I'm interested to know what folks think of Greenhill's franchise--particularly those with real experience. It seems several years ago, the consensus was it was still one of the more sought after spots on the Street. Now, when I look across threads, I rarely see Greenhill mentioned along with Evercore, PJT, Moelis, et al. They obviously didn't grow to the same extent post-crisis, but they are still recruiting what seem to be solid MDs from BBs. Recent deal flow has been skinny, which may be due lack of large and/or cross-border transactions in the last year, or might be they're just not winning any more. I imagine compensation has to be pretty efficient, or are they potentially having to overpay recent hires? Do you think the franchise is permanently damaged, or just going through a cyclical rough patch?
Trending Content - Investment Banking Forum
Career Resources
Greenhill isn't what it was 10 years ago, but it is still a fine M&A shop with solid bankers and good exits for analysts. You don't see them talked about as much on these forums because A) they are a lot smaller than their peers (NY analyst class of like 10-15?) and B) they haven't landed as many mega-mandates in recent years
As someone already mentioned, the independent advisory firm competitive landscape has changed. 15 years ago, EVR was a fraction of the size it was now, and Moelis, CVP, and PWP didnt even exist. If these firms are all offering somewhat the same value proposition (independent advice), it will be more difficult to win mandates as the landscape is more crowded.
Greenhill also hasn't grown their MD ranks as much as they should have post-financial crisis, while their competition did. There were several years where they could have bulked up, but didn't. They have ~70-80 MDs at the firm globally, whereas firms like Moelis/Evercore have closer to ~150-200? Although having more MDs doesn't necessarily equate to more transactions, there is a strong correlation between # of MDs and deal volume. I think Greenhill has realized they have fallen behind and have only recently started to ramp-up the MD hiring over the past couple years.
Hiring high-profile MDs/rainmakers can help a lot, but they are expensive to poach and from what I hear, GHL does not offer guaranteed compensation for MDs (while other firms do). There is also no guarantee a BB rainmaker will have success at a boutique - I remember when GHL hired Luca Ferrari (Head of GS M&A in Europe) in London, which was seen as a big deal, but he literally did nothing of note and left to BAML.
M&A advisory revenue is also volatile, and it helps to have ancillary revenue streams to support earnings and the stock price (LAZ has Asset Management, EVR has research/ISI etc) Greenhill only has advisory and one large transaction fee can materially impact the stock price. A volatile/declining stock price = impact to MD deferred compensation = retention issues
Disclaimer: M&A Associate at a competitor independent advisory firm with friends at GHL