Big 4 M&A corporate finance to PE - what are my chances?
This is for the UK, not sure how similar it is for other regions. Let's say I am have been working in a big 4 M&A corporate finance department for 3-4 years and have the ACA accountancy chartership, what are my chances of being successful at gaining an investment role at a mid-level private equity firm? I just want to know how common this type of background would be at getting into private equity, or would it be really difficult due to competition with people who have come from investment banks?
For those who don't know, the M&A corporate finance work at a big 4 in the UK is very similar to investment banking, helping to manage the sales process on behalf of a selling party, producing marketing documents (IMs, etc), some valuations, producing pitch books, selecting best bids.
Think you need to go to IB first
Is that true even though the work at the Big 4 M&A team is essentially the same as at an IB and I am targeting LMM/MM private equity? The work is managing the sales process, producing IMs, modelling, dealing with buyer queries
I would recommend spending most of your energy trying to lateral to an IB analyst role at a reputable bank rather than trying to find some back door way into a low quality PE firm. Play the long game here and set yourself up to be in a position to be competitive for the best quality PE opportunities.
Is that true even though the work at the Big 4 M&A team is essentially the same as at an IB and I am targeting LMM/MM private equity? The work is managing the sales process, producing IMs, modelling, dealing with buyer queries
Agreed, as someone who made this mistake. Was so happy about making it to a crappy MM firm and a year later am dealing with difficulty finding a better role even as my firm starts to look more and more like a slow-motion train wreck.
I agree with this answer. I was from big 4 that moved to a small newly established PE. It's not an ideal situation I'm in because this place couldn't care less about associate/employee welfare which matters a lot to us at associate level, while bigger funds usually have a more proper HR function. These roles are very vulnerable to abuse and exploitation. The performance review has no metrics whatsoever and you are probably valued much less than more senior people that can get things moving. Also, your comp will most likely be aligned to your previous role in Big4, so nothing phenomenal. I personally think moving to BB first is better for your professional development. Wish I have done that.
I think the above posters are US-focused.
For UK, you can move straight into lower mid market PE (mainly funds that acquire sub £70m EV businesses) from big 4 M&A, though usually at the Manager level.
Thanks, yes I heard Big4 experience espicially in their Deals and corporate finance teams hold more weight in the UK.
But to clarify, do you mean that it's so competitive that even for LMM PE firms, you can only move in from the Big 4 at manager level and not senior associate/assistant manager? Is that true even if you worked in a corporate finance M&A team at the Big 4?
I know of two people who go into LMM/MM PE firm in the front office team after having 3-4 years experience at the Big 4 M&A team, but I don't know how much of an anomaly they were.
They definitely hold more weight in the UK, but that's not to say they're on par or better than IB (hint - no one would say the latter). You may get the T5% candidates from B4 still making into MM PE fine, but normally the quality of investment professionals at those funds (and likely fund performance) are a solid grade below top tier PE (MM or otherwise).
Not to say you can't from B4, I just have several colleagues at B4 struggling and have had to shift around laterally to reposition themselves (best to do this within 2 yrs of B4 tenure once you realise this and move to IB or even strat consulting like others have mentioned)
You need to lateral to a real bank first, as others have said
I spoke with a partner at a LMM PE firm who transitioned from a BIG 4 M&A role to LMM PE. I believe it's fairly typical for individuals from BIG 4 backgrounds to find opportunities in LMM PE after ~4 years of experience. Focus on getting deal experience and building investment acumen (such as grasping the strategic reasoning behind the transactions you're working on).
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