VP moves/hiring
What drives/attracts experienced VP's to move banks? If an MD is able to originate a lot of deals (small-to-mid market tech investment/M&A, $30-150mil), but doesn't have the bandwidth to execute all the deals, what's the best way to attract VP's with execution experience to work together on the deals?
Is remote-work a large attraction?
Deal flow and comp aside, my priority would be growth. I would want to see a clear path to director and understand how much of my time would be spent between execution, relationship support and origination. Basically want to gauge if this would be the right platform for me to move up.
My opinion, as a VP in LMM:
Let's say it were a small shop (4-5 person team) where there's a ton of flexibility on schedule and autonomy, as long as the work got done. Would look to the VP to help set the agenda, schedule and to-do's.
Deal flow is 3-6 deals closed a year by MD, totaling $5-10mil in fees. There's tech sector focus (in two related sub-sectors), and most of it is based on MD relationships, industry knowledge and previous deal experience. so there's not much blind pitching. VP's are generally not involved in the pitches due to the above.
Deal team would be MD, VP, Associate/Analyst (fulltime or India-based deal support)
Comp would be in the $175-200k base range, with a revshare component, likely in the 5-7% range.
What would be attractive or concerning re: the above?
Comp looks really attractive if it all checks out (even on the low end, 5% of $5mm is $250k so it’s at least competitive at $425k-$450k all in, and 7% of $10mm implies all in could be touching almost $1mm in a blockbuster year). What’s less certain is the path to career advancement for VP. I think to attract talent, you’d want to show where they can be in 3-5 years. This is crucial in my opinion because deals are generated by MD relationships. Are you looking to groom some one to be your partner long term or will this VP just execute and sort of “stay as VP” even if there’s a token promo to D down the road? I suspect it’s hard to answer as it’s a bit of a chicken and egg. Depends on who you get in the applicant pool. But also more important part is what kind of person you’re looking for.
Yes, that would be attractive. It certainly checks the boxes for team structure and deal flow. It's a big bet on that particular MD's industry relationships, but that's a fairly easy thing to diligence and point to if there's a track record.
Comp is great in that respect as well.
It will be very personal, depending on what your prospect is missing in their current role / bank.
What you described above sounds like a tough proposition:
Just some thoughts.
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