What happens to useless VPs / Ds?
Ignore my title, am closer to VP than to analyst. I have noticed a trend over the past few years, probably 2 now where the quality of VPs has declined. Maybe it is because when I started through my early associate years I had a strong bunch of VPs / Ds.
When I say strong I mean:
- Remained calm and handled anything in front of them
- Drew up / shelled out interesting analysis / pages
- Could spot mistakes a mile away, especially model outputs
- Not afraid to go into the model / PPT or anything really
- Some level of understanding WLB
Now:
- Formatting comments only (they will easily miss a mistake with numbers that I typically catch before it goes above them)
- Not close enough to projects to speak intelligently about them but insist on wanting to handle all communication, thereby making the team look bad
- Want everyone working around the clock, this at times goes on under the noses of my seniors who aren’t aligned there
- Hide behind stronger associates, in years past my VPs would not hide behind associates because they were miles ahead
Anyone having a similar experience? Is this kind of stuff just typical of VPs and I had stronger ones when I was an analyst? The comp is a lot for the contributions of next to nothing.
Does this stuff eventually come out in the wash? Most of the newer VPs I work with should not come close to making director. No need to pay someone $800K to review a PDF and ask for minor formatting changes.
I agree that the quality of VP can be very different and the strong ones will shine more than the weaker ones. Your outline of a strong VP is how my top VPs operate. The quality of the top VPs is still the same back then and now but do see that there are more weak VPs who comprise the class. A lot of that is probably due to banks having so much dealflow a few years ago that as long as you could survive the terrible hours you would continue to stay on and get promoted since banks needed heads. My group had a few rounds of layoffs and only the VP level was affected, we cut the weaker VPs in the group. The weak VPs will get stuck and won't get promoted as the market is normalized and banks focus on promoting top talent instead of anybody who is willing to stay on to do work.
Typically I get staffed with them
Likewise, it’s pretty incredible how many have objectively zero value add. In fact, some just hold things up.
Unfortunately, if your staffers/MDs think you are strong, you sometimes get stuck with the weak mid-levels. Focus on what MDs you align with and just do their deals.
As a 2nd/3rd year, I more or less didn't have any associates or VPs because they slowed the process, and my preferred MDs knew that. I was lucky in that regard. We also went through a terrible MBA associate class in our group (all HBS and Wharton) who were largely useless. The smarter MDs grabbed me and said are you cool flying solo? It made life so much easier.
For other reasons I have previously given on this site, this worked well for me. I worked more (hours-wise) as I also had to help manage the client (while working from the US on mostly European and Asian deals), but it was so much easier because 1) the primary MDs liked me and 2) I could regulate my schedule a lot more. I had a very unique experience, I get that, but I did make it my own. A lot of that was directly due to competence and trust versus being the top technical analyst at my BB. I was good technically, but the clients really liked me so that allowed the MDs to fly with just me, and they knew I wouldn't screw it up politically or from a maturity perspective. Part of what a lot of analysts don't understand is that if your MDs let you alone with a billionaire will you say something stupid or annoy them in a way detrimental to the firm. Prove you can do that, and a lot of things change, some good and others less so. I was saving them millions of dollars, but I got normal top-bucket analyst pay.
Biggest thing I noticed is at the VP level, there’s a very wide range of individual performance and responsibility. At the analyst and associate level, the role is defined and your job is to essentially “do the work.” Although not impossible, it’s difficult to shirk responsibility at this level because the clear and narrow definition of what your job is. I’ve seen some absolute rock star VPs that get their hands dirty with the A&As, sketch out value add pages, network their assess off with clients, etc. However I’ve also seen a lot of VPs that add very little value and do essentially nothing. The VP role could definitely be the “easiest” role if you want it to be, because you’re not in charge of doing / detail reviewing the work and also are not yet responsible for bringing in $$$. If you lose business, it’s the MD’s fault. If there’s an error in the materials, a VP can claim they’re stretched thin internally so the assoc/analyst takes the fall for not catching errors.
At my bank, the competent VPs are still there. However, to your point I have noticed a higher proportion of useless VPs relative to before, whereas in the past there was a deeper bench of people who were solid and capable of doing the job. This is not just unique to VPs (although it’s probably most noticeable at this level) - nowadays there are also a lot more useless associates and even useless MDs who don’t bring in any business and just hang around. This could be due to greater headcount in IB, greater competition from other fields lowering the standards, a generational decline in work ethic & competence, the timing of the IB cycle (lots of incompetent VP promotes left over from 2021 busy market), or some combination of these.
Competition from other fields lowering the standard?
As in, the premium talent is being pulled to other fields (tech, consulting, startups, etc), lowering the overall talent pool in IB and therefore lowering the bar for promotion
Imo a good VP is showing promise in terms of overall deal organization, external communication (do they do well speaking on calls) and networking
I dont think of these items as primary VP items. The first two are fine and can be helpful but I think the last one is actually bad if the team needs the VP to get into the files:
Drew up / shelled out interesting analysis / pages
Could spot mistakes a mile away, especially model outputs
Not afraid to go into the model / PPT or anything really
Generally agree but to have zero ideas as to new value add pages / ways of presenting the analysis seems pretty weak. I have a feeling they didn’t do this at associate level either.
Agree with you. They should be able to shell out pages and decks
But decks should be pretty good already (unless its an Associate 1 on the deal) that you dont need to shell out anything beyond what the team has. It should be a once every few months thing and not a regular thing
Some vp/ds are bad, just as any level. Not a recent thing- these have always been around, trying to get credit for doing nothing and throwing everyone under the bus when things dont work out.
Malicious folks aside, keep in mind the other perspective. As an experienced associate based on your post, you’ve probably seen analysts complaining their associates are bad because they won’t do things themselves. Kind of like the point of an asso is not to be doing analyst work, it’s not the job of a vp to be an associate and be digging through the model.
Yes, vp/d should have enough reps to give good guidance and catch mistakes, but there should be no mistakes by the time it gets to them, since thats the associate’s job.
Vp/d goals are likely to be focused on building client relationships to bring in future dollars rather than needing to understand some deep model issue. Theyre being assessed on how they present the outputs that associate below them is competent enough to produce without mistakes, rather than on some technical skill, so that’s where they focus.
It could also be that when you started too many vp/ds appeared competent to an1, but now you’re just better able to identify the bad ones.
No one is buying shit from a VP or D. Often not even from junior MDs. Only group heads. That’s why they get paid 10x the rest of you
Depends on the product, size, bank, and specifics of the situation. Also, those only a VP PE don't know shit about who's buying from who. No offense, but there's a reason generally we are interacting with partners at PE firms and rarely Principles. VPs in PE firms don't move the needle for winning deals, I only really contact VPs in PE if I have enjoyed working with them and will keep them updated with ideas and stuff for people I enjoy working with/know from something else/get along with. Generally, at most firms, Directors get promoted to MD after bringing in some revenue and fees, so clearly, someone is buying things. The big switch from Director to MD levels is how much revenue you are expected to bring in.
Also how do you think people become group heads? It's through building relationships starting from their time as a VP or Director. IB is a relationship business.
Hi there! 3rd Yr ASO at BB - totally agree with a lot of what you said there. My first VP as an analyst was a machine, even then he worked like an MD. Nowadays, we really struggle for good VPs. In my view there’s 2 reasons:
- a lot of good Associates who may not see themselves as bankers for life jump over to the buyside - the people left are those very few who actually love this job and those who just stuck around because nothing better came up
- the incentive structure as you move towards VP is flawed in my view, you are treated more as an execution machine instead of learning to originate, develop soft skills while also learning to focus on the stuff clients actually care about.
As a result, you become a glorified micro manager because you never get taught to actually think commercially. Add to that a sense of frustration and entitlement (“back when I was a junior, I worked 30 hours a day so my juniors can do the same now”) and a lack of understanding that with WFH being possible, you never get to really fully switch off, and you get a stereotypical horror VP.
Good people at VP level have become incredibly rare because there isn’t many people left who want to do this job at VP level, a lot of them are just trapped by the golden handcuffs, so you end up with people who shouldn’t be here and aren’t particularly good but somehow get away with it.
Mostly, once they get some sort of P&L responsibility they get exposed, but they will just move on to the next shop.
Please note: there are many great VPs who have been mentors to me and I am super grateful for them. But these have become a very rare species. The good thing is that these people tend to make it to MD / team heads. If you are really committed to doing this job long-term, think of these bad apples as examples for your “how I DONT want to be as a VP”, Focus on learning the things that will make you a good VP, step up if they’re not capable (even if you they take credit for your work, you’re still learning) and then chuckle at them in 10 years from now when you made MD before them ;-)
Go get ‘em!
I have had same exact experience from Analyst - Sr associate…I consider myself to be competent / reasonable and there is no chance I am staying in this industry. Most people I respect have left / are leaving.
They lateral to UBS
Or they get brushed into Bank of America's EGRC team
With good politics, they still make MD or lateral downstream to get promotions. End up not producing any revenue and moving downstream indefinitely
Was thinking about this in replying to some advice in another thread. My advice works if you have sensible mid-level and senior bankers that know what they are doing and how things are done right. However, at many MM and LMM banks it can be a very difficult environment to navigate for this reason:
The comment about them lateraling downstream is 1000% correct. At the VP / Director level it can be difficult to find another job with similar pay or responsibilities so a bad VP at Citi goes to like TD or Nomura (nothing wrong with these places but a step down from BB banking). The thing is a bad VP at Citi is going to be a bad VP the next rung down and 2-3 years later they'll move down again. You can last in IB a very very long time doing this, especially at the MD level.
I started in the MM (not a household name) and eventually lateraled to an EB. At the MM the group head was obsessed with hiring 'brand' name people and they were almost all universally terrible for the reasons stated above. The home grown or people who lateraled up were almost always way better. No one good is moving downstream unless they couldn't cut it (with very few exceptions). The other hilarious part was these bad VPs at JPM wanted to be basically D / MDs at the MM given their 'experience' so they ended up in roles well above their ability which compounded their issues.
My advice, if you are considering joining a bank (and it isn't your only option), run for the hills if you see this pattern among the bankers. Your life will be hell
Funny enough most comments are from people below VP. A good VP should never have to open the model if your A&A are competent in first place. If it was up to these so called competent A&A, VPs will be scrubbing comps too. Unfortunately, almost every weak VP I have come across in the past 5 years was a DEI Becky; who would never take accountability and always blame it on the predominantly male juniors
Can you read OP’s post again and tell me where exactly they say that they want their VP to open the model or scrub comps? I don’t want my VP to do that at all, we’re just asking for them to have a bit more judgment so that they won’t create panic on a Saturday morning because the first draft of the deck has a double spacing in the footnote on appendix page 92…
I mean at least a double spacing is a ‘mistake.’ I’m talking about the ones who couldn’t tell you what the high level #s are before a client model walkthrough but are happy to comment on colors and what to make italics / bold.
This is going to be a rough pill to swallow for many of the juniors here, and I am expecting some MS thrown my way. However, I think if you all really read it fully, it'd be really helpful both for your seniors and for you in terms of understanding where juniors sit within the group.
VP is the most thankless level in banking and the worst seat to have. As a VP you are expected to not be staffed on deals others bring in to quarterback to those processes but also show an ability to bring in business. Balancing those two is very hard and frankly, the best VPs for the banks and those who get top buckets are not the ones who give you the best comments but the ones who can bring in business. The same applies to Directors, except the expectation to bring in business is much higher and the bar to get to MD is much harder. You shouldn't judge your VP or Director based on the things you mentioned because those are not the real central responsibilities for the job, the Director level in particular is a test to see if you are a good enough salesperson to get promoted to MD. Nobody cares how technical you are as a Director, they just care if you can bring in revenue.
There's a reason a bunch of top bucket juniors get stuck at VP for a very long time. They can't get promoted because they are not good enough at being salespeople, but they can stay because they are still useful due to their technical skills. Every time you complain about your VP or Director, remember that he/she is at the same time building their book, which again is their actual responsibility. Banks and groups benefit heavily from people playing up their ranks, a good associate should act like a VP on the deal and a good analyst should act like a good associate. That's what makes good juniors, if you are blaming everything on your VP/Directors, take a good look at yourself and be a better junior. Also, if there are any mistakes on the deck, that's 95% the associate's fault, it's the associate's job to catch mistakes in the model.
Well said. Some people forget what this industry is about
VP is actually the worst position to be in. They have absolutely no authority in any material produced and the work should actually come from juniors who are now crying about something the VP doesn’t even have fully responsibility of
I agree to an extent, but the VP cannot and should not totally ignore the numbers. From my limited experience as a VP so far (ignore the title), you need to know the pages, analysis, etc inside and out in order to effectively quarterback the execution process and build relationships. Agree, VPs shouldn’t be forensic auditing every single model, but they need to have a deep understanding of how it works and what the outputs mean. As an associate I got incredibly frustrated with VPs who always shirked blame with materials and claimed they were stretched too thin. Other VPs catch obvious things, so should you. Especially with junior associates, you need a 2nd set of eyes at the VP level sense checking things.
Im at a BB, so the model could be different vs other banks. At my shop the VPs have the most value “quarterbacking” the execution process of live deals. Here is what we are going to present, these are the pages that we should put together, we should take this approach, etc. When it’s time to go pure “selling” mode like in bake-offs or meetings, the MD does 90% of the talking. I might chip in on where we sourced something, valuation math, etc, but I by far add the most value via execution and building relationships on live deals. This requires that I know the materials inside and out and can speak to them. This is what the OP’s griping about and what I’ve seen - a lot of VPs are so far removed from the materials that they can’t effectively articulate the analysis. So they deflect the majority of responsibility onto the associate.
Am also at a BB, but frankly, I think you looking at the VPs that are the most value-adding completely wrong. I think you're still thinking about things from a top-bucket junior perspective. As a VP on deals, what you really should be doing is connecting and building relationships with the mid-levels at the corporates or sponsors, which is, without doubt, the number 1 important thing within the deal team. Alongside that, you should be seeking to build your book of business. I was a top bucket VP all my years and was a top bucket in my last year/first year as a Director because I was able to do that early on in my VP life and it has helped me immensely in my Director years as my counterparts in those seats are now getting promoted to Princple level or even better left to other firms at Princple levels (new client relationships for the firm). The things you mentioned as being value-added are tertiary and things I frankly don't care about, and it has never affected me in rankings or in my promotion pipeline to MD with my senior backers being the ones who recommended me the approach I am taking.
The selling mode being the bake-off is also completely wrong, IB is a relationship and terms business. By the time the bake-off comes, a good senior has an idea of if they are going to win it. It's rough because all the seniors will tell you that they are likely to win all deals, but oftentimes they go through bake-offs to purely build relationships for later wins. I do agree that a lot of relationships come from live deals, but a lot more come from just staying in touch with mid-levels on the client side from previous deals as well as outreach. Preparing things to send to client mid-levels by myself or doing research for what to send also does take time, and is a much bigger focus for me than looking over work that an associate should be doing. The incentives for VPs for top buckets and promotion are ultimately one thing and one thing only: do you have a future in becoming a good dealmaker?
I assume you have no Director above you.
The pain of having a D with no or low confidence is indescribable
Thanks for the insight.
Hoping you can answer this question: do you think a junior VP at a MM bank can take the workload as a VP at a BB doing M&A?
Context: ~8 years of finance experience, currently a junior VP sector coverage 1 yr in current role (no one under me, but I work with juniors in M&A/ECM), past 3/4 yrs in M&A at another MM bank, then the first 2/3 years doing debt focused products breaking into finance. Hours and WLB are great where I am (50 hours weekly, sometimes it goes to 80 but rarely), but i've always been in mid market firms so am thinking of getting the BB name on my CV. Money isn't BB levels but pay per hour is definitely good enough.
PS: to be clear, i'm asking about GS/MS/JPM, and have worked across DB/Greenhill and some other EBs who were buy/sellside in some of my past M&A transactions, so i have put in ~100 hour weeks as an associate (at a MM bank). At my current bank, we're also regularly competing with BBs and top tier financial sponsors (KKR etc.)
Don’t just move for an upgrade in brand name. If you like your shop and there is promotion opportunity there for you, then just stay since your work/life balance seems to be great at 50 hrs a week. You will not be working those types of hours at a GS/MS/JPM. It’s also very hard to get into the traditional IB groups at those banks from a MM bank — usually they poach bankers that they already know that have worked with them in co-advisory deals or across eachother on buysides.
It would prob be easier to get into their MM IB groups (Cross Markets Group at GS and Mid Cap Group at JPM) but like I said above, it’d probably be better to just stay put if there is good opportunity within your current bank vs have to build your reputation up from scratch and have much worse work/life balance.
they would also probably want you to start at a lower year than what you are currently at. Say you’re a VP 2 now, they might want you to start as a VP1, etc
First of all congrats on getting the offer to move!
I think at the VP level there are roughly 2 things that are important that I'd care about: 1) Is this the product or coverage I want to do for the rest of my life or at least for 5-10 years? and 2)Do I have a reasonable pathway for advancement? I would never switch to an M&A VP role because I do not want to be an execution person at the senior level, I think it's the most cyclical product and thus my promotion cycle is going to be significantly less on me than if I were in coverage or in some other product group. However, if you would rather do M&A coverage over sector coverage, I'd very strongly suggest taking the BB role. If you'd rather stay in your current coverage area or would rather be a relationship guy in the longer run over the execution guy, I would 100% stay at the MM.
The other thing to consider is promotion possibility. Do you have reasonable white space and help from your seniors to bring in new business? If the answer is yes, I would not consider any new offers period as that is frankly quite rare. Again, your main goal right now should be figuring out how to bring in business and if you can be in a group where that is a very real possibility, would not wish to switch. Also, the main problem with being a VP at a BB, I can speak to this as I was, is that MDs often guard the clearest and biggest niches in terms of business for coverage. Have a bunch of peers who at the VP level went downmarket because of this and were able to get a promotion covering the niche of their own, you don't want to end up switching into a group where you no longer can cover the are you want to focus in on.
TLDR: Remember, at the VP level, you start specialization. So really be sure what you want to do, if it's an M&A product 100% take the offer, and if it's coverage in the area you're already in stay in the MM firm.
Thank you - very well said
They spontaneously combust after they eventually leave the firm, they no longer continue to exist
They fall into the dark void of space & time, never to be heard from again
they get sent to the farm upstate
Pretty simple. The COVID generation of analysts and fresh recruit Associates are very subpar. They got dog shit experience and zero mentorship/training and it’s visible from space. If you were a sr analysts jr associate during COVID, you’re currently a VP cohort. That’s why they all suck.
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