William Blair CEO Says Business Confidence Returns as Digital Becomes the New Normal

Thursday, October 22, 2020

Split screen of Kayla Tausche and John Ettelson
CNBC correspondent Kayla Tausche and William Blair CEO John Ettelson meet virtually at SIFMA’s annual meeting to discuss the latest trends in the financial services industry.

Working virtually has become the new normal for Wall Street, from client consultations or prospecting for business to transactions from start to finish, said William Blair CEO John Ettelson during this year’s SIFMA annual meeting.

Speaking to members of the Securities Industry and Financial Markets Association (SIFMA) during a conversation with CNBC reporter Kayla Tausche on October 19, Ettelson said William Blair has seen evidence that investor confidence is returning to M&A and IPO activity after the shock wave roiled all capital markets in March.

When the COVID lockdown went into effect in mid-March, Ettelson said William Blair saw about 80% of the firm’s M&A deal transactions “pause almost overnight.” But by early summer, those conversations began to revive, particularly after the sturdy bounce back in equity markets which again led sellers to re-enter the M&A marketplace.

“Beginning in June, we began to see a resurgence in activity and now we’ve seen M&A back higher today, more transactions happening than we saw in the pre-COVID environment,” he said.

Ettelson said that from his perspective a basic and almost seamless acceptance of online discussions and other William Blair services—whether in M&A, private equity markets, wealth management, trading or research—quickened the transformation of the firm’s work-force to an almost completely digital platform in the U.S. and Europe.

While all of William Blair’s global offices remain open for business, he said, 98% of the staff have been working from home since mid-March when the COVID lockdown went into effect.

“We’ve learned virtually all of our business can be done from home,” Ettelson said.

Learning curve: generating new business digitally

Adapting to the pandemic’s vast impact on society taught Wall Street lessons as it has done with every other business sector. But those who had planned well for backup operations in a crisis were one step ahead and better equipped to deal with the turmoil, Ettelson said.

That helped accelerate a number of structural trends already underway before the COVID lockdowns that have changed the whole business landscape from how we shop or educate our children to how we receive healthcare or conduct business, he added.

Four years ago, William Blair revised and upgraded its disaster preparedness plan to improve employee mobility, productivity and agility, for example. It included migrating all employees from desktop computers to easy-to-carry laptops and introducing Microsoft Teams software.

“When everyone had to go home in mid-March, everyone packed up their laptops and had software that they could communicate both internally and with clients on a global basis overnight,” he explained.

The biggest challenge was the process of meeting new clients and building the relationships that cement trust, he added. Whether with institutional or individual clients, that process is also much easier face to face.

“We’ve learned to overcome that in the last several months but that was probably the most difficult,” Ettelson said.

By contrast, existing client relationships—with everyone now in the same digital boat, making virtual connections a necessity—have taken the change in stride.

“Any client that we’ve had a previous relationship with, we found very easy to maintain,” Ettelson said.

The new virtual world has also changed how transactions are completed.

“From an M&A standpoint, we’ve had transactions start to finish with the parties never meeting each other in the physical world. Everything is done virtually—diligence, negotiations.”

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