No Deal Experience - First year analyst

I'm a first year analyst at a BB. So far none of my deals have gone through. A few, very few, "live deals" have been live indefinitely and who knows if they are ever going to go anywhere. I'm afraid that when recruiting season comes along it will put me at a big disadvantage when it comes to PE. I know in this environment everyone is suffering, but there are still those that have done some deals and will have an upper hand.

I've been pretty good about utilizing my time. I've studied various versions of LBO and merger models done before and have a good understanding of the drivers behind them. I've also learned a lot from my pitches because most of the time we do build a full model and run numbers. How can I convey that I know what I'm doing without actual deal experience?

Thanks.

 

So if I start applying for HF/PE shops, the funds will contact my boss (MDs and/or VPs?) to ask about me? So I'm guessing there is no way to hide that you're interviewing . . .

 
sei99:
So if I start applying for HF/PE shops, the funds will contact my boss (MDs and/or VPs?) to ask about me? So I'm guessing there is no way to hide that you're interviewing . . .

ppl know that analysts are locked in for 2-3 years and only a handful stay til associate level.

assume 100 incoming analysts by the third year maybe 12 3rd years will be around to be promoted to associate.

Other than headhunters, PE/HF will contact people they know at IBs (through deals, grad school, acquaintances, etc.).

I've had opportunities forwarded to me from 1st/2nd year associates that they've received from their counterparts from grad school. MDs have recommended me to other firms when they find out that someone is looking, and I get contacted directly by an associate from the respective fund.

We're about to enter a Great Depression. Don't you want a president who's already dressed for it?

------------ I'm making it up as I go along.
 

I think generally your MDs will pass your resume out, and if they carry some weight, you can get interviews.

I'm not in banking yet, but at the boutique I'm going to, the MDs work with you if you're trying to go to a PE/HF shop, so it's not a big deal if you're interviewing.

I'm still a noob, but one of my friends at this boutique didn't have any crazy impressive deals on his resume, but I think his MDs (who are pretty well connected) were able to get him interviews at a good number of funds ($1-$4bn in range), so it seems like that recommendation can really pull some weight.

 

Also my bank has publicly disclosed job cuts recently which I think is going to have an even more negative impact on deal experience between now and recruiting season. Are PE firms understanding of this? Any advice is appreciated.

 

How come you get to work on an IPO when you are a top product group (M&A, LevFin)? Dual process? If it went the IPO route (hence the passive bookrunner role), tricky how to put your M&A or debt exp on resume.

That being said, it's fine to not have any deal exp at this point. Preliminary conversations with headhunters are meant for the two sides to connect and get to know each others. You can mention what you learn while working on that IPO project, esp the modelling skills and nuances.

Try to get into good projects in the next couple of weeks though, not end of the world if they are not announced yet.

Nothing is true; everything is permitted.
 
undefined:

How come you get to work on an IPO when you are a top product group (M&A, LevFin)? Dual process? If it went the IPO route (hence the passive bookrunner role), tricky how to put your M&A or debt exp on resume.

That being said, it's fine to not have any deal exp at this point. Preliminary conversations with headhunters are meant for the two sides to connect and get to know each others. You can mention what you learn while working on that IPO project, esp the modelling skills and nuances.

Try to get into good projects in the next couple of weeks though, not end of the world if they are not announced yet.

Strongly disagree. Like 100%

If you don't have experience to speak to just don't meet with them yet. It's fine to not meet with them until December. They will 100% ask what you are working on, whether you hold the model, etc.

Our 1st years are already staffed up and a couple may actually close a deal before year end. You don't have to have closed deals but you need substantive experience. They will assume you aren't a top bucket kid in your group if you aren't already on real shit

 

Thanks, that's broadly been my approach so far.

One question when it comes to my resume for recruiting, can I still mention the 1 M&A deal I worked on? Something like "advised x on a potential $xxxm bid for y (withdrawn)" and list out what I did (eg held the pen on the model, discussion materials, lead an initial dd session etc.). How much detail is appropriate here?

 

i think a lot of people are in your positions. I've heard of someone being in their second year now and still without a live deal experience. I'm no expert, but I think employers, as well as Bschools will be much more lenient when evaluating employees that were in M&A during these times.

 

Correct. If you aren't getting the deal experience you need (after a reasonable amount of time) you should ask the staffer to consider you for those deals.

CompBanker’s Career Guidance Services: https://www.rossettiadvisors.com/
 

Thanks for your response. I want to be more aggressive, but I don't want to come off as too pushy or someone who has his mind set on PE (might be checked out after getting a PE offer, leave after one year, or not put effort into non-relevant deals). How should I approach the conversation?

 

deal experience is overrated, know people who got megafund and upper MM offers without any "deals" on their resume, but they were able to talk about their pitches and failed processes very well. that's why Blackstone m&a does so well in recruiting even though they don't do a ton of big deals that analysts at the BBs would see. HHs and firms know that its often luck of the draw who gets on deals and who gets on pitches. just spin your M&A pitches well and enjoy the lifestyle while you can. if you really think you're really not getting substantive experience, talk to the other analysts and get their thoughts on whether your group is supportive of asking staffers for deals

 

well, its normal but just look at the Asia bloomberg league tables and you will see that there are M&A deals happening even in this market.. though things have considerably slowed down, i would think that juniors at BBs have a couple of live stuff going on.. it also depends which sector / product team you are in..

 

This is just the beginning.

I'd start with this to get a clear understanding of what your up against: http://ftalphaville.ft.com/blog/2011/12/14/795281/as-chinese-apartments…

Our secondary firm has received a growing number of requests from foreign and domestic Chinese sellers looking to exit. Problem is, very few buyers and we don't buy shit. We, along with a majority of other Asian PE firms, expect China to slip into recession.

My advice, find a nice corporate job and hold on.

 
Best Response

Depends on you. Sure, you might not be the "go to" analyst on some files, but keep up to speed on EVERYTHING. Read through every presentation (best way is to keep up to date on each draft as its being created), understand the model (sure you didn't build it, but know it inside out), and make sure you can talk to each deal.

I had a friend who worked at a regional BB. Had some stellar experience on his resume (multiple multi-bil LBOs, M&A, sales, etc...).But in all honesty, he wasn't the main analyst on the files, just a regional resource used as a backup for the bitch work. However, he knew everything on his resume cold. He landed a sick gig that even analysts coming out of top NY groups were not able to get.

 

It's how you spin your story and whether you know your stuff that will determine your chances of landing an offer.

This is not always the case, but I find that regional offices tend to be more involved with client coverage and pitches. Use this to your advantage to say you got to work directly with management on strategy/issues, building soft skills instead of being an excel monkey all the time.

ihatebanking is rite tho, once you do get deal exposure, follow all the docs and emails and know it inside out.

 

I'll echo the above, deal experience helps but it is your ability to convey understanding of the deal process and deal intricacies that will make/break your ability to land a good gig. Be sure to stay in the good graces of the senior bankers and learn as much as you can. PE firms definitely take into consideration your school / GPA, so you'll be in a decent position come recruiting.

CompBanker’s Career Guidance Services: https://www.rossettiadvisors.com/
 

I think what you just described to us above could be worked on and developed into a story during interviews. You want to focus on the good aspect, leave out the negatives and be sincere. Thats the best way for you.

XX
 

I have two additional questions that seem like a "fit" for this post, as opposed to creating a new topic.

(1) What do PE firms think of private placements in terms of deal experience? I know it's not M&A, but I'm going through the process for two PPs right now (one preferred equity, one convertible debt) and the process is nearly identical to the sell-side M&A process. Initial diligence is essentially the same, the drafting of the teaser/IM is the exact same, you contact buyers as you would in a sell-side (different buyers -- instead of PE firms and strategics, we're contacting late-stage VC firms, but the same idea), and the "track" is nearly identical to the sell-side process. As I mentioned, it's not sell-side M&A, but I feel like I've gotten much better experience on these PPs thus far than I did in the two buy-side advisory deals I've worked on (one closed and was successful, the other did not make it past the initial bid).

(2) Any good PE reading? For banking, there were a handful of books that were recommended to get a feel for the industry -- what about the buyside? I've been looking for some good books, but haven't found anything that seems like it would be informative and interesting.

Thanks guys, and TeamLRAM, hope this isn't taking over your post -- I think my questions complement yours. If you'd like me to create a separate topic, I'd be glad to.

Oh, and since I'm basically a year ahead of you (1st year at a MM-firm that provides full IB services -- equity, M&A, private placements, etc.), I have asked similar questions, and I think the response(s) you're going to get will be the experience is much more important than deal size. So, generally speaking, the more deal experience, the better. Size won't really matter (unless you want to try to go megafund). Of course, all else being equal, having a huge deal on the resume is definitely a nice touch.

 

TeamLRAM,

The number one thing PE firms look for is quality of experience. After that it is the number of experiences. The only ones who care about "Size" are the Megafunds, and I would guess that they care more about quality than size as well. As a result, differentiating yourself from others will likely not occur on your resume. That's why it is so important to get introductions through senior professionals or have an inside connection. If you don't, you're going to get evaluated on other factors on your resume such as group (M&A vs. TMT vs. ???), undergrad, gpa, etc.

JimbrowngoU,

(1) Pipes don't count for much, sorry. You'll have to sell your experience hard in terms of client interaction, responsibility, and how it positions you for PE.

(2) I'm not aware of any PE books.

CompBanker’s Career Guidance Services: https://www.rossettiadvisors.com/
 

Thanks for the response.

While I agree that PIPEs are useless (pretty much entirely paperwork and internal documents, at least from the IBD perspective -- ECM has some involvement), I'd say private equity/debt placements are pretty relevant. Right now, I'm going through a private placement of convertibles preferreds and a sellside M&A process -- both are basically at the same point in the deal, and so far, the process has been identical. Diligence has been the same, marketing materials are basically the same (teaser, IM), client interaction is the same (essentially spending time with the CFO on a daily basis to put together a marketable model), etc. -- only real difference is valuation approach. I would never go into a PE interview with the intent of placing emphasis on private placement experience, but I was wondering if it's something to include on the resume since the process mirrors that of a sellside.

 

I'm in a small shop myself as a rising junior, but I have been invited to client meetings and work on models and presentations pertaining to live deals...along with the daily role of research, database updates, etc.

It's all about initiative. Ask if you can be included in any live deal activity; sitting in on conference calls, attending meetings, modeling, etc.

 

its pretty normal. I basically carried bags and served coffee my first internship.

I did a bit of research and modeling but not much. This was at a very good PE fund with tons of deal flow.

Working on deals is something you have to earn when you actually know what you are doing. Next year when my firm called me back, i was able to develop my own thesis on an investment after I impressed them with how much i learned.

 

Depends. I was with a MM at the time. Had some great deal flow as well as a small team environment.

I recommend you do a crap ton of research and try to jump on any assignments concerning diligence for the clients your firm is working for. They love initiative. Get out of the cubicle and into the corner office!

"Live as if you were to die tomorrow, learn as if you were to live forever."
 

^^^

yea that guy has a good point. Deals are down right now. IPO and M&A activity are sucking at the moment. Private placements might be doing alright though.. dunno you probably should check the numbers.

 

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