Q&A: Senior Banker

Haven't been active on the site in awhile.  WSO is a great resource but the amount of misinformation shared is high, which I guess shouldn’t be surprising given the target age cohort of the site.  Hoping to provide some new perspectives.  AMA

  • Bio
    • Entered banking as a post-MBA associate
    • Currently highest titled non-group head role (think Partner / SMD / MD depending on the bank)
    • Have lived in SF, Chicago, and NY during my banking career and live in one of those cities currently
    • ~40yo with a family
  • Background
    • Currently at a boutique and have worked at both BB and MM previously
      • I consider boutiques to be the more established, broad-based advisory firms (Moelis, Lazard, Evercore, + 5-6 more), MMs to be the household names, and not many beyond the top tier (Baird, Blair, Houlihan, + 2-3 more), and BBs to be the names typically associated with traditional BBs (sorry Wells/RBC).  No offense to other types of firms that have great bankers, I just do not have experience there
    • Have completed $40bn+ in M&A.  Largest transaction being ~$9bn and smallest being ~$200mm

What are your actual hours like? And how would you divide them between:

  • Fully engaged in work, talking to clients/colleagues, reviewing docs, etc.
  • Partially engaged in work, doing other stuff, but thinking about deals/pitches, etc.
  • Not engaged in work, fully concentrated on family, friends, personal, etc.

Covid has changed the work style pretty dramatically.  From 8 - 5 I am generally booked solid with zoom calls (new business development, live transaction meetings, internal calls).  I have had to put recurring placeholders in my calendar to have set times daily to do follow-ups, etc.  Evenings (5-8) are mostly family time (dinner, getting kids to bed, etc.).  Remainder of evening I'll review documents and generally be responsive to emails but will have a game or tv show in background. 

If you are thinking about going into banking longer-term (and this includes associates) - I personally would prioritize team/group over brand.  The job is tough and if you're working with people that you generally dislike, your tenure in banking is likely to be short.  I've gone this route and have been happy and has worked out over a longer time period.

If you are planning to be in banking shorter-term, I'd look at groups with strong deal flow.  Brand is more important in this scenario, but I'd take a bank with marginally less "prestige" that owns a vertical so you have referenceable deals.  Sweaty shops aren't necessarily bad if youre getting a good experience.

I'm sure there are other threads on this, but its definitely harder to make a good impression in a virtual environment (I think we gave 100% offers last summer because there really wasn't a good way to differentiate).  

Personally - if an intern reaches out to me just to chat and expresses interest in working in my sector or on a transaction with me, I'll typically get them on one of my projects or at least work with them on firm building.  From there its sink or swim, but you've made yourself known and if you perform I'll make sure its known. 

As a senior with hours booked pretty much from 9am to 5pm with zoom calls, are you still able to make time for chats like this with interns without seeing it as a nuisance? If so, would a 10 mins call be more do-able than 30mins? I worry about reaching out to senior bankers as I know in the first place they do not have a lot of time, particularly in the COVID envrionment.

Thanks for doing this. Curious to know, what was the main driver in your comp increase from 700k as third year vp to 1mm as first year director? Did the group have a blowout year and that was just ballpark for your class across the board? Were you mostly in an execution role as first year D or did you potentially source a large fee and that contributed to your high pay that year?

First year director here and the 1mm figure struck me as bit high and impressive.

Sure I have.  Some days are tough - mostly due to clients.  But I haven't really given it a ton of thought.  Truth is, the higher you go, the less attractive exit options there are.  Pay difference at most logical off-ramps is insane.  I'm not going to go anywhere in next 2-5 years...want to get plenty of financial cushion.  At that point who know but given earnings up to that point, I should have flexibility to do something not based on need for $$$.

Do you think success in a corporate setting will be impacted by how long you spend in banking?

In other words, if you want to develop as a senior executive in a corporate setting, is there an advantage of leaving banking earlier (say as a post-MBA Associate), or as a VP or Director?  

Also wondering if you could walk us through your experience in sourcing clients. Having a good network helps, but how much of it is grinding and hard work vs. luck vs. using relationships and relying on the bankers around you?

Thanks for doing this! It's always very valuable to add experienced members' responses to the WSO Q&A 'archives'

- How do you think about promotions at different steps of the ladder? i.e., what do you need to do to stand out at the VP, ED, MD promotion levels?

- From what you've seen, what does it take to keep climbing to group head, head of M&A, co-head of IBD... after you become MD? Do you personally view it as an attractive athlete to pursue? I ask because I've been told by a few MDs already that they would much rather stay as MDs and keep working with their clients and growing their business vs. going into management roles

Titles are generally step functions whereas responsibilities increase more gradually.  For promo, you need to be doing what the person titled above you is doing.  If you’re a third year associate and you are proactively pushing forward analyses, drafting content, and driving some form client communication - essentially running the day to day, then you’re ready for VP.  Same thing as you progress to higher titles. 

As for group head or similar roles, the “best” bankers or the economic animals may not want the title.  Not safe to assume they are highest paid.  Admin burden can be high and annoying. 

Have had some VPs move to CFO (or Corp Dev —> CFO) at PE-backed companies and absolutely crush it on exit.  
At MD level - some good exits to UMM sponsors who are now leading or among senior leadership at those firms.  
Associate exits less impressive in general.  One started a LMM sponsor with some more senior acquaintances and appears to be doing really well.  
Have viewed exits to Corp Dev roles to be pretty vanilla. 

Thanks for this! Really appreciate your taking the time. Just had a question - in your experience, I'm sure you've seen junior bankers quit / lateral to other firms in investment banking. 

I was just wondering what you would say are best practices in terms of communicating with your boss that you are leaving to another bank, without having them hate you / attempt to take action to prevent you from taking on a new job. This would be great from your perspective as an MD. Anecdotes would be helpful as well. Thank you in advance!

Most Helpful

Vast majority of the time, if you're leaving for a competing bank, you'll be walked out that day.  Unless you're a rainmaker leaving for a direct competitor, dont think anyone is going to hate you.  Its IB, people leave/move all the time.  The only time I've seen it become an issue is when one guy downloaded a bunch of information off the drive just prior to leaving.

I encourage my team to level with me.  If they want to exit to PE - lets talk about it and I may be able to be helpful.  Its a touchy subject and some banks/bankers have policies against it.  If you have a good relationship with a senior-ish banker, I'd level with them.  More often than not I've seen analysts leave for a Tier 2/3 sponsor and the MDs are confused..."wish he/she would have said something, I could have called [better sponsor] and gave him/her a recommendation".  But you need to use your judgement here and speak with someone you've built trust with.

Thanks for doing the AMA! Intending on pursuing post-mba banking this fall, so this is so helpful!
Given your experience in several different types of banks, what are your thoughts on whether to pursue BB, EB, or MM out of b-school?
Is it true that BB is the go-to if you don't intend to do banking long-term and vice-versa?
How much should the size and brand of the firm weigh in your selection criteria vs group culture / dealflow?

I was a consultant pre-MBA (Not MBB, but Tier-2).  I'm not going to debate which one is better, but the travel associated with consulting is worse than the WLB issues in banking, IMO - and it doesn't get better with seniority.  You get a wider variety of exit options in consulting but everything else being equal, pay is better in banking. 

What do you think separated you and other MBA classmates who went into banking and successfully climbed the ladder vs. the ones who ejected for a Corp Dev or whatever position? Are these characteristics specific to banking, or is it just a matter of top people being successful no matter what industry or firm they enter?

I think everyone should try to live in NYC once.  The pulse of the city, diversity, dining, and general shit to do is unmatched by any other city in US, IMO.  Plus if you're focused on finance, offers the broadest amount of additional opportunities.  Downside is cost, but well worth it if you dont yet have a family.  Great burbs close by.

Chicago is fine.  Big plus on low COL - can raise a family in the city at a reasonable cost.  Summers are amazing.  Winter is brutal.  Decent financial hub but only a fraction of NYC.  Downside is there isnt anywhere within 500 miles that is worth visiting.

SF has fallen on tougher times recently.  High cost but very attractive if youre focused on tech.  Big plus is you're close to a bunch of amazing places to visit - Napa, pacific NW, Tahoe, Whistler, LA, Vegas is a quick flight. 

Thank you for doing this. I'm currently a first-year analyst at an EB (EVR/CVP/PJT/etc.) and I'm considering staying for longer past my 2-3 year program. I was wondering at what level are you able to start making some time for family / hobbies / other personal things? Senior associate / VP?

The hardest part about staying, at least from my current perspective, is the next 5-6 years with complete lack of control over my schedule (I'm seeing Associate 1s and 2s grinding just as hard as I am right now), but the big-picture view of the job and function still interests me and I could see myself eventually growing my skillset from an execution-focused role to more of a sales role (over the span of 10+ years, of course).

At the banks you’ve been at, are there any qualities or differences you’ve noticed of analysts that went a2a and were successful vs those going to sponsors/buyside. Is it true in your opinion that the best analysts go to the buyside? How often do you see analysts going a2a?

I don’t think there is any meaningful difference in strength of analysts who go into pe vs. a2a.  More about personal preference.  

Some benefits of a2a - you’ve established credibility with senior bankers, can get on best txns, having a huge head start on your post MBA associate cohort.

a2a is more common now but still low numbers.  Can be a grind.  More common at MM

Which type of bank MM, BB or EB did you have the best experience at.

I am an analyst looking to make a long term career in IBD. While EBs offer more pay, it seems like most senior people in EBs come from established BB platforms so would starting and progressing through the BB ranks be a better idea?

Everyone will have a different view on this and there isnt a clear answer.  Personally - I found my time at a BB to be least satisfying.  Maybe it was specific to my bank.  But the endless idea books, generally useless public company coverage tasks ("this is how the market reacted to your 2Q earnings report"), and very hierarchical nature led me to run for the exits.  Maybe its different at GS/MS/JPM.

MM is a great way to learn M&A.  If you're at a good firm, you will get a ton of transactions done in a short amount of time and have good exposure to sponsor and strategic investors.  Deal reps matter and the more you can get done the faster you'll learn.  Also best WLB.  Downside is mostly vanilla sell-side mandates and you do not get exposure to all the offerings / products that a BB provides.

Boutique has been the most intellectually challenging and has the highest caliber bankers, on average (there are exceptions to this, of course).  But you're right - most EBs hire top talent from BB ranks and development of talent can be lacking (they choose to buy, not build).

This brings up an interesting point that I've been struggling with lately. I'm an associate at an EB in a mediocre group. My WLB is solid; pay is well above street; deal flow is meh, but I'm getting some decent advisory reps (no financings since its an advisory boutique). What troubles me is that out of dozens of rain makers / there's literally one guy who worked his way up from VP or more junior. There's no incentive to develop top talent into rain makers because then the senior guys will lose their best execution people. You've got 40 and 50 year olds making $800k-$1mm a year pulling late nights and executing other people's deals. To me, it's clear that the most likely scenario that ends with me being a rainmaker at this firm is to move to another firm and rejoin once I build my own book and track record.

I'm a second year associate. At what point would you recommend jumping ship? On the one hand, I'm reluctant to take the paycut and worse WLB any time soon, but fear that if I were to go to a BB where financings would be a bigger part of my job, they'd look down on a VP who had limited financing experience. 

Curious to get your perspective

Also, as someone who is a senior guy bringing in business at a boutique now, how did you navigate the process of (1) getting the promotion and (2) the office politics involved in convincing people to vouge for you even though that meant losing a top execution person  

Do you view hw as one of those top mm firms you mentioned in the original post and what has your view of them been based on interactions/colleagues

What is your advice to give for a high schooler to get into IB?

I'm not entirely sure what I want to do but right now am leaning towards trying to go into big tech or IB for a few years and then exiting for HF, PE, etc.

I know it's way to early to think about this but I think it's good to get a jump on things.


What is your advice to give for a high schooler to get into IB?

I'm not entirely sure what I want to do but right now am leaning towards trying to go into big tech or IB for a few years and then exiting for HF, PE, etc.

I know it's way to early to think about this but I think it's good to get a jump on things.

Uh oh this is not gonna go well