An investment banker’s ideas are always slam dunks.

“Slam dunk,” noun phrase, something that is certain to succeed; a sure bet.  Usage note:  This is a jock-wannabe term that bankers love to use.  A managing director always tries to project unshakable confidence, even when presenting his most harebrained sales pitches.  At the same time, he never allows the client to see that he’s scheming for fees like a gambler in hock to the mob.  Continue reading →

Bankers and salespeople love a story with a razor blade element.

“Razor blade element,” noun phrase, a term that describes the enviable position of a company that sells a product for which the customer will have to frequently purchase replacement parts.  Usage note:  An investment banker will often have to rely on his firm’s equity or debt sales force to sell a transaction (e.g., an IPO).  Despite how well educated many salespeople are, the i-banker thinks just about all of them are idiots incapable of doing his type of complicated work, that is, making pitchbooks with lots of colorful pie charts and tables, etc.  Continue reading →

The math gets fuzzy when bankers talk about synergies.

“Synergistic value,” noun phrase, the non-existent benefits that an investment banker attempts to convince a client will arise from any fee-generating behavior.  Usage note:  Although he might jazz up his appearance with a Kiton suit, Brioni tie, and Edward Green monk strap shoes, the M&A i-banker is really just a salesman.  In his pitches, he’ll talk about strange-sounding things like enterprise value (“EV”), earnings per share dilution, net operating losses (“NOLs”), and debt leverage instead of miles per gallon, accident history, rust-proofing, and lease payments, but he’s not that different from a used car salesman.  They both want you to buy something, and then they want to help you finance it. Continue reading →