Why don't more of you go F50?
I've been reading WSO for a while now and obviously this is a forum oriented towards finance jobs in New York. In light of the recent Best Buy CEO firing, I was asking myself: this guy never went to college, is making 8 figures a year, and is kind of a moron (trust me--I know him), and became CEO of a large company. So many people want to break into a hedge fund after IBD or whatever, but why don't more of us go for corporate roles at large non-finance companies? Sure it takes longer to make so much money but with the work ethic of people here, it's definitely possible to be making serious cash at a reasonable age. And isn't the work/life balance much better?
Am I missing something here? Is it easy to leverage high finance experience into a corporate/executive role at a F50 company? Is the prestige factor that comes with becoming the next Phil Falcone hedge fund mogul really that important to you guys?
Doing IB is the safest route to financial success for people interested in finance. Period.
Yet most people that do IB hate it....interesting
I mean beyond IB though. Hence my question about leveraging finance experience to something else.
if you get stuck at the manager/senior manager level, you're making $120k/year with a modest bonus. meaning, you're making less than an IB associate. not gonna lie... this is a major reason i want to leave my F1000 finance role. maybe comp is higher at F500, F100 or F50, but i doubt it's THAT much different.
Not sure about the senior manager level, but I knew VPs of F10-20 companies that were clearing 800K (most of the VPs making this much were working abroad - this gives you more perks). These are men/women in their late 30's to early 40's, in my mind that's not bad (especially considering the hours).
That is much higher than the norm
This thread gives you more insight: http://www.wallstreetoasis.com/forums/corporate-finance-qa-with-account…
I have heard this to be true as well. If you enter in at the entry-level, you can sometimes get stuck/not advance as quickly as someone who comes in at a higher level and has top-tier experience such as BB banking or MBB consulting. There can be a ceiling of sorts.
This. Entry-level Corp Fin only seems to rival banking/consulting in exit opps within corp fin when there is some sort of leadership development program, even then it has to be a strong one.
wrg
it is not presteejous enough.
Another problem I found was initial recruit for F500 companies. Just about all their interns and first years are from where they do OCR's. Coming from a non-target I found it very difficult to land any interviews for corp finance at those companies. However crazy this sounds I wanted to do Corp Fin at a F500 over IB. While IB was super hard, it was much easier to network with people and at least land a couple of interviews (because of the network I developed) I did get a SA position in IB this summer and am very grateful for what I have.
Corp Fin is great and something I would consider after I settle down. Once I am set on marriage that is when I plan on leaving IB/PE/HF wherever I will be at the time which to me is around 26-30. I am sure I will have made a decent amount and plan on saving some and making some good investments.
I work for a F20... VP's (most of whom are in their 40's) make on low-end about 400K and high-end 1M+. Your job position is largely tied to compensation. VP is also very largely arbitrary. Not all VP's are made the same. In my org we have VP's who report to VP's who report to VP's. This gets ridiculously confusing and their comp is not all the same. In corporate finance within the org they make 400-600K whereas the sales VP's are making 500-1M so huge disparity. Why do most people in finance not go this route? You ever work in a F50 in corporate finance? Finance is often viewed as a support function (watch the office episode where the sales staff is king to even the management). There are so few executive positions in finance compared to your counterparts in the operational side of the equation.
The poster who said most get stuck at 120k/year with modest bonus are absolutely correct. Most will get to the manager/senior manager type of position and find themselves stuck because too few executive positions actually exist in finance... I mean who many do you really need? This is what prompted me to return and get my MBA at an M7 and hope to break into an M&A group (have interest here). The path to 'wealth' in the corporate world is a much longer journey and often one that people will never complete.
interesting. thanks yall.
Because it's a support role.
You're posting on a site about IB. It should not surprise you that most people here want to do IB.
there are CEOs of decent-sized companies out there who make what some 1st year hedge fund associates make.
As a couple of random (but probably representative) data points, the CEOs of two of our client companies earned ~$300k each, and these are $300m-$500m TEV companies.
You can make enough money at a corp fin gig to be happy and live a full and complete life. I work for a fortune 5 company and am in the college hire development program. I just got through doing a support rotation and am transitioning into another support rotation. I get to learn a shit load about the energy industry but the job is boring and the pay is very stagnant (although much higher when compared to other entry level corp fin gigs). The perks are great and the hours are like heaven (45 hrs MAX each week). What kills me is that I feel like the experience is worthless at this point in my life, the learning curve isn't as steep as I would like it to be. Corp fin gigs, I would say, are good post-MBA because only then can you start working in business development/strategy roles....even these roles are offered to high caliber candidates (a few recent MBA hires worked at Goldman and JPM in their energy groups before MBA). It's too late for me to pursue valuable IB gig to get that relevant experience (also, my name brand can help me get into a good MBA program). After my MBA, I plan on getting into IB and doing that for a few years then hop back into a corp fin gig and get those big bucks and nice hours....sorry for the essay.
Oh! That I might find myself only in the top 0.001% of earners instead of the top 0.00000001%! Existential crisis!!!1!!1!
Definitely not true. As posted above, it very common to get stuck in the $100-125 range in F500 corp fin. $100k per year definitely doesn't get you in the top .001%.
I'm not saying making $100k working ~45 hours a week is a bad deal, but working in Corp Fin is definitely not the way to get rich quick.
Being 50th percentile in IB can get you decent coin. Being 50th percentile in F50 gets you Honda Accord and vacations to Hawaii in economy class.
No way it is that low. My dad is a friggin' airline pilot and makes nearly 300k.
your dad will never have the chance to make multiples of millions based on performance, that is where his situation and the CEO's situation are different. If the CEO grows the company he may be looking at tens of millions, and even if he doesn't cash in initially his experience would allow him consideration for possible CEO positions at mega corporations which pay in the multi-millions yearly.
...which is what I assumed in the first place but then I read this thread and 10 separate people say you can get stuck with no career progression very easily. I know there is a large gap between the average corpfin role and CEO, but with the drive and work ethic of some of the people here who are trying just to break into IBD, how hard can it be? Do well, make money for the company, get promoted, rinse and repeat.
Short the airline, stash a parachute somewhere, crash the plane. It's not that hard.
Totally mixed bag. I'm at a F100 and we have Senior Managers breaking 200k for 50 hour weeks. Just depends on what you're talking about.
Seriously? Are you sure this is true for Corp Fin Sr. Managers?
If so, I'd definitely stay there for a while. From what I've seen thats at least $50-70k above average.
Also, to those talking about progression above. I think being smart and hard working (and not politically screwing yourself) can get you to Sr. Manager. After that, it takes a combination of factors to get you to Director and above.
At my company (F500 tech) here is what progression / comp looks like...if you are good but not a rockstar you are likely to cap out at the director level making ~$300-400K...if you are average you'll cap out at a sr. manager level making like $250K.
Structure (from top to bottom): - C-Executive Level: total comp $5M+/year (top 20 people or so) - VP Level : total comp ~$2-5M/year (next 1-2% of total employees) - General Manager Level: ~$500K-$2M/year (next 2-3% of total employees) - Director / Sr. Director Level: ~$300-500K/year (next 20%) - Manager / Sr. Manager Level : $150-300K/year (next 50%) - Analyst / Sr. Analyst: $100-150K/year (bottom 25%)
At the end of the day, most people choose banking or other finance type jobs because the financial upside is much larger. At a F500 you have a lot more job security but comp, as mentioned by many above, even at senior levels will be what an associate or VP is making in finance. That said, a person with a banking work ethic + intelligence can succeed very easily at a F500 and be a rockstar eventually getting to a GM+ position where they will make 7 figures a year by the time they are 40. The other trade off is work / life balance...at a F500 you'll be working 50 hours a week which affords the time to do other things including spending time with your family, travelling ,etc. It's really a lifestyle choice. If you are in it for the money in the short-term then it's better to stay in banking, PE, etc. In the long-run though if you are smart, hardworking, and can successfully maneuver the politics of a large F500 then you can quite easily achieve what the OP suggests and get to a very senior role and make a great living.
thanks for this. can you specify the type of role here? is this corporate development /strategy? this seems very high for fp&A or treasury roles. in my company, F1000 tech, this seems more accurate for engineering and product management types.
corporate finance is NOT investment banking, where you can pretty much expect to become a VP at some point in your career. unlike investment banking, VP is not an inflated role in a F50-F1000.... very few will ever become a VP, and they are usually in their late 40s to early 50s when this happens.
and sorry to burst bubbles about work-life balance here, but a VP at a F1000 company works hard, probably an average of 60-70 hours a week (much longer during busy times). and they have to travel internationally a lot, which can be pretty taxing. work-life balance is there for the less ambitious folks who are happy with being a senior analyst or low-level manager for the rest of their careers.
those are the ranges for all non-engineering / technical roles...jobs like corpdev/strat tend to be at the higher end of the range while FP&A / reporting jobs tend to be at the lower end.
Harvardgrad's company pays much better than the vast majority of f1000s. You are much more likely to be looking at something like this at all but a handful of companies.
FA -> SFA-> Mgr -> Sr. Mgr -> Director -> VP -> CVP/CFO
$55K-$65K -> $66K - $85K -> $85K - $100K -> $100K - $125K -> $125K - $250K -> $250K - $500K -> $250K - 7 figures
The only time it would be advisable to work at a F500 out of college is if you want to learn an industry. Don't go work for an industry you have no interest in. Let's be honest, the work at the entry-level F500 is not that difficult and does not open any doors on a technical level (different for "hot" industries like Tech, Energy etc.).
Put your 3-4 years in at the F500 (obviously F10 or F20 is much better than F1000) and leverage the name into a better position or shoot for a good MBA. You can land either a very good finance gig or go back into corp fin but at a much higher level. But to say that climbing the corporate ladder at a F500 company post-undergrad is a good option would be ridiculous....not enough money and not enough valuable experience (if you're doing strategy/bus-development out of undergrad then that totally different).
i don't know how i feel about this. brand recognition aside, i don't know if larger companies REALLY provide a better experience than smaller ones. in fact, i would argue that analysts probably get better experience at smaller firms.
from my experience in FP&A at a large firm, i've noticed that there is an "assembly line" nature to the job. one person is responsible for operating expenses related to marketing, another engineering, another does revenue. then there are other teams for tax, non-operating expenses, G&A expenses at the corporate level, and finally there's a team responsible for consolidating all this data into the P&L, balance sheet, etc.. these roles can become very narrowly focused and process-driven, which makes it difficult to get perspective of the company's operations.
i've tended to notice that financial analysts and accountants at smaller firms are more likely to put on many hats, doing everything from preparing taxes, to technical accounting, budgeting, sox compliance, and putting together the financial statements. they are better situated to understand the overall business and get a better learning experience.
My bad kids, didn't realize we were limiting this to Corp Fin. The numbers I gave are accurate for strat/analysis positions.
smaller firms = more exposure to management/ meaningful work but also means less likely to get a top MBA, so there is a trade-off. If one wants to go somewhere outside of industry in the future (banking/PE/consulting etc.) then they should gun for the best company possible to get the best MBA possible. If one wants to stay in industry I think small companies give you a better chance for advancement. The consensus on corp fin seems to be you can get stuck at a certain point before you know it is too late, the pay can be stagnant, and most top (Strat/Development) corp fin jobs go to former IBers. I want to know, generally, what industries pay the most? I'm thinking Tech, Energy, Pharmaceuticals, and Healthcare have to be in the lead, is this a correct assumption?
yes absolutely.
right again. there are exceptions, but it would be damned near impossible for someone like me (financial analyst at f1000 tech) to "network" my way into a corp dev role because i simply don't have the deal experience. also, an entry level corp dev role at my firm has the title of "manager", which mirrors the culture that ibanking has by inflating titles. it would be a very tough sell to go from analyst to manager overnight.
to anyone who wants to work in a corporate finance role in the long term, whether it's corp dev, fp&a, treasury, or anything in between, my advice is this: don't start your career in corporate finance unless it's an FLDP-like program. start in investment banking, start with management consulting... heck, you can even start with Big 4 Audit. starting here will put you on the fast-track to promotion once you make the jump.
This is the advice I've given many times on this board. Starting in a F500 as a non-FLDP analyst makes climbing the ladder VERY difficult. Starting outside of the Company altogether is probably the quickest way, on average, to make Manager. The jockeying for promotions really starts at the Manager level.
Bears1208 compensation numbers are pretty accurate for most of the F500, from what I'm aware.
It's all about brand recognition, some F1000 companies are more known than a mature, stagnant F50 company and I will agree that more likely than not the smaller firm will get you better overall experience. With that being said, some of these big companies, especially in the energy industry have very elaborate and competitive training programs and you really do learn a lot. I do agree that most of this shit is assembly line work and can get quite boring at times. If you're shooting for a top MBA then brand recognition will really help you get there.
bears nailed it pretty much spot on to what i posted earlier. That's the order and once you get passed the manager level the amount of openings are few and far between. Like pacman... I think getting an mba.. paying off any debt you may have and working through at least a 1st or 2nd year VP level and parachuting into a bus dev position in an f100 wouldn't be terrible. Your comp will drop dramatically but you'll still be in the 250K+/year range and have a lot better work-life balance. Really depends on your priorities but climing from entry-level UG as an FA to a VP... watch 20 years of your life pass you by while people leave after 3 years for mba and come back 7 years later significantly ahead of you.
F50 is great
I always wonder what company harvardgrad works for because he always says he works for a well-known tech company. :D
Well if you look at the F500 it can really only be one of the following: HP, IBM, Apple, Microsoft, Dell, Intel, Cisco, Amazon, Google, Oracle, eBay, Yahoo, Symantec. :)
But I'll never confirm or deny. muahahahaha.
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