7 Tips on Reneging

So you were a summer intern at Company A and got a return offer for FT after you graduate. Congratulations! Except now that you're half way through the fall semester you are starting to have doubts on whether you should have accepted that offer. Or maybe you were approached by a recruiter from your dream job and don't know how to handle it. I was this guy. Over the past year I went through all of these thoughts, consulted a lot of professionals, and ultimately reneged on an offer – and it could not have gone better. Going through this process taught me a lot and I decided to share with WSO what I learned about accepting a FT offer that you may possibly renege on later.

1. Don't actively apply to everywhere and anywhere.

Be selective. If you've already accepted an offer you have a job, which means you have leverage. Additionally, you don't want to apply to so many places that it somehow gets back to Company A. I took the mentality of waiting for opportunities to come my way through networking, didn't apply anywhere and it worked out well.

2. Do your research on places you interview to make sure they have no connections to Company A.

This goes off of the first point. If the head recruiter for Company A is a recent transfer from another company, chances are good that he/she still talks to the recruiters at that company. No matter how badly you want to work for that company, it is a huge risk to engage in conversations with them because there is a very high chance that they will ask about you. Another thing you need to do is search LinkedIn for possible connections. It is possible that the MD of your group at Company A is best friends with someone at a firm you are looking into. Before you engage in conversations make sure there is no chance of your name coming up in discussions.

3. Make sure everywhere you interview knows you have already accepted an offer.

This is important for a few reasons. First, you don't want them to find out after the fact and then take away your offer because of it. I don't know anyone this has happened to, but have heard some crazy stories. Honesty is always the best policy. Second, telling them you have an offer already shows you are wanted and tells the company you have a certain level of intelligence or work ethic. If Company A gave you a return offer after a summer internship, you must be a decent guy. This also helps if there is the potential for salary negotiations and Company A offered you more than a newer offer – most companies will match or beat it if they can.

4. Understand that you may burn a few bridges.

This is one of the most obvious aspects of reneging, but it is also important to remember. Some people at Company A may be very unhappy with you. You need to do what's best for you and shouldn't not renege because you are afraid of hurting someone's feelings. In my case, I still have a good relationship with the people at Company A. Ultimately, most people are going to understand if you handle everything correctly. (See below for how to handle correctly).

5. Carefully evaluate your options and only renege if it is truly a significantly better option.

This is key. If you have an offer at MS IBD and get an offer from GS TMT, don't renege. I'd like to think this is obvious but I am sure that some people consider doing this or have done this. You should only renege if it is a significantly better opportunity.

Examples of okay to renege are no name boutique to BB/EB, BO/MO roles to FO, etc. If you have mentors in industry or professors that you can talk to about this I would. Those people will do a good job of grounding you and will tell you whether it is an opportunity worth reneging for.

6. When it is time to renege be considerate and friendly, but to the point.

Don't be a dick. When it is time for you to renege, it is almost like breaking up with a long term girlfriend. Especially if it's the spring semester and you accepted back in August. Try to do it in person if you can, but the phone is acceptable too if the person you need to talk to isn't able to meet in person. DO NOT RENEGE THROUGH EMAIL. When you have the conversation, be friendly and talk about the positives of Company A, but say you had an opportunity come to you that you couldn't say no to and are going to have to rescind your acceptances. Get it out there as quickly as possible and don't beat around the bush. You also want to sound confident in your decision. There's a very good chance that Company A will try to talk you into staying with them, but you need to stick to your decision at this point.

7. Never forget that if you want to find something better but don't, you are still in a much better spot than most college graduates.

Lastly, don't stress if you have accepted a return offer but are hoping for something else to come along. If you have a return offer you are in a significantly better spot than the majority of college graduates. If you have your sights on IB but only get a Corp Fin or BO role, work your butt off and good things will come your way. I promise that it'll work out in the end.

Hopefully this is helpful to some of you. I've been a long time reader of WSO and just recently started posting. I figured since this site helped me with my pursuits I'd give back in the only real way I can right now.

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Comments (52)

May 6, 2015 - 9:49pm

edit: nice write up

happy to give advice; no asking for referrals please
May 7, 2015 - 1:12pm

Great advice except for point #3. There might be a few companies out there who still want to interview you if they know you already accepted an offer elsewhere. Great that it worked out for you. For majority of the firms though, your conversation ends the moment you reveal the "truth".

May 7, 2015 - 2:50pm

I think that is more of a myth from my experiences. I told the truth for 2 BB IBD roles, lower MM PE analyst role, and a foundation analyst role -- all of which were okay with it. I think this was in part that all but one of these places either found me or I knew someone at the firm from networking, hence why I said I think its better to use this as your recruitment method as opposed to applying online or through OCR. I'd agree that if you apply your chances of the conversation ending are higher.

May 7, 2015 - 10:16pm
BlueWing:

I think that is more of a myth from my experiences. I told the truth for 2 BB IBD roles, lower MM PE analyst role, and a foundation analyst role -- all of which were okay with it. I think this was in part that all but one of these places either found me or I knew someone at the firm from networking, hence why I said I think its better to use this as your recruitment method as opposed to applying online or through OCR. I'd agree that if you apply your chances of the conversation ending are higher.


Yea okay I can see how knowing someone at the firm helps with moving forward in these situations, but I personally would not feel comfortable telling someone who's trying to help me get a job at his firm that I already had a job but wanted a better one. I'd be concerned what that person's going to think of me. Am I over-thinking it?
May 7, 2015 - 5:29pm

Good summary of how to weigh the decision to renege. In addition, anyone who's thinking about reneging should realize that finance is a very flexible industry; looking at most senior people at any firm will give you an idea of how easy it is to move around. For example: I once had a coworker who quit and joined another company right after training.

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Jun 20, 2015 - 8:11pm

I just started working FT MM banking and I agree it can be tempting to look at other places. Even right after I accepted my offer I was still looking at online posting for FT analysts roles @ BB's because you just think there always has to be something that's bigger or better. My family and friends have helped me stay grounded but I know people who reneged on solid offers and ended up not only being burned by the company but my school as well, which will stick with him for life.

Jun 22, 2015 - 8:41pm

Great write up... Similar things can be said when finding another job. I kept telling my fiancee if aren't sure you are would take it you shouldn't apply.

Things to also consider:
Long term job potential - Less of an issue in finance but sometimes a lack of turnover means you have to leave. The fund managers where I work stay so long that if you have any chance at another firm you take it. We also have a very flat org chart.

Is your boss loyal - Not all bosses care about promoting from within. They will shop for someone at another firm even if you are qualified and you have to sit and hope they don't find someone. It may be worth waiting for a loyal boss.

Don't chase a small raise unless you need it. My bosses boss offered a guy 140k or 145k and the guy countered at 150k. He told him to fuck off because my bosses boss thought it showed bad judgement. 10k or 5k won't change your life once you are making over 200k a year with bonus.

Jun 29, 2015 - 7:50am

Great stuff, SB'd. A lot of people really stress out over this and it causes them a lot of headaches. Well done!

Metal. Music. Life. www.headofmetal.com
Dec 2, 2015 - 7:47pm

Reneging correctly? (Originally Posted: 01/22/2016)

A few weeks ago I posted a thread to ask for some advice on my situation. In essence, I have been offered an analyst 2 position in a top boutique (think Evercore, PJT...), and was at a later stage (post-signing) offered a much more senior position at a corp dev. team of one of the largest firms out there by M&A activity and revenue.

I was set on the boutique but was basing my decision on the idea of it, prestige, and the "could be" factor. I will be happier and more challenged at the corporate. Therefore, it is time to renege.

With the boutique I was in touch with the junior HR contact, several MDs, and the country head of HR. I want to preserve these relationships as much as possible since we will likely be sitting across the table from each other in the coming months (client / advisor) and the world of M&A is relatively small.

Out of courtesy, I was thinking of contacting all of the people I have been in touch with there to explain my situation. To do this I would call the HR people first to officialise it and then speak to the senior bankers individually.

Do you guys have any tips on how to renege properly? I know some bridges will be burned but I am simply trying to do this in a way that these bankers will appreciate. Perhaps some of the senior guys here could give input on how they would have liked to be contacted by a junior guy reneging.

Thanks in advance,
LWB

Dec 2, 2015 - 7:48pm

Personally I would call top down in the organization to explain as tactfully as possible. HR should be last.

Array
Dec 2, 2015 - 7:49pm

This is a unique situation relative to other people reneging to go to another bank (which is ALWAYS a mistake). In this case, you are going to a different industry and have a well thought out reason for doing this. Most senior bankers that have retained a shred of their humanity would understand why. If I had recruited you, I would expect a phone call and a polite, mature decision. After all, its highly likely I will know your future CEO. So start with the most senior banker and work down and say that you really appreciated the opportunity, feel very bad that you may have inconvenienced the firm, but your heart is in the new corp dev role and that you hope you can make it up by being a good client. That conversation will reflect well on your maturity and be well received.

Best Response
Dec 2, 2015 - 7:50pm

Thank you both for giving some advice on this.

I have now successfully reneged and had pleasant conversations all around.

HR tried to counter-offer but was then keen to keep in touch with me. The MDs wished me all the best and said they look forward to working with me in the future.

All in all a very positive experience.

A word of advice for anyone reneging in the future: even if you have no intention of accepting a counter-offer, always be prepared to reply to the offer confidently. Having a canned "way out" is a great way to keep the conversation grounded in what you came there to do.

Best,
LWB

Dec 2, 2015 - 7:52pm

Another piece of advice for those reneging (especially those who had already quit their current jobs for that new position:

Speed is key. Don't waste the bank's time and resources. If you know you are going, don't buy yourself time during the on-boarding process and background check. Be decisive and 100% sure as soon as possible and communicate that to them with conviction.

The hardest part of the process is convincing the company you left for that original opportunity that the alternative option is better. This is because they are already heartfelt that you are going and may take it personally that you keep changing your mind. Have your hypothesis clearly laid out and be 100% sure when you tell them (even if you are not actually). This will entice admiration instead of spite. You are now the man with a plan and not just some ADHD OCR kid.

Dec 2, 2015 - 7:53pm

Reneging on an Offer? (Originally Posted: 10/23/2013)

Whats the "best" way to renege on an offer?

Offered a FT position at a solid MM (non NY). Recently received a BB offer, AFTER I told them I had an exploding deadline. Not deadset on the BB but if I was going to go through the process, what is the best way to approach it?

Should I let the BB know that I have a contract already but am getting out of it?

Dec 2, 2015 - 7:54pm

You call up MM and tell them you unfortunately received an offer that you cannot refuse and thank them. They may say some things to you, they may wish you the best and hang up. Either way, keep your cool.

Don't tell the BB you have an existing contract, but you can use the existing offer as leverage if you need for negotiations (usually comp/bonuses is structured).

Step 1 = decide what you want.
Step 2 (if BB is what you want) = negotiate and get finalized contract
Step 3 (once ppw is in hand) = let MM know
Step 4 = Profit

Dec 2, 2015 - 7:56pm

What? There's no negotiating the compensation package going into a BB's analyst program. You get paid street, just like every other kid in your year and your bonus is commensurate with how you performed and the end of the year.

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Dec 2, 2015 - 7:55pm

No, don't tell the BB you have signed the MM contract already. If you do decide to go with the BB, like the above said, get the written BB contract - sign it - send it back - confirm receipt and that you are all set to join them. Once that's all confirmed, call the MM and let them know very respectfully that you have to decline their offer. If they ask where - don't tell them. If they ask why, if there's a location difference and there's family there, then maybe you can say that. Otherwise better 'fit' is one.

Dec 2, 2015 - 7:57pm

In agreement with what others have said, make sure you have your job with the BB locked in before reneging on the MM offer. You don't want shit to hit the fan and end up with nothing. This won't happen if you lock your BB offer in first.

Dec 2, 2015 - 7:58pm

Also, confirm your school recruiting rules don't screw you if you renege on an offer. On the other hand, if the MM was not allowed to give the exploding offer in the first place, you can probably hold that over their heads to make them be less obnoxious to you about it.

Dec 2, 2015 - 8:01pm

Thanks for the replies.

I'm at a non-target so exploding offers are allowed and I don't believe we have any types of recruiting rules. (Possible ban from OCR but I have a job already?)

That's a good point about trying to negotiate group / product since I would have had a very good shot at placing into one of the MM's top groups. Who should I contact about that? HR?

Dec 2, 2015 - 8:03pm

Carnage:

Thanks for the replies.

That's a good point about trying to negotiate group / product since I would have had a very good shot at placing into one of the MM's top groups. Who should I contact about that? HR?

Also probably beneficial to reach out to someone in the groups you are interested in if possible. Let them know your situation. If they like you and want you around, it helps with placement.

Dec 2, 2015 - 8:06pm

Haaa. Do NOT attempt any sort of negotiation with the BB, and especially not on comp. You are unlikely to get anything out of it, but you can be sure that all your future colleagues will find out about it and have a good laugh / conclude that you are naive or arrogant or both.

Assuming you want to go to the BB, sign the contract, confirm receipt, then tell the MM that regrettably, you will not be taking them up on their offer. If they ask why, be diplomatic but tell the truth. Don't make up some bullshit story about location / family / etc. The odds of being found out are slim, but it's a small industry, and you don't ever want to be known as a liar. The MM may be annoyed, but no offence, they don't need you that badly, they will find someone else to take your place, and they will understand your decision.

Dec 2, 2015 - 8:12pm

As an update, I did renege on the offer last week. I received confirmation from the BB that my signed offer letter had been received prior to taking any action. Meet with my school advisor (did not receive the lead/job through OCR) and was informed of school sanctions (banned from career services!) due to breaking school policy on not reneging offers. I reached out to my contacts at the MM next and finally HR. I did not originally bring up where I was going in the conversation but it was inevitably asked and I told them what bank. Not a great conversation but that is to be expected. For anyone who has to do this in the future, just be very thankful and contrite in reaching out to everyone.

Dec 2, 2015 - 8:13pm

Well, congrats on securing and signing the BB offer.

I think it's silly when the school gets involved in banning career services when a job is not even through them. Understandable if it was through OCR and the company has a relationship with the school.

Did you tell them about it which led to the subsequent ban or did they somehow find out on their own?

Dec 2, 2015 - 8:14pm

Haha I would feel pretty silly as a career services officer, if I had to ban someone from using career services when I knew they already had locked in a great job. Am I missing something or is that now completely redundant?

Dec 2, 2015 - 8:16pm

I do agree that the ban is a bit silly but it is stated school policy and I am not going to argue with it. If I really need to connect with alumni down the road I am sure I could find a way around it. I told the school about it out of courtesy because I knew that they would find out almost immediately anyway. The tension came from the fact that the MM job was through OCR while the BB was not.

Dec 2, 2015 - 8:17pm

Reneging: call or leave message? (Originally Posted: 12/04/2015)

If I hypothetically wanted to renege an offer, and I called the HR person but she didn't pick up - should I keep trying until she does, or just leave a message? I've called a couple times by now

Dec 2, 2015 - 8:20pm

I really just want to leave the situation as amicable as possible (I know, I'm reneging, so that's hard to do)

on a side note, I gave the bank my social security number when I signed. If I signed with another firm, will a background check reveal that I signed with Company A first?

Dec 2, 2015 - 8:21pm

Just send them an email saying please call me when you get a chance and leave a phone number.
What's the new offer?

Array
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