How bad are ER exit opportunities to strategy / corp dev?
I have a LO ER offer out of college but getting fomo seeing friends go into management consulting with all the exit opportunities available to them. Long term I want to do strategy / corporate development but could see myself enjoying AM for a good few years. Am I screwing up by taking this offer and not looking further? It's not a particularly prestigious shop but seems to have a decent training program.
It's not clear what you meant by LO ER, but assuming you have an offer from a LO fund (not SS ER), it's not common. Corp dev positions usually require some transactional experience, which LO cannot provide. I've seen a few SS ER folks move to the company they cover. They know the management, and they know the business.
But it's not the end of the world. You may end up really enjoying the LO work. You can also consider other routes like LO -> MBA -> strategy.
You can make the move to a hybrid strat/corp dev role in the industry you cover. A pure corp dev role is going to be hard but hybrid is doable.
I’d be open to hiring someone with an ER background. Just do consulting style interview prep and be ready to make recommendations for what a company should do in interviews. Also, depending on the company, you might have a modeling test too so be prepared for that as well.
One more nuance in recruiting is that a lot of roles have requirements of IB, consulting, or corp strat experience. If recruiters are stringent about this, it could be harder for you to do blind apps. I would still apply but would concurrently and thoughtfully reach out to hiring managers as well.
would this be true for someone with credit experience as well covering that sector?
Less so but still doable imo.
Consulting / corporate strat I get. Why IB is sought after for corp strat? I argue ER folks are paying more attention to competitive dynamics of their coverage everyday? (I don't know, never worked in ER)
The corp dev team primarily focuses on M&A, strategic partnership, securing funding, restructuring, etc., among other things. And transactional experience is often deemed necessary.
My reply on preference was in reference to hybrid roles. For pure corp strat, consultants and ex internal strategy people with relevant experience are preferred at many companies.
On research vs. banking, I don’t think most people would be against hiring research folks. It’s just that there is a large proven talent pool with regards to financial modeling/analysis, executive presentation skills, and work ethic in banking. It’s not that ER folks don’t have these skills, but if I’m creating a job posting, I’m not even thinking that ER is a talent pool for corp strat because it’s not at top of mind.
Also, I didn’t even think ER people were interested in strat/corp dev until I saw this and a couple other threads.
Do you think being open to hiring people from ER backgrounds is relatively rare for your peers? I'm trying to figure out whether it's worth the costs associated with pivoting to consulting now (more applications, lower salary, less pre-existing network etc.)
If you ultimately want to end up in corporate strategy sooner and with an easier path in, then yes. But if you want to try LO investing with the option of corp strat, then I wouldn’t make the move.
As for how hiring managers think about potential ER hires, they don’t. It’s not something that’s thought about.
Most people fundamentally care about hiring intelligent people with requisite financial and analytical skills who possess high eq and maybe some relevant industry experience. On the basic skills and intelligence front, being in ER signals both for me.
Two skills that you might not gain in ER in a significant manner are PowerPoint and cross functional project management. It sounds silly but creating excellent decks is pretty important and does take experience. On the project management front, I have no idea how much complex, cross functional interaction you have but if I had to guess, it’s probably nowhere near a banker, consultant, or ex strategy person’s experience.
This is where I probably differ versus some peers, but I think both skills can be taught pretty quickly (~ 3 months) given a person is coachable and possesses high eq.
I'll say this. Most people on this site just regurgitate that they hear. If you do some digging you'll see ER people in all types of corporate roles. I'm currently in ER and one of the companies I cover just hired a senior analyst from Fidelity to be head of corp dev. That person has no IB, PE, or consulting experience.
ER is generally a small pool both SS and buyside. People in ER generally aren't interested in many corporate roles aside from IR. Most of the people that join AM just typically don't leave because there's never a real reason to unless you hate the markets which means you shouldn't be in the field anyway. The raw skills in ER aren't entirely different than IB aside from the PowerPoint aspect, which is probably the easy skill to learn literally just by looking at decks. Also not sure how IB analysts gain "executive presentation" skills considering that in my time in IB vs ER I never talked to a client vs. that being everyday reality in ER. One could argue that the presentation skills gained in ER from actually gaining pushback on your ideas and opinions is more valuable then lecturing clients.
The problem is not what YOU think - it's that idiot recruiters see resume from ER, they just reject because they are in "investment banking" or "management consulting", which show up in the job description, because likely both recruiters and the hiring managers have no awareness of ER as a profession (probably don't even know the difference between buy-side and sell-side)
That creates a problem from entry point perspective.
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