Middle Market Investment Banks

What are Middle Market Investment Banks?

Middle market investment banks are financial institutions or intermediaries that deal mostly with mid-market firms, specifically for raising debt or equity capital, as well as mergers and acquisitions. Middle market firms are mid-size businesses having annual revenues from $10 million up to $500 million and 100 to 2,000 employees. Some of the most well-known middle-market investment banks are Robert W. Baird, Piper Jaffray & Co, Needham & Co, and Stifel Financial Corp.

Criteria for Middle Market Investment Banks

A middle market investment bank is one of the broader categories under investment banking operations. The other categories are bulge bracket banks and boutique banks.

Middle market investment banks are distinguished from the others by the following attributes:

• Deal size – Deals or transactions with mid-market firms generally range from $10 million to $500 million
• Geographic focus – Middle market investment banks typically have a strong local presence but lack international exposure compared to a bulge bracket bank that has a multitude of overseas branches and offices worldwide
• Services – Services offered include the following: merger and acquisition advisory services, debt and equity capital fundraising, and corporate restructuring
• Client focus – Mid-market banks often deal with relatively smaller, private firms, offer more tailored or personalized services, and focus on working with companies in a particular market sector or industry (in this way they are closer to boutique, or niche, banks)

How Are Middle Market Investment Banks Classified?

Mid-market firms are generally classified into the following three categories:

• National full-service middle market firms – Expand their services to combine investment banking, wealth management, equity research, and brokerage and private equity services. Examples are William Blair & Co., Piper Jaffray, and Robert W. Baird.
• National Advisory-only firms – This category primarily includes big accounting firms that provide merger and acquisition advisory services in addition to audit and accounting services. Examples are Ernst & Young, PricewaterhouseCoopers, Deloitte, and KPMG.
• Single-industry specialists – Focus their services on middle market companies within a single industry, such as real estate management companies or retail stores. May also be sector-specific rather than industry-specific, e.g., healthcare, consumer products. An example is Brown Gibbons Lang & Co.

List of Middle Market Investment Banks

Middle market investment banks interact with middle-market firms with annual revenue of less than $1 billion and a deal size of less than $500 million.

Here is a list of the top seven middle market investment banks:

1. William Blair & Co. – Provides a range of financial services such as equity research and brokerage services, asset management, private equity, and investment banking. Focus is spread across various market sectors, such as financial services, technology, healthcare, energy, and retail.
2. Robert W. Baird & Co. – An employee-owned investment banking firm with 3,100 professionals. Offers its services to a variety of companies in the healthcare, real estate, technology, consumer, energy distribution, and energy and industrial technology sectors.
3. Houlihan Lokey – Recognized globally as an advisory-focused firm and as one of the best middle market investment banks. Services include financial restructuring, corporate finance, and financial advisory services related to mergers and acquisitions.
4. Lincoln International – Considered an elite institution with multiple offices located around the world. Known for its aggressive approach to merger and acquisition services.
5. Stifel – Recognized for its IPO advisory services in the middle market sector. It focuses on companies in the defense, aerospace, financial services, healthcare, energy, and real estate sectors.
6. Harris William & Co. – Established its name in the leveraged buyout business. Popular among private equity firms, with its focus being primarily on media and telecom, healthcare and life sciences, business services, consumer, transportation and logistics, specialty distribution, and energy and power.
7. KPMG Corporate Finance – With a strong reputation and long legacy, primarily in professional services such as accounting, tax, and audit services. It mainly focuses on 11 verticals – insurance, real estate, consumer markets, media and marketing, technology and communications, energy and natural resources, business services, cleantech and industrial technology, financial services, healthcare, and industrial markets.

Additional Resources

Thank you for reading CFI’s middle market investment banks list.  To keep learning and advancing your career, we highly recommend these additional resources:

• Bulge Bracket Investment Banks
• List of Top 100 Investment Banks
• IB Interview Guide
• Financial Modeling Best Practices
• See all career resources