Middle Market IB out of college
I was wondering if I could get some input on the pros and cons of going into middle market sell side right out of college vis a vis BB. I've read a lot on the BB vs Boutique distinction but firms like William Blair, Perella Weinberg, Harris Williams, Piper Jaffray, etc don't seem to fit either mold. If anyone out there can answer the following that'd be yuge:
How competitive is landing a spot at one of the above firms vs a middle of the pack BB?
How does workload/dealflow differ from BB to middle market?
How does comp differ from BB to middle market and between middle market firms?
Does BB generally offer better exit opps than middle market? (I'd love to eventually go into middle market PE)
In the LR, how much value, if any, is there to having, say, BAML or CS on the cv versus any of the above middle market banks?
Regardless of the intrinsic upsides and downsides, of is it common/uncommon/unheard of for a prospective excel monkey with offers at, say BAML, CS, and Harris Williams to choose the latter?
Thanks guys
Generally just as competitive in terms of the process that you go through (interviews and superdays with other kids); main difference is that the schools that these kids come from will be different
I just finished my internship at a MM and I'm under the impression that workload is essentially the same but just spread out across less deals/pitches/projects. With BBs, I'm sure you get more deal flow, but at the same time, the sizes of the teams are much larger. My coverage group was very lean and as an intern, I was able to run with multiple pitchbooks independently each week and work directly with my associate/VPs. An alumni contact of mine at a BB said that his interns were tasked with PIBs and only constructing one or two slides in a book and that running with entire books independently was rare.
Comp is the same. My MM is 80k base + 30-60k bonus.
Generally, yes. But if MM PE is your goal then MM IB is fine as long as it's a good shop (like one of the places you mentioned)
I only interned this past summer so I can't fully answer this question, but I've heard that it's easier to build your rolodex if you're at a BB. Most of the rainmakers at boutiques and MM started their careers at BB.
Can go either way. A lot of the MM shops are regional and so I've met kids that interned one summer at a BB in NYC, decided they don't like the city, and chose to stay closer to home or whatever and work for the MM.
1) Still highly competitive. My firm had 800+ applications for our 4 summer analyst spots.
2) It doesn't differ that much for the most part. Hours are long and due to the smaller sizes of many firms you may not have the same resources (powerpoint + printing teams etc) available to you that you will in a BB.
3) Normally the salary is the same. Bonuses can differ significantly. It also depends on the type of firm you're at. My bonus is roughly 60-70% of BB firms but I also work less hours than a BB. I'm happy to forego a street bonus for less hours.
4) Depends on what exit opps you wish to pursue. For MM PE you'll be fine with a MM firm, particularly if you're at a firm that does a lot of work for PE funds. Look at Harris Williams placement for example. Megafunds will be much tougher. If you wish to leave finance, the brand recognition a BB has over a MM firm is hugely helpful.
5) Depends entirely on what you want to do in the long run. If you wish to pursue a MBA or pursue a different role than MM PE it'll certainly be of value.
6) I can't comment here as I don't have a large enough sample size to provide an accurate answer.
what about Jefferies as an MM firm? How are they?
On a scale of 1-10, how much do you like working 100 hour weeks?
I've heard from a friend that interned there that their summer interns had quite varied work balances. One summer analyst was typically leaving at 10-10.30, but the SA was only on like 2 staffings. Another summer analyst was getting crushed and leaving at 1-3 consistently for 7 weeks, but he was a top ranked SA and was on a lot of live stuff. Seems variable to me, but I'm just curious - interning at a small hedge fund and looking to target quality MM firms (also of course trying for BB and EB) for IB SA (top 25 non-target).
1) Generally just as competitive; if you were a football player BB / EB would be like SEC and MM would be OSU / Michigan / ND. Marginal difference 2) BB will have house accounts where you're a slave to a mgmt team. You'll do board presentations, strategic reviews, etc. BB for the most part will have better deal flow BC you will see more types of transactions - capital markets deals, M&A, etc. Most MMs will be M&A specialists with a heavy bias towards sell side M&A deals (Harris Williams, William Blair, Stephens, etc) 3) Not much in base; bonus difference could be $10k less... generally the same 4) BB tend to have more diverse and slightly better opps. I've heard some guys in MM struggle to get interviews @ HFs. MM IBD tends to do better in smaller MM PE 1bn funds from what I've seen (maybe it's changed?). BB tend to get more megafunds and large MM PE (10bn+ AUM) 5) Nobody will ask / care if you worked at Harris Williams 10 years ago or GS TMT. It's what you've done recently at your last job and can you help them create value / make money for your new employer. 6) All things being equal, I would encourage prospectives to do BB / EB over MM unless there was a case of BAML ECM vs Harris Williams' M&A or something.
Getting a spot at William Blair, PWP, or Harris Williams is much harder than getting a spot at a mid-tier BB and I'm speaking as someone who is at a BB. These banks are way more selective and have a specific characteristics in mind when they hire and can't really afford to make bad hiring decisions. At BBs its much different. You will have complete morons mixed in with very smart kids. The experience and responsibilities are also much greater at these shops vs a BB.
If you are talking about the above places, I would say exit opps are a better bet from these above places vs. mid tier BBs. Once in a while they will place into MFs but not often. This doesn't mean anything though because 99% of people at BBs don't get MFs either. Plus MFs aren't necessarily the best option. There are so many great PE and HF shops out there that will take people from one of these shops.
What about Jefferies / HL vs. a mid tier BB? How does Jefferies stack up? I've seen Jefferies spoken highly of here but the posts are from like 2014.
I consider HL an EB. The kind of analysts they hire overlap with EBs and it seems like the best comps for them are Moelis, Evercore, Lazard etc. I think they've had excellent placement out of there in recent years.
Jefferies is also very good. Very comparable to some of the mid-tier BBs.
Can confirm a lot of what people have said here already, but just to elaborate a bit more on MM vs BB differences:
At a MM you have leaner deal teams and the opportunity to work with more VC/PE backed teams vs. large public companies. With the leaner teams comes more responsibility as you establish yourself as a good analyst. That's both good and bad as you have to do more admin tasks but also have greater access to management and opportunities to provide real input in the process.
I started at a BB and am now with a middle market firm:
As everyone has pretty much stated, they are equally competitive by the numbers, just different quality of candidates.
In my experience, I am much more involved throughout the process at the MM level, largely as a function of leaner deal teams. The downside is, dealflow tends to be weaker.
Surprisingly, compensation is very comparable
The MM or lower MM PE firms we work with are almost all founded by guys with BB background, but they hire largely from MM or boutique banks because the deals that Analysts/Associates are exposed to at these firms usually fall within their investment mandates.
5/6. The brand recognition alone from having BAML or CS on your resume is so valuable and I would highly recommend, given the opportunity, that you take a BB offer over the MM offer as it can only help in the long-run.
What other banks would you guys say are solid MM IB firms?
-Robert Baird -Houlihan Lokey -Lazard MM -Lincoln
To name a few. A lot of the others have been mentioned already.
I think the top MM firms would include William Blair, Lincoln, Robert Baird, Jefferies, Houlihan Lokey, and Harris Williams. Other solid MM firms include Stifel (and KBW), Raymond James, Lazard MM, Stephens, BMO, Piper Jaffray, and SunTrust. Wells Fargo isn't a MM firm, though they have a MM group, but they're not a BB either.
Can confirm that going MM > HF is difficult as I'm going through that process now.
Another thing to consider is that a lot of the MM opportunities are not going to be in NYC; which may not necessarily be a bad thing but it can make buyside recruiting a little more difficult. Instead of taking the morning for a "dentist appointment" in Manhattan, you'll need to find time to fly out to your interviews. Harris-Williams is a bit of an exception as I'm pretty sure bankers there actively help analysts get buy side positions.
It'll be helpful if you know geographically where you want to end up, as certain banks have great reputations in their region but it doesn't necessarily translate on a national scale.
What are the top MM banks in Boston/Chicago.
I didn't read all the replies here, but wanted to include a few bullet points of my own. I never worked at a BB, but I did work at a "no-name" boutique and a MM.
Placement: I don't want to get into an argument over this, but BBs and EBs clean up with placement. MM firms do place at solid PE shops, but if you're looking at the cream of the crop, you need to be at a top group at a BB or at an EB. Even for MM PE, BBs and EBs clean up. If PE placement is a high priority, I would shoot for a BB or EB.
Work: At MMs, expect to be very involved in deal processes. I don't know much about BB work other than what I'm told by friends, but at MMs, analyst frequently attend management meetings, are the touch-point for the client during due diligence, regularly interact with potential buyers, etc. I am told this happens less so at BBs, but again, this is just what friends at BBs tell me.
At the end of the day, the most important advice that anyone can give you is to choose a firm where you feel most comfortable at. If you have offers from a BB and a MM, you should never feel like you chose a lesser option if you choose the MM. At the end of the day, your choice is all that matters.
Sil I'm currently at a no name boutique and looking to go through the MM recruiting process in the Fall. Did you enjoy the MM work and felt it was worth it over going into a BB?
Whether you choose a MM over a BB will depend solely on you. I never had any intention of working in PE or corp dev in NY, exit opps was not of concern to me. If exit opps are something high on your list of priorities, you really need to be at a BB. I hope that helps.
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