• Private equity reps are asking to meet with college seniors headed for jobs on Wall Street.
• These "coffee chats" often lead to interviews for jobs that won't start for two years.
• The May start has soon-to-be bankers on edge at a time when they should be celebrating.

Graduation season is supposed to be filled with commencement speeches, family dinners, and tearful goodbyes. Newly minted graduates headed to Wall Street, however, are finding themselves trading libations for leveraged buyout models.

Soon-to-be junior bankers told Business Insider that they have been summoned in recent weeks to introductory meetings with buyout firms and headhunters for associate jobs that won't start for two years — when their investment banking analyst programs end.

The communications reviewed by BI were for introductory meetings, often referred to as "coffee chats," and informational webinars. They came from employees and headhunters representing firms like Apollo; Hellman & Friedman; KKR; General Atlantic; Clayton, Dubilier & Rice as well as recruiting firms like Ratio Advisors, Gold Coast, CPI, and Amity. Spokespeople for these firms either declined to comment or did not respond to requests for comment.

Students said the coffee chat requests, which often precipitate more formal interviews, are taking place earlier than expected — putting them on edge about the industry's infamous recruiting frenzy, known as on-cycle recruiting.

For some, the feeling that official interviews could kick off at any moment has cast a pall over graduation season. Rather than occupying themselves with photo shoots in their caps and gowns, some finance grads are stressing over when interviews could break out.

"It's constantly monitoring your email," said an incoming first-year investment banker about the recent onslaught of meeting requests. She said she and her friends have their notifications on — "calls, texts, everything" — in order not to miss out.

The student, who hopped off the phone with BI just as her own graduation ceremony was commencing, said coffee chat meetings started hitting her inbox in early May, about four to six weeks earlier than classmates who received similar overtures last year.

"It's awful," said the student, who asked to remain anonymous to protect her future employment. "You never get a break."

On-cycle could kick off sooner than ever

Matt Ting, the founder of Peak Frameworks, which helps students prepare for Wall Street job interviews, said he's seen demand for his courses spike in the last two weeks as students gear up for on-cycle to kick off any day now.

"A lot of college grads go on a grad trip around now, which muddies things," said Ting, adding: "Some are still in school. Many firms had issues last year since it kicked off while many grads were backpacking somewhere in Asia."

The problem with the industry's on-cycle recruiting process is that no one knows when the hurricane will hit. And once it makes landfall, aspiring private-equity dealmakers are expected to drop everything to participate.

A second-year investment banker recalled getting an email around 10 p.m. when he participated in on-cycle recruiting last June. The firm's representatives asked him to interview the next morning at 8 a.m. Fortunately, he was within driving distance of the company's office. Some of his friends weren't so lucky.

"I personally felt it was too rushed, like I was taking the opportunity just because it presented itself, not because I was very calculated about it," he told BI about the experience.

The second-year banker said there is a clear distinction between coffee chats and official interviews that would signify the start of on-cycle. On-cycle recruiting, he said, only starts when a headhunter uses the word "interview" in their communication with candidates.

"The coffee chats are just an interview to get an interview," he said.

The process used to start after investment bankers got some job experience under their belts, but has been moving progressively earlier every year. Last year, the process kicked off on June 24, before many graduates had even started their jobs. The year before, it took place in July, prompting some investment banking analysts to skip out on training.

The sudden rush of coffee chat requests has students bracing for on-cycle to kick off earlier than ever this year. A college student running a college finance club said he'd heard on-cycle could begin after Harvard's graduation on May 29. An industry recruiter predicted that on-cycle recruiting might not get underway till late June, in keeping with 2024's cycle. They asked to remain anonymous to protect their relationships with prospective employers and private-equity clients.

Inside the coffee chat

Coffee chats, the step before PE firms proceed with formal interviews, may sound casual on the surface. In fact, they're a high-stakes way for recruiters to pre-screen candidates for official interviews, students told BI, so a lot is on the line.

"My advice has always been, no matter what, every coffee chat is an interview, implicitly or directly," said the second-year investment banker who participated in last year's on-cycle process.

These jobs, of which there are a coveted few, can vault early-20s professionals into the highest tier of American earners. Many tout comp prospects of more than $300,000, inclusive of salary and bonus, so the pressure for rookie masters of the universe to leave a good impression on recruiters is palpable.

A recent graduate about to start an investment banking job at a bulge bracket firm agreed. "I've had a firm tell me that I'm shortlisted," he said of his coffee chats, adding, "I've had headhunters follow up with me and say, 'Hey, by the way, this firm had great feedback on you. Let's stay close here,'" he added.

He said he moved to New York City immediately after graduation, motivated in part by the sense that he should be in a position for an early on-cycle recruiting process.

"I don't even have a couch," he confessed, so he spent his first few nights in the big city sleeping on a mattress on the floor. "Now I've got a bed frame."

"But if you want one of these jobs, you've got to play the game," he said. "And I'm just playing the game."

• Trump's tariff pause was great for stocks, but for deals, it just kicks the can down the road.
• The pause threatens to extend Wall Street's hiring freezes and further lower bonuses.
• Bankers and PE execs share how they are spending their time as they wait for clarity.

Long hours, hiring freezes, and a souring bonus outlook. This is the life of the Wall Street dealmaker right now as M&A stalls amid continued uncertainty over Trump's tariffs.

On Wednesday, President Donald Trump announced a 90-day pause on most tariffs, with the exception of China, which is now facing tariffs of up to 125%. While the reversal lifted stocks, resulting in the biggest single-day gain for the S&P 500 since 2008, it isn't expected to do much for M&A, which was already on the fritz leading up to Wednesday's announcement. In fact, some are predicting Trump's pause could make things worse.

"We're going to have three more months of paralysis," said Alan Johnson, a finance industry compensation consultant. "Buyers and sellers are going to say, 'I'm going to wait,'" added the Johnson Associates founder.

It's not just investment bankers who are sitting on the sidelines. Private equity deal pipelines are also on hold as investors and target companies try to understand how current and future tariffs could affect business revenues and supply chains.

"If you're an investor, unless you have an amazing conviction that you're insulated from the tariffs, you're sitting on your hands and waiting," said the head of a sector at a major private equity fund.

As one investor at a midmarket private equity firm put it: The news of the 90-day pause was well-received, but nothing to celebrate. "We pop bottles when we have great exits that earn our investors tons of money, not for short-term noise."

Inside the lull

What do dealmakers do with their time when there are no deals? The people who spoke to BI said they and their teams aren't going home any earlier. In fact, some are traveling more to stay in touch with skittish clients even as they predict year-end bonus declines. Others are working longer hours to understand what the tariffs will do to their portfolios.

Eric Stetler, the head of mergers and acquisitions at the independent investment bank D.A. Davidson, told BI that far more of his time is being spent keeping clients updated.

During a time like this, Stetler said, "just staying in front of clients" is paramount. "People want to know what's happening."

Stetler said senior bankers tend to devote about "75% of their time" to existing client mandates and the rest to drumming up new business. "At times like this," he said, "that reverses, or close to reverses."'

"That's not to say that our new business development activity is pausing because we're still having a lot of conversations," he said. "We're still pitching new business. We're preparing businesses for sale, and looking at processes with our clients."

The PE sector head said private equity deal teams are spending more time with their portfolio companies or updating their models with the latest tariff numbers.

"The announced tariffs were more severe than what was expected, so we've been having to update Plan B, Plan C, and Plan D to make sure we can mitigate the effects," the executive said before Trump announced the 90-day pause.

Hiring and bonuses

Hiring is largely frozen, according to a banker and Wall Street recruiter. "What I'm hearing is that it's kind of like, 'Maybe this is not a good week to push something through. Can we give it a week or two?'," the headhunter said.

Though the firms this recruiter communicates with had yet to invoke full-on hiring freezes — which are rigid postures that tend to presage layoffs — the word "freeze" had been mentioned in some conversations.

"If things don't get better," the recruiter added, "there will be layoffs."

Bonus expectations have also hit the skids as the prospect of closing a deal gets pushed further into the future. As Stetler explained: "It takes roughly four to six months to run the sale process" on a live deal. Even if a buyer decided to pull the trigger on a purchase today, "you are looking at a late Q3, probably, at best," for when such a merger might close.

Trump's tariff pause threatens to further dampen bonuses by pushing the timeline out even more — potentially to 2026, said Johnson, the compensation consultant.

"Would you do a deal now if you're a buyer? In 90 days, maybe he changes his mind again, or 90 days becomes 30 days, or 90 days is tomorrow, or 90 days is 180 days," Johnson said, referring to President Trump. "Maybe things will be a lot better in three months, the sun will start shining. But now we're in what, July? And then by the time the lawyers get involved and you sign an agreement, it's 2026."

Get in touch with these reporters. Reed Alexander covers Wall Street banks; he can be reached via email at [email protected], or SMS/the encrypted app Signal at (561) 247-5758. Alex Nicoll can be reached via email at [email protected], or Signal at @alexnicoll.01

• Dealmaking on Wall Street has sputtered out in recent weeks, bankers and consultants said.
• It's a reversal of the industry's hopes that 2025 would deliver an M&A and IPO rebound.
• Industry insiders pointed to Trump administration actions that have clouded the economic outlook.

Wall Street's dreams of a dealmaking rebound have been put on hold over Trump's tariff turmoil.

Investment bankers welcomed 2025 with high hopes that Trump's business-friendly, antiregulation policies would lead to a surge in fee-generating deals. Instead, many corporate boards and buyout firms are standing on the sidelines as they wait to see the impact Trump's aggressive trade policies and gutting of federal agencies could have on the economy and stock market.

How bad things are depends on who you ask. Some bankers said corporate dealmaking has merely slowed, while others described Wall Street's bread-and-butter business of M&A and IPOs in more dire terms. What's clear is that no one knows when — or whether — the clouds might lift, raising questions about everything from bonuses to layoffs to hiring.

"A common refrain I hear amongst dozens of sponsors over the last six to eight weeks," said Seth Goldblum, whose firm provides deal advisory services to private equity firms, is that "the uncertainty in and of itself is actually the worst thing."

"A lot of our sponsors are just sitting on the sideline," he said, referring to private equity firms, which are often referred to as financial deal sponsors. The managing director for CBIZ Private Equity Services pointed to the negative impact Trump's tariffs could have on inflation and interest rates as among the issues holding firms back.

"It's a shame. It looked like we were finally getting unstuck," Goldblum said, adding that the deals industry now appears "back to being stuck."

What bankers are saying

Rob Stowe, an equity capital markets banker with Barclays, agreed that 2025 has proved more challenging than many in his field anticipated.

"We are still seeing companies coming to market, and we still expect we'll see companies coming to market, but it's definitely making decisions harder, and it's adding an extra element of caution for corporates and the sponsors that are thinking about raising capital," said Stowe, who heads the division that handles IPOs for the bank's Americas region.

Eric Li, who covers investing banking for research firm Crisil Coalition Greenwich, said his discussions with clients suggest a more dire picture.

Dealmaking, he said, has largely "frozen."

"There aren't any deals going on," Li said. "It's almost as bad as Covid," he added, referring to the dealmaking stoppage that followed widespread stay-at-home orders in 2020 as the deadly virus spread across the globe.

According to the consulting and advisory firm EY, Wall Street started the year strong. In January, there was a 29% year-over-year increase in mergers and acquisitions in the US, valued at more than $1 billion. The consulting firm's M&A data has yet to be released for February, however, and that is when the stock market started reacting negatively to Trump's trade policies, sending the S&P 500 down roughly 10% since a high set on February 19 and about 8% since Trump was sworn in on January 20.

Layoffs and hiring

On Wall Street, the big question is what it all means for the bottom line — and how it will impact pay and jobs.

At the end of 2024, investment banks were hiring aggressively as dealmaking heated up in anticipation of a Trump White House. Now, there are questions about whether the momentum will continue.

Brianne Sterling, head of the investment-banking recruiting practice at the financial services search firm Selby Jennings, said hiring hasn't reached the gangbuster levels some had hoped to see when the year started. She said some clients are still interviewing new hires even if they've indicated they'll push off the timeline for filling open roles till later in the year in hopes of improved market conditions.

Still, she feels optimistic.

"I think we will still see hiring," she said. "I just don't think it'll be as aggressive or as much volume as we initially anticipated, but we'll see how the year goes."

Even amid rosier expectations many banks were focused on cutting costs this year, including Goldman Sachs. As Business Insider previously reported, CEO David Solomon has tasked some staffers with finding ways to save money, including by reducing redundancies and moving workers to cheaper locations like Dallas, Texas.

The bank's vice president ranks have been targeted for cuts because their numbers have gotten bloated. The bank even moved its annual headcount-cutting exercise from fall to spring, when it is set to cut roughly 3% to 5% of its workforce, which stood at 46,500 as of the end of 2024.

Bank of America has also recently cut investment banking roles, including positions in New York, a person familiar with the cuts said. The more recent round of layoffs primarily impacted junior bankers, such as analysts and associates — though some may be reassigned to other roles within the firm, added the person. Earlier this year, the bank also cut more senior positions in a round that amounted to under 1% of the bank's workforce in global markets and global corporate and investment banking, this person added. The cuts were first reported by Reuters.

Sid Khosla, a financial services executive at EY who serves as the firm's banking and capital markets leader, told BI that such layoffs are part of what he calls "the efficiency conversation" among companies seeking to please shareholders — a trend that started before Trump took office. The topic has come up increasingly in talks with clients, particularly in the past three to four months, Khosla said. "It's always the top two or three conversations. Some institutions may think it's a No. 1 conversation."

Whether corporate dealmaking picks back up depends on how long the turmoil lasts, bankers said.

"I think any reasonable outlook is going to be a little clouded here for a while because there's no certainty that the conversations around tariffs and the concerns around the US economy or around interest rates are going to stop," said Stowe, adding: "I also don't think there's any certainty that the current level of volatility will dissipate in the near term."

Reed Alexander is a correspondent at Business Insider covering Wall Street and financial services. He can be reached via email at [email protected], or SMS/the encrypted app Signal at (561) 247-5758.

James Faris contributed reporting.