M&A job difference between Banks and Accounting firms
I was wondering what is the difference if any between the M&A jobs in banks and those in accounting firms! Is it worth looking in accounting firms rather than small and unknown investment banks?
I was wondering what is the difference if any between the M&A jobs in banks and those in accounting firms! Is it worth looking in accounting firms rather than small and unknown investment banks?
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They are completely different jobs - as a banker you do the financial modelling, arrange financing, execute the deal, etc... accounting firms are there to support with accounting stuff (and maybe tax implications). Do you want to be a banker or an accountant? That's the question.
If you don't know what you're talking about, don't talk.
Just speaking based on my experience on calls w/ accounting firms - no need to be hostile. The accounting considerations in a major M&A transaction are enormous, there obviously needs to be an expert party to address those issues. Hope this helps.
Big 4 Accounting firms work on smaller deals, MM deals, many are PwC. Not E&Y though. Comp isn't as great either, this is for both salary & bonus. You'll work less hours though.
If you're looking for a small shop, I encourage you to focus on boutique IBs, several will have a sector focus. Much better to work for a firm like this, deal flow will be stronger because they have that domain expertise and are able to articulate the business model and value prop of the firm they represent much better than some generalist Investment Banker. Relationships will be stronger too since they are sector focused - this includes other firms in the sector as well as PE guys.
It depends on your experience and what you are looking to do. Given the size of transactions that M&A groups in accounting firms work on, I will stick to MM IB shops because they are not comparable to BBs or EBs. I will attempt summarize some of the pros and cons.
Pros: *Much better work life balance
*Earlier exposure to business development (meaning it isn't just MDs or Directors looking to drum up deals)
*Potentially more involvement quicker with all aspects of the deal (some MM groups are good at involving junior members of the deal team in management presos, pitches, etc., others are not)
*Work tends to be more focused and less busy work, such as churning pitchbooks, updating comps and pulling industry data
*Creativity is strong for maximizing client value given the ability to leverage in-house resources (e.g. tax, wealth management)
*More exposure to buy side assignments and capital raising (MM shops are notoriously sell side heavy and take on far fewer buy side engagements unless they believe it will lead to a sale down the road; more tend to work on private placements since it typically leads to a liquidity event). I believe this can be spun as a positive if you are looking to exit to Corp Dev (most of the buy side work is from strategics).
Cons: *Compensation is significantly less than MM shops (part of the work/life balance trade-off) particularly on the bonus portion. Salary is slightly less too in most cases.
*Expense budgets are tighter than MM shops (e.g. you can stay at a Westin for a conference, but not the Four Seasons)
*Deal flow tends to be more lumpy than MM shops as Accounting M&A groups source many mandates directly without going through a pitch process (the premise being, all of these trusted advisors are out there should know if their client wants to sell, raise capital, acquire, etc.)
*Prestige is lacking at times with exit opportunities compared to well-known MM IBs. Also can be an uphill battle in pitches going against top firms for larger mandates (e.g. Harris Williams, Houlihan).
*Size of the transactions is, on average, going to be lower than the premier MM IBs (e.g. Blair, Baird, Houlihan, Lazard MM, HW) - part of the reason comp is lower.
Let me add to the cons:
*Some people in finance don't know that M&A team's in Big 4 even exist and many still have a perception that this is an accounting/due diligence role
Who are you referring to by "people in finance"? College students on WSO or MM private equity professionals?
Having worked at both a Big 4 M&A team and now a MM M&A team, I can say that there is little difference in the actual day to day work, running a sell-side process isn't rocket science and is basically the same pretty much across the board in terms of materials preparation.
This is possibly skewed as I am/was a generalist in both and based in London, but the only material differences in my opinion are: - overall compensation - much less at Big 4 - lifestyle - much better at Big 4, weekend work was non-existent and I never really stayed in the office beyond 10pm - deal size - at the time I was at the big 4 firm, the overall deal size never really exceeded £60-70m and the fees were much much smaller than what are charged at my MM currently
Curious to hear how your lateral interview process worked and how you told your story. Why lower middle market to upper middle market?
What is typical signing bonus for a lateral at a MM (HL, Rothschild kind of firm)?
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