Company asks me to renege

depends on whether you think you're legit enough to survive on the buyside or not without a banking gig to mitigate downside risk/how sure you are that you want to be an investor/how you feel about the fund's strategy?

is this a top boutique? How big is the fund? There's been several recent threads about this type of situation (direct buyside out of college) in the HF section that you should probably take a look at.

I'd stick with M&A - if this place is THAT quick to change their mind in your favor, they'd likely just as quickly cut you if convenient for them....and then what are you going to do?

I guess I'm also worried about the consequences of reneging. Wouldn't that be bad? It's not an elite boutique, but they have consistent dealflow. The thing is, if I renege, I would basically screw them over in terms of hiring (since the bank is really small). The fund is a couple billion in size.

Also UFO, they didn't change their mind I guess. They've always wanted me to work for them, it's just that they're asking me again after I already accepted somewhere else.

Ah sorry, you're right. I don't know, I mean...what do you REALLY want to do? Is the bump in pay really worth it to you? Ultimately, look, this is your life and your career, don't think these guys give a shit. What do you want to do?

Another thought is to negotiate the offer that he gave you, if he is personally calling you then I'm sure he would be willing to make it worth you while to renege.

Also i commend you for thinking about reneging as something that would put the bank in an inconvenient position, but truthfully, it's not that hard for a decent bank to find an eager young hire that will work his/her ass off. Of course, when one can help it they should not renege... But this is a business, and most firms will not hesitate to let folks go when things go south or they need to cut costs.

You should put greater emphasis on what's best for you and weigh risk and rewards regarding yourself first.

http://imgur.com/67CBExk

But on a more serious note, make the best decision for yourself and don't let the renege issues influence it. I agree with ct banker - why not negotiate some more? You have nothing to lose.

Thanks for all the suggestions everyone. Ctbanker and BugCatcher, I'll definitely try and negotiate for a higher offer, although I don't know if they are willing to raise it anymore, given that it was already a 15K bump from before (Mainly via a signing bonus since they didn't have one before).

Kanon, you're advice has definitely given me a lot to think about. I guess if I were to be completely honest, I have no idea what I want to do. Coming out of undergrad with only two prior internship experiences (IB and PE), I think I would be happy with either, but I also wouldn't know for sure until I've worked at either field for a longer time. However, I will say that I never did plan on staying in IB for that long. Previously, when I accepted the IB offer over the PE one, my plan was to go to business school after 2-3 years and then figure out what I wanted to do from there.

So the boutique bank that I accepted the offer from is an extremely small (BB peers but get paid the same. I actually don't know how good the exit opps for the bank is since it just started a few years ago and most people have not left (they explain this as because everyone loves the culture there) but the analyst that recently left (who i'm supposed to be replacing) went to a fairly well known mid market PE fund. In keeping with their "family like" culture, the bank said they played a role in helping the analyst the position although how much they helped is unknown. That being said, since it is such a small fund with little name recognition, I'm worried that if I renege, they will a) really hate me and b) find it really hard to get any candidates since I think recruiting has pretty much ended.

On the other hand, I've always thought that the fund will go places. I've worked there before, and I get along with everyone very well. I think the caliber of the people is also very strong, but even though i got along with everyone very well, I'm not sure if I fit in there completely. In addition, location is another factor, because the fund size is still pretty small too (

^Sorry for the essay guys.

Hmm... if the boutique IB has decent deal flow, but a small team, and the analyst that left is the role that you are replacing... I find it hard to imagine the hours not being bad. Because generally, the hours should be long in a lean shop (unless they aren't doing much... or unless they are VERY efficient - like little to no pitching and everything you do is for a live deal). At least, that's been my experience anyway (working in a lean shop with a top heavy team and good deal flow - you get worked). Curious what other WSO users have experienced in this regard.

Just going by how you've described the PE fund you worked with - having a couple billion AUM, GS, MS, JPM, the elite boutiques like Greenhill, Evercore, and then very strong MM IB shops like Lincoln International and Harris Williams... coming from a new name, you'll be disadvantaged. Business schools are very aware of what bankers do... and it's not all that thought-provoking. But with private equity, there are more possibilities for a junior professional to do something beyond financial models and investment memo writing. Like, maybe you invest in some companies where they don't have much bandwidth to hire staff to help the CFO, and you get to get involved with the portco (I'm making this up of course - but depending on how 'hands on' the fund is, you could potentially get some operational exposure... but in IB you won't).

I get the student mentality of wanting to be in a bigger city vs. somewhere in the middle of nowhere. I would tell someone to go for the role that offers the most potential upside, or is more aligned with their future goals (especially given you're looking at pre-MBA roles, as opposed to a long-term role). I suppose if you aren't set on PE, you could really go either way (though you'll still have to exit IB eventually) ... but if you are interested in PE, I think it's pretty clear to go for the PE fund.

Don't try to negotiate for a higher offer - they need talent but trust me they aren't THAT desperate. Also IMO buy-side > sell-side.

A boutique with less than 15 seems like your exit ops won't be so great.

You sure the buyside fund doesn't have anything against you? If it was me I would be paranoid that I would have lost all credibility with them by reneging on the offer I had accepted with them, which means worst case they do what you did to them and renege the offer after you already turned down the bank, and best case you're at a long-term disadvantage relative to other analysts at the fund who didn't renege. Just hard to believe that there would be no loss of trust whatsoever.

This sounds like a pretty small bank and if the fund raised an additional 9 figures, it sounds sizable and you seem to be confident in its trajectory. I'd take the fund offer assuming you intend to move to the buy side anyways.

My take:

1.) I strongly disagree with the ethics of me being asked to answer this question. On the one hand, deontologically, I'm supposed to give you advice that furthers your best interests. On the other hand, you are supposed to be deontologically ethical too. So we have a conflict of ethics here.

2.) I'd be concerned about what happened if I got laid off in the first year after doing this. I'd take a long hard look at signing bonus and the clause that defines how/when it must be repaid. And I'd wonder if those terms would be negotiable.

Something that I think wasn't brought up: keep in mind that the sign-in bonus will do next to nothing for upcoming salary negotiations. You'll take home a good overall compensation in the first year but then your second year might even decrease on guaranteed compensation. I'd try to revisit that point and try to at least move some of the additional comp into the fixed salary. Obviously with a different argument like matching compensation structure you'd see at the bank.

I also agree that the small bank doesn't sound like great exit/MBA opps unless the calibre of people gives you the feeling that this could be the next Centerview, Evercore, etc.. So I would caution you to consider what you'd do after 2-3 years and your business school plans don't work out as planned.

Personally, I think buy side work can be more versatile and still provide for a better life style but that's a matter of personal taste. It's overall a though choice that you need to take by weighing all things carefully, just try to make it about yourself and worry about how you can explain it to others/what they will think after you took the decision.

If you decide to renege your offer, just make sure you sign the contract at the other fund first. It should be obvious but you do hear of people that shoot themselves in the foot here.

The safe bet is to stick to the grind in the boutique M&A. The buy-side re-offer sounds like a risky but rewarding opportunity. Fast forward 3 years at both places and try to imagine the roles you'll be performing, your compensation, your level of respect and pick the one that seems more interesting to you. Good problems to have nevertheless.

Dude, maybe it's because I've gotten older or the posts have always been this shitty, but you're going to have to give way more context...

Are we talking about Robert Baird boutique size?

What's a typical investment for the PE firm?

It all comes down to this. What is the most strategic place to be for your career? And it sounds to me that the PE firm beats out the IB. Since the IB is so small, most arguments in favor of it being the 'safe' choice and/or for the 'exit ops' doesn't seem to hold true. Yes it sounds like there is risk in the PE firm, but compared to the IB it's not that different, and the risk has been mitigated by your insight into the firm from previously working there (ie your gut feel). You will probably have way more relevant / good experience on your resume than a no name IB where you compete against other kids from BBs.

It sounds like the risk/reward is tilted in your favor for the PE firm. But again, it should be based on what is most strategic for what you want to achieve longer term. And obviously the location is a personal preference that only you can decide how much that affects your strategy

Wow. Thanks for all the input everyone. You have no idea how much help this has been to me. So overall it sounds like there is a general consensus that the buy side firm would be better than the IB one. Since both were exploding offers, I think if I had more time to think before accepting either of them when they initially gave me offers, I may have chosen the buyside firm. However, now my problem is this: Should I renege to accept the other offer?

Even though I realize now that working at the PE firm may be better for my future career aspirations, I'm very hesitant about reneging on the IB offer. If the bank was a bb or even a more established name, I would feel a lot better about reneging because they would not have trouble getting someone to fill my spot. However, I do think that me reneging now would put them in quite a bad situation, and since they've been nothing but great to me so far (very flexible on a lot of job related issues) and super helpful, I would feel pretty bad about putting them in this bind. In addition, I kind of feel like the responsible and "right" thing to do would be to honor my commitment to them. However, maybe I'm naive?

By the words you use, sounds like the M&A boutique isn't really a reputable firm. I don't know if it is or isn't, so ask yourself two things:

1. Will this boutique place you into a larger fund?
2. Do you want to do banking or PE?

This sounds like a dream come true for many people. Upper nine figure investment is nothing to scuff at. I would take the PE gig, you will save your early twenties from pitch books and face time.

OP - it's nice that you're putting so much thought into whether or not you would be putting the small investment bank in a difficult position, but don't worry about that too much. If they are guys that have credible backgrounds and have a good dealflow, they will have no trouble with finding your replacement.

Yes it's late in the FT recruiting cycle... but there are hundreds of eager, hungry students - both at target and non-target schools alike - still looking for FT opportunities. Not saying you're not a special snowflake... but they'll be just fine finding your replacement. : D

In fact, if you happen to know very smart, capable guys/gals that could take your place, you could offer to even help the bank source some people to interview. (I've done that before for roles I declined - though... not due to reneging, so maybe this is not an option here because it would be a more delicate situation. But depending on how they take the news, it could be a way for you to make amends - assuming you have someone very stellar or better than yourself in mind for them).

Take the offer that you feel best positions you for your long-term career goals and will benefit you the most.

I think people are jumping to conclusions here based on limited info. Not all buyside spots are the same, not all boutiques are the same. Sector, level of responsibility, etc all come into play.

Uhm.... I'm sorry, but I can't believe some of the opinions on this thread. Must be a lot of college students with IB goggles opining. Here's an opinion based on 10 years experience in banking/PE/bschool/more buyside: Based on the OP's description of the two opportunities, this is a no-brainer. PE firm all the way. And it's not close.

For almost every reason you can think of -- experience, learning, type of work as the principal investor vs. being a broker, being the client vs. client service, lifestyle, talent level of colleagues probably, resume, exit opps, bschool admissions, on and on... except for location, in the eyes of the OP, which should frankly be near the bottom of your priority list when you're starting out your career.

And yes, you feel bad about reneging but not bad enough to not do what's right for you. You're doing yourself a HUGE disservice if you put yourself in a disadvantaged position for years just to make another firm's life a little easier in the short term. That would be way unfair to yourself. No one faulted Lebron for leaving Cleveland to go win championships in Miami, only the way he went about it.

Thank me later.