I was wondering if anyone could provide any insight into how important it is to have a brand name employer on your resume when applying to B-schools?
As a senior I'm starting to think about what jobs opportunities to pursue if my intent is to enter business school 3-4 years after graduating undergrad.
Keeping in mind a goal of getting into say a non-Harvard/Stanford M7 school for eventual associate placement in IBD, which opportunity would I be better off pursuing:
1) corporate finance at F500 company, 'development' program within the company's finance department
2) Boutique IBD, very small 10 man firm, been in business a long time but focus on smaller deals. Would get paid well and get good experience, and wouldn't have to work wall-street hours.
I'd prefer the second since my long term goal is BB/Elite Boutique IBD, but would be worried the lack of brand name would be harmful for business schools. Given a strong undergrad background (3.5-3.7 @ Ivy) and GMAT (~730?), would I be ok going with boutique ib to start?
interested as well. At what point is it better to go for a non-IB brand name over a no-name boutique?
If the boutique is filled with blue chip MBA types (or the folks are not MBA alums, but went to great schools and worked at blue chip firms), go with the boutique - it may not be as "unheard of" as you may think, especially if there had been analysts before you who had gotten into the top schools from that boutique.
Go with your gut on this - which seems to suggest the boutique, as it sounds like you'd get more out of the experience there.
Also, for b-school admissions, school pedigree is more important than employer pedigree.
Ah fuck, lol. Where you went to UG is more important than where you worked since? Would good GPA and good work experience set you up well for not M3= but say M4-M7 (assuming a non-pedigreed UG, whatever that means)?
Quality of work experience isn't irrelevant (it's hugely important), but in terms of pedigree or "names" - yes school names do matter, even outside H/S/W (just not to the same degree).
If you look at H/S/W, you'll see that regardless of occupation, culture/race, etc. - a lot of folks come from the same small handful of schools. That's why so many of the folks there sort of know each other already before b-school -- they either went to school together, or are friends-of-friends, or they're one or two degrees separated from one another. Of course there's quite a number who don't have the school pedigree, but think of the sheer number of those without the branding who applied compared to those who get in. Again, school pedigree isn't the be all end all, but without it, it puts you at a sizable disadvantage at H/S/W, somewhat of a disadvantage at Booth/Kellogg/Columbia/Tuck/Sloan, and slight to no disadvantage at Stern/Cornell/Yale/Duke/Ross/Darden/UCLA/Haas.
In short, it matters for all top b-schools (not just H/S/W), just not to the same degree. In other words, there is a bit more diversity in terms of school branding outside H/S/W.
Ask the boutique IB where their previous analysts have gone after leaving the bank. That will give you some sense of the exit/b-school ops available to you.
Also, boutiques that have partners/VPs that came from top b-schools will position you a lot better for that path. Admissions people like to see references from alumns of their programs who were your direct supervisors.
I can really only see this being beneficial if you want to stay in banking though. Since PE mega funds don't recruit from regional banks, you would probably end up at a smaller shop without the MBA connections. Or is this assumption just wrong?
I'm not exactly sure what your question is. At the boutique where I previously worked, all but one of the partners had top MBAs. Most of the VPs did as well. A couple of former analysts ended up in pre-MBA PE positions, and a couple of others took different paths and then went to b-school. You can break into mid-market PE shop from a boutique but not likely into a mega-fund pre-MBA. All of the former analysts that applied to b-school got into top programs.
The OP was interested in top-MBA -> BB associate so in that case I don't view the boutique route as hurting his chances.
Firm Brand Name vs. Location vs. Function (Originally Posted: 02/09/2013)
Hey guys,
I was wondering what job you would pick out of these in terms of most learning, most prestige, best exit opportunities, most pay and any other factors you think would be relevant. As you can see, the jobs cover multiple functions, locations and firms which is why I'm having trouble seeing which one is best. Your thoughts would be very helpful, thanks!
I know some folks at BAML Houston energy S&T and it is very legit - if you can handle the city (I wouldn't be able to), it's probably the best choice (assuming you prefer markets to banking).
Do you have offers from all these separate places?
Thanks jtbbdxbnycmad, the only thing I was concerned about was that apparently you don't have much of a say in whether you become a trader or salesperson. Would that affect your decision at all?
eleutheros, I'm still waiting on a response from them, but I got superdays for all of them. Just preparing to make a decision.
If you're interested in FO trading or banking, I would cross JPM TSS off your list
eleutheros, that's what I was thinking, but I really wanted to live in New York.. and I was hoping the JPM brand name would compensate for the non-FO role if I recruit for IBD or S&T in New York again in the future. Is TSS considered more MO? They still deal with clients and make money for the firm though. Also, I heard internal mobility is pretty good at JPM, and it's common for people to move divisions.
I got an anecdote here, for what it's worth. A friend of a friend summered there and was miserable. He didn't return and now is doing a master's degree.
And it should go without saying that if you want IBD over s&t then go for #4.
WF or baml
1st or 3rd.
BO or MO at JPM is still BO/MO.
What sort of boutique?
Wells and then swing into PIMCO. Have a nice life.
You'd have to pay me a looooooooot to live in Houston. Austin, different story.
Okay, so it seems like it's pretty unanimous that JPM should be knocked off. The boutique is Gleacher. Problem is, I'm not sure if I'm a better fit for IBD, S&T or Fixed Income. Which offer do you think would give me the most flexibility to move to other industries/roles if I don't like it later? I know once you're in S&T, you tend to stay there or maybe exit to a hedge fund. So mobility is a concern.
Surprised no one has suggested the IB job, am I still on WSO?
This is the trader part of the forum.
3 or 4 IMO. I just couldn't deal with Houston, regardless of job.
depends on which boutique.
but i'd take WF.
What's people's problem with Houston. It's a perfectly nice city and an analyst's salary goes a lot farther there than NYC or SF.
The Brand Name Advantage: Valuable, Sustainable and Elusive (Originally Posted: 10/03/2013)
The Interbrand rankings of the top brand names in the world are out. As always, they have created buzz in the financial press, with the big news story being the displacement of Coca Cola from its perennial number one spot and the rise of technology companies (Apple and Google have the first two spots and there are four other tech companies in the top ten) in the rankings. Here is the listing of the top ten brand names from 2012 and 2013:Why brand name valuation matters
If you are an investor or even a corporate manager, you may believe that these brand name rankings matter little, since all they do is parse the value of a company into its component parts. These rankings do, however, raise interesting questions about the power of a brand name and how it manifests itself in earnings power and in value. In fact, there are good reasons why you may want to value brand name independently. From a valuation perspective, separating how much of the value of a company can be attributed to its brand name is important in a variety of contexts:
- Sale of a brand name: If a company is considering selling its brand name alone, while holding on to its physical assets, you have to be able to value the brand name separately from the rest of the business.
- Legal disputes over brand names: Brand names become the subject of legal disputes, with each party claiming the lion’s share of value. Without knowing how to value the brand name and the drivers of that value, you cannot apportion the value to the disputing parties.
- Accounting “fair value”: The shift in accounting towards fair value from original book value has opened the door to accountants also trying to estimate the value of intangibles such as brand names, trademarks and customer lists. While I don’t think this is a good idea and have said so in other forums, it is clearly the trend in international accounting.
From a marketing perspective, where brand name has historically occupied a much more central position, you need to understand what goes into a brand name and how to value it in the following circumstances:The power of a brand name
While there are some who bunch together all of the competitive advantages possessed by a company into the “brand name” category, I think we are better served isolating brand name from other competitive advantages. Consequently, I have a narrow definition of the power of a brand name, which I am sure that some of you will take issue with.
Brand name power: The power to charge a higher price than your competitors for an identical or almost identical product or service.
To provide an illustration of pure brand name power, I took a stroll through my local pharmacy and found these two bottles in the painkiller aisle:
The generic aspirin was priced at $2.25 and the Bayer version was priced at $6.00. Aspirin, of course, has been off patent for decades and the ingredients in Bayer Aspirin and its generic counterpart are identical. Clearly, though, there are customers who are willing to pay a premium for the Bayer Aspirin, notwithstanding that reality. In fact, you can find multiple examples of this generic/brand name price disparity through grocery stores and pharmacies.
So, what explains the pricing power of a brand name? It would be far too easy to get on a soap box about consumer irrationality, but I would not dare to do so, because I am sure that we have all been guilty of this irrationality, if not with Aspirin, with other products. Brand name power is a testimonial to how our choices as consumers are driven not just by product characteristics and prices, but also by an array of behavioral factors. It is no wonder then that the secrets to creating a valuable brand name are shrouded in mystery. If it were just spending advertising dollars, the big ad spenders should dominate this list of top brand names but there are many who don’t show up. Conversely, there are companies that seem to come out of nowhere and become valuable brands in short periods: Snapple in the early 1990s, Lululemon and Under Armor in the last few years. Brand name value is as much a function of luck and serendipity as it is a function of planning and design.
The value of a brand name
If you accept my definition of brand name power, the process of valuing it then becomes simple, at least in the abstract. It would require you to answer the following question: If you are a brand name company and you lose your “brand name” overnight (consumers develop selective amnesia), what would happen to the value of the company?
That question is easier posed than answered because facile comparisons don’t quite capture the effect. Thus, comparing the market capitalization of Coca Cola to the market capitalization of a generic brand name company will tell you little about brand name value. While the comparison of pricing multiples (PE, PBV or EV/Sales) between brand name companies and their generic counterparts are more useful, there are still too many unknowns to control for. As I see it, the only way to value brand name is to use an intrinsic valuation model, identify the drivers of value and then look at how brand name and generic companies differ on those drivers, with consequences for value.
Rather than talk in abstractions, let’s pick a company: Coca Cola. Though it may have dropped out of the top spot on Interbrand’s list this year, it remains an iconic brand name, recognized in almost every corner of the world. To value the brand name of the company, I have to first identify differences on key valuation metrics between Coca Cola and a generic counterpart. In this case, I was able to find a generic manufacturer of beverages, Cott Inc., a Canada-based company that produces beverages that can be branded by grocery stores as their own. To illustrate the enormous advantages that Coca Cola’s brand name endows it with, I compared the two companies in the table below: 0 0 1 40 234 Stern School of Business 1 1 273 14.0 Normal 0 false false false EN-US JA X-NONE /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-priority:99; mso-style-parent:""; mso-padding-alt:0in 5.4pt 0in 5.4pt; mso-para-margin-top:0in; mso-para-margin-right:0in; mso-para-margin-bottom:10.0pt; mso-para-margin-left:0in; mso-pagination:widow-orphan; font-size:10.0pt; font-family:Cambria; mso-ascii-font-family:Cambria; mso-ascii-theme-font:minor-latin; mso-hansi-font-family:Cambria; mso-hansi-theme-font:minor-latin; mso-fareast-language:JA;}
Coca Cola Cott Measures After-tax operating margin 17.07% 4.08% Pricing power Sales/ Invested Capital 0.97 1.89 Revenue productivity Return on capital 16.54% 7.73% Investment success Cost of capital 7.31% 8.51% Cost of funding Excess return 9.23% -0.78% Value added
Note that Coca Cola’s after-tax operating margin of 17.07% is almost 3.5 times higher than Cott’s after-tax operating margin of 4.08%; the return on capital for Coca Cola is 16.54%, 9.23% higher than its cost of capital of 7.31%, whereas Cott’s return on capital of 7.73% lags its cost of capital of 8.51% by 0.78%.
So, how do we devise a pathway from these numbers to a value for Coca Cola’s brand name? This is after all not meant to be a comparison of Coca Cola with Cott, two companies of vastly different scale. Here are a couple of options: Option 1 (Coke's margin = Cott's margin): Assume that Coca Cola loses its brand name overnight and that it’s operating margin converges on Cott’s operating margin of 4.08%. That drop in margin has ripple effects, lowering the return on capital and growth rates. Holding revenues and the cost of capital fixed, that translates into a value for Coca Cola’s brand name of $149.5 billion.
Option 2 (Coke's ROIC = Cott's ROIC): One reason that option 1 may over estimate the value of the brand name is because Cott is more efficient in generating revenues per dollar of capital invested ($1.89 per dollar of invested capital) whereas Coca Cola generates only $0.97 per dollar of invested capital. Giving Coca Cola both the margin (4.08%) and the sales to invested capital ratio (1.89) that Cott has effectively gives it Cott's ROIC (7.73%) and this reduces the value of the brand name to $120 billion.
Extending this approach to other brand name companies, you may face one potential hurdle: finding a generic competitor. Even in the case of Coca Cola, you may take issue with the use of Cott Inc. since it margins may not be reflective of the margins of a generic company. One solution is to look at the distribution of key metrics (ROIC, operating margin, sales to capital ratio) across the sector. For instance, looking at the distribution of return on invested capital across global beverage companies:
Note that the distribution is split, with lots of companies at either end of the distribution: high ROIC and low ROIC. You can then use the median ROIC (or some lower percentile if you prefer) of the sample of 11.07% as your generic ROIC and use it in your valuation). There are other choices that you can make: that all of the excess returns are due to brand name, that Coca Cola earns the same excess returns as Cott etc. The value for the brand name ranges from $90 billion to $150 billion, depending on your choices and you can see them all in this spreadsheet.
Note that this approach works well for Coca Cola, since there is little else other than brand name that separates one sugared, colored beverage from another. It is much more difficult to do this analysis for Apple, where you can argue that pricing differences are only partially driven by brand name and can also be explained by differences in operating systems, features and quality. Thus, while we can estimate the portion of Apple’s value that can be attributed to all of these competitive advantages collectively, parsing it among the advantages can be in the eyes of the beholder.
Implications
- Brand name is one of the most sustainable competitive advantages in business: There are very few competitive advantages that have survived as long as brand name. A technological edge can be lost and economies of scale can be matched but brand names often endure the slings and arrows of competitive fortune.
- Brand name is not the only competitive advantage: Not all valuable companies have a valuable brand name (Eg. Walmart, Exxon Mobil) but they have other competitive advantages; Walmart’s edge comes from unmatched economies of scales and supply chain management whereas Exxon’s come from its reserves). Even some of the companies on the Interbrand list have questionable brand name values. As I see it (and I am biased), Microsoft’s competitive advantage has not been its brand name. With both Windows and Office, the company has used a mix of overwhelming force (packing the products with features that most of us never use) and a networking effect (where not using them makes you the odd person out) to win.
- Misidentifying your competitive advantage can be dangerous: You may feel that the parsing of competitive advantages that I am doing is pointless, since they all lead to excess returns, but I do think that it matters. If you do not know what your true competitive advantage is, it will not only be difficult to nurture it but you may put it at risk with your actions. Thus, while brand name value is a sustainable advantage, its benefits can still be lost by careless, deluded or distracted managers. A classic example is Coca Cola’s ill-fated attempt in 1986 to introduce New Coke, in a misguided belief that it was taste that mattered, when in fact it had little to do with Coca Cola’s success.
- Investor alert: If you are an investor in a company whose primary competitive advantage is brand name, the primary risk you face to your wealth is not that the company’s growth will lag (though that is always a concern) but that its pricing power will dissipate. In pragmatic terms, investors in brand name companies should track operating margins at these companies, staying alert to slippage.
Brand name spreadsheet: Generic spreadsheet for valuing brand name My paper on valuing brand name and other intangible assets Posted by Aswath DamodaranThat aspirin example is a very bad one, as it has very little to do with Bayer's brand. Usually pricing of store brands has an inverse relationship with the CPG company's brand power (i.e. in order to buy Cott soda, it's gotta be really cheap compared to Coca-Cola). That isn't the case here.
The reason store brand aspirin is priced so low is because people who take aspirin often generally have chronic medical issues. So they're very valuable pharmacy customers, and drawing those customers on low-priced related items is a common strategy. Generic pharma margins are really high at pretty much any price, and by discounting that much to the brand, the store brand can further their claim to providing a lot of value throughout the store, but still make a decent margin.
Source: Lots of retail consulting experience.
Wow, good stuff Mr. Damodaran. I didn't know you were active on WSO.
What do you have currently as your equity risk premium? This is a topic that is always extremely interesting to me. I used your ERP last spring in an investments class to calculate WACC for IBM. Enjoyed reading your material. Thanks
sorry forgot to add on the post that this is a syndication from his blog http://aswathdamodaran.blogspot.com - comments to him should be directed there
p.s. nice username -a seahawks fan
An Argentine tango fan here.
I think Coca -Cola's dethroning on the Interbrand rankings this year had to do with their lower ROIC in EMs, and not so much with Apple's or Google's rise in brand value since last year.
Brand Name vs. Experience (Originally Posted: 02/28/2013)
Just wanted your opinion on what matters more the brandname or experience. So, interning for Goldman or a reputable name being the coffee boy or instead being at a no name firm which let's you do financial modeling and skills that can be carried over.
and yes I have already used the search function
You can't look at such an extreme scenario like that, it doesn't make any sense. The comparison is Brand name vs. non-brand in a similar job function. The truth is no one really knows the answer because it's very situation specific, but the edge in recruiting goes to brand. If the choice is waterboy / corporate jizz rag, then go with the non-brand firm that will allow you to develop skills.
Brand name vs. potential experience earned from internship (Originally Posted: 12/04/2012)
Hi fellow monkeys, I've been a lurker on WSO for a while now and recently decided to be more active, please be friendly! Not sure if I've posted this in the right forum, but if you guys have any advice or comments, I'm open to them.
I'm a sophomore at a non-target, majoring in Finance, and I've recently been offered an internship at a big AM firm (think Aberdeen/ Schroders) in Investment Ops, and also another offer at a much smaller bank in Risk Management. My career goals have the buyside in my sights, probably in AM or PE, but I'm looking to gain exposure and experience in corp. finance at this point in time.
Here's the dilemma: I'm fairly certain that I won't get much finance exposure, if any, from the Investment Ops internship (I was assured of this by the head of Ops who interviewed me), but the brand name of the firm will definitely help turn heads later on. On the other side, the RM gig would probably give me a whole lot more experience that might come handy in future interviews, such as analysing trends, and creating research reports, but as I said, it's a much smaller bank, brand name won't do much for me.
What are your opinions on this?
I would say do the risk management role. You don't want to be labeled OPs guy if you want to get into finance role. Go to the internship that you'll have more experience in and be able to apply going forward into your next internship.
Cheers for the response,
I had that same sentiment as well, and I'm one to avoid the monotonousness of an ops role. It turns me off that there's no element at all of research in it, which is what I'm rather interested in as I think that gives me the greatest exposure to almost all areas, as compared to S&T, etc.
I'm still quite uncertain as to which outweighs the other though, brand name or job experience?
Would you want to be the janitor at Goldman Sachs? Good brand name, not such a great experience.
Well this is one of the more terrible false dichotomies I've seen in a while. It all depends; personally I'd prefer good experience over a brand name if it's what I really want to be doing. If you're unsure of what you really want, brand names will give you the most options.
Thanks everyone for your input. I've decided to take up the risk management position, since I can't for the life of me imagine myself working in the sort of environment that is ops. Either way I shot a nice polite email to reject the other position, that was kinda awkward though since they thought I was accepting it.
brand name, low deal flow, what to do? (Originally Posted: 10/27/2009)
The title pretty much explains it - im a 2nd year analyst at an elite boutique (Moelis/LAZ/BX). You might not believe it but deal flow has been stagnant and although i'm getting an overall great experience (reasonable seniors, decent client interactions) i don't think I am getting the experience that I should be getting in terms of executing deals and modeling extensively. I am interested in PE's, not necessarily a mega shop and would have no problem getting interviews according to HH's, but I am genuinely afraid that I will just embarrass myself for not knowing nearly enough about industries/LBO modeling and such.
I am wondering if I should stay for a 3rd year (assuming getting the offer) or start interviewing and see what I could find. I mean i have no complains about the job really except for some transaction experience, which, of course, is crucial.
Lastly, I'm wondering if it's already too late in the cycle for next summer's position, in which case I would need to stay for another year. This also brings up another question that I always wonder about - say if positions for next year (2010) are full, so I would need to interview for 2011 summer positions. I know that the process would start April/May 2010, at which point I will still be a 2nd year analyst. Assuming that I land an offer in June/July 2010, or before my 2nd year ends, do PE shops generally expect me to complete a 3rd year as an analyst? Or is it a possible scenario that I don't have to work until the summer of 2011?
Lots of questions, any feedback will be appreciated!
I am in a similar position as you.
You need to learn the material on your own, so build your own models during the day, read company research, know where companies in your industry trade and be prepared.
That being said take the third year offer as well and leverage that onto other opportunities
Bump - can someone shed some lights? My situation has not changed substantially, and the 3rd year offer is in no way for sure.
you obviously work for Moelis (and please stop writing "Moelis/LAZ/BX", as if Moelis is better than or on par with LAZ and BX. No offense.)
you clearly don't like your group/firm, so you should get out. i've heard that 3rd year analysts, when interviewing for the top PE shops and hedge funds, get slapped on a stigma (i.e. "must not be a top analyst, or he/she would've found a job already last year")
i think you've missed the boat on large cap PE recruiting for summer '10 start. i think some MM and smaller shops are still hiring, but even those are dwindling. your best bet for this summer is probably hedge funds, which do hire late.
didn't know Moelis had an office in HK...
I would try to secure your 3rd year offer before going out on interviews now given that it's relatively late in the process. You don't want to be left without an exit opp or 3rd year offer.
Also I don't think there is any shame in staying a 3rd year if it will give you more transaction experience and prepare you better for buy-side interviews.
guys thanks for the feedbacks. First of, Im assuming that 2nd to 3rd year is still given to a small percentage of the class, so worst case that I don't get it, it by no means would raise eyebrows in eyes of recruiters, please comment on this.
If i don't land another offer and become "jobless" in july, im assuming the options left are just some scattered, random (but by no means sub-par) PE opportunities in smaller shops. Honestly I don't think I have much trouble getting interviews with the resume, but i haven't done a LBO since training and I have announced two deals in two years.... don't know how much i can impress with those. please comment on this as well.
well elite boutiques in HK don't quite have the deal flow as in the U.S, but do you happen to be in a group like LevFin or Financial Sponsors which doesn't have much deal flow in Asia in general?
while I don't know about specific application dates, if HH say you will not have a problem getting interviews and you have shots at good PE opportunities, than what's the problem? are you just concerned about your modeling skills, why don't you revisit your training documents. you should focus on getting those interviews lined up first.
yes doing just that - reviewing all the training materials. In terms of deals - well I've announced 3 deals in two years, not substantial but i guess i still can talk about them.
My question is if i don't end up getting a 3rd year offer, how will that affect the recruiting effort for PE if by summer I am still not placed. How will funds view my candidacy? Honestly i started the process quite late..
Brand Name versus Department Group (Originally Posted: 12/10/2009)
Hi all,
So I am now confronted with a classic dilemma. Which is more important: Brand name of bank, or specific group?
Currently, I have to choose between two options (both in Hong Kong): JP Morgan Equity Capital Markets (ECM), or HSBC Investment Banking Real Estate Group. So obviously, JP Morgan is stronger as an I-Bank and as a brand, but ECM does not give me nearly the same modelling and deep exposure than IB. I am currently leaning towards HSBC because its real estate IB is perfect for what I want, but my only concern is that its brand and teams are not as strong.
How much difference does brand vs. skills make? If I plan to go into PE, Corporate, or IB in the future, is it more important to have the modelling skills, or be in a brand name bank such as JPM? Or putting on the flip side, which is more of a disadvantage: NOT having IB/modelling skills, or not being in a big name, bulge bracket bank? (Ppl say I can easily transfer within bank from ECM to IB, but I am quite skeptical about the reality)
I should also mention that HSBC is certainly stronger in HK than in the US, and it is certainly an up-and-coming bank. Also, they will have a HUGE deal in the pipeline when I enter, so I'm guaranteed with lots of good work. BUT, it is still not as strong as JPM in terms of potential connections, contacts, and door-openings.
Thanks a lot for all your advice! Psylo500
I definitely think you should take the JPM offer and after a year or two try and switch over to JPM IBD as a second year analyst.
Internal transfers rarely happen - the prospect is used to lure people into jobs they're lukewarm on at best.
You will not have good exit ops from any capital markets gig and you can forget about p/e.
I'm not sure what you should do but keep in mind yesman posts the same thing over and over and nontargetguy is still in school and knows very little about banking let alone anything else. GS/MS/JPM capital markets does have pretty good exit opps from what I've heard (ask around yourself), but if you know you're interested in RE modelling and you're sure HSBC will have good dealflow maybe you should go for that.
I'm in equity derivs TRADING, thank you very much. And as I've written before, I know people in capital markets who had/have good exit opportunities besides just business school. One is going to TPG growth, another to a hedge fund, and one to an f500 strategy dept. Then again, the people I know are from targets and at top banks.
By the way, I did my IBD summer internship a couple of years ago. Last I heard you're still licking the bottom of people's shoes to beg them to give you anything. Based on what you've posted about yourself, it suits you well :-)
I'm in a top 3 ecm desk also in Asia.
JPMorgan's ecm desk is quite good out here in asia although they're stronger in INdia and SE Asia.
I can tell u with 100% certainty ur better off in JPM ECM. The people on the HK ECM desk and syndicate dekss are great (Yes I know them personally)
Non target guy - hyou do talk a lot for a kid still in school. If you want to continue talking like that please post your name and school
Exit ops: Brand Name vs. BSD Group Head (Originally Posted: 08/19/2010)
I'm currently considering the possibility of joining a well known financial institution but sub-par IBD in hopes of improving my PE exit options. The issue is that the bank in question, while it is a well known global financial institution, their IBD is not competitive with the well known IBDs (e.g. GS, MS, JPM, DB, CS, BAML, Citi, Barclays) they have been poaching some well known talent to head some of their groups (namely the one I'm currently in final round interviews for).
Now from what I've surmised thus far, I'll have pretty good client exposure and exposure to the BSD MD. I'm wondering if the lack of IBD brand name can be mooted by this MD helping me secure a primo PE gig. And is this something I can count on him to do, assuming I do really well and impress the right people?
So basically, if I join AllianceBerstein/Brown Bros Harriman IBD (do those even exist?) and they just poached the head of CS FSG to head their FSG group... assuming I can make a name for myself in my 1-2 years, will his connections make up for the lack of brand name?
Would you rather be a small fish in a big pond or a big fish in a small pond?
Are you implying the small pond of Jeffries/Macquarie/Pipar FSG is better than the large pond of GS TMT, JPM FIG, CS FSG?
Size of the pond has nothing to do with it. It all depends on the reputation of your firm/group in the PE world. If you're working is a FSG and not advising on any decent deals... its going to be hard to catapult to a megafund/top PE gig. On the flipside if you've got a well know FSG head hitting up his rolodex to get you interviews, that will definitely help. But remember, even if he can get you interviews for some very sought after PE positions, if all your competitors are from top groups at GS/JPM/MS, you're deal experience will pale in comparison... hopefully the tradeoff is that you were in a much leaner environment and got a richer experience, albeit on smaller/lesser known deals.
I'm interested to know what some of the other experienced monkeys, possibly the ones already in PE, have to say regarding the OP's question.
How limiting is a lack of BB brand name? (Originally Posted: 06/22/2012)
Hey everyone,
I'm a rising junior with what I think is a competitive profile for recruiting next year. My plan is to do 2 years of IB, 2 of PE, and 2 for an MBA. This is obviously subject to change.
Because PE firms are looking for people with very solid financial modeling skills, among other things, I currently believe that an elite boutique analyst stint would be a better foundation for kicking ass in PE than 2 years at a BB for 2 reasons. The first being that I would be guaranteed broad modeling exposure as there would be no risk of being placed in a group like capital markets or a sub-par industry group. The second reason being superior exposure to the deal process as I would work more closely with associates/MDs. (I'm telling you all of this because I hope that you guys will poke holes in my logic... or reinforce it).
I have a friend that accepted his offer from JPM IBD and had to deal with the possibilty of being placed in a group that would have eliminated a lot of his exit opportunties. Is this how all of the bulge bracket banks work? (Making you accept their offer before they place you in a specific group).
Finally, would working at Greenhill/Centerview/Evercore put me at a disadvantage relative to someone with Goldman/JPM on their resume once I've left the realm of high finance, if I do? Say I wanted to be on the management team of a non-financial company. How much less appealing of a candidate would I be to those that don't know the name of the bank or the PE firm (given that it's not a megafund) at which I worked? Is this an important consideration?
Thanks in advance for your input.
When you say Division I athlete, does that mean you play a real sport like football, baseball, basketball, lacrosse, wrestling, or boxing or some pussy-ass shit like cross country, golf, tennis, gymnastics, swimming, tiddlywinks, or anything else celebrated in the summer Olympics....
Examples of people who play real sports (yes most are super athletes but I'm trying to make a point): http://www.pridefc.com/pride2005/images/fighter/354_l.jpg http://fattylane.files.wordpress.com/2011/09/antonio-alfonseca.jpg V.S. pussy shit: http://www.110pounds.com/wp-content/uploads/2010/09/phelps3.jpg http://looklikeanathlete.com/wp-content/uploads/2011/06/male-gymnast-bo…
^ Lol
Dude your profile is ridiculous, athlete and 3.7 at HYP is ridiculous. I think a lot of places look at elite boutique as equal if not better than BB in some cases, so I wouldn't worry about that at all if that's what you'd rather do than work at a BB. Don't limit your options but ya, you're fine and elite boutique is not in any way a disadvantage, haha.
If you are confident that you understand what PE entails and are sure you want to do it, I absolutely agree with your logic on elite boutique vs. BB. Don't need to risk getting put into a group you have no interest in. (HR at every BB will tell you that people always get their first or second choices, but I know a fair few people at various BBs who didn't get any group in their top 5)
Ditto BlackHat, elite boutique is not a disadvantage. Solid profile, good luck with recruiting!
In terms of management team... it kind of depends. Just realize that a top goal for your long-term ambition should be getting into a top 5 MBA program. See if analysts at Evercore/Centerview/Greenhill are getting into places like HBS, Stanford GSB, etc. vs. BB product groups. Just speculating, but being in a random product group might affect your ability of getting into a top MBA program. I know that analysts at the boutiques you mentioned and other top-notch advisory firms do sometimes move to corporate development senior analyst roles at F500 firms (not quite management, buy high-exposure). That being said, outside of high finance, those names are not always well-known. If you want to do corporate development, you will be ok, as many interviewers in internal M&A were likely formerly in banking themselves, so they know what's up. If you want to do something other than corporate development, you might be a little at risk... but if you have experience with good advisory projects (say, transactions involving well-known firms), which elite boutiques may offer their analysts, you'll be ok. The risk of getting placed into a random product group at a BB is definitely valid though. It has happened to two friends of mine. If you wanna do management, try to get pure play M&A now and a top MBA later. But maybe you should consider management consulting? Because with your gameplan, you'll either need to "go corporate" post-MBA and wait 10+ years to get to management level with some lucl, or wait until you get high enough in IBD or PE (at least VP-level, but perhaps MD/partner) to move over.... and I'm assuming you want to do corporate finance/development/strategy as oppose to marketing or some other function.
Don't want to derail the thread but I have a question about this (big noob). Why is the Capital Markets Group bad? I hear of a decent amount of people going there, I'm guessing it is less prestigious than other groups within IBD?
thanks
FormerHornetDriver - I don't want to go into details but it's a sport that requires me to be big and strong enough to (probably) kick the living shit out of you... if that answers your question
thewaterpiper/BlackHat - that's good to hear, thanks for the encouragement
bulldogs12 - looking at the MBA track record of elite boutique analysts makes a lot of sense, thanks for your insights (and I haven't ruled out consulting but I want to at least try banking for a summer)
...so does anyone know if the elite boutique analysts do well in terms of MBA placement?
Oh lawd, we got a bad ass over here..
How does it feel to know that he has a job and you don't?
D1:
You have a nice looking profile but are probably getting a little ahead of yourself. Focus on preparing for / nailing your interviews and then see what your options actually are. One step at a time man.
That being said, here is my nutshell comparison between BB and Elite boutique: BB = Good brand name recognized everywhere. Actual work experience is highly dependent on group Boutique = Leaner deal teams (better xp w/ entire deal process). Harder to transfer out of finance.
BB ultimately gives you more optionality.
that was said with approximately 10% seriousness, but to answer your question, it feels perfectly fine
he's on his track and I'm on mine
also, I could probably beat the living shit out of you too
Didn't realize volleyball (girl sport) / soccer (poverty ball) players were such hard asses.
Gotta be a wrestler then. Until you can handle those Cornell guys though don't be so sure about that last part!
Thanks illiniPride, I definitely get ahead of myself, it's a problem. The main reason that I'm trying to figure the elite boutique vs BB predicament now is because I want to apply my networking efforts effectively. Is networking enough for an interview at the elite boutiques and some of the BBs feasible given the time constraints of a busy student?
Also, everyone says "network, network, network" but how many bankers from each bank should I be reaching out to?
If I had to choose between networking with boutiques vs. BBs, I would choose boutiques simply because they give out less offers. I know I had to beat out well over 200 applicants for the SA slot at my boutique.
Also, the main value of networking is to get passed the initial resume screen. You still have to nail the interviews after. Your profile will get you interviews no matter what so I would suggest your major focus should be interview prep.
Sounds like your head is screwed on straight so I think you'll be fine. Good luck.
Honestly, networking is a great deal and it can't hurt, but I wouldn't kill yourself over it. For entry level positions with OCR, very minimal networking is needed, none of this "search LinkedIn for alumni at banks I want to work at" bullshit. Yeah go to info sessions and make an effort to get to know people, but you don't need to be firing off a ton of emails to people you don't know.
You go to one of the top schools in the nation, are a varsity athlete, have a great GPA, and are doing what seems to be a very solid internship currently. You'll drop your resume in January and get interviews regardless of whether you know anyone at the bank. What you need to do is make sure you have your interview skills down pat and that you come off as a likeable guy.
Yea man i'm sure you could beat the living shit out of all of us. Especially, the ex-military guys. Nobody wants a piece of you.
^ This
Having gone through OCR for SA positions this year, networking didn't have much of an impact in hindsight. I'm doing an IBD SA stint and I didn't network with anyone here lol, whereas some of the other firms I networked with I wasn't even offered interviews.
Seems like you have a great profile. Just maintain your GPA, and keep in close contact with your alumni friends. They are the ones who will most likely get you interviews (or can help doing so). Because HR keeps track of who comes to the corporate events on campus, just go, sign in, have some free food, meet some peeople, have a short but meaningful talk, get their business card, shoot them an thank you email, and don't waste your efforts. If they respond, try to follow up for phone informational interviews or what not, but if they don't...whatever. I think the biggest points people miss when networking is that you have to ultimately nail your interviews to move on. Some people network a lot thinking it's gonna get them the job, but that's not true. Just be careful of getting carried away with networking too hard (or being too aggressive about it).
FormerHornetDriver - I am gonna have to tell you that you are one ignorant dude who does not know the demands of the sports you so called pussy. If you cant play those pussy sports at a professional or world class level you do not have any right to call those sports as pussy. Go get a life you ignorant ass.
Barring a personal connection with a recruiter, what impresses about the varsity sport is the time commitment. My senior bankers always "adjust" the GPA of a varsity athlete up to reflect the time commitment, so a good thing. Also, social sports (like golf) a good thing. No one plays office league football anyway.
BB Name vs. Top MM w/ More Inegrated Deal Experience (Originally Posted: 10/17/2011)
When applying to top MBA programs, how is the top BB name on your resume' compare to a top MM? More specifically, if you have more hands on deal experience through pitching, execution, and contact with PE firms and CFOs vs the typical analyst roles at BB firms. It seems that at my firm I will be taking on more associate level responsibilities than most analysts at other banks.
So what really matters, the name or the actual experience?
BB/elite boutique name matters more. This is finance. Prestige >> everything else.
I'd say BB.
MMs often sell their experience, but MM doesn't not necessarily mean better experience/closer to deals. In fact it could mean the opposite: less infrastructure = you do more back office bitchwork like database management or formatting while the BB analyst is running the model because they have internal presentation teams. BB > MM (assuming both are NY offices and both are IBD and not capital markets). There are some very legitimate MM firms (e.g. Harris Williams) with tremendous steady deal flow, but even then the BB has a bigger name for whatever you want to do later
The only consideration I'd make if it's really close (e.g. it's UBS vs. a William Blair) AND there's a legitimate fear that the BB is firing analysts, in which case you might go MM if you're risk averse, or if the BB offer is FIG/real estate specific and you don't want to be pigeonholed
Thanks for the input, I definitely understand your point of view. I will be working in a small office of this MM IB (which also has a large presence in Europe) that is mostly sell side M&A with a specific industry focus. Most of the work is dealing with PE firms and MidCap firms where the analysts are literally on the phone with the CFOs on a daily basis. The office also has an internal presentation officer for formatting of presentations which should minimize grunt work. The structure of this office is also unique, because there is an MD, Director, and 3 analysts including myself. Could this lead to an experience that top B-schools would see as comparable to BB analysts?
Thanks!
Most MM shops (e.g. Jef, HL, Cowen) even boutiques are structured like that. I'm sure you are in a great program. However everything else being equal it will not be comparable to BB. How impressive it is to B-schools will depend on your particular case. For example, you might have worked on some cross border deals that are small, but a lot more interesting than what a typical BB industrial guy has done. That said, one large deal at a BB can easily beat out 5 of your MM deals. Since it's so easy to brag about these large deals, even if you barely contributed anything.
-It would be a more convincing argument if MMs were unambiguously recognized as "the top experience" game in town, I feel many would argue that this isn't the case. There are going to be large variations between banks at both BB and MM level, so unless the admissions officers at each of the top MBA programs know the MM space intimately well, they won't really know how much of each transaction you were truly exposed to. Furthermore, as the kids at the BBs will be able to sell their experiences to sound like they had EXACTLY as much (or more) involvement on their various transactions as you did, the experiences point becomes moot and prestige will win-out.
(Besides, there's a much greater consensus that the top deal exposure/experience ratio comes from Elite Boutiques rather than BB or MM anyway.)
-Unless you plan on getting your MBA directly out of your analyst years (which is itself and unadvisable route that puts you at a disadvantage), you're going to need a second (or third) job in the industry before applying to top programs. Again, we can see how the advantage will be given to the Bulge, as the higher expected prestige of their exit-opps further opens the margin between them and you.
Of course, the system isn't perfectly efficient and this model leaves out things like undergrad performance (which likely gives advantage to BB again), GMAT scores, ECs and the like, but you can see how the argument becomes difficult to win from the MM perspective. Of course the top MM candidates will frequently win-out against the very bottom BB candidates and lateral moves are also quite common at the analyst level, but you can begin to see how the system sifts out the MM kids from the beginning (arguably before, actually).
Ok cool, thanks for taking the time to give your inputs! It's always nice to gain multiple perspectives :)
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