DCM Path
I'm interested in going into DCM. Yes, I understand that it usually comes with a sacrifice in regards to exit opps.
Any insight on whether or not the "path" of going into DCM is any different than it would be for M&A? Tips on internships, target schools, competition, etc. would be helpful....
More generally, which BBs and boutiques have good DCM groups? Is DCM big in any other cities --- like Houston, SF, Chicago, Boston, Atlanta?
Based on other threads on here, the learning curve isn't as steep. As a result, some find the actual work in DCM to be more "mundane."
Mundane - "lacking interest or excitement; dull:"
Sell-side M&A analyst here and about 85% of my day is spent doing mundane tasks.
(Caveat: What I say below applies strictly to investment grade DCM.)
In terms of "the path": You have to interview with a lot of people at all levels, have them all like you and have good grades. Is it less selective than your typical M&A or coverage group? I don't know for sure, but I doubt it is much less selective if at all. Most DCM groups are far smaller than a bank's combined M&A+coverage groups (although larger than any one of those), and they are recruiting the same 3.5+ GPA kids from the same Ivies, etc... Now again, the odds are the M&A group is harder to get into simply because of supply and demand, but it's not like DCM group are letting kids with 3.0 GPAs from Yale, or 4.0s from Middle Tennessee University in. The credentials required are more or less the same; just the M&A group will get their pick of the litter
The banks with the best DCM groups are those with the biggest balance sheets. DCM is very balance sheet driven; i.e. the guys who act either as lenders to the issuers and/or have the ability to trade large volumes of their paper. To be big in DCM, you need to have a pulse on the credit market and the ability to sell new issues, and to have a pulse on the market and sell new issues you need to have a big credit trading operation. Few boutiques have this because they don't have the capital needed to do so.
Given DCM relies so heavily on trading, and vice versa, most banks have the bulk of their DCM groups located in NYC. You might find the odd energy-focused group in Houston/Dallas, and small regionals may have their DCM groups located in their home bases, but really New York is the only place you want to be in the U.S. if you are doing DCM.