Q&A: West Coast Tech IB Analyst

Don't do much posting but this site has been invaluable to me so thought I'd help contribute...

Quick Background:
- Wrapping up my second year at a BB Tech M&A group in the Bay Area (also summered here my junior year)
- Will be moving to a role at a late stage MM Tech PE fund this summer
- From a semi-target public school

Feel free to ask whatever you like - happy to answer questions about IB recruiting, tech group specifics, my PE recruiting process and anything else that comes to mind.

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Comments (82)

  • Intern in IB-M&A
Jul 7, 2020 - 11:15am

What're your thoughts on some of the Tech (& Media) Boutiques in SF (DBO, Qatalyst, LionTree). Also, do you have plans to go to B-School?

Most Helpful
Jul 7, 2020 - 3:31pm

All three of those places are obviously top-tier shops. If you're looking to do purely tech M&A, Qatalyst is #1 in the space when it comes to tech M&A. LionTree is a lot more dominant in M&T than tech. Don't know too much about DBO but have heard good things and know they exit well too.

Would say the main differences between BB's and boutiques (throwing traditional EB's like EVR and LAZ here too) come down to:

  • Type of experience and deal exposure - if you're in an tech M&A group at a BB, your experience will probably be pretty similar to a non-Q EB (Qatalyst practically runs the $1+ bn tech sell side space). Would say the boutiques probably run quite a bit leaner across the board on an analyst per deal basis and have more senior level exposure. You're obviously not running the model at a tech coverage group (unless you're group runs in-house M&A), but you do get broader exposure across different products, which is valuable.
  • Resources available - at a BB you're getting far more resources like dedicated graphics support, print teams, research teams and even outsourced India support (these guys can do things like spreading comps, putting together profiles, etc. and can honestly do it better than some of the FT analysts...). You don't get any of this at a boutique.
  • Exits - both sides exit well and you're going to get looks from any of the BB's or top boutiques, really just comes down to the individual. Some of the boutiques like CVR might not have an open recruiting culture though which can be tough (same goes for GS).

The fund I'm joining does direct promotes without B-school, so no plans to go at the moment. Honestly don't see the value in an MBA if you're not from a non-traditional background or considering a major career change, aside from going because of burnout.

  • Prospect in IB-M&A
Jul 7, 2020 - 8:34pm

A little confused about the differences between your Technology and M&A group. Are you in a tech coverage group that does their M&A in house? Or are you in the M&A group but your bank is tech focused?

Also how is Menlo Park? Hard to find a place out there? Is it cheaper than NYC and SF? Don't know if you live there or SF but I'm sure you know a little about the area.

Jul 7, 2020 - 4:08pm

Personally think tech coverage with in-house M&A. My answer a couple years ago definitely would have been tech M&A, but I think there's a lot of value in getting exposure to different products and thinking from a coverage angle. Most analysts coming into banking put M&A on a pedestal because M&A group means you model a lot, and more modeling means better deal experience and higher chance of exiting to PE. Not to saying modeling isn't an important skillset because it definitely is, but after two years of it I realized that (1) the type of modeling you do in banking doesn't require much thought, you're either using consensus numbers or management provided numbers so you never really get to think much about assumptions, (2) it's a commoditized skillset that almost anyone can get good at with enough practice, whereas being able to think about the actual assumptions, or thinking critically about industry or business model is a lot more valuable and (3) there's a lot of value in working an IPO or debt financing and getting exposure to the deal process, especially if you're in a lead role (even if you're hoping to recruit for PE).

  • Intern in IB-M&A
Jul 7, 2020 - 4:09pm

Interested, recently signed with a BB in SF for their tech coverage group and wondering if maybe I should try to move to M&A for FT if things pan out. Would love to hear a little more about the different experiences if the coverage group doesn't do in-house M&A

Jul 7, 2020 - 5:04pm

If you were to choose between tech pure coverage and tech M&A (or coverage in-house M&A), advantage definitely goes to M&A if you're looking to recruit for PE. You're not touching the model in a coverage group, so you're doing things like putting together the teaser/CIM for a sellside, spreading the comps and doing industry research / putting slides together in PPT.

Jul 7, 2020 - 4:22pm

I think it definitely makes it easier because you have relevant deal experience in the space and you're able to learn the nuances of tech that are pretty different from other industries (how to value tech companies, how to do a revenue build/operating model for a SaaS company, what are the relevant metrics for Saas/eComm etc.). Having said that I've seen a lot of people at tech funds from non-tech groups, and vice-versa (if you're in FIG, RE or O&G probably a bit harder). In some ways its similar to majoring in a non-finance degree - you just have to take the time to learn the skillset on your own and be able to demonstrate an interest in tech.

Jul 7, 2020 - 4:27pm

In terms of FT re-recruiting, probably pretty similar to most other verticals. Just comes down to networking with folks starting early on in the summer and seeing what FT conversion rates are like. COVID this year definitely makes it a bit tougher as conversion rates are probably going to be close to 100% (if they weren't already in previous years).

Jul 7, 2020 - 4:38pm

Probably taking the time to join clubs/finance orgs & surround myself with smart people looking to move into IB/finance. Being around a bunch of driven people gave me a network to study together, mock interview, and recruit together. Other than that, taking the time to actually enjoy college. Working on your career goals is great but you have the rest of your life to do that and you're never going to have another opportunity to be so unplugged.

  • Intern in IB - Gen
Jul 7, 2020 - 11:59am

Where do you want to be in 2-5 years (still in PE, B school, startup, VC, Corp dev, etc.) and how important do you think IB will be in helping you get there?

Jul 7, 2020 - 4:48pm

Could definitely see myself staying in PE long-term, but who knows if I get burned out or another opportunity pops up. Not really considering B-school at all given the enormous opportunity cost (see my comment above), and corp dev seems a little to slow paced / narrow focused. Public markets has always been interesting to me; there was a long post a couple days ago from someone else talking about their transition from PE to HF that had a lot of good points.

Would say IB helps the most in building your financial foundation, but other than that acts as a good gateway to whatever job you want to pursue next. It's a pretty logical and tried & true path to move from IB into any of fields you mentioned above, but from what I've heard gets harder from there (e.g. it's hard to move from corp dev into PE, or even PE to VC).

Jul 7, 2020 - 4:57pm

To be honest, I really don't mind SF that much, although I know some of my friends hate it. It's definitely a big step down from NYC in terms of social scene, but I think part of it is managing expectations, cuz there's really not any city comparable to NYC in the US. You've still got a pretty decent bar scene in the Marina, Mission and SOMA areas. The other thing is when you start in banking, you're probably going to be working a lot during the week, so that doesn't leave you a whole lot of time to be going out (probably only limited to Friday night / Saturday if your bank does protected Saturdays, and maybe the occasional weekday HH once you're in your second year). Finally I'd say one nice thing about SF is the proximity to everything else - you've got a ton of outdoorsy stuff within an hours away, Tahoe/Mammoth within a couple hours driving distance and Vegas/LA an hour's flight away as well.

  • Analyst 1 in IB - Ind
Jul 8, 2020 - 12:41pm

If you had to recommend where to live for a first year working downtown, what would you suggest? My buddies and I were thinking North Beach/Marina but curious to hear thoughts.

Also any recs on bars/restaurants/things to do for an incoming first year? Really approaching the city with an open mind, but have heard really bad things about the social life lol

Jul 7, 2020 - 6:35pm

Honestly I think part of the reason I got interested in the first place is because that's what everybody else does, or what you're "supposed" to do after IB. Having said that, I think I've always had a preference towards a value oriented investing philosophy since I started getting involved in college, which fits well with later stage funds over VC or growth. Also like the control aspect and operational side of PE.

Most excited to start a new learning curve - you sort of top out the learning curve in banking after the first year to year and half (at least from an analyst level), so I'm excited to be learning again, especially from an investor standpoint and not an advisor standpoint.

Jul 7, 2020 - 6:45pm

Think it really just depends on what the SA conversion rate is for each bank. Most of the banks I know of in SF hire SA's with the intention of converting them FT, assuming that they're competent. The fact that SF is regional also means you're usually recruiting directly into the group (vs NYC where you can summer in one group and place in another FT).

Best way to gauge which groups will be recruiting FT is to start networking with other banks (cold emailing and leveraging your existing network) earlier in the summer, and keeping in touch with them as the summer ends. Most folks will have a good idea about who is getting a return offer around the mid-summer review, and if they might need to re-hire for FT. Obviously things are different with COVID as SA's probably aren't getting a real banking experience, which makes it harder to judge people. Guessing conversion rates will be higher than normal this year (they're generally pretty high for BB's already).

  • Intern in IB - Ind
Jul 7, 2020 - 10:31pm

thanks for the input. as a summer analyst, how risky do you think it is to reach out to people at other banks in the same city / another city? really worried about the scenario where the people I reach out to are friends with people at the bank I work for and tell their buddies I'm looking to recruit elsewhere and have that jeopardize getting a return offer. thanks!

  • Intern in IB-M&A
Jul 7, 2020 - 4:49pm

what are your thoughts on MM tech players? I'm interested in tech but think I'd be better suited for a MM shop. I think HW, Blair, and Piper all have big tech teams- any idea who leads that space? thanks!

Jul 7, 2020 - 7:03pm

I know WB kills it in the sponsor sell-side space and some of the transactions they've advised on are in the $1bn+ range; they probably do more pure M&A advisory than several of the BB's (lot of BB advisory credit is tied to the financing they're providing). Not as familiar with HW and Piper but they're definitely both reputable, solid shops in the MM space. Jefferies has also been doing well in the past several years given their ability to provide aggressive financing terms (although they're probably categorized as more of a BB than MM in the tech space).

One thing I would say is that because of Q/GS/MS/JPM's dominance in the multi-billion M&A space, you tend to see some of the mid/lower tier BB's moving slightly downstream and competing for / working on deals that you would traditionally associate with MM (e.g. deals in the sub $1bn or even sub $500mm space). Tech as a whole is a pretty big space though, which means there's still more than enough dealflow to go around.

  • Intern in IB-M&A
Jul 7, 2020 - 8:34pm

how would you say the top MMs compare to lower BB/EBs (not Q/GS/MS/etc) in the tech space? sounds like somewhere like Jeff/Blair/etc gets a ton of solid deal reps (sell side M&A) while some BBs might do a lot of pitching and bigger but non-M&A stuff. would you rather work at, say, Jefferies or Citi in tech? thx

  • Intern in IB-M&A
Jul 7, 2020 - 4:52pm

Which schools do you run across the most in SF? Specifically curious about Stanford, USC, Berkeley, UCLA, Claremont schools....

Jul 7, 2020 - 7:11pm

Berkeley and USC are definitely the most common of the West Coast schools - great alumni networks at both and place dozens of bankers in SF each year. Don't see too much Stanford but I think that's a product of choice (choosing CS or product over IB). Would say UCLA is pretty common as well, think they place well in SF, but definitely fewer than Berkeley/USC. Claremont schools are probably in a similar boat, but more LA concentrated. Other than that there's a fair share of your typical target/semi-target schools from the East Coast represented in SF.

  • Analyst 1 in PE - LBOs
Jul 7, 2020 - 7:14pm

Which MM tech PE funds in SF have reptutable associate programs? I feel like people on this site only ever talk about Silver Lake/Thoma/Vista, so it would be nice to hear about some other firms with a MM focus.

Jul 7, 2020 - 8:15pm

Some of the tech buyout funds with an office in SF that come to mind are AKKR, TCV, Vector, Marlin Equity (LA), Siris Capital (more media focused), Sumeru (Silverlake's MM arm). There are even more funds that invest in tech among other sectors like Genstar, HGGC, GI Partners, Gryphon, Siris Capital, Gores Group (LA), HIG, Riverside, etc..

  • Prospect in IB - Gen
Jul 7, 2020 - 9:22pm

What's the split between fintech covered out of FIG vs. tech?

Jul 7, 2020 - 10:32pm

During analyst recruiting (SA or FT), how important is the candidate's knowledge in technicals specific to tech? (CAC/LTV, churn rate, etc) If yes, do you have any resources you would recommend to study for that?


Jul 8, 2020 - 12:01am

Definitely doesn't hurt to know this type of stuff, but I doubt you'd get anything too in depth for most BB's and even many EB's, especially at the SA level (if you're interviewing at Q or somewhere more intense might be a different story). Think you're more likely to see questions related to the SaaS business model or other tech specific business models (why is SaaS preferable, what differences are you likely to see on the 3 statements vs non-SaaS companies), how to value tech companies (especially non-profitable companies) and tech industry knowledge in general (major trends going on in tech, any specific areas within tech you're interested in).

Couple of resources I found useful for the type of metrics you mentioned were:
- Andreessen Horowitz blogs (good article here: https://a16z.com/2015/08/21/16-metrics/)
- Boutique firm called Shea and Company published a great primer on SaaS metrics and evaluating SaaS companies

Jul 7, 2020 - 11:03pm

Thanks for the Q&A! Currently non-tech coverage SA:

  1. How much influence did you have for getting staffed on deals/verticals you're interested in? Side question: does anyone actually like working in semis?
  2. As you end your current gig, what type of relationship do you have with your senior bankers?
  3. Best bars to visit in SF?

Congrats on the offer and thanks again!

Jul 8, 2020 - 12:24am
  1. Quite a bit especially if you're good, but obviously not everything is always going to go your way. DRs/VPs/AS' like working with people they can trust, so if you're doing your job well you build rapport with the people you want to work with, and they'll often request you. Personally didn't mind working in semis even if the companies themselves can get a little dry (especially the semicap players...). Still a lot of M&A going on in semis (definitely slowed since the 2016 explosion of deals) so people often work in the vertical for the product exposure. Also personally not that interested in internet/consumer businesses so preferred working in semis for the most part over those verticals.

  2. Would say good relationships overall. I definitely tried to leave on a good note and not burn any bridges, finance is a small community and you never know who will be in a position to help/hurt you later on. I left with great relationships with the VPs/DRs that I worked with a lot, and on good standing with the MDs. MDs see you as future business if you're moving onto the buyside, so as long as you didn't totally slack off during your 2nd year it's an amicable departure.

  3. Makeout Room and Blondie's in the Mission are always a good time. Westwood and Monroe are also solid.

Jul 8, 2020 - 1:56pm

My guess:

Best would be in the north eastern side of the city (marina, north beach, etc)

Worst: Hunter's Point, visitacion valley, tenderloin (TL is great if you're a biologist wanting to collect samples of human feces)

Jul 8, 2020 - 6:07pm

Been a while since I interviewed for SA so don't remember too much. Can speak to the types of questions we ask our SA candidates though.

Generally falls into a couple buckets:
- Behavioral questions: pretty classic walk me through your resume, why finance, why tech, etc.
- Tech industry knowledge: you should definitely be able to walk through some of the key trends in the tech space, as well as talk semi-intelligently about some specific niches within tech that you're interested in. Have also seen "pitch me a stock" type questions come up before.
- General technicals: classic finance technicals that you can find in the WSO / M&I guide. Things like valuation techniques, 3 statements, basic merger math / LBO understanding
- Tech specific technicals: valuation for tech companies specifically (SaaS companies, how to value high growth/unprofitable companies), nuances on the different statements (deferred revenue balance, etc), talking about business models specific to tech

  • Intern in IB - Ind
Jul 8, 2020 - 2:50am

Thanks for the Q&A!

I am a new analyst joining a BB tech group that does not do in-house modeling. Curious to see if you have any advice on what to do to become more competitive during buyside recruiting.

Would also be great to get your perspective on 2nd year vs 1st year buyside recruiting. Specifically for tech, would it be better to have more deal experience and get more industry exposure before jumping into buyside recruiting?

Jul 8, 2020 - 7:37pm

Still going to get decent looks at any BB coverage group, even if you're not running the model. At the end of the day it comes down to your ability to sell yourself and demonstrate that you know your stuff to the headhunters / funds. Would focus on making sure you're able to get basic 3 statement LBO's in under ~1.5 hours, as well as up to speed on tech specific valuations and metrics (especially if you're not getting exposure to those in your group).

Personally think that it makes sense for a lot of people to wait till their second year, or at least first year "off-cycle" (on-cycle is so early now that a lot of funds end up waiting until the 2nd wave, or saving spots for off-cycle candidates too). Unless you're absolutely sure on what you want to do and are confident that you've got your technicals/industry knowledge/modeling etc. in interview ready shape, probably makes sense to wait for the latter half of your 1st year / 2nd year. You're only ever going to get 1 shot at impressing the headhunters (if you mess up here, you're not likely to get many good looks), and more importantly the places you're interviewing at.

Jul 8, 2020 - 7:45pm

Posted some resources somewhere above, would definitely take a look at those. Other than that, also used the standard M&I / BIWS guides for general technical prep as well.

Early stage / VC investing never really interested me - think it's incredibly difficult to differentiate in that space and generate sustainable performance, but maybe that's just because I'm not smart enough; know several smart people who have joined VCs. Also think the space has become somewhat self-fulfilling (i.e. top funds like Sequoia / Andreessen will always get the cream of the crop coming to them).

  • Analyst 1 in IB - Ind
Jul 8, 2020 - 12:39pm

Incoming Analyst in SF here - have you received any guidance on when to expect to begin working in the office again?

Also on a side note - how do interviews differ based on stage? Did you tell HH's that you'd rather do late stage than buyout or will they traditionally just show you both?

Did you interview on cycle? What did your process look like?

Jul 8, 2020 - 7:54pm

Guessing SF banks will have people start trickling back into the office in the fall on a rotational basis (assuming things don't get even worse). Doubt things will be back to "normal" until at least the spring/summer of 2021.

You should be going into HH meetings with a pretty good idea of what you're looking for, or at least come off as such. HH's like to see that you know what you want in terms of stage/size/location/focus (e.g. if you're looking for large-cap tech focused late stage buyout shops, or tech focused growth shops that have a balance of both sourcing / execution). If you tell them that you're open to anything, you're probably going to get nothing... If you're not 100% sure or want to recruit for multiple fund types (not sure this is recommendable as it's hard enough prepping for 1 type of interview), you can tell different HH's different things. Would look up the client lists for different HH's to get an idea of who they represent (e.g. you can tell Glocap you're interested in growth given they're stronger in that space, and tell HSP you're interested in buyout).

  • Analyst 1 in IB - Restr
Jul 8, 2020 - 2:39pm

Thanks for doing this. I have a couple questions:

  • Best resources to stay up to date with tech? Am aware of Tech Crunch but are there any resources I can spend 5 hours on to get a complete overview of say the cloud industry or cybersecurity?
  • Additionally, ik the BBs might ask merger model questions in interviews, any easy way to get up to speed on that kind of stuff in a short amount of time (i.e. without spending time building a bunch of them)?
  • Analyst 1 in IB - Restr
Jul 9, 2020 - 10:46am

I have access to ER. Do you remember off the top of your head which firms publish the best primers for industries within tech? Took a look around but wasn't too easy to find.

  • Prospect in IB - Gen
Jul 8, 2020 - 6:06pm

Could you compare SF and LA in terms of the banking scene? Are both equivalent when it comes to recruiting in California? thx

Jul 8, 2020 - 9:16pm

Think the difference really just comes down to the coverage groups in each location. Most tech/healthcare groups are up in SF, while LA is a mix of sponsors/RE/gamimg & lodging and some consumer retail. Definitely several very strong groups in LA that recruit really well.

Exit opps just comes down to 1) the relative strength of your group and 2) your individual ability to sell yourself in interviews. There might be a slight advantage to recruiting for tech funds out of a tech group in SF, but very doable from any solid group in LA.

Aug 3, 2020 - 7:29pm

Again, thanks for doing this UnicornOrBust. In the beginning, did you recruit specifically for Tech groups or were you designated by the bank once the interviews were over? Also, is there a timeline difference between SF and LA recruiting?


  • Analyst 1 in IB - Ind
Jul 8, 2020 - 7:43pm

Thoughts on Citi tech SF? Seen a lot of "Prospects" giving their opinions as well as a very disgruntled former employee but haven't seen anyone in the space give an unbiased opinion.

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