People with the job titles "investment banker" and "business broker" seem to serve the same function. Both help business owners sell their business. Both also represent buyers looking for companies to buy. What are the differences? How is compensation different between investment bankers and business brokers? Is this just a terminology difference?
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Typically business brokers assist sellers and sometimes buyers of very small, private businesses - often as independent agents or as a part of a business broker network (similar to a real estate agency). They may or may not be licensed depending on the state where they operate (for example, some states require business brokers to be licensed real estate agents and some require additional certifications). Their services are very similar to a real estate agent in that they help determine a valuation (or offering price) for the business, market the business for sale through various listing services and other media, manage communication and negotiation with potential buyers (and sometimes sellers) through the conclusion of the transaction.
Investment bankers are employed by financial institutions in the business of raising capital for businesses. Advisory services related to mergers and acquisitions that may seem somewhat similar to the role business brokers play with small businesses are just one aspect of the work of a typical investment banker. In addition, the acquisition advisory services provided by investment bankers are much broader in scope and typically provided to larger businesses that require more sophisticated advice regarding potentially complex transaction structures. Investment bankers facilitate the issuance of public securities and raise private capital in addition to providing transaction advisory services. Investment bankers may be required to hold an MBA and a CFA designation in addition to other certifications depending on the requirements of the financial institution that employs them.