Overview

From a historical point of view, the main activity of investment banks is what today we call security underwriting. Investment banks buy securities, such as bonds and stocks, from an issuer and then sell them to all investors. In the eighteenth century, the main securities were bonds issued by governments. These bonds were priced and placed extraordinarily similar to the system that investment banks still use nowadays. When a government wanted to issue new bonds, it negotiated with a few prominent middlemen (today, we would call them investment bankers). The middlemen agreed to take a fraction of the bonds: they agreed to do so only after having canvassed a list of people they could rely upon. The people on the list were all investors. The middlemen negotiated with the government even after the issuance. Indeed, in those days, governments often changed the bond conditions unilaterally, and being on the list of an important middleman could make the difference. On the other hand, intermediaries with larger lists were considered to be in a better bargaining position. This game was repeated over time, and hence, reputation mattered. For the middlemen, being trusted by both the investors on the list and the issuing governments was crucial.

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Biography Entrepreneur specializing in Finance Education. Steve has built and successfully run several start-ups in the Education and Technology industries. He most recently founded the New York School of Finance, which evolved from AnEx Training, a multi-million dollar finance education business, providing financial education to banks, firms, and universities worldwide. Steve is also the author of Financial Modeling, which guides the Investment Banking and Private Equity industries. The New York School of Finance is a semester-long program based in New York and geared towards helping business students from top-tier and lower-tier business schools prepare for jobs at Wall Street's top firms. At AnEx Training, Steve continues to participate on the training team, actively providing training at bulge bracket banks and for M&A teams at corporations, and has personally trained personnel at funds catering to high net worth individuals worth billions of dollars. AnEx continues to train at over 50 locations worldwide, and Steve travels extensively every month, training at sovereign funds and investment banks overseas. Before his entrepreneurial endeavors, Mr. Sanders worked at HL Ventures, a $1 billion private equity firm affiliated with buyout giant Partners. Before that, he was at Morgan Stanley, where he worked on various technology, energy, and transportation transactions. Steve continues to consult on Private Equity and M&A Advisory transactions, having most recently closed a leveraged buyout of a $30MM medical device business. He is also actively working on several M&A assignments for Fortune 500 companies.

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