Severely underpaid
Update 1: sent out a few resumes to gauge interest. A headhunter told me to wait for at least 1 closed deal, which would make my tenure at current firm ~ 1 year. She said it's a higher chance of winning interviews and securing offers. I agree. I don't mind getting more deal exp and wait until December since now I got 2 live IPO deals (one backed by Warburg Pincus and the other backed by Eli Lilly Venture). The only problem is I'm not sure how many spots there will be left then.
A couple guys here really helped me clear my thoughts.
Clarification: numbers are for illustrative purposes only.
My current plan: really appreciate the highest-voted answer here. I'll start shooting out some resumes to firms that are not my #1 choices to gauge market reactions. Meanwhile, I'll suck up and get some live deal exp because both live IPOs will "close" --- all documents submitted --- by year end. I started Dec'20, so that'd be a year with at least 2 "closed deals".
Putting specific names and groups aside, let's say that my group has good/okay deal exposure and is a MM/big balance sheet bank level one.
Say my base is only $55K, and MD promises to pay 50% of bonus, making that ~$80K per year. I work normal IB hours, say 70 hours a week on average. I know this is lower compared to most EB/BB/MM hours, but I still work a fair amount of 80-90+ weeks, and typical IB requirements apply (24/7 on call to work).
I know for a fact that people get paid different levels at my company even if people wear the same title. Is this normal?
Can I propose a raise ~8 months into the job, and is considered a top analyst? Or I just bear with this for a year, recruit after getting some deal exp and GTFO after bonus hits bank account? I am an extremely money-hungry person coming from a lower-middle-class/none-middle-class background. I worked my butt off to get into IB, only to find out that I got paid like shit when I see the salaries and bonuses made by my peers.
Please, I really need some advice here because I got frustrated by this every single day, and I cannot for a single second stop thinking about "fuck my MD and this company for underpaying people".
Other example: know 1 Associate with 4 years of experience under her belt (2 ER + 2 PE) that got paid ~$100K all in.
Maybe 8 months into your job is a bit early, I would wait just before salary increases are due. The argument should be that you are paid below market (try giving some figures of comparable firms) but avoid mentioning the salaries of other people in your firm.
In parallel, I would start looking to lateral just to edge yourself.
TBH I'd start looking to lateral after about 6 months, hope to leave around 8-10 months so the new bank owes you a bonus, which will likely be street or close. BB/EB will happily buy out analyst bonuses. DON'T say you're leaving because of pay or tell them what pay/especially bonus is, find some other reason you're leaving.
Doubt asking to get paid street will work. Maybe you can ask for a normal sized raise, but they are never going to double your base. I'd focus on getting reps, make sure you know your deals well, and GTFO before even a year hits.
OP here. Thanks...actually I've just started 2 live deals, after 8 months into the job. I got staffed on 1 live deal before those 2 but that deal died. I have seen the deal timelines for both deals. When almost everything is done, although deals might not be fully closed, I'll have plenty of stuff to talk about since I'll be handling a lot of grunt work in both. That would be ~1 year for me as an analyst. By then I'll start applying for jobs and ask to jump ship as a 2nd year analyst, even if I do not get a fucking bonus.
Oh I misunderstood, thought you had just started. You can definitely start looking to lateral now as a second year, places are desperate for experienced hires and you might get a real bonus from your new bank
I want to start shooting resumes now. Only thing I'm worried about is, I don't have a lot of actual deal experience. I've done 1 small M&A (in process, don't think it'll close because of company founder's/seller's personal issues), and am in the process of 2 IPOs that just started. What do I say when they ask "so what kind of deal experience did you get/are you getting rn"? I'm genuinely concerned.
For the 2 IPOs, I will be drafting prospectus, create some materials for senior management, run some revenue projections and write roadshow slides. Also a lot of due diligence work.
You can just put "Project Alpha - Divesture/Acquisition of XXX of XXX" in your resume and say the deal is currently undergoing, and that you cannot disclose too much information, but all IB analyst basically do the same thing - make PPT, Excel models, PIBs, reserach, fee runs, etc. You can explain those processes and it should probably be fine.
How much modeling experience do you have? Even on pitches. Are you comfortable with accretion/dilution and M&A math?
Questions will probably lean model and deal experience. You have the one deal, I'd shoot for 3 that you can talk about - any pitches you did a lot of work on, maybe modeled a specific combination or even had follow-up discussions? If you can scrape up one of those and put one ongoing IPO that's plenty. Just prepare a 2-3 minute talk on each especially with what your contribution was, and go back over the model so you can talk about it. Also, for the deal that died just say it's ongoing on the resume and obviously don't say it won't close :)
Shoot the first batch of resumes at places that aren't your #1 dream group so you can get some reps answering these questions without losing out on any jobs that are really important to you. At 8 months in I bet you have enough to talk about and just need to prepare how you'll do so in an interview. If you find you're really struggling on deal experience, wait another few months. Finally, if you're at a bank known to do few deals they won't expect you to have the deal experience of someone in GS TMT.
Just curious, what reputable bank has any sort of base pay differentiation at the same level? Never heard of that at the analyst/associate level across any EB/BB/MM
Yeah I won't call the bank reputable...international balance sheet bank, Asian.
Maybe not a reputable bank in your opinion, but SunTrust is currently severely underpaying on base @ 87.5K first year.
If this is Mizuho, I heard they pay not well. Would lateral ASAP.
Is this in NYC??
I'm confused by this example...when/where does this happen??? I've never heard of something so low
70 hours a week x 50 weeks (I am assuming you get 2 weeks of vacation, but I doubt it from the sound of it) = 3500 hours.
$80,000/3,500 = $22.86 per hour.
Aren't fast food places paying $16/hour now days + signing bonuses? You might be able to lateral to Burger King for better lifestyle.
I’m going to give OP the benefit of the doubt
Kid sounds smart and extremely hard working. Yes your underpaid but if your out of undergrad, you have a very long career ahead of you
Fact is, IB is going to open a lot more doors than most other business jobs.
Do a NPV on your earnings stream and stop focusing on this year
That being said I highly recommend lateraling after 8-12 months, and don’t stay more than 18 months
good luck
OP here. It’s non-NYC. The numbers are not the exact ones, but for illustrative purposes.
Well 55k in Omaha is a lot better than 55k in NYC. It's hard to provide advice without knowing a bit more about your group, its location, and roughly how much lower you're making than your peers. Did you come from a really off-target school or have bad internships or something? Pretty strange to see such a wide spread.
8 months in is very early to complain and ask for more so I would just lateral if you can.
Depends where you are but even if you're in a smaller city, 55K is low by any standards. Especially if you're at a MM/Balance sheet bank. I'd look elsewhere. Especially since you say an associate is making 100K all in. That doesn't look great for you. An associate these days at a reputable bank will make 175K on base the first year and a significant % of that for bonus. Granted I'm quoting NYC salary but you get that even if you're in a T2/T3 city the pay cut wouldn't be that drastic. Analysts now are expected to enter at 100-110K base for 1st years, you getting paid half that hardly constitutes a col adjustment. For the work you're putting in, look for someplace which compensates you properly. Never worth spending time at places which underpay like this
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