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In the spirit of thanksgiving, I have decided to host a thread where you can ask all you ever wanted about banking or PE. Please feel free to ask away.

Comments (250)

  • chiphifrat's picture

    Does KKR (and most mega-funds nowadays) have a 2-year and out program, or do they encourage you to stay for a while? If they do encourage you to stay for a while, do most people still go to B-school after two years?

  • PennJamin's picture

    Thanks for the thread -- it's refreshing to see something relevant on this forum. How well are the elite boutiques (GHL/EVR/LAZ/BX) represented in the top megafunds? Do you think they are overhyped on this forum?

  • In reply to jtbbdxbnycmad
    10xleverage's picture

    jtbbdxbnycmad wrote:
    Hi, I like the spirit of your thread.

    Is it still possible to transition into PE if you're a post-MBA IBD Associate, or is one perceived as more expensive than an analyst but also less open to being a grunt? Or is the post-MBA track a long-term career move that only gives you options once you reach MD level (where, as you say, you stop being a glorified slave and then your value is in your decision-making skills, network, etc)?

    I believe I have the chance to get perhaps 6 months of pre-MBA PE experience at a small-ish fund, through networking. Would that make a significant difference during MBA recruitment, or would IBD still be the only option in the world of M&A?

    Thanks! Enjoy the turkey and pumpkin pie.

    Appreciate the support. Regarding the transition into PE at the post-MBA IBD level, it is incredibly difficult to get into a megafund (especially in this market) if you are not from a traditional background. KKR will typically only really look at you if you did 2 years at a top bank, 2 years at top PE and then HBS. Are the only people in the world qualified enough to work in PE made of this mold? Absolutely not. Is life tough? Yeah, it can be. That said, absolutely do not make post-MBA decisions with an eye towards exit opps, this typically turns out badly. Associates in IBD do have exit opps, but they are not as clear and regimented as their analyst counterparts. In middle market shops it is probably not as regimented, but you will still absolutely need meaningful pre-mba experience that is hopefully related to finance. Exceptions to the rule always exist, but I am just generalizing here because generalizations are the easiest things to discuss.

    Regarding the value of the MBA, it absolutely helps, but nobody is making promotion decisions based upon where somebody (or if) went to business school. However, a person may have a significantly better network because of their MBA contacts. That said, there are partners at KKR who skipped the MBA and are doing just fine. To each their own, and you really have to weigh the costs and benefits when you are faced with it. It is unlikely though that somebody will be a superior dealmaker solely because of the fact they have an MBA. Lately the trend seems to be that b-school for non career switchers is coming out of vogue, but that said, an MBA will still provide more career versatility down the road.

    Regarding your plight, I would suggest you try and get that pre-mba PE experience as it will significantly boost your profile (and relevance) when you apply for those jobs post-MBA. You should not take a cut in pay or responsibility to get this position though as it will look weird on your resume or as you speak about it.

  • In reply to chiphifrat
    10xleverage's picture

    chiphifrat wrote:
    Does KKR (and most mega-funds nowadays) have a 2-year and out program, or do they encourage you to stay for a while? If they do encourage you to stay for a while, do most people still go to B-school after two years?

    Generally 2 year and out although this is becoming less so. You will see some superstars these days getting promoted to the post MBA level although there is still a preference for the MBA. Many kids also will leave to go to hedge funds (tiger cubs and the like) as the large PE funds are becoming more bureaucratic (it comes with the territory when you are publicly traded) and as such, harder to advance in. There isn't that much encouragement to stay, it's still a dog eat dog work place, so it's not like you're in a fund of 10 people where people are begging you to stay. You can still be replaced.

  • In reply to PennJamin
    10xleverage's picture

    PennFranklin wrote:
    Thanks for the thread -- it's refreshing to see something relevant on this forum. How well are the elite boutiques (GHL/EVR/LAZ/BX) represented in the top megafunds? Do you think they are overhyped on this forum?

    Appreciate it, god only knows how much filth is spewed in this forum. I've been a reader for quite some time and can't begin to explain how much misinformation is shared on this website. The elite boutiques are good for megafunds but the top groups are as follows:

    GS TMT far and away #1
    GS FIG / BX Restructuring
    MS M&A

    After that, it's good to be in any of the major M&A groups (or other industry groups at GS/MS), merrill's legacy m&a group which is now in BAML is pretty good, citi M&A is pretty good, the boutiques are also good (Lazard and BX M&A are terrific although Greenhill and evercore are a step behind in recruiting, moelis also does well since UBS LA had a strong track record of placement on the west coast at tpg and kkr west coast). The fact of the matter is, if you are not in one of these groups, it is an uphill battle. If you are in one of these main groups that I've mentioned, recruiters contact you, and all you do is submit your resume, and the rest is history. I never cold called a fund once, nor do they particularly want you to call them. They know what groups they generally want to reach out to, and they go back to them year after year. Again, is this fair? No. However, it is generally a good way to fill up a class if 8-10 people because on average the kids at GS are smarter than the kids at CS and so on. It's just a fact of life. Kids from non targets absolutely do occur, but they will need to do more networking through their own senior people, or through winning the ear of headhunters. Like anything else though, once you get an interview, the playing field is fairly flat. KKR's not going to take some bumbling fool from GS tmt over some stud in UBS just because he's from a better group.

  • In reply to Stringer Bell
    10xleverage's picture

    Stringer Bell wrote:
    Any advantage of M&A over Sponsors?

    Yes, M&A is better, you do real analysis there. Sponsors is more of a relationship manager for PE funds. Although you are exposed to PE funds, it doesn't matter much at the junior level since you aren't the real relationship manager. Be in M&A if you can. If you're in sponsors (especially at one of the better banks), it's not game over, but M&A is superior.

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