starting an investment bank
Hi. I know this would be a pretty broad question but I really need advices.
I dropped out from college due to lack of money to pay for tuition.
I know that it would be almost impossible to get a decent job for me but I started to dream in establishing a great investment bank company. (i know this sounds stupid)
I want to devote about 50 yrs of my life for the growth of company.
Getting an internship in financial sector would be impossible, but I thought I need some knowledge of what investment banks do. So after reading some books in the library,
I was thinking of if it would be possible to start an investment bank company after having a good skill on handling financial modeling programs that sells in websites like Wallst Prep.
PLEASE HELP ME OUT.
I don't want to end my life now.
You want to start an investment bank as an analyst?
MDs take years and years of being in the industry to establish contacts, trust and build a reputation. Even with that, they need to go to bakeoffs to win businesses.
If you've ever seen a pitchbook, you'll know half the book is devoted to "Why XXX Bank", and league tables and tombstones are thrown in there to validate the reason for choosing his/her bank over others.
It's hard to do banking (esp since you're gonna be a MD right away) without having a track record of success, and unable to discuss valuations intelligently, because it is more art than science, and the experience and judgement is what makes a banker great.
I'm guessing you'll be working with microcap companies since you're starting out, and these companies are extremely hard to value, like biotech or internet companies, who have never made a cent in their lives, and are looking for equity financing. No idea how u're gonna convince investors to buy them when you've never done a roadshow or raised capital before.
Sorry to be a cold blanket, but realistically, STARTING an investment bank takes experience, you can't approach it like Facebook or other startups. The industry is built on reputation, trust and respect. Look at Moelis, the reason he's successful in starting his own firm is because of the reputation he built on the street.
I'm just giving a reality check, if someone is more optimistic about his chances of "establishing a great investment bank", I'd really like to hear it...
i have a sneaking suspicion this is a troll post...
Dude, trying to start an IB without any experience helps contribute to your final result, failure.
Seriously, drop that thought so you don't lose your pants and try to get back into school. If not, go find a job...
No offense, but if you have to ask, you're won't be able to do it.
Also, the negative effect your profile has on the hiring process will be GREATLY magnified when you're trying to find clients.
too much trolling in one post to handle.
Hello
You need to have a good experience to start an investment bank . Your profile not on a positive side too .. Its better to look out for other available options which you can easily materialize . The earlier the better
All the luck Thanks http://www.fintel.us/
LOL, this post must be a joke, but if it's not it's the worst idea I've ever heard in my entire life ever.
But to be fair, there are all kinds of small businesses looking for all types of financing. All you need is acces to debt and equity lines and it would be pretty easy to start a small boutique investment bank. But then, that would require access to debt and equity lines developed through contacts and experience. And any kind of success would be determined by your knowledge of which you have none. But to be honest, if you put a gun to my head and said you have 24 months to start a viable investment bank, I could honestly probably do it, but I have the right money contacts and I have an industry specialization (institutional commercial real estate) with a good resume and a lot of contacts.
ok, while i agree that the OP is either a troll or high on something, i do want to bring up one specific case of young i-bank founders, which is quite surprising
harris williams..
it was founded in 1991 by hiter harris and christopher williams. i then noticed this: http://investing.businessweek.com/research/stocks/private/snapshot.asp?…
apparently they are currently 45 and 43, respectively. that means they were 25 and 23 when they founded the firm.. i doubted it at first so i went to check the website to try to confirm. cant actually confirm, but they dont look much older than 43/45 http://www.harriswilliams.com/professionals/williams.html
i guess it can be done! (again though, this is in no support of the OP.. harris and williams are also harvard MBA)
Hi, perhaps an investment partnership - as opposed to an investment bank - would be a fine idea? In the UK, the time and money required even for legal costs in starting an IB would be crippling to a young, independently financed guy like yourself.
As for an IP, the legal process is light and there are oodles of graduates about who - I imagine - would work as your analysts for a pittance.
Upon graduation my friends and I put together a little private home-care company (for the elderly) with a very small investment through such a partnership. It was only about £10k but it let us hire nursing staff and chase contracts from the local NHS, and now we're doing rather well.
The guy who invested in us had saved a few thousand pounds of his own money and then allocated it independently for 5-odd years (multiplying many times) before approaching investment partners. An accountable track record, he said, is very important and would set one in good stead.
Furthermore, by squirrelling away a little money, allocating it and working over the next few years, you might have time to complete your studies? Alternatively, LSE now offers some degrees through correspondence.
...I don't meant to be a stick in the mud, but in your position I would opt for a more realistic, if less flashy, IP option.
Best regards and best of luck!
Do not allow yourself to be discouraged by all these descriptions of the mountain you have to climb. Simply do this: get yourself a job of any kind that you do during the week. Save some of your money preferably about 0ne tenths as the Christian Holy Book says.
Then on weekends meet with the small businesses in your area and discover their financial needs and help them grow using your money. Try to valuate the businesses, determine their worth as they grow say over one year and value your contribution to that growth and take a portion of the business in written Agreement. Keep helping and every so often let the owner buy you out when they want to but at the prevailing value of the business, so you make profit on what you gave the owner at least a year ago. Do not force them to buy you out though.
Keep this up and keep reading everything there is about Investment Banking and Investment Bank. When you determine that your collective ownership in these businesses is of sizable value then create a company call it "[Your-Name] Investment Bank" and make the company comply with the corporate and investment bank laws of your country as such, and you are on your way as an Investment Bank owner. Keep up and gradually hire people as more businesses come to you for financing. Cobble similar businesses together, securitize them and offer their shares to the public. The business owners will be happy and thank you for it.
Good luck my friend.
Incredible advice.
Wonderful advice. Thanks much!
Hi my name is Javier, i just saw your post. Im sort of going through the same thing right now. I would like to know what you did since your post. If you like i could sent you my email and we can talk direct.
How hard would it be to start an investment bank? (Originally Posted: 12/12/2011)
How much do you monkeys think it would cost to open your own ibank?
Ask Mr. Griffin.
I'm wondering the same thing. Obviously you would need a ton of experience, but how much cash/assets?
I heard MF Global is going for pennies on the dollar.
If you have to ask you can't afford it
I highly doubt affordibility is the problem I would have.
Guess I should look at the OP before being a smart ass. PM'd ya
Are we talking hard, as in the title, or costly, as in the body of the thread? Cost, not much - given that it is so much a service, requiring mostly time, maybe a cap IQ connection, maybe office space to meet prospective clients at, money for office upkeep and IT and maintenance and a server/website, land line, but that would probably run at maybe... less than 10k per month, in a tier 2 city?
In terms of difficulty, from ridiculously hard to easish depending on the scale of the companies you wanna have as clients - could take years to build up a base of 40,000 people youve been in regular contact with at different companies, compared with knowing a couple of guys at large companies who may come to you given that you have a relationship and that they want you to work their deal.
nm
rep > money for starting your own investment bank
10 easy payments of $95261.63 a month
Hi my name is Javier, i just saw your post. Im sort of going through the same thing right now. I would like to know what you did since your post. If you like i could sent you my email and we can talk direct.
hmm....I am sure Franky Q will know the answer to that.
A friend was wondering this as well. We never looked into but it would be awesome :P
I would imagine the money requirements would be the easiest to fulfill for just about anyone who was considering starting an ibank. I would also bet the sourcing and find the deals would be the most difficult. The lack of "prestige" would also weight heavily on the new company.
Collaborate with a BSD (likes of Ken Moelis).
Your best bet is becoming an exec at another ibank, and leaving to start your own, that way u can bring over some clients and therefore get some deal flow. Otherwise no one's gonna come to you over anywhere else.
Money isn't the issue, connections and deal flow are the issue.
I actually worked for a startup IB (that for all intents and purposes failed). The upfront $ is for a few offices from Regis, salaries, Laptops, BlackBerry, Cap IQ access, Website Development, a few conferences, etc..... I'm not saying it's super cheap, but if you're even considering starting an ibank you have enough $.
The ridiculously hard part is actually getting the work. It's going to be next to impossible to land mega deals, but if you have enough middle market connections I think it's possible. There are a lot of MM deals that can keep the lights on as you build your shop if you can get in on them.
heister, PM me. I know someone that did deals independently, but he stopped after awhile to lead the Investment Banking program at my University. I can get you in contact with him.
Thanks, I'm no where near putting this idea into play. I was merely wondering what others thought about the idea. I know the financial implications, I was more interested in the social and business impact of this.
^^^ I know David H. very well he actually also contributed to the book Investment Banking.
Starting an investment bank (Originally Posted: 07/30/2012)
Call me naive, but I've got this crazy idea of starting my own investment bank very early in my career(like Harris Williams). I've got a few questions:
1 how would I get my name out
2 is this a realistic idea
3 what would I need to do to be truly competative and therefore successful
I think if you have to ask yourself these questions then the answer to #2 and #3 is obvious.
Even look at random boutiques, they are all started by guys with lots of experience. What business is going to put their future in a guy who was just an analyst?
There was a thread on this a while back you should look for. Essentially you need a thick network to go through with it, which would have been formed by previously working with said people before opening up shop. So yea, I would plan on sticking around for longer than the analyst level if this is your game plan.
The owner of a boutique I used to work for took a 50% cut on all deals, whether he was a part of them or not. He could be on a 4 month vaca while the MDs structured & executed the whole thing and he still took his 50%. Sure is good to be the top boss..
Does anyone know how Harris Williams were so successful?
youre totally fucking delusional
1) You can't.
2) No.
3) Get through college first.
They did
I like how you shoot for the stars. If more people did that, the world would be a better place. Don't you think you should focus on getting some initial FT experience first?
If you so believe, then you shall achieve
step 1: become an MD at a BB or MM step 2: open your own shop, and take your clients with you
It's a great idea. Two questions for you:
Where are you going to get paying clients? Where will you get balance sheet?
The formula for success:
Phase 1: Collect underpants Phase 2: ??? Phase 3: Profit!!!
I would start by spelling "competitive" correctly.
Not only did they do it after getting industry experience and gaining the networking power of Harvard behind them, they also did it back in 1991. Shit's changed bro.
I'm going to start a Investment Bank at 19 Years Old. (Originally Posted: 09/27/2012)
Hello Everyone.
I'm not going to bulls**t anyone on here. Before you say, and I know you're going to say this is a Troll Post, but it's not. It's an "idea".
One that could allow me to reach World Power, in a Good Way. Anyways....
I'm 15 now, I've always had this idea of being this big wig banker, walking down the stairs of Morgan Stanley, about 3 in the Afternoon, and getting inside my Valet Parked Porsche 911 Turbo, while inherently getting Flicked off by the "Regular Americans". ;-)
This was until I found out what really goes on in the day of a JUNIOR Banker. That aspiration quickly dwindled.
Even as it Dwindled, I still had this obsession with world of Economics. Yea sure, my grades present a fairly good chance of admission to Stern, Berkeley, and maybe Stanford.
The problem is I hate school. Reading through context to gain Knowledge is not good for me.
My knowledge is gained through steady Observation of the specific topic, BUT not through reading but by studying the things around it.
How do we know their is a Black Hole their? By studying the things around it.
School wants me to directly study that "thing", High School, it's possible that I could do this and still receive all A's. In College, it ain't happening.
I'm gonna write a killer Business Plan at 18, present it to some investors and hopefully start my road to success. I need some Capitol and Access to Debt and Equity Lines, apparently those are gained through "connections". I won't really need , if I can hire 2 Senior execs.
But you may ask, "Who's gonna leave the gig at JP Morgan to go work for some unknown Start up Bank?"
The answer is no one.
The good thing is their have been numerous Senior Bankers accused Fraud, who's out of work right now. 'And you know what'? I'm gonna hire them all on the spot!
Why can't I just become the next Richard Branson? J.P Morgan? Paul Warburg?
I'll Accept no one's definition of my life; I'll define myself.
I don't love Money, I just love what Money can do WSO. Lol.
This might go down as the worst business idea to ever be thought by the brain of Human Kind. But Bill Cosby once said...
"In order to succeed, your desire for success should be greater than your fear of failure"
Thanks Guys, God Bless
Learn how to string together a coherent, and grammatically correct sentence before you go start an investment bank kiddo.
Thanks for informing me!
"I don't love Money, I just love what Money can do."
Thanks for clearing that up. Because most people who love money merely love the cotton/linen mixture that composes it.
This is for the Burbans and the Cadillacs With the 10's and the 12's bumpin in the back This is for the playas smokin woolimacks Hittin skins make dividends and ridin with my strap UNH woodgrain with the leather seats Windows so dark you need a flashlight to see me Smokin on that dojah four ni**as in tha back screamin NO LIMIT SOLDIER
So...
Step One: Daydream Step 2: Disregard studying Step 3: ????? Step 4: Profit
And it begins....
"Before you say, and I know you're going to say this is a Troll Post, but it's not."
I totally believe you.
I vote for blumie to come back...this shit is terrible
boring troll post...no real substance or imagination :/
Only thing I found useful in your post, was your username.
Thanks!
P.S Could you give me some insight on starting an Investment Bank?
aleksey? aleksey vayner?? is that you???
impossible is nothing, kid - go for it.
.
This topic is now about Justin Bieber. Discuss.
http://www.youtube.com/embed/R4em3LKQCAQ
Dont get me wrong, I dont like the guy's music, but I dont see why hes hated so much more than any other shitty pop singer thats been around. I guess it could just be due to the boom of the internet, media, and internet memes that have allowed for widespread mockery more so than previous solo/group shitty pop singers.
Pathetic attempt
what?
Fixed
Let me know when you start earning revenue.
Definitely interested. HMU
.
Have you all forgotten about the 14 year old kid who got 50k from kevin o'leary to start an investment fund? Present your ideas to shark tank! j/k lol. I'm filled with business ideas at age 28 but haven't yet taken the leap. Take the leap, you'll learn a lot if you stick with it. Try to go after the small business owner selling liquor stores etc. The middle class market is underserved. Many don't know how to properly value their businesses, that's where you walk in and say here is DCF valuation based on a common multiplier of this area/industry. I wish I could point you to a directory of recent business sales, I guess there's tax data like there would be for real estate. All I can say, is find the data somewhere. Look at similar businesses for sale, ask them about their revenue/expenses/vendors, talk to every small business owner you can and learn business in general. Look for undervalued businesses and tell them you'll sell their business for a commission fee and work your ass off to get rid of it. Gaining valuable sales/marketing/communication skills from practice will take you far kid. Even if all you do is sell one business by age 19, you're off to a good start because it might snowball from there if you invest more time and effort into it.
Go for it!
So what you're telling me is that I actually CAN be an astronaut cowboy millionaire?
DAFUQ did i just read?
http://www.wallstreetoasis.com/forums/16-year-old-hedge-fund-manager -> This.
But this kid is just even more delusional.
i hate you
Ohh, and OP - you best start studying: http://dealbreaker.com/2012/09/there-is-a-guinness-world-records-catego…
Makes sense to me. You have an idea, all you need now is capital, relationships, reputation, a team, and know-how.
Where do I wire the money?
I will say this is possible. I met Emerson Spartz a few weeks ago - he dropped out of all school when he was 12 and homeschooled himself. Started the latest harry potter fan site and became a millionaire before he was even 18. Went to Notre Dame an now runs massive social media sites.
Very cool story here: http://technori.com/2012/08/2464-emerson-spartz-what-a-modern-day-robin…
[quote=TheBigBambino]I will say this is possible. I met Emerson Spartz a few weeks ago - he dropped out of all school when he was 12 and homeschooled himself. Started the latest harry potter fan site and became a millionaire before he was even 18. Went to Notre Dame an now runs massive social media sites.
Very cool story here: http://technori.com/2012/08/2464-emerson-spartz-what-a-modern-day-robin…]
Not even comparable to an investment bank. Some types of businesses can be run based on ideas, some need to be run based on experience. Banking is the latter.
Investment banks get clients because their people have great deal experience and industry know-how. It wouldn't matter if you knew everything there was to know about investment banking when you were 19 because you'd still have no clients. If I were a billion-dollar corporation, why would I trust some kid with no experience to do my $100 million dollar debt financing deal?
Seriously, just get a job like everyone else. If you're really good enough, be an MD at Goldman at 27 like Eric Mindich and then start your own hedge fund.
Oh? Are you sure that personal relationships, sweetheart financing deals, and straight up salesmanship have nothing to do with it?
Justin Bieber @justinbieber
BELIEVE is on ITUNES and in STORES WORLDWIDE! - SO MUCH LOVE FOR THE FANS...you are always there for me and I will always be there for you. MUCH LOVE. thanks
All Around The World · http://www.youtube.com/justinbieber
He's doing good man, 28+ million followers....got to build some street cred' like the Biebs and that good ol' capital will flow like pre-pubescent girls through a concert gate for the #believe tour...... IJS dawg. Sky is the limit.(and now its our point of view!)............................see what i did there
Because you're fucking retarded
I really hope you were lying about this being a troll post. If not, please explain to me how you're going to raise capital. Who the hell is going to give you money?
You're a fucking idiot. MS is on what, like 45th and 7th? That's in the middle of times square. Where the fuck are you going to park your porsche? Notwithstanding the fact it would get towed in a fucking heartbeat, if by some miracle you came outside to find the thing still there, a pretzel vendor would have set up shop on the hood and a family of rats would be living in the upholstery.
And deal experience and industry know how? Please. Any BB has the expertise to execute any transaction. "Top" banks don't get better pricing in the capital markets or better structures in acquisitions, that's idiotic. Do you really think some CFA at Metlife buying corporate debt sees GS's logo on the prosup of Ford's most recent bond sale and, after changing his underwear of course, shaves 15 bps off what he's willing to pay for the deal?
Banks get business for two reasons - they have strong personal relationships, or they're willing to write a big check. Dude, think for one second.
And even if deal experience and industry know how were the main drivers, you don't have any so that's a knock against you. Do you have any idea what it takes to close a mortgage on a shitty mall in Tuscaloosa, Alabama for a shit finance conduit CMBS deal? Let alone some complex cross-border acquisition... dude, even the deals that never come close to page 13 of section Q of the WSJ require years of experience to execute.
They're critiquing your grammar because it's not something as easy as turning on and off. See, now you're paying attention to it, so it looks fine, but what about when you've been up for 30 hours with only the 60 ounces of Starbucks coffee running through your veins? You're going to fuck up. Hell, analysts fuck up all the time but that's why they're analysts. They have the opportunity to learn now so they don't screw up when they get to the big time.
And why are you going after people's personal/professional lives? They aren't the ones that put their life and goals on display, you are. What did you expect, people to come in acting like puppies and butterflies, giving you words of encouragement? You can't even logically respond to their attacks, how the hell are you going to run a bank?
Oh, and note all the people who started their own financial institutions without college degrees did it when college was still somewhat of an unnecessary thing? How many of those people have you seen since 1990, since the introduction of the internet to the mainstream consumer?
Back to the bush league with you.
He told me that I'll be working in the back of Purina Dog Chow, this statement provoked my statement of retaliation, hence I asked him about his professional life since he has the ability to predict mines.
In all seriousness, I have yet to receive a post of decency related to my post. Gosh, this websites possesses guys with ton of experience and knowledge about the world of finance than I could ever think of, and yet people still just want to give me their opinion on how society works and how it will work no matter the circumstances.
I don't care if you think I'm retarded, too young, or arrogant. Please just give me insight on how to start an investment bank or any other financial institution that involves Investments. Please, I'm not telling you, I'm asking.
If this ever takes off, hit me up we can be partners lol
ladies in gentlemen, we are in the presence of the greatest troll of all time.
LOL... WSO is reaming this kid in the ass. You guys just took a shit on his dream, ouch.
-
Dude, it's all good to dream but you need to have a roadmap as well - read a few books and then ask some real questions - anyone can have an idea to start their own investment bank, just because you're young doesn't mean you will be successful - rather tone it down on the arrogance, its in small bursts we get ahead, not in giant leaps...
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