Managing Client Relationships as an Investment Banker, Lawyer or Consultant

Covering

client

s is a learned skill, it's not an innate skill and I remember when I was in your shoes I was worried when I started at Goldman Sachs that when I looked at people who were really good at covering

client

s and really good at attracting the client are the called rainmakers. I was worried that maybe they were just born that way, maybe they were just natural salesmen and saleswomen, and what I discovered was that was not the case that I had found over the years and from the beginning. that these are skills that you can learn if you are willing to learn them and what you need to do is find someone at the firm that you work at, whether it is a consulting firm, a law firm or an

investment

bank accounting firm , whatever. someone who is really good at generating business, covering clients and learn everything you can from that person be an open book, put their ego aside and learn everything you can.

I got lucky and found something like that at Goldman Sachs and for the first two years I did everything I could to observe this person and be with him. I worked on every transaction I could with him. He carried his suitcases. He made the fun photocopies. I did everything I could to help them and said I really want to learn from you and sometimes I would watch him in meetings and he would do things that I thought were wrong or that didn't make sense to me, but I put my ego aside. I said there has to be a reason why he is doing this. and as time went on, I realized that there were in all cases and I started using the same strategies with potential clients and clients and they worked and to this day a good part of what I do with clients a good part of the skills A good portion of the strategies I use with clients come from this guy and the rest are things I added on my own over the years, so I found someone was really good.

He flattered me that the person said that, from the looks, you are really good. I want to learn from you, is it okay if I just attend meetings with you? Is it okay if I work with you on a transaction? I'll do anything, make him coffee, make him lunch, photocopy or whatever. take it and then be an open book put your ego aside approach it from the perspective of a clean slate and learn because you can learn these skills, they are not innate, they are learned skills, so the first piece of advice, the second piece of advice that I would give to you the most common mistake that people who cover clients make when they cover clients is that they do not become strategic advisors to their clients, so what I mean by that is that they do not take advantage of the opportunity while working with the client. customer who do.

I don't take the opportunity to start advising the client on matters outside of the matter for which he has been hired, so let me give you an example. It is best to illustrate this advice by giving an example from my world, so if you were a merger

banker

, so a merger

banker

is someone who has been hired by a company to help them carry out a merger, say to buy another company, so let's say you are a merger banker and you have been hired by company A to buy the company. B, your clients' company, you're going to spend a lot of time with a CEO over a period of six months to a year working on that deal, you were going to spend every night with the CEO, you're going to be confined to conference rooms.

Get to know that CEO extremely well and hopefully you will build a very good relationship with him. Most bankers do that and do a good job on that merger transaction and then the transaction comes to an end. They have a good dinner. Closing dinner, they will toast the closing of the deal with the CEO and then they leave and then, five years later, there is another company with a merger mandate that is going to buy Company C and the banker calls to see you and says: "Hey, remind me, we spent all that time." I did such a good job together, I see you or we don't get in line, we're going to have a competition, five companies are coming, you can be one of the five, you know, we can hire you, we might not, the relationship is over. because what the banker did was they didn't take advantage of the opportunity while they were intimate with a client to become a strategic advisor to deliver.

What I would do is start to involve that merger client in other matters that I would tell the client while we are working on the merger. The value that comes into you in the form of yen will probably decrease. Have you ever thought about hedging your exposure against the N because if it goes down 10 percent, you're going to lose $2.2 billion of that $2 billion of revenue? That's an interesting point, Jim, why don't I get the FX hedging team together and talk to you about what other clients have done? Found it helpful on hedging foreign currency exposure. You could involve the client in the dance mandate, have you noticed that?

Its competitors are raising financing in the debt markets right now because interest rates are very low and it is very cheap rather than using equity financing. Why haven't we ever thought about using debt financing? How to build the debt financing team we could? have a discussion about that and then I'm not just a merger banker, I'm a merger banker, I'm a currency hedging expert, I'm a capital markets banker and over the course of six months I'm intimate with a CEO , my job is to become a banker in everything. For them, I start advising them as much as possible and over the course of the relationship, if I do a good job, I'm not even just financial advice on everything, advice if they hurt their knee.

They are calling me and saying Hello, good doctors, could you recommend that they fix my knee, that is ideal. Well, you know, my daughter is applying for a police officer. Where do you think she should go? They know that she is becoming a strategic advisor to her clients. Lawyers make this mistake. bankers make this mistake accounting

consultant

s make this it takes time and time I don't know how often I see it, so if you're a

lawyer

working on an antitrust matter, do a great job on that antitrust matter, but take advantage of the opportunity while are you with the client to start involving them in other things, what are your competitors doing, have you thought about me to structure this transaction?

Different potential clients that minimize the tax impact. Can we bring in our tax people to talk to you about that? Use that opportunity to build

relationships

very useful for three reasons: one, you give the client better advice, the more you know about the client, you become a better advisor, so the more things you do for the client, the more you know, the better advice you can give it because everything is intertwined if you are working on a merger mandate, that will affect the ability to raise financing or hedge their currency or whatever, so you will be able to give them better holistic advice the more you know, secondly, you exclude the competition, so in my case, when is when the CEO has the RAM to think if they should hedge their currency, they are not going to have a competition and I will bring it to ten currency hedging companies to help them know that they are not like Jim's. doing that for me because it's doing everything for me, including helping me find a doctor to fix my knee correctly to exclude the competition that no one can get into and thirdly, smoothing out the cyclical nature of these different areas of practice that You can find.

If you're a merger banker or a merger

lawyer

, you know it's very exciting to be a merger banker right now or an M&A lawyer because interest rates are very low, money is cheap, there's a lot of activity going on, guess what? no? stay like this, you feast or you starve and people are feasting right now in that area, they are starving in other areas if you are in everything there, everything in the bank or in everything, Lord, you acquired it , you smooth out the cyclicality of those individual business segments, so when mergers are dead and interest rates are high, maybe you're working on some bankruptcy work, maybe you're working on more hedging work, maybe you're working on financing jobs because financing becomes a lot more nuanced when you have high interest rates etc. so secondly. become a strategic advisor to your clients, don't make the mistake that most people make, which is to work very hard on the mandate they have, do great work when the mandate ends, you leave the relationship and then it declines over time and you don't do it.

You won't be in a relationship after a while. Don't make that mistake. The third tip is to listen and ask open-ended questions. The most important quality and covering clients effectively is empathy. The ability to put yourself in someone else's shoes. So how can you do it? achieve empathy how do you become empathetic? you ask a lot of questions and open-ended questions, so questions that don't lend themselves to yes or no answers, so you don't say, you know, is it sunny outside? Now you say, how? I like the weather outside and you'll get the client to talk more the more the client talks the more you learn, believe it or not, the better it feels.

I give an interview talk here from time to time and Kevin asked me to do it. and the best interview you can have with a potential employer, I'm sorry, is an interview where they talk like 95% of the time and you walk out of the room and they say, "Wow, you know Sarah is an amazing candidate." I don't know anything about her, but she's amazing and that's why they spent all their time talking about what matters most to them about themselves, because you made them talk about themselves all the time, so ask a lot of questions, ask them open-ended questions and listen very well. alright, the third tip, the fourth tip is to be creative, the real story is that I covered two CEOs, they were independent of each other, from different countries, they didn't know each other in different industries and they both had the same nickname for their lawyer, the nickname. because their lawyer was a doctor no and oh and the reason they called their lawyer doctor no because they felt like every time they went to their lawyer their lawyer told them why they couldn't do something they were trying to do and by the way , that's often the right advice, like, you don't want to get your clients in trouble, you don't want to tell them they should do things they shouldn't, okay, say no, give them honest advice, it's good advice, but don't stop there.

Think of an alternative, think of a creative way that they can achieve what they were trying to achieve or, if it's not possible, or something else, even if you don't think they want to do it, at least it looks like you're trying. Don't be a doctor, no, that's the fourth tip, be creative. The fifth tip is to put the customer first. Now a lot of people say that a lot of people talk about that. What does it really mean? In my opinion, it really means two things. opinion, the first thing is to be prepared to give the client advice that is not in her interest.

There is no better way to establish credibility with a client than to give her advice that is not of interest to her, so in my world we are advising an example. I used to advise company A to buy company B, we actually only get paid if the transaction is done through the right people who take my Corbitt strategy class know that many times it is not the right decision Company A buying Company B is, in fact, most often not the right decision, so if you go to Company Eight, your client, and tell them that you know what not to do in this deal as a lawyer, you will They will pay more the longer the deal lasts to completion. through consummation you get paid by the hour you shouldn't do this deal it's a disaster if you're overpaying they're hidden whatever it is you'll establish a tremendous amount of credibility in the long run because the client knows that's not your interest - given that advice, they will pay you less, you will stop getting paid that day if they listen to you, defend the positions strongly, regardless of what is of interest to you, in fact, it is even better to consider it in the long term, better for the relationship.

Put yourself in a position where you are advocating a position that goes against your interests, so put the customer first, that's the first aspect of putting the customer first. The second aspect is one that is probably less popular for all of you, but it is necessary. work very hard and convince the client that you are there to help them all the time. Now a lot of people talk about work-life balance and I'm a fan of work-life balance, right? I didn't have much of that. when I started at my firm until I made partner and even for a period of time after that, but it's not a bad thing to have a work-life balance, it's a good thing, but it's also a very competitive world and if you don't you are there for the client about the thing they were hired to do or they hired you, which is very important to them, someone else will be there to help them and there will be plenty of people willing to pick up the phone at 2:00 or 3 :00 in the morning.

If not, you have to work hard. I think work-life balance ismore long-term than short-term, so I don't achieve work-life balance on a given day, maybe not on a given week, even though I'm old enough. I try to have a work-life balance on a weekly basis, but at the stage of your career when you're just starting out, think in terms of a monthly or annual work-life balance or until you become a partner, whatever it is. You can think about it in different ways with different time periods, but you have to convey to the client that it is the most important thing in the world?

For you, which means you want to respond as quickly as possible to what I told people when I started at Goldman Sachs during the first ten years I was at the firm. I would tell clients look, you can leave me a voicemail at any time unless I am dead or asleep. I check it every 10 seconds and that resonated with people and by the way some people were trying to test me on that and I always did so you and I don't get much sleep either so you know they're getting. I've gotten a lot of responses, so you have to do that.

It's not a popular gathering, it's fair to say, but it's important to have a work-life balance. Maybe you have a longer term perspective on it, but you have to be there for the client when they need you because you are hot being hard working is something that is really important to them number six this may seem obvious the most obvious advice I have ever given but be optimistic I can't tell you how important it is to be optimistic so if your life is a disaster, don't tell the client that, don't let the client know that if you're having a bad day, a bad week or a bad year, don't Let the client know. that you don't share those things with a client, you may be tempted to particularize if you approach a client, that it is better or not to be optimistic because it is contagious, people want to be around happy and optimistic people, so be optimistic, be happy , you know if things are not going well for you get up come in they go with a happy face during the period of time that you are interacting with your client very important being optimistic is contagious being depressed is also contagious you don't want to you don't I don't want to get discouraged when you meet with clients.

The last tip is for all of you. This is a unique tip. Take classes in the law and business section here at UVA. You have a unique opportunity. Has current company. except top professors who teach business oriented classes and the reason you want to take these classes is there are two reasons, the first reason is that you understand business, you understand your peers in business, why they make the decisions they how they were educated, what motivates them, how their companies run, will it make you a better lawyer,

consultant

, banker or whatever, you will be the second reason I tell my students often, which is a goal in my A goal of My class that I teach is to demystify the jargon and language of the business world.

The world I operate in, like the world you operate in if you're in law school, is bewildered in language, right? terms that a lot of people don't understand history decisis res judicata so if you're not a war you can go to law school and say, oh my gosh, you know what these things mean, the reality is it's not complicated, right? It's just the same jargon. It's true in the business world we talk in terms of capital asset pricing model discounted cash flow analysis comparable merger analysis where do you want to call it? The concepts behind those terms are easy, but if you're not familiar with them and you start covering a client or you're in a boardroom and they start using these terms, they're speaking a foreign language and you're out of the conversation, yeah, You will feel quite intimidated.

I don't know how many times I've seen lawyers. They close because they don't understand the language it's like they're speaking a foreign language that they can't understand if you take classes in the business law section here it will help you demystify, unmask some of them, if not most of those expressions, most of That slang is used in the classroom and you are fluent in it, at least if you are familiar with it you won't feel intimidated.