I’ve seen a lot of posts where people are brief and choose product groups over industry due to M&A but not give thorough explanations. I know it depends on the person and bank, but generally speaking, what do you prefer and why. Also, what does each entail generally.
Thanks!
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Depending on bank, coverage groups can handle a lot of the execution and get you better access to an industry, but M&A and levfin groups that model are generally the most sought after. Lots of threads here and look at league tables for industries to get an idea of who does what
M&A > industry groups (incl. FS) > LevFin > ECM > DCM. Always take the M&A group if you have the option, but these are usually the most sought after and most difficult to break into. If you’re in an industry group, you’ll end up doing a lot of industry analysis and PPT formatting for ‘check in’ meetings with clients in your industry, essentially meaningless marketing meetings that create super late nights as you prepare the materials for a pointless work product. At least in M&A you’re late nights are client driven, and you’re getting to work on live deals and will feel a sense of purpose
How are the compensation and exit ops any different?
From what I’ve read the pay is about the same but industry may have more hours which will result in more pay. I’ve also read that due to the connections you build in industry groups there is more job security. A lot of people say that product groups or whichever handles M&A has the better exit ops go PE HF and VC.
My understanding is that senior level coverage bankers make more than their M&A colleagues because they own the relationships. That said, if you're looking for PE exits, M&A is best. For long-term banking work, coverage may be appealing due to the comp and client-facing aspect.
At the recognizable names in IB, whether BB or MM, comp at the junior level, especially at the analyst level is pretty similar. Top buckets in all the groups will get the same bonus. The difference though is which groups are able to secure more top bucket rankings vs. mid-bucket for their team. This is where the MDs and VPs in the group come into play and their success and standing at the firm.
Exit ops can vary, it depends way more on what the bank's strengths are. For example, FIG at MS will have good exits but not as great as M&A. At GS, FIG in NYC is the top group and will have the best exits. Very dependent on firm and group there
In general, people gravitate toward product groups because there is less pitching or PPT work involved but I think it’s a valuable skill to have. To each their own
I did M&A my first year and then lateraled into an industry group my second. I started with M&A first partially because that was the best group at the bank I started at, and partially because I specifically wanted to build my technical / modeling skills first. It's easier to pick up industry knowledge down the road, but it's critical to get the technical foundation established starting on day one.
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