Comments (146)

 
Apr 9, 2010 - 10:44pm

I'm curious to know the difference in comp between the BB's and Boutiques too. Most (if not all?) of the boutiques listed above don't have the balance sheets to drive deals and focus on pure advisory so you would think that their comp would be less because of their lack of ecm / dcm business. But on the flip, the revenue per banker would be much higher for boutiques because they don't have as many staff and this would probably flow through to bonuses as well. They also would presumably have less overheads.
The reason I ask is because everyone needs to make this choice at some stage in their career: boutique or BB and whilst the work in boutiques would probably be more interesting as opposed to some of the BB's who would spend 70% of their time marketing ideas, you need to look at what your end game is. If it's money, then the above question regarding comp differences becomes important because you are going to be inclined to endure the marketing boredom if the incremental bonus from your underwriting deals is significant.

 
Apr 10, 2010 - 4:05pm

How much does an average boutique firm in NYC pay an ibanker? (Originally Posted: 07/17/2007)

what kind of base/bonuses can i expect starting....5 years into it....and 10 years into it....thanks

 
Apr 10, 2010 - 4:08pm

Boutique Starting Salary (Originally Posted: 04/11/2009)

Any thoughts on what would be the starting salary for boutiques particularly on the West Coast? Information regarding well-known boutiques to much smaller ones would be appreciated. Thanks everyone.

AA

 
Apr 10, 2010 - 4:09pm

Boutiques can vary widely. Most pay street ($60k) or a bit (max 10%) above. Some smaller, lesser known boutiques may pay up to 20% or so less.

  • Capt K
- Capt K - "Prestige is like a powerful magnet that warps even your beliefs about what you enjoy. If you want to make ambitious people waste their time on errands, bait the hook with prestige." - Paul Graham
 
Apr 10, 2010 - 4:12pm

Elite Boutique 1st Year Bonus (Originally Posted: 04/21/2009)

Hey Guys,

Was curious to see if anyone had some incite into what expected 1st year analyst bonuses may be at a place like Evercore, Greenhill, or Moelis? Obviously no one knows for sure, but I'd be interested to get some thoughts or see if anyone has heard anything.

Thanks,
FnkyMnky

 
Apr 10, 2010 - 3:44am

boutiquebank4life:
Moelis is 10k, have a friend there.

Jef is not a boutique either and WF is not middle market.

I agree, JEF is full-service with a focus on middle-market. WF is not MM in debt and equity offering, but in M&A they do a large number of mid-market deals. The majority of their advisory business is generated from Barrington Associates, which was def an MM and was acquired by WF last year (they were a subsidiary of WF before the acquisition)

Would it be fair to say that those solid MMs pay handsome bonus in a normal year, say 80% to 100% of the base?

 
Apr 10, 2010 - 4:17pm

I'm beginning FT at a MM in July, and from speaking with a couple of analysts there, they expect 1st years to be between $45-55k. They're expecting about 10-15% more as 2nd year analysts. It's not an elite boutique, but it's a fairly well-known MM bank.

 
Apr 10, 2010 - 11:48am

Looks like you accepted an offer there. Stop being such an insecure bitch, asking the same kind of questions in every thread. It's just a summer. If you don't like it there, fucking shop your offer around. You will get a good feel for your firm over the summer. Keep networking and build contacts for FT if you want to move around.

 
Apr 10, 2010 - 4:47pm

Boutique Salary Question - Interviewing at regional boutique (Originally Posted: 12/11/2011)

I'm Interviewing at a regional boutique for an SA position, they are looking to use the SA to recruit a new FT analyst starting summer '13 as their current analyst will be either moving on or becoming an associate. I'm wondering what sort of comp I should be looking for, it's in Boston, deal flow is good, they are focused on a niche area and are well regarded in it, their average deal seems to be $50 to 150 MM. I was thinking of, if it came up in the interview for 60-65k base, 5-10k sign on and 25-40k bonus or an all in between 90 and 115, I'm not going to broach it, but if it comes up is this reasonable?

 
Apr 10, 2010 - 4:50pm

He didn't say no-name, he said regional and well regarded. It could be 90-115, but I'd expect closer to the lower side of that. Also, you're interviewing for an internship, normally FT pay wouldn't come up. If this is your only option for an SA, I'd take it regardless of comp. If the comp ends up being shitty, leverage the internship for something better. It's their fault if they don't offer a comp package that convinces you to work for them. Of course, if they have friends in the business (which they probably do), burning them could bite you in the ass.

"You stop being an asshole when it sucks to be you." -IlliniProgrammer "Your grammar made me wish I'd been aborted." -happypantsmcgee
 
Apr 10, 2010 - 4:51pm

It's not my only opportunity, the season is still early and I have other interviews, I spent my last summer at a MM and the reason that this appeared interesting is that they are strong in an area of interest for me. I just figured I'd head out to the interview as it would be nice to have the offer to leverage with the MMs I am applying at. Do you think that since it's in Boston comp will be lower?

 
Apr 10, 2010 - 4:53pm

It's a smaller shop 10-15 people, lower MM focus, 2 offices, Boston and another Tier 2 city. Top executives are from top tier BBs and MBAs, travel heavy, I don't want to give out the boutiques name. They do mostly M&A, with some fairness opinions, restructuring, Corp fin and secondary offerings.

 
Apr 10, 2010 - 4:58pm

I was quoted 50-60 hours during my interview for a boutique (follow-up 2nd round interview is this Friday). Do you think he was just being nice and trying to sugarcoat the hours or does that seem legit? I almost would rather work more then that and just get paid more, but then again, it would be hard to complain about 50-60 @ 80-85k.

My name is Nicky, but you can call me Dre.
 
Apr 10, 2010 - 4:57pm

Too many variables to make a decent guess. I work at a regional boutique too and the IBD analysts start at 80k and bonus is on par with the street but I've heard of many places paying substantially less.

If the hours are that low, I think it justifies the lower pay but it that says something about deal flow.

 
Apr 10, 2010 - 4:59pm

Bonuses at Boutiques (Lazard, Evercore, Blackstone, Greenhill) (Originally Posted: 02/22/2012)

The other threads seem to be outdated.

Out of curiosity, how were these boutiques' end of year bonus numbers last year for first year analysts?

Also, what was the spread between bottom bucket and top bucket?

Lazard - I hear pays street. But what was it?
Blackstone - I hear all first years get the same bonus, which is above street.
Evercore - ?
Greenhill - ?

 
Apr 10, 2010 - 5:06pm

This is also outdated, but I know GHL paid incoming associates above street a couple years ago. I forget exact numbers, but signing bonus + salary was like $20-30K higher than every other bank. Would be very curious to hear how associates fared this year, especially at some of the private shops (Moelis, Perella, etc.)

 
Apr 10, 2010 - 5:08pm

Yes Blackstone pays analysts the same bonus (because the analyst class is small, and because they don't want people putting in worthless facetime). I think it's usually slightly above the street's top bucket.

But yes I agree with the above posts that earning a few thousand dollars more or less as a first year is pretty trivial. Go for places like Greenhill or Blackstone because they have fantastic cultures, not because you want to make more than your friends.

 
Apr 10, 2010 - 5:12pm

Current environment salary level at a Boutique Banking firm (Originally Posted: 04/26/2012)

Hey guys,

I'm in the interviewing process and just wanted to get an idea of the salary level for people in a similar situation as me. I have over 2 years of experience as an Analyst in Valuations and at an Alternative Asset Management firm. I left the firm about 3 months back because I wanted to pursue Investment Banking.

While seeking positions, I have been working in a consultant capacity at a boutique bank and have picked up very transferable skills.

I am in the interview process with a boutique firm that is looking for a hybrid Analyst/Associate. Basically, someone with a couple of years of experience. How much salary are people in similar positions (couple of years of experience and right in that middle period between Analyst and Associate (Senior Analyst??), working at a boutique / MM, not in a major city in the west coast) making? What is the salary range I should expect?

Your input is much appreciated!

Thanks

 
Apr 10, 2010 - 5:17pm

Based on your discussions w/ boutique banks, will they hire someone as an experienced analyst/associate without previous banking experience?

I work in risk/valuation/analytics position at a respected Asset Management firm and have been looking for opportunities in investment banking recently, but the feedback I have gotten from these banks indicates that you'll be starting at the very bottom, in a class of fresh out of college analysts, if you don't have previous I-banking experience. Just curious what your feelings on this are based on your discussions w/ boutique banks and your background.

 
Apr 10, 2010 - 5:18pm

The answer to your question hinges on the organizational structure and culture of the boutique.

If you find boutiques with no set Analyst/Associate hierarchy, then you'll just be the most junior person.

If you apply to boutiques with a defined Associate and Analyst position, its obvious.

In my experience with speaking to boutiques, there is no "class of fresh out of college analysts" -- you're just the most junior person there. Depending on your fit with the team, they're either gonna be willing to take a chance on you and "train" you if needed, or they're going to move onto another candidate they think is a better fit (fit including a myriad of variables such as direct experience)

 
Apr 10, 2010 - 5:32pm

Not standard at all. 5% of fees is fucking amazing, assuming of course that you actually close deals.

$50mm M&A deal at a blended average 2% fee is $1mm. Let's say it's a referral and 20% goes to wealth manager - down to $800K. 5% of that would net you $40K. Close two deals in a year and you are absolutely crushing it for an analyst.

Was the salary decent?

"For I am a sinner in the hands of an angry God. Bloody Mary full of vodka, blessed are you among cocktails. Pray for me now and at the hour of my death, which I hope is soon. Amen."
 
Apr 10, 2010 - 5:34pm

What is the base?

I have heard of this 5% story before. If it's too good to be true, it is. How many deals does your firm close in a year? What kind of deals do they work on? Some small boutiques do capital raising (although they say they do M&A, ECM, DCM), who wants to do ECM, DCM or M&A with a boutique? Boutiques are always more expensive and some charge outrageous (retainers') fees. If they close 2 - 3 deals, and charge what 2 - 3% (yes, they are ****ing expensive!), the total transaction value is $50MN, that's 1MN before tax (to the firm, ignoring any admin expenses). 5% means you are getting what $50k on top of the base? No way, you won't be getting that.

That incentive structure sounds ridiculous to me.

Join a good boutique if you can. By that, I mean Lazard, Moelis, Evercore, Catalyst etc... I am sure you can get a list somewhere.

 
Apr 10, 2010 - 5:37pm

j-phone:
who wants to do ECM, DCM or M&A with a boutique?

Lower middle market M&A at a boutique bank is what I do for a living, so I'll raise my hand on that one.

j-phone:
Boutiques are always more expensive and some charge outrageous (retainers') fees. If they close 2 - 3 deals, and charge what 2 - 3%

2-3% is pretty standard for a deal of that size. Anything lower and there is no profit on the transaction.

j-phone:

Join a good boutique if you can. By that, I mean Lazard, Moelis, Evercore, Catalyst etc... I am sure you can get a list somewhere.

No fucking shit. Jobs at Evercore don't grow on fucking trees.

"For I am a sinner in the hands of an angry God. Bloody Mary full of vodka, blessed are you among cocktails. Pray for me now and at the hour of my death, which I hope is soon. Amen."
 
Apr 10, 2010 - 5:48pm

j-phone:

What is the base? Some small boutiques do capital raising (although they say they do M&A, ECM, DCM), who wants to do ECM, DCM or M&A with a boutique? Boutiques are always more expensive and some charge outrageous (retainers') fees. If they close 2 - 3 deals, and charge what 2 - 3% (yes, they are ****ing expensive!)

Very few boutiques will use the term ECM/DCM as that implies access to public markets, which most boutiques do not have the distribution channel to access. The smallest boutiques are usually M&A only and are heavily skewed to sell-side. The next step up will also work on private placements (equity and debt).

What do you mean by a boutique is always more expensive? Yes, they might charge more than a BB on a percentage basis, but it's an entirely different game because most BBs won't get out of bed for deals under a few hundred million in transaction size, and I can assure you that (at least when I was at a BB) we'd crank up the rate for deals at the bottom of our size threshold. It's not a head to head comparison. Think of it as economies of scale for transaction fees. When negotiating with a potential client IBs target to a specific deal fee amount for a transaction type versus some set percentage. Also, many companies put several banks through a bake off - if your fees are too far off market, you won't win.

Retainer fees are credited to the deal fee, and they are done to ensure that the company has some skin in the game. Plenty of small companies will waffle and change their mind on what they want over the course of a deal process. The retainer is to give some downside protection against flaky company owners. We also used to charge a retainer at my BB, although that was many years ago so I have no idea if that's the standard now or the same for all groups.

 
Apr 10, 2010 - 5:35pm

Another thing to remember is the barrier to entry for advisory boutiques is low/non-existent, so you get many small boutiques doing capital raising projects for small private companies.

These companies, corporate finance boutiques or whatever you want to call them, come and go. They source deals in some way - maybe from their personal connections (from the past etc.) and start calling all the buy-side firms just to see if any funds are willing to put some money into it. If that marketing campaign is successful, they charge the outrageous fees. It costs zero to start these firms.

Some from these firms can't even do proper financial modelling. I am not talking about complicated equity transactions, but just a simple DCF. I met these people who are about to start a boutique firm. The founders had no experience in M&A, ECM or DCM, but they said, oh yeah, we know enough people in many industries and can do the marketing.

This is why it is important to join more established firms where you can get exposure to more things. Learn things in the right way first and then you can start discovering your own form. Just like sports.

 
Apr 10, 2010 - 5:49pm

j-phone:

Another thing to remember is the barrier to entry for advisory boutiques is low/non-existent, so you get many small boutiques doing capital raising projects for small private companies.

These companies, corporate finance boutiques or whatever you want to call them, come and go. They source deals in some way - maybe from their personal connections (from the past etc.) and start calling all the buy-side firms just to see if any funds are willing to put some money into it. If that marketing campaign is successful, they charge the outrageous fees. It costs zero to start these firms.

It costs way more than zero to maintain your broker dealer license. The boutique I worked for spent around $250k to $500k per year to maintain its BD license (cost varies depending on whether or not you were audited that year).

Selling securities (what is done when raising capital) is illegal without being a broker dealer. There are some shady boutiques that aren't licensed, but they are playing with fire. Smart companies will only work with banks that are FINRA/SIPC members.

 
Apr 10, 2010 - 5:47pm

WOBA:

Having worked at both a top BB and a small lower middle market boutique, I can attest that the level of modeling needed at the boutique was actually more sophisticated in terms of revenue and cost build ups. At BB you are unlikely to build true operating models.

I've also worked at both a BB and a small boutique, and this is accurate. Furthermore, many smaller companies only have quickbooks so there is a lot of research and effort needed to even get the data you'll need for the model.

 
Apr 10, 2010 - 5:40pm

I'd guess that they are talking about 5% of fees to the deal team, which would be after the firm's cut for overhead (often 1/3 of total fee) and possibly after the partner's cut (may also be up to another 1/3). Then the partner may also take a sourcing cut, the partner may share in the deal team split or there might be a referral fee as mentioned above (although 20% seems high - the boutique i worked for didn't take referrals from wealth managers, although we did regularly get them from the IB groups at a couple of BB's that didn't ask for anything - the deals were usually too small/too complicated relative to fees for them to waste time on, and they wanted to look like a good guy by referring to someone competent and willing to work at a lower fee).

My guess is that they are really telling you that it would be somewhere around 5% of the remaining 1/3, or

 
Apr 10, 2010 - 5:41pm

TechBanking:
although 20% seems high - the boutique i worked for didn't take referrals from wealth managers

Usually 10-20% depending on the bank, but was trying to be conservative. Places like UBS and MSSB have formal referral programs and the FA is compensated out of the referral fee (in addition to generally getting the new assets, which in the long run is probably a bigger windfall).

Agree with everything else you mentioned. At my office we generally look at it like we have $2mm of overhead to cover for the year, after that everything accrues to the bonus/partner pool (50/50 split) and you get paid off marginal fees. This is less of a steadfast rule for juniors who are more confined to a range. Our BD team gets paid a direct % of any deals that they source (not sure of the amount, but less than the 20% for external referrals).

"For I am a sinner in the hands of an angry God. Bloody Mary full of vodka, blessed are you among cocktails. Pray for me now and at the hour of my death, which I hope is soon. Amen."
 
Apr 10, 2010 - 5:52pm

here is what goldsmith agio helms (nka Lazard Middle Market) did before they were acquired by Lazard

30% to partnership
25-35% to MD based on experience level/who sourced deal/etc.
15%-25% to VP/Director
7.5-10% to associate
3-5% to analyst
any balance back to partnership

obviously bigger deals required 5 person teams (MD, Dir, VP, Ass, Ana) so %'s get cut

so if you worked on $3M of deals as an analyst you would get $3M*5%=$150k in total comp
your base of $60-70k is backed out of total comp so your bonus was $80-90k
one note is that there are caps, an analyst/associate cannot make $500k, just because he was staffed on random homerun deal, there are caps at lower levels

this was the framework and varied from deal to deal based on size, deal team, who sourced it, etc., but general framework of how they did it and how some M&A boutiques operate

 
Apr 10, 2010 - 5:55pm

Bluto:

Lazard is one of the best banks but why is compensation so low compared to its peers like Centerview and Evercore.

On that note do current employs know what a first year analyst can expect to make? And does pay vary by location?


Just quoting this so he / she doesn't realised how retarded he / she has been and edit it.
"After you work on Wall Street it’s a choice, would you rather work at McDonalds or on the sell-side? I would choose McDonalds over the sell-side.” - David Tepper
 
Apr 10, 2010 - 5:59pm
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