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Tiny Advisory Firms Challenge the Big Banks

Startup firms operate free of the big banks’ hassles and bureaucracy
Tiny Advisory Firms Challenge the Big Banks
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The townhouse in London’s Mayfair neighborhood where Michael and Yoel Zaoui have their office is much more modest than the sprawling financial district headquarters where they spent most of their careers. Yet the brothers—former senior mergers-and-acquisitions bankers at Morgan Stanley (Michael) and Goldman Sachs (Yoel)—are becoming a major force in some of Europe’s biggest corporate transactions. In April, Zaoui & Co. worked with drugmaker GlaxoSmithKline on a complex $23 billion asset swap with Novartis, and it advised cement manufacturer Lafarge on its $40 billion merger with Holcim to form the world’s largest cement company.

Other supersmall firms, including New York-based LionTree Advisors and Robey Warshaw, a new venture set up by London bankers Simon Robey and Simon Warshaw, are betting that their experience and relationships with corporate clients will allow them to challenge big investment banks for lucrative advisory fees.