13 Comments
 

Don’t do small cap investment banking … if you’re going to go through all the pain of M&A at least do it for something relatively sizable … just my two cents

It would be like telling your friends you’re a professional football player but in reality you’re a ticket scalper (shoutout Daejon Love)

 

If it's RBC I think you should take JPM. Based on your post history the coverage group is FIG. JPM Small-cap does $100-500mn in EV; at WF or JEFF FIG you should have stronger deals than this. Getting grinded to the bone at RBC FIG for the same deal size as small-cap and a way worse brand name is not worth. Taking a teller job at chase honestly would be better than RBC FIG

 

I think it really depends on the coverage team. RBC Industrials / PU&I / M&A would be worth taking over JPM Small-Cap. All of those groups consistently work on multi-billion dollar deals including at the very top of the market (co-lead advisor to TopBuild on its $17B sale to QXO, exclusive advisor to FBM on its $9B sale to Lowe's). Very strong PE exits other than MFs (although they happen) but those are out of reach at JPM SC anyways. 

Would not take Tech, HC, CME, Sponsors over JPM SC.

I don't know much about RE/FIG so can't comment there. 

 

Absolutely do not do JPM Small Cap. You got two giant issues if you take that route. Number One: it is a brand new group that overlaps with their existing middle market IB team. It takes time for any new group to gain momentum if at all and now they will most likely be fighting internally for deals. Imagine a deal that is $550MM. Do you really think some MD in the middle market group is going to let that go to a new Small Cap team? Number Two: do your research on who is leading the Small Cap team and who are the first hires. If they are not killers from LMM banks, you are in trouble. Contrary to what most people think, you actually do need people who know what they are doing for a new group to be successful. If you are an MD going to a new group for a guaranteed paycheck, fine. But if you are a young banker needing deal experience and mentorship, new groups, let alone those in small cap at a bulge, are not the way.

 
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Just trying to add another perspective, the group is one thing and it’s important for sure for your day to day life and the next 2-3 years of your career. If you also want to consider the longer term (10+ year plus) aspects, the brand you have on your resume and the bank you work at early in your career does compound in terms of network, your thought process and how you approach banking/finance. It’s like your college / undergrad school choice. It matters and it doesn’t matter. In a sense people change but it is a formative time so if you also want to think about some long term aspects like alumni connection and future deal flow and broader market positioning for your professional career try to think about that too. Some people may prefer to just be a JPM person even if it means a tier 2/3 group. Some people may prefer Wells or RBC or Jeff. They do have different GTMs and personalities though it may seem like splitting hairs at this point. 

Hopefully you have gotten some sense from your interactions so far. Trust your gut with this and try to think about it you had to deal with the same kind of people for the next 10 years which ones you would prefer to deal with. Exit ops from these places are never too different from where you come from in that banks tend to have feeders go certain exit ops. Like the “Apple doesn’t fall too far from the tree”


Def important to heed advice from others above but just chiming in with this thought as well to try to aide your decision process. 


Good luck!

 

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