Offers Between Top BB and EB

I was fortunate enough to receive offers at a BB (GS/JPM/MS) and an EB (EVR/CVP/MOE/LAZ) for summer 2021. My goal is to get an M7 MBA after my analyst/associate stint and go back into banking. Exit-opps are not a big factor since both firms will lead to great exits. I enjoyed talking with everyone at both firms so I am indifferent in terms of culture. How should I go about choosing between both offers?

 

Yes I think the same firm after my MBA. However, I am open to changing firms. This is a long time from now so I'm looking to see all of my options. Would be very helpful if you have any insight on this

 

The EB shills on this site are ridiculous. If you want to have a career in banking, you should definitely start at a BB (this is not a controversial answer). You may not make as much initially, but it's much easier to climb the ranks and develop client relationships at a BB because you can set up meetings with potential clients to discuss financings and other BB products, whereas you only have M&A to sell at an boutique. Once you have an established client base, then you can make the jump to a boutique. Boutiques almost always hire externally for senior roles, with the exception of maybe Centerview. Centerview is the only EB I would take over a BB for career bankers, otherwise go BB

 

Gotcha thank you for the incredible insight. Which would look better when applying for b school? The BB with the brand name or an EB with more analytical experience?

 
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I'll tell you the pros and cons of top BBs vs top EBs, but first let's talk about the MBA. You just got summer analyst offers, you'll accept one of the offers, do your internship next summer, and hopefully get a full time offer. (Assuming you want to stay in banking) you'll work there for 2-3 years, and get a direct promotion to associate. You don't need to get an MBA. Firms prefer to promote internally. They'd rather have a fully trained and competent analyst become an associate than hire from M7 and have to train them. And, in fact, they won't sponsor your MBA if you want to get one. No one in IB gets an MBA and then goes back into IB unless they were at a really low tier shop (regional boutique, Nomura-tier, etc.) and can't lateral up. You're starting at the top, there is literally no reason for you to get an MBA. If you can't get a promotion at your current firm it is incredibly common to lateral from one firm to another to get a promotion, and in your case you have unlimited options because of the quality of the firms you listed.

In terms of choosing a BB, I'd say the biggest draw is for a long term banker. There is a much more formalized pathway up from analyst to MD. BBs are incredibly large, especially the 3 you listed, and they have a lot more resources available for you. As you move up to the more senior levels, the fact that all three of those BBs can use their balance sheet (especially JPM) to win mandates is big since EBs don't have a balance sheet to draw on. And your bank will give "discounts" if the client uses all the services of your firm rather than outsourcing advisory to an EB. The negatives include a pay gap at all levels. EBs pay more. You're still making a killing though. Another negative is the size of the bank. I mentioned the positives of that earlier, but also because it is a larger firm there's less money to go around because all of the secondary departments have to get paid too.

EBs are the best place to make money. At the junior level you can be making 20-30% more than your peers at a BB. Not sure at the VP/D level, but at the MD level you get a substantially higher commission. This is partially because that is just the EB model, but also because the firm is much leaner and doesn't have the same peripheral staff that a BB does. Deal teams are also much leaner as well. That means that at a junior level you will have much more responsibility and you'll probably be more competent than your average BB analyst who spends more time initially on reports and powerpoint rather than modeling. Also bonuses tend to be more in cash than stock (and the nonpublic EBs all cash). The negatives are the less formalized promotion structure. It's changing, but the vast majority of EB MDs haven't been promoted internally, they've been poached from other firms.

Personally, I'd prefer an EB to a BB. I want to exit to PE and the average person at an EB has better exits than the average person at a top BB (but top BB groups have better exits than the average EB analyst), I'd be getting paid 25-40k more per year, there's leaner deal teams and I'd learn more, and there's way less bureaucracy which I loathe. That being said, if I stayed in banking long term and wanted to become an MD, I'd probably prefer to start off at a top BB. There's more resources, more of a set path, and a much better track record of promoting internally. If all went well, by the time I became a director I'd lateral to an EB, take the huge commission percent that they use to lure over MDs, and end my career there.

 

This is great insight, thank you. I am leaning more towards the BB offer considering it is the more conservative choice and all the other reasons you mentioned. I understand it might not make sense to go to b school if I want to stay in banking, but will the network, qualitative skills, and brand name I pick up at b school be beneficial for a long-term banking career?

 

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