PE FoF vs. strategy consulting
Hi all,
I'm currently in my second year at a second tier strategy consulting firm (think OW/Booz/LEK). It's okay, but I find the work to be relatively mundane, and I haven't really developed any "hard" skills (never had to build a model or anything). Also the hours are long and unpredictable.
I previously studied engineering and my plan had been to do consulting for a couple of years and then transition into strategy/corporate development or product management at a technology firm. This could be a startup or a large established firm, but in the UK there are relatively few interesting jobs in this sector - so I'm not sure a direct transition would be feasible unless I went to b-school and came to the US (which I am keen to do). I'm also interested in roles in PE/VC with a tech focus.
I was recently made an offer with the FoF division of a BB. The role is said to be 50% primaries and 50% coinvestments. However, I'm very confused as to whether this is the right career move to make. Here's the way I see it:
1. This BB has a better brand name than my current firm, which may help in the long run (or should I disregard this?)
2. I'll be doing more technical work/gain some modelling experience etc (especially on the coinvestment front)
3. (Apparently) better hours and lifestyle
However, my concerns are as follows:
1. Am I getting further away from my long term goal of strategy or product management at a tech company? While I assume the skills that I'd get from coinvestment will be relevant, the 50% focus on primaries sounds unrelated to the kind of skills that I might want if I'm interviewing for a strategy job at say Google or Apple. Or am I mistaken?
2. How would this kind of role set me up for VC or direct PE?
3. Would this kind of role place well into business-school? And would it open up more post-business school options for me than if I stayed at my current firm for another year and went directly to b-school?
Thanks if you read through all this!
I reckon with 2 years experience in consulting you can apply for roles in strategy at tech firms like Google and Apple and secure interviews. Also look into business operations, sales operations and strategy etc teams at tech firms. Once in the firm you can lateral (tech firms are open to this, but I cannot speak for other industries as I have no clue). Don't just look at Google/Facebook/Apple but all tech firms - there are a lot of good ones out there. Look at Dublin positions because - yes - the UK sucks for tech generally in these areas. Once in Dublin (usually the HQ for a tech firm) you can lateral over to the USA after gaining experience.
I note you are planning on doing a MBA. Why not wait for your firm to sponsor it, intern at a tech firm during the summer of your MBA, and then secure FT role that way?
For product management (or 'product' anything) you need a Computer Science BSc or MS (typically - based off what I have seen) so again your best bet would be to get into the firm and lateral.
I'm not sure about BB/PE/VC so cannot provide advice - sorry! Hopefully someone else here can help you. GL.
double post
Sorry I didn't know that. Thank you for the information.
I'd probably stay in consulting. With co-investments you will be heavily leveraging the GP's diligence/model and the skillset from primaries will in no way be transferable to corpfin.
Lifestyle will depend on the group. I know FoF groups that work ~50 a week and some that do ~70+. Probably much less travel though, as I assume you do quite a bit now.
If you go FoF now, your direct investing career is probably over. The places you listed are good enough to get interviews for direct jobs, you need to get in touch with headhunters and network.
]quote] It's okay, but I find the work to be relatively mundane, and I haven't really developed any "hard" skills (never had to build a model or anything) [/quote]
Coming from a corp dev/strat role at a startup/growth stage company myself, you do a LOT of modeling. So I do not know how people at those tech firms, hiring for strategy roles, will view your skills and bump them up against their skill set need.. Have you had to make decisions for your firm's clients before? That will be better leverage in your strategy interviews since you do not have any modeling experience.
If this FoF is taking you further away from what you want to do, then don't do it.
Thanks for the responses guys. A couple of follow-up questions based on the points that have been raised:
So seems that I could transition into corporate strategy/development with my current background - although the lack of modelling experience could be a concern. In order to develop my modelling skills, would I be better off doing this FoF gig for a couple of years (i.e. is the 50% coinvestment work likely to greatly increase my technical proficiency?). Or does it convey signals that i am more interested in fund management, and might actually work against me? I do have some modelling experience, but by the sounds of it far less than my peers in IBD or in other competing firms seem to have
Interesting to know that FoF would rule out direct investing (I assume we are referring to direct PE; is the same true for VC?). The BB is one of the top 2-3, whereas my consulting firm is probably top 5 at a stretch - does the "prestige" not count for anything? I would be lying if I said this isn't currently factoring into my decision (sadly)
Thanks again for the help so far.
Yes FoF normally doesnt lead to jobs in the respective direct domains and that's true for all of VC/PE/HF unless you have a very large part of co-investments ie a hybrid direct/FoF role. In FoF you select funds while in direct you assess "real" operating firms and the required skillsets are quite different. Consulting and IBD provide the best training ground for direct. Just ask your staffer for more relevant cases eg strategy, restructuring, PE due dil, financial modeling.
Also, as often mentioned on WSO: you may be better off not prioritising prestige unless you can afford to. If you take the BB FoF you'd certainly be at a nice BB but still getting zero relevant experience for direct.
Don't do the FoF. Lots of folks who do co-investments don't do fresh models (some might) lots of them just test the inputs and ask questions. This is fine if you come in at a level that's higher than associate or jr vp on the direct side - but that doesn't sound like it. Your career path will change a lot. Like others have said, ask your staffer for some different projects if possible, otherwise speak to some headhunters? Though if you do the BB role, look to move to IBD or PE within the firm quickly (a year or so, if possible). Might be easier to move internally (I don't know how that process works - others here might). Good Luck
Okay thanks - it's pretty clear that if I want to do any form of direct investing I should stay where I am.
One final clarification - if I want to get into corporate strategy/development (ideally in technology), am I better off staying at my current firm for another year or so, or would this primary/coinvestment FoF opportunity add more value when applying for these sorts of roles?
Thanks again!
Defo stay where you are if you want to go corporate.
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