Negotiating VP Sign-On Bonus (NOT Tied to Deferred Comp)?
I'm aware the banks frequently offer deferred comp buyouts to lateral hires. However, is it possible to secure a similarly sized bonus / equity grant for candidates that do not have any existing deferred compensation? In theory, the bank would have to pay a make whole to another candidate so don't see why it would be an issue.
I have an offer for a VP role where I'm an unusually good fit, but am on the fence about the role. A meaningful equity grant (on top of guarantees) would go a long way, but I don't have any existing deferred comp that would actually need to be bought out.
Based on the most helpful WSO content, negotiating a sign-on bonus or equity grant as a VP without existing deferred compensation is possible, but it depends on several factors:
Leverage Your Fit: If you're an "unusually good fit" for the role, this gives you leverage. Banks or firms are often willing to pay up for candidates who bring unique value or reduce hiring risk.
Market Precedent: While deferred comp buyouts are common, firms may also offer sign-on bonuses or equity grants to attract top talent, especially if they perceive the candidate as critical to their success.
Negotiation Strategy: Frame your request around the value you bring and the precedent of paying deferred comp buyouts. Highlight that while you don't have deferred comp, a meaningful equity grant or bonus would demonstrate their commitment and incentivize your long-term contribution.
Firm-Specific Policies: Some firms may have rigid compensation structures, while others are more flexible. Research the firm's history or speak to insiders to gauge their willingness to negotiate.
Timing and Guarantees: If you're on the fence about the role, consider negotiating for guarantees (e.g., guaranteed bonus for the first year) alongside the equity grant. This can provide additional security and make the offer more compelling.
Ultimately, the key is to articulate your value and use your unique fit as a bargaining chip. Good luck!
Sources: Associate ---> Director/VP/Manager, Vice President Fund Carry/Equity, https://www.wallstreetoasis.com/forum/job-search/negotiating-offer-before-during-and-after-interview-follow-up?customgpt=1, How many of us are making over $250k?, What would it take to pull you out of PE and into ops?
There’s a couple different points of negotiation here
The easy one is a guaranteed bonus. It’s September. You’ve accrued almost an entire year’s bonus. You should negotiate either 1) a sign on bonus paid now plus stub paid at year end when bonuses are regularly paid or 2) a guaranteed year end bonus. I’d go with option 2. Its cleaner. Any real bank worth joining should understand this is the cost of hiring an employed banker vs an unemployed banker.
The harder item to negotiate is a bonus to replace deferred compensation which you do not have “just because” which is what it sounds like you’re asking about in this post. That’s a tough ask. They may ask for proof of your deferred compensation.
I wouldn’t treat these as 2 separate negotiation items. I don’t know how well your bank pays, but it’s within the realm of possibility to negotiate a gtd full year bonus that is higher than your current bonus. You can view that premium as your vig if that makes sense
Helpful answer
If they know this, not sure how/why you have any genuine leverage to negotiate here
What is stopping them from telling you to kick rocks if they know they’re the only thing standing between you and unemployment? Do you have a set of specialized knowledge that results in a super thin candidate pool?
If you’re actually fine being unemployed go ahead and ask…no downside. I would advise against being so happy to be unemployed in this market where AI can probably already do your ‘niche’ job.
If it was me (ignore title I’m more senior), there’s almost no way I’m giving you a big sign on bonus if I’m not buying you out, I probably don’t have the authority to even do it if I wanted to since the stock for stock swap is tried and true…so the more logical thing for you to do is try to negotiate a higher end of year guarantee - that has the added benefit of hitting more than just once.
Feel like you missed ECON101.
Your main point is correct. But the bank’s goal is not economic parity from the banks perspective. Their goal is to get the best talent at the cheapest rate possible.
I could also fairly argue that the bank not offering you a sign-on bonus while also offering to cover another candidates deferred comp
IS economic parity from the candidates’ perspectives. You are sacrificing nothing by taking the job. Alt Candidate X is sacrificing $xzyK of deferred comp by taking the job. So the two offers are equal from the candidates’ perspectives. The bank sees it as a “make-whole” not a sign-on bonus. You have nothing to make whole.
The bank needs to see you as head-and-shoulders better than the next-best candidate (which they might based on your unique experience you described) in order to offer you something beyond table stakes, which for you (with zero deferred comp) does not involve a signing bonus equal to the deferred comp of other candidates.
If they think they can get you for cheaper, they will try. You should also 100% ask if you’re truly comfortable being unemployed for a while.
I think what I’m suggesting aligns with ECON 101 and dysfunctional bank policies are resulting in two different prices for labor. The bank should want the best candidate and be willing to pay up to $X for it.
I would be giving up a lot for this job (moving, career optionality, etc) and a meaningful sign on could convince me to accept the trade off
Re-read my last two paragraphs. That’s how this is going to go. Welcome to capitalism. Best of luck.
Depends so much on the bank. At a BB or cheap MM (like Blair or Piper) no way in hell the hiring processes are so dysfunctional there.
at an EB or an independent advisor if you are actually bringing something they want you have more leverage. But either way be prepared to have to walk away because they say no
So your bank is shutting down and you want them to not only give you a guaranteed year end bonus that you would not otherwise get, plus have them also match phantom deferred comp that you don’t have.
As a VP level candidate.
Wow, and I thought I was arrogant and delusional lol.
How is that delusional? I’m not a banker, don’t want to make the move, and think the role is potentially limiting but could do it if the comp was right.
Because you seem to want a fatass package to join when you’re just a VP dude.
Don’t believe me?
Please tell us what the response was when you floated this idea of being paid this additional sign on bonus since you don’t have any deferred compensation.
Possible, but it's a different conversation. A buyout is easy to approve internally because it's 'make whole' money, not new money. A sign-on with no buyout is pure incremental comp, so it needs a justification - a competing offer, or you being a genuinely unusual fit, which it sounds like you are. Route the ask through the hiring manager or group head, not HR. And if the equity grant is a stretch, a two-year guarantee structure often lands easier than a headline number.
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