Lateral to LevFin

Breaking into LevFin from a non-traditional background like commercial real estate debt advisory is challenging but not impossible. Based on the most helpful WSO content, here are some insights and actionable steps:

1. Feasibility of Transitioning to LevFin

• Non-Traditional Backgrounds: While it's less common, lateral hires into LevFin from non-traditional backgrounds do happen. Success often depends on how well you can position your transferable skills and demonstrate your commitment to learning the technicals.
• Expectations: At the Analyst level, you would likely be expected to have a solid grasp of core technical skills, such as building LBO models, normalizing EBITDA, and understanding financial statements. However, some firms may provide training or expect a learning curve, especially if you can show strong foundational knowledge and a willingness to upskill.

2. Key Areas to Focus On

• Technical Skills: Since your current experience is CRE-focused, you'll need to bridge the gap by mastering LevFin-specific technicals. This includes:
  • Building LBO models.
  • Understanding capital structures and credit metrics.
  • Analyzing financial statements beyond CRE.
• Networking: Cold emailing, reaching out to LevFin professionals, and leveraging LinkedIn or alumni networks can help uncover opportunities. Many lateral roles are not publicly posted, so proactive networking is crucial.
• Certifications and Courses: Highlighting your CFA progress is a plus, but consider supplementing it with targeted courses on financial modeling and LevFin-specific topics to demonstrate your commitment.

3. Practical Steps

• Upskill: Dedicate time to mastering LevFin technicals. Resources like WSO's financial modeling courses can be invaluable.
• Tailor Your Story: Frame your CRE experience as a strength. Emphasize your credit knowledge, deal exposure, and ability to adapt to new industries.
• Target Firms Strategically: Focus on firms or teams that may value diverse backgrounds or have a history of hiring non-traditional candidates.
• Prepare for Interviews: Be ready to discuss your transition story, demonstrate technical proficiency, and show enthusiasm for LevFin.

4. Challenges and Realities

• Competition: The lateral market can be competitive, especially for roles like LevFin, where traditional IB or credit backgrounds are often preferred.
• Learning Curve: While some training may be provided, you’ll need to show initiative and hit the ground running as much as possible.

By focusing on these steps and leveraging your existing skills while addressing gaps, you can improve your chances of making the transition.

Sources: Joining LevFin and FSG at this point in the cycle, Leveraged Finance – 2017 Update, Lev Fin Outlook & Best Groups 2020, Leveraged Finance Exit Opportunities, Credit Analyst Q&A