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Just my two cents (take with a pinch of salt) but I would go with EB. I have personally o interest in Energy but yet I believe this is a better option because not only is pay higher, but you also get a better name brand bank (prestige), AND much lower cost of living in Houston. My only thing would be that if you want to recruit for buy side on the west coast it may be easier if you go with SF. Energy can prob be a bit of a pigeonhole but it is not super rare for one to go from energy banking to generalist buy side
Gonna be highly dependent on your career goals (i.e. location, buyside or not, industry interests). I will say that if you aren’t 100% interested in oil and gas and staying in Texas, I would go to the west coast MM. Currently an analyst at a top bank in Houston right now and would probably take the SF side of that trade if I was just starting out. No reason to subject yourself to the energy pigeonhole if you can avoid it (assuming not interested)
Honestly might be biased because I am at a top group in Houston but I think you should go with the EB. I second everything the first poster said and in addition to that I think being at an EB is far more advantageous compared to other banks in Houston. You get to work on M&A deals and also on the RX side of things. M&A is picking back up in Houston (just look at the amount of large M&A deals in the past 6 months) but being in a group that can provide RX advisory is also very beneficial (even if you don’t completely hold the pen on the RX deals). You can still list both deals on your resume and that’s definitely helpful. Additionally, I can’t reiterate how far the EB pay goes in Houston (I get paid a similar amount). You also don’t have to pay exuberant amounts like you would have to in SF just to live in some shitty place. While it’s true many of your opportunities to exit might be energy, I think you can definitely get looks for non-energy opps. if the EB you are at is good.
Agree with the benefits of being at a firm with m&a and rx, and especially the pay but would also emphasize the biased perspective here and want to be clear with OP.
@OP take a look at recent Houston threads. You’ll notice a general theme that some first years and interns / incomings are optimistic on the recovery, but - as pointed out by the more experienced professionals - the long term fundamentals (exits, industry, sponsor activity, capital) are all unfavorable.
An exit from O&G to generalist isnt impossible but it’s not “easy” either. Recruiters and PE funds don’t view O&G as fully transferable and anyone that’s been through the process and is honest with you will tell you that. If you’re not 100% interested in staying in Texas or O&G, I would advise against taking the offer just out of the short term prestige and pay.
That said, if you are from Texas or like it / oil and gas, then 100% take the EB - it’ll pay off for sure. As someone who’s originally from Texas and got thrown into O&G banking without thinking, just trying to make sure you have all the facts.
Both of these are super helpful, thanks.
The biggest appeal for me is getting product agnostic experience, especially Rx, as oppose to solely MM M&A. Would doing 1-2 years in Energy IB to get this experience, see what I like, and lateraling to a different coverage (P&U, Industrials, etc.) or product (M&A or Rx) group in another city be a difficult/bad call? My shop is in the TPH/EVR/MOE camp if that helps, so definitely solid Houston office.
Obviously that higher pay + lower COLA is nice af, but I'm more focused on the experience/skill set that I'll be building and think that gives a lot of merit to the EB route, regardless if I want to do energy long-term.
Did you accept the EB or the MM M&A? would be interested in knowing your thought process.
Sure, I ended up going with EB. My thought process was the following in order of importance to my decision:
(1) Going the EB route will give me exposure across several products (Rx, buy side M&A, sell side M&A, IPO, etc.), rather than solely sell side M&A. Regardless of if I stay in Houston IB, I felt getting cross product experience will help me develop a more diversified toolkit AND get a broader look at finance and what areas interest me for post-banking.
(2) Beyond being an EB, it is one of the top groups in HTX. As such, it has had lots of nonenergy exits from the previous analyst classes that make me feel confident I wont get pigeonholed if I decide energy isn't it for me.
(3) Longer term I think my interests lean more towards NatRes, Industrials, P&U rather than TMT, HTC, or CRX that I would experience in SF.
(4) Lastly, and definitely the least important factor for me, but even though the SF MM M&A group paid above street, the EB still paid more. That in-hand with HTX cost of living less than half of that in SF just makes it even more appealing. You'll be living like a king with any IB salary in Houston, especially EB, not the same can be said for SF.
Hopefully that's helpful.
Great decision! I am an incoming 21 SA intern at a top shop in HTX (that also pays above the street) and couldn't agree more with the reasons you listed.
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