Bull Bear Report Dec 14 2010

1-800-BANKER: Wall Street Upheaval Creates Role For Temps

By kyle stock and liz moyer

Young investment bankers striving for recognition face a binary professional choice: work 80-hour weeks chained to a computer, or don't work at all.

Accordion Partners, an on-demand investment bank founded last year by two boyishly affable investment bankers who met on the lacrosse field, Nick Leopard, 30, and Andrew Blechman, 27, aims for somewhere in between. It hires out junior to mid-level analysts on a project-to-project basis for companies that either don't need permanent finance staff or are too skittish about the economy to hire them full time.

Companies already tap temp staffing firms for professionals such as lawyers and accountants. But recruiters say Accordion also reflects the profound way the financial crisis has changed Wall Street. Amidst the ruins of massive institutions, surviving banks grew more creative in saving money and staffing deals, opening the door to flexible work arrangements and a streak of entrepreneurial activity.

John Landers, regional vice president in New York for the financial services group at Robert Half, a staffing firm, said such sentiment is natural in bear market recoveries, when business is still volatile and firms are reluctant to bulk up on full-time employees. Lately, Landers said Robert Half has seen a rise in demand on Wall Street for temporary workers in fields like accounting and compliance.

Netik LLC, a New York data management services firm, recently used Accordion for 95 hours of work on a private equity financing round. "These are guys that sat around for five years eating cold pizza in conference rooms and working on deals," said Rob Flatley, chief executive. "We could just plug them into our models."

Accordion currently has 20 analysts who can put together financial models, research markets and polish pitch books for clients. About half of them have "Lehman" or "Bear Stearns" on their resumes, including Leopard, the father to a young toddler, who touts flexibility and work/life balance in his spiel to prospective hires.

"We knew people wanted a new way to work in finance," Leopard said in a recent interview. "We're just essentially stripping away that expensive senior-level layer of overhead."

Flexibility also appeals to a younger generation that rejects the Wall Street ethos that work means sacrificing a personal life. "Right now, we're getting a ton of buzz from people that have been at the banks five years and want a change," Blechman said.

Accordion employees, almost all of whom have three to seven years of experience at bulge-bracket banks, are paid cash based on prevailing Wall Street rates. Since they average 60-hour work weeks versus the typical 80 or 90-hour weeks at bulge bracket firms, their hourly take home is comparatively higher, Accordion says. They also don't get bonuses like typical bulge bracket bankers, where associates and vice president make most of their pay in unpredictable year-end cash and/or stock payouts. Instead Accordion sets its pay to be commensurate with what a bulge bracket banker would get throughout the year, if that year-end bonus was paid out over 12 months.

They get full health benefits but can pick and choose their assignments, and, consequently, set their own work hours. Antoine Farris, who has worked at Accordion for about a year, uses the flexible schedule to manage a skateboard and snowboard store that he started as a teenager in the Detroit area. He says his former coworkers at Bear Stearns and former classmates in the University of Chicago MBA program are somewhat envious.

"They're still at times working 80-plus hour weeks and rarely have the time to go to the gym or even have a normal sleep pattern," said Farris, 32. He recently helped a small New York apparel company size up acquisition targets and advised a large healthcare retailer on expanding its product line.

Roughly half Accordion's work is with boutique investment banks, though it is in talks with at least one bulge-bracket bank. The other half is a mixed bag of corporations and private-equity funds looking for merger due diligence or industry analysis. Most of the work is done at the client's office, and Leopard and Blechman assure that confidentiality is not a problem; in fact, they often don't know what exactly their employees are working on.

To date, business has come exclusively from personal connections and referrals.

Netik hired Accordion to help it raise money and evaluate a few acquisition targets. It was too small to draw the interest of large investment banks and the accounting consultancies that it considered didn't have as much banking experience, Flatley said.

Robert Davidson, founder of personnel technology company Talent Portfolio Solutions and a former managing director at Morgan Stanley, where he created technology that helped the firm track and analyze its talent pool, says project staffing is in its early days but could fill a need in cases where typical outsourcing isn't adequate. "The choice is an experienced highly targeted team of professionals versus an outsourcing situation where it's low cost but you lose management control," he said.

Leopard and Blechman, both former captains of Division 1 college lacrosse programs, met while playing the sport in a post-grad league in New York. Leopard left Bear Stearns eight months before its collapse for a small mezzanine fund before founding Accordion in October 2009. Blechman worked as a quant trader at Bank of America and briefly as an analyst at J.L. Berkowitz, a hedge fund, before teaming up with him. The pair founded Accordion with under $1 million in capital raised from family and friends.

The model is drawing interest in the feast-or-famine world of investment banking. There are still almost 600,000 people who lost jobs at U.S. banks, brokerages and insurance companies, and who are looking for work, according to recent data from the Bureau of Labor Statistics.

Accordion has 1,700 resumes on file and a "waiting list" of 15 candidates ready to sign up if assignments pick up. Leopard and Blechman just signed a lease for a bigger office in SoHo and plan to hire another 100 bankers in the next year or two.

Write to Kyle Stock and Liz Moyer

Related: How to Write the Perfect Investment Banking Resume



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