I’ve been interviewing at a lot of boutique CF houses and initially I thought I had a strong profile after working c. 3 yrs at a Big4 (Business Modeling and Valuation team).
As I have +6 yrs of experience they keep telling me that modeling/valuation work is not as important as understanding the deal cycle/process/project management part of a transaction.
So they tell me that even though I have this experience it is way easier for them to pick someone with 1 yr of CF experience.
But in order to move into IB, CF, PE I know I need to do deals and understand the processes.
Am I applying to the wrong firms? I would expect boutique CF houses to be less competitive than BB IB firms, PE etc.
Any thoughts?
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Based on the most helpful WSO content, it seems like you're facing a common challenge in the finance industry. It's true that understanding the deal cycle, process, and project management aspects of a transaction are crucial in Corporate Finance (CF). However, your modeling and valuation skills are also valuable, and it's surprising to hear that they're being downplayed.
It's possible that the boutiques you're interviewing with have a specific focus or approach that doesn't heavily rely on modeling/valuation. Or, they might be emphasizing the importance of deal experience because it's something you lack compared to other candidates.
As for whether you're applying to the wrong firms, it's hard to say without more information. Boutique CF houses can indeed be less competitive than BB IB firms or PE, but they also might be looking for different skill sets or experiences.
Here's a bit of monkey wisdom for you: don't get discouraged. Keep applying and interviewing. Consider broadening your search to include other types of firms, or roles that might value your modeling/valuation skills more. And remember, every interview is a learning experience and a chance to improve. Keep swinging from those branches, and you'll find the right tree eventually!
Sources: BB vs. Boutique? Why always BB, Does IB/PE Kill Your Creativity and Intellectual Curiosity?, Capital Markets vs. Boutique M&A
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What is a boutique Corporate Finance house? Corporate Finance in this forum mostly just means FP&A, Accounting, Corp Dev, IR, Treasury... The departments under the CFO at a F500 company. Where, no, modeling is not particularly important (besides in Corp Dev)
What is a boutique CF house?
For Corp Dev, understanding the modeling is critical. If you are interviewing for Manager+ positions, knowing the process is indeed crucial. Perhaps you are targeting roles too high up given your knowledge base?
Are you talking about small IB firms when you mention boutique CF houses? If so they're kind of right - I started my career at a small regional boutique and even though I had to model, a lot of my work was managing / supporting the deal process, which a lot of times doesn't involve modeling / excel. They're kind of right to a certain extent that there are candidates with more applicable experience, but at the same time the barrier to entry should be lower with these boutiques. My guess is that the tight hiring market makes them less likely to take a risk on someone without direct applicable experience, but I'm just making an assumption. Either way keep trying - going from Big4 valuation / modeling to IB is pretty doable so it might just be a numbers game at this point for you.
Yes, what I mean is probably a boutique IB firm such as "Big4 Corporate Finance team" just smaller.
When I go to interview at these places they look at me saying "You know, what we're doing isn't rocket science so do not expect us do extensive modeling and proper valuations"
I just got an offer from a small LMM IB which I expect to take, however, I don't know if I should have aimed for larger investment banks. However, the competition seems much higher at these firms...
Nice congrats on the offer! In the end it depends what you want to do. Experiences will wildly vary, but the modeling experience I did at my LMM gig was more than sufficient for what I wanted to do in CD, corporate finance, etc. It was also enough for getting offers for some LMM / MM PE gigs (to be fair I had to study for these too).
I think name will carry you a bit further if you're able to get into one of the larger investment banks, but to your point they're more competitive. I think a good potential strategy is stay at your LMM for 1-2 years then transfer to a larger bank depending on your career goals. I would just take the offer for what it is and play it safe, but that's just me.
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