The Buy-Side vs. The Sell-Side: The Worst Way to Categorize Finance Firms?

“Yo, you’ll make bank when you move to the buy-side! Screw this stupid investment banking job.”

“Yeah, I heard everyone at hedge funds makes at least $1 million and gets a castle as their signing bonus.”

“So when’s your interview?”

Ah, yes: that classic debate about the buy-side vs. the sell-side. Although the conversation above is fictional, similar exchanges are taking place in cubicles across the world as you read this.

You hear about the buy-side vs. sell-side distinction everywhere, whether you search online, browse through you message boards, or even (gasp) talk to people in real life.

The only problem is that “buy-side vs. sell-side” is the worst way to categorize financial services firms.

From Boutique to Middle-Market to Bulge Bracket: Got Rankings?

“Can you please rank the banks?!! Please! Just this once, rank the banks!!!”

“If I buy you bottle service, will you rank the banks? It’s on me, really!”

No, no, and no. Ranking anything is my least favorite topic in the world – possibly because I spent the first 20 years of my life attempting to out-rank people to get into more prestigious schools and activities.

But I will acknowledge the differences between different types of banks, and that it’s more complex than the previous discussions of boutiques vs. bulge brackets.

If you’re looking for rankings, you should press Alt + F4 right now and end your suffering.

But otherwise, read on and learn all about different types of banks, from tiny boutique to bulge bracket and everything in between – and where you should work.

Boutiques vs. Bulge Bracket, Round 2: Underdog Victory?

Last time we looked at this one (early 2008), things were a lot different.

Major banks hadn’t failed yet, most of the “superstars” were still at bulge brackets, and the economy was better… sort of.

Starting with the key question:

“But are there any cases where a boutique would actually be preferable to a bulge bracket?”

We came to this conclusion:

“The only situation where you might want to pick a boutique instead is if you have offers from multiple banks, are reasonably confident the boutique will give you good work, and just like the people or work environment a lot more after thorough investigation.”

After everything that has happened in the past year, is that still true?