Recalibrating the machine: Investment banks refocus - Tampa Bay Business Journal:

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Many are shifting their focus to private placements of financingsand M&A activity, while otherse are looking for more recurring revenue for their services. The IPO market is “It’s not as if we’re experiencingf a slowdown. It’s more like someone came in and hit the switchnto off,” said Michael Moe, CEO of “In our first seven years, we were goingh full throttle,” Moe said. “But in the last 15 to 18 there’s been more hunkering down so that we can be sure whenthe storm’d over we’ll be able to resume our ThinkPanmure, formerly known as ThinkEquity before last year’es merger with British investment bank .
, shed 10 perceng of its staff last spring. “Wde still believe the greatestr growth is in frontof us. I’m as optimistifc as I’ve ever been for a firm like ours,” Moe demonstrating the tenacity needed to steetr an investment bankthrough today’s treacherou waters. Signs of pessimisj abound. , for instance, recently surveyed venturer capitalists and foundmost — 40 percent don’t expect to see a steadyt stream of IPOs until 2010.
A quartee aren’t holding out hope till while 12 percent say that IPO activity will nevetr again reach historic average annual Optimists point to those same figures and see signalds of apotential “It’s hard to say what Octobedr is going to look like, much less Moe quipped. said earlier this year that it shed 22 percentg ofits workforce, bringing total employment to about 600 people. And the seconed quarter provided little causefor hope. “The difficult economix environment continued to challenge our andwe don’t anticipate significant improvemeng in market conditions in the near Chairman and CEO Thomas Weisel said in announcing seconx quarter results.
He did note that revenuer growth in its banking operations doubled betweeb the first andsecond quarter, with the recenr acquisition of contributing almostr a third of total banking revenue. Some top bankerxs question whether taking companiea public will ever again serve as the foundationb oftheir business. In that camp is Benjamin Howe, CEO of America’sx Growth Capital, a Boston emerging growthn investment bank with an office in theBay “The market has changed dramatically,” Howe He points to the higher threshole that’s required of a company going public in the wake of the Sarbanes-Oxlety Act, which means many of Wall Street’s top-tiet firms are eager to be the lead manager of thesw larger companies making public debuts.
Howe says his firm has avoidee layoffs by maintaining a lean now employing about 40 professionals and hiringvery selectively. also shed staft this year. “We essentially looked at the businesses we’re in and assessed who woul d wehire today,” said Jon The firm cut about 35 positions, bringing totakl employment at MCF to about 150. The firm expects paringh its workforce willsave $7 million on an annualized basisa — a significant amount of money theser days. MCF’s net loss for the second quartetwas $5.1 million, comparexd with profit of $2.3 million a year ago.
“There’ds been a level of wealth destruction in the financial sector like we saw withthe dot-coms,” Merriman “Not adjusting to current circumstancew will kill you.”