Bank on Banking

What’s the bonus differences between Debt Capital Markets and Traditional IB – which would you choose (analyst, associate, up the chain)?

Generally speaking, IB bonuses will be higher than capital market banker bonuses moving up the chain. However, in most banks, the bonuses will come from the same bonus pool – in other words, at the analyst level your bonuses will be based on ranking regardless of group. As you move into VP and higher, bonuses will be based on your performance and the performance of your group with the group that brings in the most revenue generally getting, understandably, the largest piece of the pool. Personally, unless you are really interested in DCM, I would go with a different product group within IB (such as leveraged finance, M&A, or Project Finance – in those banks where PF is an independent group) or an industry group (energy and power, financial institutions, technology, etc) of interest.

That said, on an analyst and associate level, there really isn’t a difference in bonus figures. Additionally, in DCM, at least high grade DCM, the hours are often a bit better, and there will be more client interaction a bit sooner, but the modeling is nearly non-existent – at least in terms of interesting modeling such as M&A, project or lev fin modeling.

I landed a SA position, but am still considering other options for FT – should I reach out to my contacts now, wait until the internship is over, or not at all? Will my contacts talk with the bankers here and get me shunned?

You’ve got a few questions here, so let me tackle each of them one at a time.

First, while the Street is small, there is nothing wrong with networking and, generally speaking, your other contacts won’t go running to your current bank and be like “hey, check this out – so and so is totally screwing you guys – don’t offer him a FT position.” It’s expected that you will shop around, network and keep your options open if for no other reason than you don’t officially have a return offer yet (and won’t have one until nearly the end of your internship or so – even if it implied beforehand). Also, it’s always good to stay connected to your alumni and contacts not just for immediate use, but for down the line – if you are ever thinking of making a move or helping out a friend, etc. In short, definitely network and definitely put the feelers out there.

Now, to the 2nd question – whether you should start networking now. I definitely think that putting the feelers out now and making a big push is acting too soon. You want to give things some time – let people begin their internships, and start looking towards FT before really reaching out – you don’t want your contacts to think that you are miserable in your current position or that you don’t care about it – you want them to see that you’ve experienced it, like it, are learning a lot from it, but are considering other options for FT. That said, waiting until the end of August, if not later, is definitely delaying a bit too much (considering you have options and contacts already). In other words, waiting until August/September is fine, but in your case, you’ve already got several avenues to pursue – so pursue them. I would recommend that you wait until you are about half-way through your internship and have worked on some projects and learned a few things so that you have some valid talking points and, honestly, selling points. Essentially, I’d start thinking about reaching out towards the end of July – take it slow, but definitely make your move. This will give you enough time to pace yourself and continue to build the connections.

Is using Linkedin is a viable way of networking when contacting alums and such. Would someone think I am a creep if I randomly sent them an ‘inmail’? Sorry if this is a stupid question, but I figure it is better to ask and know than have no idea at all.

To your question, it is definitely not stupid, and one that I hear fairly often. The purpose of LinkedIn is to actually connect people with other people – more specifically, professionals with professionals that have common points of interest who otherwise, might not have made that connection. While everyone that you reach out to will not come running with open arms, you will absolutely find several people that are interested in making the connection and helping you out – whether with advice, insight, a recommendation, or a combination of the 3. Just as with an alumni database, the key when reaching out is to be patient and let the contact grow. At the same time, however you want to be persistent and really cast a wide net. Craft an articulate email mentioning the mutual point of interest (your school, for example), and then ask if they’d be available to offer a bit of advice and such. Start slow, and then, if they show an interest, you can talk more about school, their background, how they broke in and more. You’ve got some time, so really use it and make it count.

I am trying to get placed into my BB’a M&A team for the summer and I’ve gotten in touch with the VP staffer for M&A and set up a time to speak. Honestly though, I’m not sure what I’m going to say. I reached out to indicate my interest etc. I’ve spoken with an analyst in the team who was cool, but I honestly have no idea what I’m going to ask the staffer.

Just be yourself and be genuine. You should talk to the staffer about the number of projects that have been coming in, the team dynamic (personalities, interests, etc), what they are looking for when the dole out projects to analysts, etc. Try to show your interest in the group and the field and ask a few questions accordingly. Remember, it doesn’t have to be a big formal interview – keep it casual and enjoy the opportunity.

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