Q&A: Big 4 Consulting to Lower MM IB to MM IB (No MBA).

As the title suggests, former Big 4 consultant turnt banker at a lower MM M&A shop in the Midwest. Just switched over to a larger MM IB and happy to address any questions. Some quick background of myself: - Graduated from a non target - Started with the Big 4 in the advisory group doing primarily Operations and IT consulting (3 years) - Switched over to a Lower MM shop that focused primarily on M&A as a generalist (3 years) - Just switched over to a larger MM shop in a specific industry group (to remain unidentified) - No MBA This website has been an awesome resource to anyone aspiring to have an interest in banking, or finance in general. Always happy to answer any questions regarding the switch from Consulting to IB, the lateral interview process, interviews in general, and any questions on the job.

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Comments (29)

Aug 31, 2017 - 10:45pm

hightheta01 - the process is very unstructured compared to whats offered in school for on-campus recruiting. There is no set deadline for resume drops, no set dates for on-site interviews, the process is very much put together "as needed" (e.g. whenever someone quits and they need to fill the gap, or if they're swamped they decide they need a growth hire).

Getting the interviews was all about networking. I had messaged, called, grabbed coffee with a bunch of Associates, VPs, etc. just to learn about them and the firm and show my interest. That helped give me an "in" for when the group did need to hire someone.

The interview themselves were different than I expected. I expected it to be very technical and about my story (considering I was in consulting and had no direct experience in banking). The technicals weren't bad - about what I expected, but the major aspect that caught me off guard was the emphasis on knowing the M&A process and knowing the role of the position (analyst). In retrospect it makes sense why: unlike a senior in college, experienced people are expected to know you're getting yourself into. That means, if you were doing another job and you're saying IB is what you want to do, then you're expected to explain what IB is, walk them through a process, walk them through the deliverable/milestones, explain what role the analysts plays, etc.

Hugo

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Aug 31, 2017 - 2:38pm

Not that this particularly relates to you, but in B4 were you aware of people transferring from audit or other lines of service into advisory easily?

Quant (ˈkwänt) n: An expert, someone who knows more and more about less and less until they know everything about nothing.

Aug 31, 2017 - 10:58pm

@BubbaBanker" - "easily" is a Big stretch. It is possible, but unlikely. I know of a few people who was able to do it, and I know of A LOT of people who tried.

First off, most groups operate as silos, so they don't share the same HR/recruiting team, so its almost as if you're applying to a completely other company. Only difference is they'll be able to access your records/reviews on the internal system.

In addition, unless you're a top performer who has a partner or two pushing for you, then you have to networking deep and hard with the targeted group. Because its separate division, you'll need support at the Partner level to push advocate and push your candidacy through. As you can imagine, getting to that level requires a lot of time and networking to develop those relationships.

But there are always exceptions, but most of the successes ive seen involved the above.

Hugo

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Sep 2, 2017 - 4:46pm

Would you recommend trying to network with both my audit partner and the relevant advisory partner from the group I'd be targeting?

Quant (ˈkwänt) n: An expert, someone who knows more and more about less and less until they know everything about nothing.

Sep 1, 2017 - 12:02am

5000 Meters - it was actually not tough to get interviews at larger MM shops. The tough part was getting them to take me as a direct lateral because I was promoted early (didn't finish a full 2 years as an Analyst) and also my firm was much smaller.

I'm an Associate now and will be a direct lateral to my new company. In terms of the shop, they are in the same league as those listed. The interview process for the lateral hire was very easy in my opinion. Yes, there are technicals- there are also questions where they give you a scenario related to a deal and ask how you would approach/solve it. But none of those questions were hard considering it was the same stuff I'd been doing at my old shop. Yes, the new Company works on larger, more big name clients, but the job/function itself is pretty identical regardless of the size of the deal. Yes there will be nuances,, but I'd say 80%, if not more, of the process, milestones, deliverable are all the same.

Also, this wasn't asked but I did want to point it out: working at the smaller shop made me a better banker. The smaller shop offered smaller deal teams (typically 3 or 4). This allowed junior level staff to step-up and take on a bigger role (owning most of the CIM/MP, negotiating NDAs, leading buyer calls, etc.). All of those were very well received during my interviews as I don't believe most analysts get that level of responsibilities at other shops.

Hugo

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Sep 1, 2017 - 9:41am

@Hugo Stiglitz - Thanks for this information. I am in a very similar situation. Did a few years corporate finance at F50 company, going on 2 at a midwest boutique and going to be promoted to Associate. However would like to move to one of the larger MM shops in Chicago after a year.

My banking experience is also similar where I really get to lead deals up to a certain point so its good to hear another guy was able to leverage that experience to make a lateral move.

Sep 1, 2017 - 12:10am

kellyt7 - "common" is an overstatement. Definitely doable but not easy. I dont know if its easier to apply to another firm or not, that depends on each person. Specifically, (1) are they a top performer? (2) do they have a good/strong network at the firm? The answer to those two questions has a strong influence on the "ease" of transferring. Again having people at the partner-level advocate for you goes a long way as its really the Partners who decide if people switch or not (they need to sign-off). HR may run the process but the Partners need to approve/sign-off.

Thus, if you're a top performer or have a strong network, you'll be better positioned to switch. If not, you'll need to network a lot to find people who like you/are willing to push for you. In which case, it may sometimes be easy to just apply to elsewhere.

Hugo

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Aug 31, 2017 - 6:14pm

Excellent job and congratulations on the great success :)

1) In terms of the timeline was it generally unstructured? Did you apply online or was this something you found through a contact/networking?

2) Was it difficult getting up to speed initially going from IT consulting to M&A? Just given the degree of modelling intensive work that I imagine you were staffed on.

3) Do you plan on getting an MBA or progressing within your firm in the near/medium term?

There's a closer meaning to my user name. Try reading it quickly. Perhaps you will then understand ;P
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Best Response
Sep 1, 2017 - 12:30am

alpha_q - thanks!

  1. It was very unstructured. Unless you're applying as a new UG or MBA, then most of the application/interview process is very unstructured. As mentioned in a previous response, groups/firms typically put on an interview process whenever someone leaves and they need to replace or if they need a growth hire. So it only occurs "as needed." For most of the positions that I got interviews for, they were either through my network/referral, or through a headhunter who reached out to me. I've had 0 success just randomly applying for a position online without knowing someone on the other side advocating for me.

  2. The one aspect that surprised me about M&A IB, is how little modeling there is. In my job, I'd say maybe 20-30% of it was "modeling" the balance was in writing, researching, project management, and creating other main deliverables (e.g. CIM, MP, etc.). Regardless, the smaller MM shop didn't have aformal training program (e.g. no TST, no 2-3 week modeling prgoram, etc.). After 2-3 days of doing firm/HR trainings and meeting people, I started working on pitches/deals immediately. The hardest part was understanding the jargon and the deliverable and how to do them properly). As with any job, learning how the Company does it, is usually the hardest part.

Doing consulting first was KEY to my success. Although the technicals aspects of consulting was not transferable, all the soft skills/project management skills were. I felt like I was way ahead of other analysts in terms of my soft skills and ability to build a rapport with the client since I was use to collaborating with clients in consulting. In addition, whenever my deals entered due diligence, I could project manage the shit out of it, since that what my responsibilities were during my IT consulting projects. Having all those skills developed allow me to just focus on developing my technical skill set, which made it much easier for me. To this day, I think IB is one of the best jobs out of UG because it requires you to be good at some many things, quickly. Personally, I don't know if I could have developed my soft skills, project mgmt. skills AND the technical abilities all at once, so am glad I did consulting first.

  1. I'll answer this in two portions: the first from the perspective of the Company/interviewee and the second from my personal perspective. As the Company/interviewee, if you're an experienced hire (or anything Associate or above), you're answer should be no, unless they tell you straight up that they want you to get an MBA. The reason being, typically at the Associate level or after, you're in IB for the long-haul. Also, it costs a lot for the firm to develop Associates and above, so they don't want to invest the time and money into someone just o have them leave in a year or two. This could also be true for Analysts roles for smaller shops (like my lower MM), where they can't afford to bring in 10+ kids a year and have a formal TST program. Most smaller shops try and offer better work/life to ensure they dont have as much turnover at the analysts level because they don't want/cant afford the drastic turnover. If you have a smaller shop, then you need everyone there to be able to do the job fast and well. You can't do that if you have people leaving often.

From my personnel perspective, I dont know if I will get an MBA anymore. It was always my plan to get it 4-5 years after UG, but as I progress in my career (and my salary increases) the opportunity cost to get an MBA gets way too high and I don't see the value-add of it anymore (at least from a monetary perspective). As an Associate in my job, I'm making just as much as an MBA hire would, difference is I'm not $150k+ in debt. However, with that said, I still value the MBA. I view it as a "redo" card. If i go down a professional path I don't like, and don't want to start from the bottom, I can use my MBA to switch into something new at a post-MBA level. For me, I don't know what I'm passionate about yet, and so I waiting to play the MBA card until I find out what that is. When I do, if I cannot seem to make the jump from where I'm at, then I'll reconsider getting my MBA to help break the barrier.

Hugo

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Sep 5, 2017 - 11:22am

allinamd - thats a tough question to answer with a general blanket statement but I'll try... I've seen a few different "structures." Generally BB and EB are the trend setters, meaning they are the ones that increase the salaries (not always but often). Then you have the larger MM that will follow them (the timing of which varies by the bank).

When you deal with smaller MM/boutiques, the compensation gap widens because they are much slower to (or can't) adopt to the new comp structure. Part of it is because they cannot afford to do so. BB/EB and even larger MMs get a lot of deal flow and/or have very large success fees (few million dollars or so). Thus, they have a large pie, which allows them to give people large slices of it. Smaller MM/boutiques however typically have much smaller success fees, so the economics arent there for them. They have a smaller pie and cannot afford to give such a large slice.

The point of that context is to show why you can't find consistent salary data for lower MM/boutiques. Some still use the old IB model (low base but high bonus) - back in the day where the base was $55k-$65k and bonus would be ~100%. Others are still in the previous comp range of 70-75-80 for analysts (the bonus range of which depends on the performance ce of the group). A lot of the lower MM/boutiques I've heard are in the 30-60%. Then you have others that have matched market with comp at 85-90-95 for base (won't comment at bonus as I've seen some major fluctuations based on group/firm).

I'm sure there could be a lot of hole in what I've stated as its only based on my experience at my bank and from conversations with connections at other banks.

Hugo

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Sep 5, 2017 - 10:41pm

Hugo Stiglitz Thanks for the post. Just finished first full year with Big 4, doing consulting within financial services. Complete gimmick. In short, I'm looking to make the switch from consulting to banking but really just have no idea where to start. I obviously need to start networking and reading up on the industry, but what should I be doing in order to learn all technicals and modeling? Any advice would be great, congrats on making the transition.

Sep 20, 2017 - 9:03am

Its been a few years (hopefully I remember all), but I recall I did a lot of research on this website/glassdoor to get an idea of the types of questions to expect at a given round. And also used websites like IBankingFAQs to get examples of actual technical questions.

But practicing those can only get you so far. For me, the best was actually simulating a case by doing a random DCF, or a comps/transactions approach so that I could actually apply what I was trying to memorize.

Its one thing to understand how a DCF work, but often times an interviewer may throw you a specific scenario and want to see how that affects valuation, and you can't just memorize those answers, it takes some applied knowledge.

Hugo

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Sep 6, 2017 - 4:38pm

Hi - I am actually planning to go from BB IBD (current post-MBA associate) to McK. My hypothesis is that the opportunities will be better and ill get to do more operational work. Potentially get into PE in a year post McK

What do you think ?

Sep 20, 2017 - 9:01am

This question can easy be a debate it itself, and I'm sure there are hundreds of topics that cover this. My personal 2 cents would be that it depends on what group you're in at the BB IBD and what M&A deals you've been on.

If PE is your end goal, I would imagine that BB IBD would position you better, UNLESS you're just in a coverage group and/or haven't head any deal exposure whatsoever.

With that said, I would say the work at the BB IBD may be the most transferable in terms of PE, but what MBB offers is a very strong/well-connected network. I can't speak for McKinsey, but know that the the "BB" in MBB will often help its candidates prepare for interviews at other companies. The reason being is that they know that % of people staying in consulting for their entire career is small, so they want to help people move to their new roles. Doing so will allow you to have another connection in that firm for future business opportunities. I don't think that mindset exists at any BB (or at least I havent heard of any).

Hugo

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Sep 25, 2017 - 11:49pm

I'm looking to do something similar to you though I'm not in Big 4 consulting. A couple of questions:
1) How long did the process take for you, beginning from reaching out to the first banker to eventually signing an offer?
2) How did you deal with leaving the office and potentially traveling? Were you only targeting firms in your city?
3) I'm planning on starting to recruit once I hit the 6 month mark at my current job because I just can't take it. Do you think looking that early is a red flag for banks?
4) Did you get any interviews with BBs? Is that possible if you're willing to restart at a first-year analyst position?

Gimme the loot

Feb 28, 2018 - 2:22pm

Gratisfaction Sorry - realized I never responded to your questions.

  1. The process with the Company I signed with was very short. Maybe 2-3 weeks from first meeting to signing the offer. I realized that the lateral process can occur pretty fast (depending on the Company) since its usually a result of a need for growth hires or replacing someone leaving, both of which means that they need people, so they typically make decisions quickly.

  2. I was never gone for too long (usually 30mins-1 hour) maybe sometimes for 2-hour pockets. I was very involved with the firm on internal initiatives, so often used that to put placeholders on my calendar to create times where I could take calls and/or move around the city to local shops. For anything pre-Superday, I would usually tell recruiters/companies when scheduling interviews about not wanting to do anything for more than 1.5-2 hours at a time during business hours to be respectful to my employer and not make it obvious. I usually had a lot of success in being able to section off interviews, where instead of doing 2 or 3 back to back calls, I'd spread them through the course of the day or even over a few days, so I was not MIA for periods.

  3. 6 months would be too early to start applying but its never too early to start networking. And networking is key. Anything without context could be a red flag, which is why it's critical to network first with any company you're interested in. That way you can control the communication of your candidacy and the context of your situation. If you just blindly apply or randomly ask to be considered for a role, all they'll see is a candidate wanting to jump ship from their employer after 6 months of work, and that would be a red flag.

  4. I actually did not try to go BB at all. Most of the reason being none of the BB had strong industry group for my target industry in the Midwest.

In terms of if its possible, it for sure is but it's definitely harder. I will say to not undersell yourself and offer to re-start as a first year from the get-go. I did that when I first switched to banking from Consulting because I wanted to secure the job. In hindsight, I wish I held firm. I'm now a huge believer in asking for you want and having them (the Company) counter. You have more upside since they may have been willing to take you as a direct lateral instead of having you restart as a first year.

Hugo

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Mar 26, 2021 - 11:17pm

Hey, I know the post is 3 years old, but I hope you could still answer my question and I greatly appreciate it. I'm a junior from a non-target, I have 2 offers for the upcoming summer: Corp Fin at F10 and Big 4 Financial Services Advisory. Which one would be more beneficial in terms of transferrable skills to break into IB? If so, what's the best way to do so out of undergrad? I don't have any prior IB internships.

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