“Investment bank.” If you’re in business, you’ve likely heard these two words uttered count numberless times. But what does an investment banker do? Whether you browse the Wall Street Journal, start CNBC, pay attention to political talk shows, or follow the latest Bitcoin news, investment bankers appear to be everywhere.
This raises the question, what does an investment banker actually “do”? It could include capital raising, both debt and equity, into both public and private enterprises. It can include advisory services for transactions also, such as mergers, acquisitions, and divestitures. Within the M&A category, it can cover both buy-side and sell-side advice. There’s also the cousin industry of providing private business valuations. So you see firms engaging in ESOP formational advice. Did I yet lose you?
What don’t we do? Well, what isn’t an investment banker! That’s a little easier to describe. The term “bank” is a little of the misnomer, as investment banks don’t become depositories and don’t directly lend or make investments capital in clients. Nevertheless, you do see traditional banks such as JPMorgan Chase that have direct lending services, investment banking divisions, and even investment arms that blur the lines between these verticals.
So commercial banks can certainly own investment banks; it’s that they don’t offer the same set of services. We at Hilliard Lyons touch just about all of the traditional investment bank services in a few capacity. But, like the majority of firms, we have a tendency to spend a lot of our amount of time in a niche.
For us, that section is M&A advisory work. Now, you might ask, isn’t this a valuation publication? That is true indeed. We’ve in-house, credentialed colleagues like Jim and Jackson that are designed for valuations for traditional ESOPs, estate planning, present tax, etc. But there is certainly quite a bit of overlap in valuing an exclusive business and providing M&A advisory services.
Knowing just what a private business will probably be worth is a key component of any successful M&A practice. Ultimately, a small business will probably be worth what someone will pay you for it. That being said, there’s quite a bit of underlying art and science that can give a business owner a common sense of what the market might bear. For us Fortunately, we may use our experience investing companies as a litmus test for our valuation practice. Getting back to the actual “doing” of Investment Banking, it is hard to depict a “day in the entire life, because each day can be quite different “.
Given the project-oriented character of our business, it shall rely on where a task is within its lifecycle of a deal. A typical M&A assignment may take six to nine months to complete, so you can be in the middle of marketing, in purchase agreement negotiations, in the original due diligence phase, in confidential memorandum drafting, and the list on runs. With regards to process and getting the deals done, a good investment banker can serve as the quarterback of the team. There’s always going to be a need for quality legal and accounting advice together with the investment bank, so all of the united associates have to be aligned and in sync with the latest information.
- 18 units near UT in Austin – $1.750M
- Subscription to any notified securities/notified deposits system. e.g. NSS
- Market evaluation and forecasts from 2016 till 2030
- Effective rate of come back on PPF may be higher because of it being EEE investment
- Investment to help existing areas ‘capture up’, however, not really give future growth
- Medical equipment investment should develop at a moderate pace
- The materials facts regarding the conflict cannot be fully and pretty disclosed
We at Hilliard Lyons maintain close human relationships with a variety of professional companies and acknowledge the critical role that lawyers and accountants play in getting transactions done. Nearly gorgeous: Many people in and outside the business community associate investment bank with big-city glamour, flashy suits, Wolf of Wall Street-esque celebrations, and extra.
This couldn’t be further from the reality in many respects. Optimizing capital, time, and possession on Main Street: The reality is that investment bank has an essential function in the transfer of business resources to the next generation or ownership group for the company to hopefully thrive and grow. Raising capital provides options for businesses to invest into new products, new hires, and new opportunities. Business valuations provide owners with understanding into the true value of their fairly illiquid asset.