Why do MM banks pay so much?
As the title says. I’ve heard analysts at Shea & Co clear 220k, Leerink 200k, Harris Williams 210k.
Meanwhile, I’ve received a SA BB offer paying maybe 160k all in.
Why is this the case?
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Bump
Brand name tax, more overhead, different profit/ownership models.
Significantly less overhead, smaller teams, some focus purely on m&a.
If I were you I’d rather work at Shea & Co. and make 220k all in than work at one of the MM churn shops (HL, etc.) and make 160k all in for 100+ hours a week on avg
Is HL a churn shop? Any insight on William Blair versus something like Shea?
HL is a volume mill who will take on everything they can get onto. Interned there and it was a joke sitting in on some of the opportunity calls as everyone there knew the MDs were gonna yes it. Look at the q1 m&a standings for reference, their avg deal size didn’t even hit 100m
Bump this would love to hear thoughts on a boutique mm player vs something like Blair or HW
In my opinion, if the MMs want to recruit top talent then they got to compete with the BBs. If the MMs offered the same pay to a talented banker as the BBs offered, it may be hard for them to convince that person to go to an MM over a BB. Compensation is a whole package thing and cash comp is generally top of list for investment bankers. GL
Very well put
While the WSO forum widely segments the MM firms as “MM” they are in fact boutiques. Economics on the boutique models pay better.
EB = mid-good deal flow + high fees per deal + few people = high pay
BB = low-good deal flow + high fees, massive teams often 2x or more that of EBs + higher bank take rate of fees = lower pay
MM = high deal flow + low fees + few people = good pay
I hear this. Thanks for sharing. Could be summed up by just the revenue per MD / revenue per head number. If the MMs have higher rev per MD and the BBs, they can afford to pay junior bankers more. 🤝
Thought it might be helpful explaining revenue per head. They’re very different models -> volume of deals with private companies vs continually calling on larger names in a big team
Banks understand opportunity cost. BB has more prestige, and therefore requires less comp drive to bring in talent. MMs on the other hand (the firms you mention are still quite good) rely less on prestige but more on comp since they aren’t able to pull people on brand alone. It’s all a balancing game.
Any insight on HW comp?
Buddy starting FT in SF, believe it’s street
Yeah I can also confirm base is 110k, but I think bonus can scale up to 100% similar to what happened in 2021.
This is as of 2022 so could be stale, but $110k A1 base -> $115k A2 base. A2A stub sign-on bonus is $60k. Bonus is highly variable depending on firmwide performance in any given year, along with bucket
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