What are Boutique Investment Banks?
The boutique investment bank is different from its largest cousin, the bulge bracket investment bank when it comes to the size and services offered. Bulge bracket investment banks are often national or global in scale and offer a full range of financial services.
In contrast, a boutique investment bank may only be regional or local, although some boutique investment banks operate globally. The main criterion for being defined as a boutique investment bank is that it does not offer full-service investment banking, but does offer at least one investment banking financial service.
That being said, the size of the firm does not indicate performance. Boutique investment banks are known to be reliable financial advisors and banks, as exemplified by the well-known firms, Charles Schwab and the Blackstone Group.
Some firms may also only specialize in financial services for a specific industry, and this may be beneficial to clients looking for focus and quality. Cain Brothers, for example, is a boutique investment bank that has a specific focus on the healthcare industry. It is easier for a smaller bank to establish a reputation for expertise in one or two areas.
Working at a Boutique Investment Bank
As an employee of a boutique firm, there are many benefits that one would not get at a bulge bracket bank. While compensation packages may not be as attractive as those offered at bulge bracket firms, training and experience are more “hands-on” and direct for those at boutiques.
Due to their firm’s smaller size, individual investment bankers at a boutique are more able to take direct responsibility for tasks and to have more direct interactions with all the people involved in transactions. If you enjoy interacting and building relationships with clients, and giving them personal service, you’ll have more opportunities to do that with a boutique firm.
In other words, a boutique banker may feel less like just a cog in the wheel than a bulge bracket banker does. It’s difficult to get recognition at a larger bank where any deal you put together is just one among dozens of similar deals.
At a boutique bank, it’s much more likely that every deal you do or client you land is a significant accomplishment and one that your bosses will reward you for. Finally, while hours are still long compared to other industries, boutique investment banks tend to have more predictable hours than bulge-bracket banks.
Boutique Bank Services
Boutique investment banks may be engaged in providing one or more of the following financial services:
- Underwriting of debt and equity securities
- Mergers and acquisitions advisory
- Connecting clients, especially with regard to IPOs or further stock offerings
- Capital raising (such as through private equity deals – not as common, due to the size of the firm)
List of Boutique Investment Banks
Here’s just a partial list of boutique investment banks across the globe:
- Allegiance Capital Corporation
- Arma Partners
- Berkery, Noyes & Co.
- BG Capital
- C.W. Downer
- Cain Brothers
- Cantor Fitzgerald
- Capstone Partners
- Corporate Finance Associates
- CSG Partners
- Europa Partners
- Fennebresque & Co
- Gleacher & Company
- Guggenheim Partners
- High Rock Partners
- Imperial Capital
- Keefe, Bruyette, & Woods
- Ladenburg Thalmann
- Lancaster Pollard
- Lincoln International
- Marathon Capital
- Marlin & Associates
- McColl Partners
- Miller Buckfire & Co.
- Montgomery & Co.
- Morgan Keegan & Co.
- Needham & Co.
- Panmure Gordon
- PCE Investment Bankers, Inc.
- Roth Capital Partners
- Sagent Advisors
- Sonenshine Partners
- Stephens, Inc.
- Stifel Financial
- Sucsy, Fischer & Company
- WR Hambrecht & Co.
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