Firm Flexibility, Revenue & Ramp-Ups: New Candidate Tips

This trend is what a new candidate needs to be knowledgeable of.

One of the new trends I am seeing across all sectors (i.e., public finance bankers as well as bond counsels) is the flexibility we used to have to show and hire bankers or counsel that were different from the firm’s initial sector focus.  Firms were willing to take chances and develop new areas of expertise with proven bankers or counsel “outside of their box.”  This is no longer happening.  We are not seeing the flexibility of a firm in their hiring process.  Firms are now looking for that exact fit and taking much longer in their due diligence of a new candidate before extending an offer.  What does that mean to a bond counsel or public finance banker? 

From Then To Now

Recently, because of the movement from the bulge brackets, firms have now considered hiring individuals differently.  Prior to this, they would go ahead and entertain the new candidate if I had a well-documented candidate with his or her revenues consistent over the last three to five years.   Even though audited revenues are stellar, a firm is now unwilling to step outside its comfort zone with that same successful candidate.  I have had numerous candidates over the last six to twelve months with documented revenue, and firms are just not as interested in them unless they fit perfectly into the sector focus of that firm.  This is now spreading to not only the regional firms but to the boutique firms as well.  Firms are now especially sure of who they are and what they are, and their hiring is becoming commensurate with that same mode. 

Looking Ahead: What Should You Be Doing?

That is not to say that firms are not hiring large producers. They are and will always be, but they are not taking the “flyer” on that new individual, even with documented revenue.  What should a new candidate with considerable origination revenue but in an area outside of the firm’s purview do to get hired?  There are a couple of recommendations that I am consistently sharing.  First, try to move your current business model to a more specific focus on traditional municipal bond finance areas.  Par value needs to come down as the large pool funding is not as in demand as it used to be or as desirable for the regional and the boutiques.  This, of course, excludes syndicate transactions.  It’s harder for a banker who is doing senior business but not sole senior business, especially in areas that are considered non-traditional areas. 

Significant Revenue Vs. Consistent Revenue

Going to a firm and getting them to stretch may now be a thing of the past.  However, finding a firm that understands your current business model is more critical than ever. Significant revenue dollars are no longer the key to helping you move to a new firm; although, revenue dollars that range from what a firm is used to are even more critical.  Firms no longer have the patience for RFPs for pools, etc.  They want to see revenue within the first year a new candidate is hired.  Ramp-up periods are being reduced since the firms need to demonstrate to senior management and the boards that oversee the firms that a new hire can be productive within three to six months (with revenue occurring during that time frame). Significant revenue is not as much in demand as consistent revenue.  Consistency is the key, but consistency within an area of a firm they are extremely comfortable in today. 


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About Harlan Friedman, JD & Founding Member, H. Friedman Search LLC. Harlan is a thirty-year veteran Public Finance Banker turned recruiter who specializes in the placement of all levels Public Finance Bankers, Healthcare Bankers, Municipal Advisors, Compliance Officers, Issuers, and Bond Counsels.