Ask Tech Buyout:
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on 12/21/09 at 5:23pm
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Why do so many people here
Why do so many people here hate capital markets? So odd. Seems like a cool area from what I've heard of it.
Sure. This is open-ended,
Sure. This is open-ended, but...do you like your job?
If so, why?
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Hello, I will be in a tech
Hello,
I will be in a tech M&A shop next year. However, this is not MS or GS, more like a tier below the top boutiques.
Since I am not going to have headhunters knocking on my door, do you have any advice on how i can reach out to tech buyout shops or pe growth shop?
jonx8262 wrote: Why do so
Why do so many people here hate capital markets? So odd. Seems like a cool area from what I've heard of it.
It all depends what you're looking for, desk jobs are great in that they are usually less hours and it's easier job function. If you work on a pitch with a coverage group, you send of the pages and they just drop your pages into the book. Execution is minimal too, since the group is often just an intermediary. I think it's a good spot if you want an easier lifestyle and still be under the IBD umbrella (at most banks). however, cap markets groups often get hit hard in downsizing.
I think it gets hated on because, the exit opps from a capital markets group make it tough to have a broad reach in terms of buyside recruiting.
If you're in ECMG you might have a shot at some fund that has a strong foothold in receiving IPO allocations or if you specialize in the convert product you may end up at convert arb fund...
If you're in DCMG you might end up in a debt fund or a HY trading fund...
So it essentially limits your exit opps. A guy/gal from M&A / Sponsors will be more sought after and will get 5x as many interviews.
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TheKing wrote: Sure. This is
Sure. This is open-ended, but...do you like your job?
If so, why?
I'll compare and contrast my current job with my prior jobs.
The benefits of working as an analyst covering a sector(s) is that you have free reign in how you approach your investment ideas. You attend trade shows, sellside conferences for both debt and equity, talk to research analysts and company management and you choose how to allocate the majority of your time. Your job essentially is to pitch your ideas to a fund manager or whoever gets the allocation of your sector and hope they bite. Assuming they do allow you to make the make the trade you better hold onto your seat because its a wild ride, since public securities are marked to market.
The diligence is on public information for the most part (unless you're dealing in a private deal), and your information may be incomplete at times. This can be annoying as you'll have to spend alot of time doing research, talking to analysts, asking questions on conference calls etc.
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In private equity (especially at a large fund) you're managing tons of moving pieces and you're responsible if shit goes wrong (as an analyst in banking you might get bitched out by someone, but more often than not you're not the last line of defense). First you're responsible for the financial model, which is going to be detailed beyond believe and you'll have to layer on tons of cases and cap structures, since you'll be working with McK/Bain who will help validate your drivers, you'll have banks, hedge funds, Mezz funds, offering you financing packages and you'll have to mix and match the best cap structures and quickly toggle and tweak each component. Then you have to deal with diligence and you'll have benefits/pension consultants, legal diligence accounting diligence and you'll be running around doing site visits and multiple management meetings.
The thing that sucks is half the time you lose in the bidding process unless your firm was lucky enough to get a jump on the process, partner with another potential buyer, etc. Working with another PE firm is annoying since each side thinks they are way better than the other team even though you're both at top firms and the information flow can be fucked up.
Also the deals in PE take much more time and are often much more draining in terms of getting the deal to the finish line.
However, monitoring and valuation of the investment can be less stressful since valuations are quarterly and you're not watching share prices move daily and hunkering over sellside research and investor calls. If the privately owned company hits a bump in a quarter you may monitor it more closely but you aren't shitting bricks because the share price fell 25%.
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Personally, I like the fast paced action of working at a hedge fund, we can pull the trigger 100x faster than in PE, which takes much more time doing diligence, going through multiple ICs and you may not even end up winning the deal.
Oh yea Hedge Funds Pay $$$
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Since I don't know all the
Since I don't know all the details I'll lay out some scenarios and you can dive into one if you see fit.
Tier below top boutiques (Moelis/Blackstone.... Lazard/Evercore/Greenhill/Gleacher/Centerview)
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1) You're at JPM/CS/BarCap/UBS' Tech M&A group, you'll be fine headhunters will still get you interviews and you'll be in the running for most jobs. You'll have an edge at the Franciscos, Vectors, Accel/KKRs, TCV, type gigs since (they're tech focused)... Silver Lake, Elevation, are more picky in terms of pedigree so they may not offer you an interview... I for a fact know that SLP cares about school and bank.
2) You're at Wells, Cowen, Thomas Weisel, RBC, Jefferies, Montgomery, etc. You're going to have to reach out to the headhunters and let them know who you are. Your friends at bulge banks will get contacted (since the headhunters get the analyst facebooks) so you're going to have to ask them to forward the analyst data sheet. Fill it out and get a meeting with the headhunters. They usually host meeting days at hotels in various cities or at a minimum will give you a phone call.
3) You're bank is obscure and unknown, then you're going to have to pitch them a bit talk about your deal experience and your school is definitely going to come into play here. It's tough to break into the buyside with no name / no school. But it can be done, you're going to have to be able to show that you understand the deal process, use of leverage, and be able to show that you can think like an investor. It helps if your shop also works with debt alot of M&A boutiques just are sell-side shops, which will make it a little tougher.
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Very informative thread. Just
Very informative thread. Just curious, how exactly did you land this gig at the HF ? Were you actively looking to move into a more markets oriented role ? Also, where do the Analysts junior to you typically come from ? IB ? ER ? other L/S HFs ? Are they the ones reading the footnotes and helping you prepare your thesis ?
Thanks
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Tech Buyout, I have a couple
Tech Buyout, I have a couple really good friends who are/is working at a smaller hedge fund & at 28 are running their own books and are making a ton of money. Most guys trying to pursue the whole PE route at that age would be back at biz school at that age. If you feel your quick enough on your feet to work at a HF is it a much better choice? For the longest time my goal was to do venture capital, but seems like it takes forever to get paid (most investments in VC aren't realized for 5+ years). I have an engineering degree which I've heard is favorable in the HF world; but I've been so hell bent IBD->Start Up->Biz School->VC that I wouldn't know where to switch/start at. Do I need to try to get a job on a trading floor? Also I was also thinking that working for a smaller MM PE fund in my hometown (Denver) after my 2 yrs in banking would be nice, but what would the pay be like? Would I become a country finance bumkin from there on out?
You can generally find a fund
You can generally find a fund that fits your experience. A tech buyout has stated, a lot of our experience will not only give us deal expreience but also teach us how to approach a problem and that varies from fund to fund. IF you have a relevant set of qualifications, you should form an opinion about what kind of fund you think / want to join and go after those first before casting a much broader net
Any general advice for
Any general advice for incoming analysts?
Can you get HF experience
Can you get HF experience inside a traditional BB?
I worked with alot of the
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?
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westfald wrote: Tech Buyout,
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chimpb wrote: Any general
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themonkeybandit wrote: Can
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Given your background at
monkeyinasuit wrote: Given
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Are you still on the WC? If
Sorry I'm a noob, but can
Do you know which MM PE shops
Mezz wrote: Are you still on
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zykke wrote: Sorry I'm a
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whateverittakes wrote: Do you
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Tech Buyout wrote: IBD->Start
3 questions: Tech Buyout
"Ride your bike. Drink good beer."
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i know there is alot of
westfald wrote: Tech Buyout
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Quote: 1) Why don't people
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bankingplease wrote: i know
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How seamless did you find the
Ouch... I didn't do that well
Coming from a
Is there no flexibility in
Kasanova wrote: How seamless
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zykke wrote: Ouch... I didn't
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chimpb wrote: Is there no
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what kind of fund are you at,
Glad you're still answering
Hey - I've read some of your
Blackacre22 wrote: Hey - I've
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the_situation_09 wrote: what
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O look he's back. When will
What if the best group at my
12345 wrote: What if the best
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Not sure if you have info b/c