Which would be a better opportunity: working at a successful boutique investment bank or joining a startup?
I’m currently faced with two options. The first is the boutique I’m interning at, which is performing well in the mid-market M&A space. While the pay is low, they’re handling significant deals and achieving great results. The second option is a startup founded by former directors of that boutique. They’ve mentioned they’re actively pursuing growth capital deals of $10 million or more in sectors like technology, financial services, healthcare, education, and consumer internet.
They haven’t mentioned salary details yet, but if they offer a higher base, would it be a worthwhile decision to choose the startup?
One response
When considering whether to join a boutique investment bank (IB) or a startup, there are several factors to weigh in your decision:
Career Goals: Think about your long-term career aspirations. If you’re looking to build a strong foundation in traditional investment banking with exposure to mid-market M&A transactions, the boutique IB could provide valuable experience and networking opportunities. On the other hand, if you’re interested in the startup ecosystem, innovation, and potentially more dynamic work environments, the startup could be an exciting choice.
Learning Opportunities: At a boutique IB, you might have the chance to work on interesting deals, gain exposure to clients, and develop key skills in financial modeling, pitch preparation, and deal execution. At the startup, you could have a broader range of responsibilities and the ability to learn about various sectors and deal structures, which can be beneficial for your career, especially in growth capital.
Compensation: While the boutique IB may offer lower compensation initially, it’s essential to consider the long-term potential. Startups can sometimes provide equity or performance bonuses, which may be lucrative if the company grows significantly. Ask yourself how much you value immediate compensation versus potential long-term rewards.
Job Stability and Culture: Boutique firms are often more stable but come with their own challenges, such as longer hours and high-pressure environments. Startups can be exhilarating but may also come with uncertainty and fluctuating job security. Reflect on what kind of work environment you thrive in.
Networking and Reputation: Consider the reputation of both firms. If the boutique IB has a strong brand and a good handful of successful transactions, it may provide strong networking opportunities in the future. Conversely, if the startup is led by experienced ex-directors, you might gain access to a different network, especially if they have connections in venture capital or other growth sectors.
Personal Circumstances: Think about your current financial situation and personal preferences. If immediate cash flow is a priority, that could weigh your decision towards the startup if they offer higher pay.
Ultimately, it depends on what you value more at this stage of your career—stability and strong learning in a reputable firm, or the potential for growth and a more entrepreneurial role. Make sure you align your decision with your own career goals and values!