LMM Banking is sweaty and mind numbingly boring
At a LMM Bank (RJ/Stifel/Stephen’s) and I can’t get passed the fact of how small the deals I am working on are. It feels like our MDs are literally hand holding these founders and business owners for what, a sub $500k fee? It feels like I’m not really even in banking at all… not getting to do much financial analysis it’s mostly just pushing processes and spamming 200+ buyers to see if anyone will buy these companies. Typical size is about $20-$40M EV for my group. I get things are slow but for some reason I’m just dreading work because it’s so terribly boring with no critical thinking whatsoever. Anyone else in LMM feel this way? I already signed with a Growth Equity Shop on the west coast, so I’m 100% toughing it out but my god like I’m literally spamming zoom info to find contact info for these CEOs of giant businesses that are never gonna by these companies. Also seems like any business we sell is just an add-on for any PE and therefore, I don’t get to listen to any sort of strategy from PE or founders it’s kinda just oh yeah we will tuck this in if the price is right. Am I missing out by not being at a BB/EB? Believe it or not I had an offer from low tier BB and now I’m regretting not taking it. Mind numbingly boring work. Are any counterparts at BBs\EBs having a different experience ?
Region is not Italy - I’m new to this site - I’m US based.
I'm at a comparable MM and we don't do that at all/have established relationships.
You have a buy-side offer so just stick it out and mindlessly zoom through your analyst stint until bigger deals start rolling in.
I spent 2 years in M&A (ignore my title) at an EB this site would consider as being "top" (EVR/PJT/CVP) and honestly worked on a fair number of these shitty small-cap deals as well. I remember one company was so small that I think the Partner from our team could have bought it himself without even making much of a dent in his bank account.
I also was able to work on some "sexier" transactions, but honestly other than the arrogant feeling of clout I had when working on a deal I thought could potentially end up in the WSJ, I felt similarly shitty feelings there too. Way more bureaucracy around deal processes, super bloated deal teams, lots of bs accounting/legal/tax stuff, etc.
Point is, Partners' incentives at banks are rarely aligned to Analysts' incentives. Especially at firms with profit-sharing models at the partner level (i.e not "eat what you kill") all that matters is building relationships. So ultimately the Partner doesn't give a shit if the junior team is cranking for this $200k fee, because the relationship he/she will build by getting the deal done could lead to a much bigger fee down the line. Just another shitty part of being a junior in banking lol.
I'm in a bank that is on roughly the same tier, with slightly better circumstances. Have seen some big deals occasionally where things are better.
In general, this is what I have day to day in a coverage group.
Funny, I work at one of the companies you named and quite enjoy it (as much as one can enjoy IB, that is...), it's decently challenging and I enjoy my sector. Maybe you just have a skill issue or something.
I did an internship at a lower MM bank a decade ago and that process sounds nuts. The MDs there generally had a really targeted buyer list of preexisting PE relationships and strategies.
Nah I feel you. I worked at a LMM bank and we did a lot of deals with sub $10mm EBITDA/Sub $100mm EV. A lot of the time it feels like a joke when you compare it to larger “actual” transactions but you can get a lot in terms of learning how to run a model and the norms of a sale process. At my shop it seemed like the senior guys just wanted to play “dress up” as if just to call themselves bankers. These guys were delusional to the point of thinking we could go out and win mega cap deals when in the entire firms history we would maybe average like a $50-60mm EV. I got out of there quick.
This is EXACTLY how I feel. Mutter this to myself all the time. Sad.
Which bank if you don't mind my asking
Not going to say the specific firm, but it was a NYC industry boutique
Sounds like your MDs don't have relationships. I work in a similar size, and sure we have maybe one or two cold names in each process, but 99% are relationships or warm intros.
Are the mechanics and subtleties of a mega cap deal different from the MM / LMM? Absolutely. But it's not all black and white. Am in the middle of a probably $50-75M EV sell-side and both the buyside advisors are EBs. Everyone goes where the fees are.
Have a friend at one of these banks and yea sounds like a pretty similar experience. Culture sounds real rough too but not sure if that’s related
Try to "see the forest for the trees."
You may or may not choose to stay there, but while you're there, try to think of it as an opportunity to learn, with preparation for your next career move.
Be a sponge for learning from the seniors and get those deal toys to help you market yourself for the future.
Ray Jay is a notch above Stifel or Stephens these days, but regardless, how in the fuck are you getting sub-$500K fees? Doesn't your bank have a minimum fee requirement?
Thank you, RJ analyst
He’s not lying though I wouldnt group those tg
In 2.5 yrs at Stifel, 2 biggest deal fees I was on were $7.5mm and $10mm, had a couple 250k fee advisory assignments / comanaged IPO's as well lol.
Not surprised, I was at an LMM PE firm early in my career and we almost never used bankers since we could typically do it all in house in addition to whatever buy or exit work was necessary. The few times we did, the bankers either added zero value or threw wrenches in the deal. Pure banking in that range is probably in it’s twilight years the way things are going
Where did you exit to?
Since when is RJ shitty LMM?
Before I get MS I do not and have not ever worked at RJ, but I know a few An/Aso there (am from the Tampa area) and they seem to like it and they certainly get paid very well. Always have been under the impressions its a middle of the road MM with above-average culture/hours (for FL employees, at least)
RJ is a weak MM bank outside of their tech team (Boston?) - their other teams are LMM for sure and certainly chase sub $100mm deals.
have never heard strong comp or been impressed with the Tampa juniors. It’s where senior bankers at larger firms go to coast and retire kinda like the old Suntrust
Have a friend who is having a similar experience at Cowen/HL/HW as well (not the best banking experience), but literally he works less than 40 hours a week and the culture is amazing. The good news for all these LMM analysts, is there are opportunities to lateral (maybe not in this economy).
Where the fuck does your friend work? He works LESS than 40 hours a fucking week, I’d probably 22-25 years old and makes a base salary between 105-125k depending on bank and position lmaoooo that’s insane
What a joke
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