Lincoln International- Growth and IPO
I've never been active on this site but I wanted to go on here and see what people think about this. On the buyside at a MM shop and have seen tons of material come through from LI. Seems like the firm has been rapidly expanding and now they're going public... interesting. Is this an offensive or defensive play, and is this still the low tier shop it was 10 years ago or is it turning into something relevant? Let's hear it.
Bump
Heard Rob Brown might be retiring. Regardless, deals are flowing (Still churning low-mid EV though). Not the lincoln we knew 5/10 years ago. Definitely on the come up and exits are starting to become pretty legit.
Firm is legit and filled with non targets. Don’t know how to analyze that being that they only operate in MM and every other MM has ties going 10-30 years back before them, but have been impressed looking at MM league tables.
Have not seen the financials, but the franchise has improved definitely over the last decade. Still not as good as a Houlihan especially for restructuring, IPO makes sense as a liquidity event for the older partners who want to cash out.
Agreed with IPO take and that they should start a competitive RX practice.
They just hired an RX MD from greenhill
What does their restructuring practice look like? Didn't realize they had a built out group for that.
I’m on the consulting side and have not worked with them. From what I’ve seen, they tend to bring smaller deals (~$100m funded debt) to market. Impressed with their volume honestly after looking at what they’ve done recently but not a real big player in the RX game imo
Got an offer as a lateral there. Big volume shop - quality of assets are meh. Quality of juniors are meh too. Lots of non-targets that rubbed me the wrong way, but the typical core of Chicago/NW/ND juniors are fine.
I always think these things don’t matter once you’re on the desk but then people like you exist on wso, lol
Bump
Still low quality, not middle market, they are squarely lower middle market, and run shitty processes. We have tried to buy lmm stuff from them a few times and we always remark "geez we will never have lincoln sell an asset for us"...
I have spoken with 10+ friends/connections on the buyside and have quite literally only ever heard the exact opposite of this.
Disclosure: I don’t really care and it’s not directly relevant since I was only interested in their new RX buildout after I was contacted.
I work on the buyside and that has not been my experience either with the Lincoln guys. Pretty high quality imo.
Anyone have any color on what the typical exits look like from Lincoln right now? I know a lot of people stay but what about the ones that don't?
Know an associate in Chicago office who did his analyst years there. Pay is good, it’s Chicago COL vs nyc which is a plus, culture and hours are good relative to banking, and the office and location itself is very nice. They emphasize career bankers, a lot of their seniors started at Lincoln. Don’t know about exits, but would assume LMM.
Obligatory have never worked at Lincoln but have been on the buy-side for one or two of their processes. Chicago Industrials team runs a legit process.
Juniors on the deal seemed very overworked, the Associate was visibly in rough shape at one of the MPs. The group is notorious for being sweaty.
To try and answer your question, I would assume an IPO is an offensive play. Let the partners scale while taking some of their chips off the table.
Adding my thoughts as well:
My strongest connection is a former HL colleague who went to a non-target school according to this forum that likes to think of itself as a target according to my interactions with alumni. I worked with a lot of people at HL fortunately and nearly all were very nice and easy to work with etc at least for me. He was for whatever reason one of the most challenging.
He ended up leaving HL for the same team at Lincoln. He seemed to have gotten a better title so good for him. I hope he is easier to work with now and doing better.
I may have also interacted with their RX or M&A about joining myself but I may be off in my memory.
That said, tons of these pure advisory banks trade at like 20x earnings in the public markets. For the founders/owners of a private version of this that don’t think they can stay around and work hard enough to collect another 10-20 years worth of earnings, selling to the public markets seems like an economical decision.
Private market values are probably much lower than 20x earnings (the only private name I can think of is Carlyle or whoever’s investment in Kroll), which is probably done at like 10x EBITDA with 6 turns of leverage.
GS and MS and crew leading the IPO and adding another boutique to their coverage list seems like a fairly easy deal for them to get done. Especially given how all these advisory only no balance sheet bank stocks are doing (evr, pjt, HLI, etc.) I would expect more ipos to happen. While the music is playing you gotta get up and dance…
Either way congrats to Lincoln and all on this milestone. Good luck. Hopefully all this investment in boutique banks means better results for clients and (most importantly to this forum) the EMPLOYEES! :)
Cheers
Forgot to mention this in my previous comment, but the all-cash bonus may now be in question going forward for more senior bankers.
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