• Boutique merger-advisor firm favors subjective awards
  • Mahmoodzadegan seeks teamwork culture, all players on field

Moelis & Co. said it is shunning commission payments to bankers as the boutique firm challenges larger rivals to win deals and attract talent.

The merger-advisory firm prefers to reward managing directors with year-end bonuses that are subjective, co-President Navid Mahmoodzadegan said at a JMP Securities conference Monday in New York.

“We’re intensely focused on bringing all of the firm’s capabilities to the client --- a teamwork culture where we’re bringing all of the players on to the field to try and win mandates and execute for clients,” Mahmoodzadegan said. “It’s very hard to do that if you’re paying people on a commission basis.”

Moelis has more than doubled its employee base since its initial public offering in April 2014, and last week promoted Mahmoodzadegan and Jeff Raich to co-presidents. While acknowledging that boutiques haven’t always been great places for staff to rise through the ranks, Mahmoodzadegan sought to assure clients and potential hires that his company has the right approach.

“We’ve been able to essentially gang-tackle and win business,” he said, referring to a strategy in U.S. football where teammates join together to bring down an opponent. “We’ve been very, very focused on this one-firm philosophy.”

Evercore, Guggenheim

Firms such Evercore Partners Inc. and Guggenheim Partners, which is private, have been hiring bankers for a broad range of industries this year as mergers-and-acquisitions are at a near-record volume. Houlihan Lokey Inc. had an IPO this year and Paul Taubman’s PJT Partners Inc. also is in the process of becoming a public company.

Moelis said in July that it hired at least eight managing directors and promoted four this year, while also recruiting its largest incoming class of 90 junior bankers.

“Developing our talent to become home-grown MDs is an important part of our strategy,” Chief Executive Officer Ken Moelis said during a July conference call. “It creates a self-sustaining and self-generating pipeline.”

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