Hi all,
There's been a lot of talk regarding "generating revenue" in order to be promoted up the ladder quicker. I was wondering what exactly that means, how does a VP generate revenue? Are we talking about revenue in terms of investment banking fees? Does this mean that some technology-related product groups generated a lot more "revenue" than the other product groups in the late 1990's?
If someone could explain what exactly it means to generate revenue be it a VP or an MD, I'd be highly grateful.
Revenue generators bring in deals, or at least potential deals. These are primarily sourced through contacts, which is why networking is so important. Example: MD's fraternity brother is CEO of Visa and wants to IPO it - who do you think the CEO goes to?
Next, revenue generators successfully close the deals, which relates to managing your team well and making the client happy. This gives you a good reputation which may lead to future deals.
Closing deals = big investment banking fees
Summary: Source deal --> Close deal --> Earn fees/better reputation --> More deals sourced...
So it's really all about networking and effective execution?
Here's how an MD, for example, would "generate" revenue:
1) Speaks with guy he has long-term relationship with at private equity firm at an update meeting.
2) PE guy mentions they are thinking about selling a portfolio company and invites the banker to come "compete" for the mandate to sell the company (this is called a "bakeoff" or "beauty pageant").
3) Banker comes in, pitches against a few other banks, and wins the deal.
4) Banker creates marketing materials, approaches buyers, gets someone interested and 6 months down the road, announces the deal.
5) Deal closes in month 7/8, and the banker gets paid a % of the transaction value as a fee. He has brought in revenue.
As you can see, the relationship - step #1 - is most important because nothing else would have happened without it.
Tenetur odio ullam eos laboriosam ut sed eum possimus. Hic ratione non et suscipit culpa quos ab. Ea perferendis ipsam esse. Vero pariatur impedit suscipit eum nam illo velit. Eligendi quo voluptate et nemo excepturi debitis non.
Saepe ea error molestiae est dolorem. Doloribus hic maiores quo et aliquid ea quod. Mollitia autem facere in magni quia vel. Sint ea modi nihil dolorem quasi sit. Facere velit nihil exercitationem ipsum facilis. Quis quos dolores corrupti aspernatur dicta sed.
Cum eaque praesentium non culpa quos atque quia. Numquam non quia asperiores est dolor autem autem. Tempora sed iste in magnam. Ullam aliquid numquam unde dolor.
Eum sequi ut voluptates eius quae aliquid. Et repellendus consequatur ut architecto consequuntur necessitatibus non. Soluta tempora nihil eos qui similique. Eaque maxime enim ut repellat omnis voluptatem. Nulla quas est et dolor et debitis. Cupiditate natus neque odio enim laborum necessitatibus ipsum at. Est minima quis officia fuga quae distinctio voluptatibus voluptatibus.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...