Having once been in your shoes, I understand the importance of picking the brains of someone who has been in the rat race for some time... Here some basic information on me: - Law Degree and Master in Management & Economics - Started career in Consulting in the FS and TMT team for 1 year - Moved to IB Boutique and haven't looked back since - Fast-tracked to Vice President in 4 years - Passionate about the past and present of IB with a special interest in the history of finance - Repsonsible for the selection, training and mentoring of Analysts and Associates in the firm - Read 100s of CVs, created case stadies for candidates and lead the interview rounds Open to all kinds of questions regarding: - IB & PE landscape in London and Germany - Recommdendations for books and training materials - Personal view on success factors in interviews - Personal views on Boutique vs. BB
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would be great to know more about the case stadies
For intern positions: Random company profile with some raw items from financial statements (i.e. P&L and CF items mixed) and ask calculate GP, EBITDA, EBIT etc. After this, asked to speak about observations (i.e. is 5% a good margin for a manufacturing business?) to check if they know a little bit about industry dynamics. Then ask who could be a buyer for the company in an M&A process (types and maybe some examples) For analysts: Will be given parts of old IMs and raw set of transactions and comps and ask for valuation ranges including DCF. Need to justify selection of comparable companies and transactions. Also questions around details of M&A processes. Results need to be presented in Excel/PPT to see what the level of proficiency is (and how to cope with time pressure) For associates: As above with some element of LBO modelling
Best resource from my point of view in general: Try to get your hands on as many old IMs as possible for the sector(s) that are relevant for you and see how other banks etc. are describing business models, markets, market dynamics and which the key KPIs are (operational and financial); Find out who acquired/invested to understand the buyers in your sector. Also always nice to have some inspiration in terms of design. Source could be friends at other firms, classmates etc. If you prepare for the recruitment day: Build an LBO and Merger Model 4x from an empty sheet. Kind of useless as most firms have templates that will be used as basis for the models once you work there but somehow people are obsessed with seeing it done. If you follow a good book (i.e. Paul Pignatoro: Financial Modelling & Valuation) step by step, it is easy to prepare (but takes time)
Thanks for doing this. I would be interested to know what your recommendations are for books. Thinking non-training, more general finance and/or IB biographies and non-fiction.
Here a list of my favourite book:
The Last Tycoons (Lazard) King of Capital (Steve Schwarzman & Blackstone) Money & Power (Goldman Sachs) The House of Morgan (JP Morgan & Morgan Stanley)
Reading about history of Banks/PE firms helped my to understand today's environment and gives me a great level of motivation to push hard in my job.
Some very good books that may interest you:
Bloodsport: When Ruthless Dealmakers, Shrewd Ideologues, and Brawling Lawyers Toppled the Corporate Establishment: This is a history of M&A from Lipton & Flom through the 2010s. Focuses much more on actavist deal making but provides amazing context for US standards like Revlon and Unocal.
If you are really planning to move to an investment role, I would say the earlier, the better. Although PE and HF will appreciate the experience that you might have gained on working on deals as a lawyer, they will usually not pay for this experience. After 4-5 years as a Corporate Lawyer, you will have reached pay bands in the law firm that the PE/HF will not be willing to pay when you start with them and you need to downgrade lifestyle. I personally would say that restructuring would be a good field as restructuring lawyers need to be more commercial and get their hands dirty. Also special situation investors tend to have team members that have more diverse backgrounds than regular PE.
I work across FIG, Consumer and a little TMT. I enjoy Consumer a lot due to higher deal flow and generally more action and travelling. The deals in FIG tend to be bigger as a lot of the bank and insurance-related deals are balance sheet heavy and complex. A lot of analysis and pitching but not that many deals... I work in a ambitious boutique with the partners coming from BB and EB. Good partners, culture and some exciting deals but still a lot to do on developing the brand... I quite like the book "Mastering Private Equity: Transformation via Venture Capital, Minority Investments and Buyout". It does not only focus on the technical side of a deal but also covers topics such a Secondaries and Fund Structures which are helpful to fully understand PEs
Thank you for your post; WSO is very US centric, so it's great to hear something from the UK side! I just had a questions about IB in London. Namely, is it essential to have a foreign language to be promoted futher than Associate level? From looking on WSO, it seems like it's basically requirement for S&T and most PE, is it the same for IB?
Thanks in advance!
In London it really depends on the firm and the team that you are working in. The UK has a lot of domestic small & mid market M&A activity and you can easily become partner/MD if you don't speak another language. For bigger firms that do cross-border deals, it is quite common to have people with another European language (or Asian) but still not a pre-requisite. In the end, for more senior promotions, it all depends if you can (or are expected to) generate fees for the firm.