Clients spend a great deal of time vetting their advisors and, rightfully so.
Unfortunately, many boutique investment bankers do not spend the same amount of time vetting their clients.
Most boutique bankers would consider themselves “industry agnostic” and “opportunistic.” Those are fancy words for non-discerning. It’s the age-old mantra of shooting everything that moves or engaging with someone who simply fogs the mirror.
Some investment bankers–due to lack of quality dealflow–are willing to take on engagements that may be less-than-ideal. It’s the scenario that includes a hairy deal or a wantrepreneur capital raiser that is willing to pay an engagement fee.
We have had to fire clients before. It’s not fun, but like a band-aid, it is best to disengage early and quickly when the deal and team start to show their true colors.
Reasons to fire a client:
- Non-performance
- Unscrupulousness
- Unrealistic expectations
What about the engagement fees? Up-front fees can be refunded, monthly fees generally are not, but it all depends on the amount of work provided.
