Immelt, he mentioned he enjoys long-term engagements and is willing to advise against his own interest (but I'd guess that every MD says that).
If you have first-hand knowledge of this, may you please kindly share your insight on how this advice could be different from, say McKinsey or another boutique like Qatalyst? Is this less-commoditized advice about organic growth?
I'm borderline retarded when it comes to this stuff (I can't tell if this is a bluff) and not knowledgeable about what this advice could entail. I apologize if this has been covered in another thread already. I didn't find my answer in the search function, but if it's been answered, I kindly request that you direct me to it.
Thanks for taking the time to share your thoughts.
Centerview Partners (CVP) is often highlighted for its unique approach to advisory, which sets it apart from other firms, including McKinsey or boutiques like Qatalyst. Based on the most helpful WSO content, here’s what you need to know about CVP’s "X Factor" and its less-commoditized advice:
Strategic Advisory Focus: CVP is known for its emphasis on "strategic advisory," which goes beyond traditional M&A work. This involves providing long-term, relationship-driven advice to clients, often focusing on broader business challenges rather than just transactional outcomes. This approach is less about volume and more about high-value, tailored solutions.
Whale Hunting Model: CVP operates on a "whale hunting" model, targeting high-value deals and long-term client relationships. This contrasts with firms that may prioritize deal volume or quick wins. The focus on fewer, larger deals allows CVP to dedicate more resources and attention to each client.
Accounts-Based Staffing: Analysts and associates at CVP often work with the same clients over extended periods, gaining a deep understanding of the client’s business and industry. This continuity enables CVP to provide more nuanced and impactful advice, which is less commoditized compared to firms that rotate staff frequently.
Operational Strategy Experience: CVP integrates consulting-like operational strategy into its advisory work. This is particularly evident in its San Francisco/Palo Alto office, where analysts gain exposure to consulting and operational strategy alongside M&A. This blend of services is rare in the investment banking world and adds depth to their advisory capabilities.
Client-Centric Approach: CVP’s culture emphasizes advising in the client’s best interest, even if it means advising against a transaction. This long-term, trust-based approach is a key differentiator and aligns with Effron’s comments about prioritizing client relationships over short-term gains.
Comparison to McKinsey and Qatalyst:
In summary, CVP’s "less commoditized" advice stems from its focus on strategic, long-term engagements, its integration of operational strategy, and its commitment to client-centric solutions. This approach is distinct from the more transactional or volume-driven models of other firms.
Sources: https://www.wallstreetoasis.com/forum/investment-banking/everyone-and-their-moms-want-to-lateral-to-centerview?customgpt=1, Thoughts on Centerview SF / Palo Alto (Comp, Culture, etc.), Another Way to Classify Boutiques, Is IB Advisory Commoditized?, Lazard vs. Morgan Stanley?
Disclaimer that I haven't worked at CVP but people I know have interviewed / have worked there
Look, every bank is pretty much the same shit bar a few differences.
CVP claims to be independent and lack of conflict of interest. Maybe, that is true. In EMEA, however, it doesn't really do much.
At least in EMEA, it's the big BBs and Roths / Lazards that dominate thanks to their historical relationships and connections. EMEA IB isn't about the coolest financial structure in a transaction but instead just about doing the job just right and getting the best price for the deal.
If it was to me, I'd put the BBs, Roths or Lazard over CVP but that's just my two cents (and I'm interning at one of the aforementioned places this summer).
De l
Lazard / Roths london over cvp? You got to be smoking something my man
Maybe that would make sense for the paris office, but cvp does not have a German or nordic office so not apples to apples
Roth in London is fair but Laz? Fuck no
US BBs & Rothschild have 80%+ market share consistently in Europe.
Roths for sure in London
Lazard is debatable but OP is right that they are definitely more visible in the market
Ok so basically either no one knows on this forum or there is no X factor to begin with (as indicated above). Any final perspectives to add from anyone here?
Tokat built relationships with a bunch of smaller biopharma firms that people overlooked when doing deals, and those balloned overtime with decades of connections and relationships. He was at the Merrill healthcare team way before i think
Blair Effron led UBS pre-2008 and then did high profile TMT specifically telecom mergers like time warner and gave them the X factor there
Todd Davidson idk much about
But Centerview is led by two to three central rainmakers who have dominated the industry. But they are getting old so idk how much longer this sticks versus evercore, who (im biased towards) just has a bunch of MDs all bringing it in
It’s all a bunch of marketing bullshit they say to sound sophisticated. The only X factor in banking is a managing director’s rolodex.
It is objectively true that CVP does actually set up a lot more "check-ins" with their accounts between and beyond the times when a transaction is imminent. You can just ask the juniors and midlevels how much time they spend slogging away on account work. How much does this help them win deals? More debatable. For some mega-transactions in some spaces, it undoubtedly helps them keep their status as banker of choice, but as others menitoned, their dealmaking rainmakers are pretty concentrated. I haven't seen a ton of MDs lateral over to CVP and suddenly start closing things left and right that they weren't sniffing before, if that's what you mean by "X factor." And it's not like the big pharma deals that are done by LAZ, the big tech deals that are done by GS TMT, or the big anythign deals done by MS M&A don't require a ton of strategic work for years in the run-up to the deal sprint actually happening.
So there's definitely some truth to the marketing and branding here. Whether it's an "X factor" or just another feather in the cap of the "chill strategy nerds" aura CVP has that big corps seem to like is in the eye of the beholder. It does impact junior work at the margins if that's a consideration, too.
No x factor, largely fungible (ie it is just the people there). If you built a firm tomorrow and had Michael Grimes, Ken Moelis, Gordon Dyal, Steve Trauber, Paul Taubman, etc. there you’d see the same thing happen. Just a great comp structure for rainmakers that attracts a lot of them. Nothing more to it.
Have firsthand knowledge here. Centerview’s “strategic advisory” practice is not just a euphemism for M&A like some of their other competitors. It goes beyond normal banking market pages, “Chinese menu” target lists with fake math, etc.
CVP typically works on retainer with the large caps, holding recurring meetings throughout the year with C-suite/Boards covering more bespoke topics. Things like corporate strategy, portfolio reviews, investor messaging, etc. and has even assisted with C-suite transitions. All of this engrains them in their clients’ orgs and ultimately lends itself to more dealflow.
Yes, all of the work itself is still partner driven as noted above (and subsequently if they left, so would their knowledge), but they’ve done a solid job of institutionalizing this style of engagement.
The retainer fees for strategic advisory accounts for ~30% of revenues (see WSJ article below). For the skeptics / naysayers, think we can all agree that numbers don’t lie, and if companies are paying CVP nearly $600M per year for strategy advice, I’d say that’s evidence of a clear “X factor”
WSJ: Centerview Considers Deal of its Own
Thank you for sharing first hand. May you please expand on the essence of these bespoke topics, like the corporate strategy and portfolio reviews part? Is this like McKinsey where they focus on growth/market penetration, or something else? Investor messaging and CEO transition is self explanatory so thank you
On average what’s the split of advisory to transaction execution?
Bump, can you please expand
I work at cvp and that 30% number is total bull - they include buyside M&A fees and other stuff a that are counted in that (PEP, JCI, HON, TR, others)
Every year at their offsite (this year is the 20th anniversary btw) they list the number of paid retainer clients and to hit the number you quoted, it would imply each is paying more than their largest client (Pepsi)
To why the firm is doing well - its because Blair and Robert are generous with the economics - the guarantees for partners are lower than a BB but the payout is the highest for a legit platform (sorry Q, Dyal, etc) and the firm has only hired top partners.
The firm almost fell apart in 2016 if Hillary would’ve won - and in 2024 if Kamala won as Blair would’ve left the firm and a lot of key relationships would be at risk.
The firm has done okay at home growing talent (Doramus, Katz, Neata, others) but the breakdown for fees is 80%+ just the firm hiring the best banker in a space and farming their Rolodex. Some examples include Gordie who came in 2024 and suddenly cvp did 4 of the 5 biggest digital infra deals. Healthcare they hired the best BofA and ML dudes who have great synergy with the CS and GS guys
Long story short, the firm is nothing special, they’ve just hired the best partners and stayed private so they can give them the best platform. Trust me, their books are only 10% better than a Goldman book… maybe 20% given they grind you for it. If CVP go public this equation becomes materially different. But for now it works
Heard a well known partner at CVP say why would you not be here until the day they go public. Wonder what happens down the line if IPO occurs.
I can echo this as well as someone who has worked with senior CVP bankers fairly soon after they left that bank. I also have junior / mid friends who worked there who seemed to confirm my understanding.
The model seems to be getting to be the “in-house” banker with a mega-cap company in a space and dominating any and all investment banking related work for them. The poster above gave good color, I can just add that I have also seen heavy IR work and board long-term planning (like big picture company vision over the next few decades or more kind of stuff).
Once CVP becomes by far a mega cap company’s “favorite investment bank”, when that company has budget/interest/appetite to execute a big fee M&A deal like to add AI exposure or break into a new market or sell a division or the whole company or what have you; then CVP knows way in advance there is a bake-off and is most prepared and best positioned to prove to the board that CVP is the best decision for them to hire even over GS/MS or whomever else.
Once the board with the advice of counsel decides to hire CVP over GS, CVP can still earn a mega-bank GS/MS type fee (maybe even pricing a bit lower than Goldman Stanley to really hone in that the client is getting a great deal by hiring a better and more knowledgeable banker at a better price than anyone else on the market).
This mega fee can now be split among a smaller group of partners at CVP than what any GS partner has to share with the rest of GS. This is attractive economics to a top banker who knows they can win mega-fee business from a mega-cap company.
I hope this helps and doesn’t get any MS lol
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