Capital Markets 2nd Year Analyst shooting for PE: Take 3rd year IBD or lateral?
As the title suggests, I'm a capital markets analyst that was given the option of taking a third year in my Capital Markets Group, or moving to IBD internally. I'm trying to make a move to the buyside, preferably within private equity (although have been interviewed by some credit funds). It's been tough to get interviews for traditional PE coming from a Capital Markets Group, although I have closed sponsor-backed LBO deals on my resume.
Without any other options, I accepted the 3rd year offer at my current Tier 2 bank (Barc, BAML, Citi, CS, DB) where I will be taking a role in the FIG group. However, I'm worried that the combination of the uniqueness of the FIG group, the reputation of the Tier 2 bank from a headhunter/recruiting standpoint, and the fact that the Summer 2015 cycle is largely completed is all working against me.
Do you guys think it would be preferable to try to lateral to a Tier 1 bank (GS, JPM, MS) in any IBD group as a 1st or 2nd year? I think I might get better looks at traditional PE shops coming from a Tier 1, and I believe I can effectively spin my story to explain the move from both my current firm and the step back from my 3rd year role. I am aware of the negative connotation associated with junior bankers who spend too much time as an analyst. At the same time, I know it's also a red flag to take the associate promotion. I don't want to lock myself out of the Pre-MBA PE recruiting process and have no interest in going to business school at this time, but I worry that I'm caught between a rock and a hard place and time is running out.
Any suggestions from people who have faced this unique predicament or can just provide some educated responses would be appreciated.
Thanks very much
Bump, thanks.
Bump, any help appreciated.
Take the 3rd year in IBD. FIG at a non GS/MS BB will still get you interviews at most places. Your biggest issue will be timing for Summer 2015 starts, but if you're willing to be flexible with fund size and geography, you'll still find good jobs.
Hard to say what's optimal. 3rd year at your bank should be fine for PE recruitment, don't think it matters that you'll be in FIG. Lateraling will give you more time to do more deals and the opportunity to go through 2 cycles (assuming you start as a 2nd year), but not sure the marginal benefit of a Tier 1 bank's interviews will be that much greater.
Recruiters have told me that FIG is definitely unique and can be somewhat limiting given the wave of junior bankers that were already placed for Summer 2015. They also mentioned that restarting as a 1st year at a Tier 1 or Elite Boutique (given the right spin) will give me the opportunity to interview for top tier PE firms in the Summer 2016 cycle (interviews beginning middle of 2015). To begin the 2015 process I was willing to be flexible with fund size and geography, but if I take a step back into the grind of being a 1st year again I'd really only be interested in brand name megafunds and top tier middle-markets in NYC. I'm wondering if the recruiters are correct that stepping back two years will give me a chance for Summer 2016, or if I am 'damaged goods' after 2 years of capital markets.
@nomodlesnobottles I have had no interviews from my current seat at my Tier 2 Capital Markets Group, so I believe a broader M&A experience (Industrials M& / Consumer Retail M&A) from a Tier 1 / Elite Boutique will help improve my marketability and open more doors for Summer 2016 than FIG M&A from a Tier 2 bank for a Summer 2015 start.
Let me know if you disagree with anything. Extremely helpful to hear opinions either way.
Just go for it man. If you want MF, go to a better bank and recruit on-cycle. Recruiting, like anything else in life, is largely dependent on how motivated you are. If you go back to being a 1st year, there will certainly be questions, but that's fine. Funds will get over it if they really like you.
Sounds like you've done a decent amount of homework on this. Just make sure you stay diligent both when evaluating lateral opportunities and when you start on the new job.
Oh and a few of the "elite boutiques" seem to be always looking for laterals. The headhunters will know for sure.
Fair enough, though I find it unusual you have no interviews from your current seat at a Tier 2.
If you can restart as a 1st year at a Tier 1 or EB, you will be good to go. You won't be tainted and can easily spin the Capital Markets vs. IBD role to justify why you stepped back two years.
I also find it unusual, however our group has historically not gotten much attention from headhunters and analysts who spend two years here often need to lateral internally for a third year in order to pad their resume enough to entice buyside shops. This was not made fully clear to me when I originally signed on.
To all incoming analysts who are reading this thread and want to learn from my mistakes, it's VERY IMPORTANT to ask the tough questions about buyside placement to fellow 2nd year and 3rd year analysts you trust. Do not think that just because you are a good analyst with a good reputation that you will be able to open doors that others have not. The path to the buyside is much more difficult than you might imagine as a college senior, and I wish I had paid closer attention to that before I started as a 1st year.
Did you graduate from a strong undergrad institution with good grades? If not, upper MM PE and megafunds will probably remain out of reach even if you do successfully transfer to a tier 1 bank.
Do PE firms request your GPA/Transcripts/Etc. when they hire IBD analysts?
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