Looking for sort of a reality check on my understanding of the landscape.
- IB/Consulting are often seen as pre-requisite experience for many (almost all?) jobs in anything remotely related to finance. And if not quite required, they're universally helpful. I see so many open roles in finance (VC, PE, strategy roles at startups, management roles at big companies, etc.) that stipulate 'experience in IB/consulting' as the main qualification, even though these jobs often have little to do per se with IB/C; it's being seen almost as a general education req.
So basically the entire industry writ large seems to see these two experiences as 'training/proving grounds'; a necessary gateway experience which few get to skip to work in something in the financial realm but not really related to IB OR consulting (and I can think of roles like this).
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Given this (and recognizing there are maybe on the order of ~100 IB firms, and maybe 20 consulting firms, with just 10 and 3 respectively of those being the big ones. So I see this as insane competition for an EXTREMELY narrow solution set of 'jobs/roles etc.' These companies can't possibly absorb even a fraction of the number of aspirants.
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So my question becomes, are IB/Consulting the ONLY main 'entry points' into the entire 'world of finance'; or are there other entry vectors? I don't see them much discussed on the site, so I'm guessing probably not?
*as an aside anecdote, I have seen people simply skip this notion of IB/Consulting being gateway experiences, and just work in management, VC, strategy, etc. depending on background.
To qualify this; I don't see much discussion of business development roles; say at startup companies, smaller companies. I've definitely seen people start at these roles from undergraduate, often in technology or related companies, and then later use their experience to work in 'advanced' finance jobs in VC or strategy consulting work (not PE or HF though of course given the specific nature of those; I'm not sure about M&A - I assume not).
So I definitely think the VC/consulting/strategy/management roles don't have as hard-edged an IB/Consulting "pre-requisite" if you will. I feel like this could/should get more attention.
(I also understand many on the site want to work in HF/IB/PE et al. though where I don't know of other types of roles that transition like IB/Cons)
Just to clarify are you referring to biz dev jobs at startups that are sales type roles? (i.e. Building up the platform through new clients and strategic partnerships) or are you referring to more traditional m&a / strategy corp dev work?
I tend to lump those together in my mind because they're very frequently working closely together in those types of small company environments and often wind up doing somewhat similar things depending on the company's maturity.
But more apropos, I have seen BOTH people who work in BizDev with zero experience (UG hires) eventually get bumped into strategy/development/expansion work in new companies despite having no 'consulting' background obviously. (It makes sense to me, they know that individual company well, already worked with the same people, and clearly are probably better fit than someone parachuted in from MBB to fill the same role).
But of course I have ALSO seen people (again UGs zero experience) get hired into strategy/development groups; they basically seem to refer to these people internally as "smart people" who basically just are part of the team (experienced hires ARE almost always experienced consulting types), and eventually 2 years or so in learn enough to be considered 'consulting' people.
So again, I'm just trying to square what I see in reality with the ideas and opinions and frameworks I see online and there seems to be a disconnect (Obviously I'm more inclined to trust what I see in reality than people online lol).
Bluntly: I've seen all kinds of people from all kinds of places with all kinds of experiences, get the so-called 'extremely coveted' jobs, roles, experiences, et al. that people on this site obsess over...
So I'm trying to figure out what's going on with that, and understand the mechanics and dynamics of it.
IB / Consulting are rarely a mandatory pre-requisite to any particular industry. This isn't school. Yes to work at particular firms in an industry, it's almost a requirement. If you want to work at Blackstone PE you will need to have worked in investment banking or have been recruited out of undergrad. But there are plenty of PE shops (often a bit "less" prestigious but not always) where no one has IB experience (usually they will have been accountants, Big 4 transaction advisory, etc.).
A better way to think about this is that both IB and Consulting are good experience that will open doors, but they are by no means a requirement to break into a specific function / industry.
"But there are plenty of PE shops (often a bit "less" prestigious but not always) where no one has IB experience (usually they will have been accountants, Big 4 transaction advisory, etc.)."
Which PE shops are you talking about here? I have no hard data, but I find it very hard to believe there is even a handful of PE firms that consists of only/primarily ex-Big 4 audit/TS/valuation/similar backgrounds.
Look into smaller PE shops - AUM 100mm to 300mm. They are mostly regional and not as well publicized and typically have 2-3 associates. It is not uncommon for these associates to have worked in the fields mentioned above before breaking in.
PE shops in the lower middle market are a lot less geared towards financial engineering and focus a lot more on improving operational efficiency, so a solid financial modelling background is not as important as the Mega Funds. Also many of these smaller firms hire operational partners that did not work in the finance industry prior to working in PE.
Main Street Capital in Houston is full of recovering accountants, nicest guys though.
Don't take everything you see here as gospel. Tons of useful information, equal amount of BS. A friend of mine worked in public accounting, not even big 4, got an MFin and is now an associate at a boutique IB in my area. He was pursuing an associate role with a PE firm where he made it to the final 2 but ended up losing out to a guy from the back office of the firm who was looking to jump.
My friend and the guy who beat him out for the PE job are both examples of not needing to follow the WSO goldman to harvard to APG to forbes list requirement for success.
That being said you definitely need to work harder and find a way outside of online applications if you don't have the resume to rely on like others do.
Ok wow, so I actually completely forgot I started this thread; apologies. This seems to have careened a bit into an argument about PE firms.
I know technology is MUCH more fluid than finance but still the analogy holds: many engineers will tell you "you need to work at Apple, Google, Microsoft, or Facebook before you work at any of the much smaller but often very elite high-tech companies" in the same way they sort of function as 'gateway' experiences. And to a large extent sure, this is true; they tend to be hiring targets for new companies looking for good experience. But at the same time there's a good majority of engineers who don't have that experience at all and who end up working there anyway. I guess this post was originally meant to explore what the binomial experiences of people is like on the 'elite experience' vs 'those without' spectrum.
OF COURSE people with the most competitive education, elite experience, strong networks (and given my personal experience, even strong family/friend connections) tend to saturate competitive jobs in finance (and most things actually).
I don't find that especially revelatory or really worth over-emphasizing. Presumably those types of people don't hang around on forums like WSO (the 5 people I know who work in PE/VC have never even read these forums).
a. I have seen everyone from art history students working in PE to musical theory people working in IB to quantum physics types working in MBB; and that's before I even get to the actual finance/economics types at either UG or MBA level. The main thing they had in common was a top undergraduate school as a background, but even then while statistically significant it wasn't very strong. But in terms of work experience, it was usually either very thin, or bore zero resemblance to what WSO forum types would have you believe one 'needs' to do.
b. Part of my question was why so many job postings which were (mostly) unrelated to finance or consulting often requested as a top-line requirement that the person have IB/Consulting experience. It seemed to me like it was a 'baseline' requirement.
But this couldn't square with reality since 1. there were too many open positions for even those people to possibly fill and 2. many people lacking those credentials often wound up taking the positions anyway. So I'm guessing this is a form of 'signalling' where a job poster/company signals the ideal candidate they would love to have, but wind up getting someone a bit different.
I know I'm going to get crucified on here for even mentioning this possibility, but I really think people on the finance boards need to expand their map a bit in terms of career/jobs/education; that is to say, I think there are a LOT of ways to do the types of work people want to do that don't necessarily involve working at a total of 13 companies that are extraordinarily oversubscribed and as noted ad nauseum tend to fill up with very specific types of people; it's a very big world.
STARCHITECT and TakeNotes08 I think make excellent points; I think the point is telling someone they need to go to Harvard College, work in IBB for 3 years, go to HBS and then go work at xyz isn't really 'advice' or frankly very useful. And most of the forums seem to be this type of 'advice' lol.
Furthermore, I think there are two separate goals, if not 3. One goal, presumably shared by many on the site, is to 'work in finance' whatever they means to them - this is eminently doable, and probably people need to focus more on this, I certainly am. The second goal seems to be more "I want to work at these very specific companies so I can go to this very specific school to work at this other very specific company" in which case I think my advice would be... ok good luck. And then 3rd perhaps is compensation; which I think distorts logical thinking so I'm ignoring.
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