Moving to the buyside from boutique ER
I've spent the past two years at a smaller, less well-known boutique ER firm (think Seaport, Edgewater, Roth MKM) and am now looking to transition to one of the big MM HF's. My current team focuses heavily on channel checks, so I haven't had as much experience with modeling and writing as others might have. How feasible is it to make this move directly? Would it make more sense to go to a top-ranked analyst at a BB first? Any advice is greatly appreciated. Thanks
Transitioning directly from a boutique ER firm to a big MM hedge fund is challenging but not impossible. Based on the most helpful WSO content, here are some key considerations and advice:
Skill Gaps:
Since your current role focuses heavily on channel checks, you may lack the modeling and writing experience that hedge funds typically value. Hedge funds often prioritize candidates with strong financial modeling skills and the ability to generate investment ideas. To address this:
Direct Transition Feasibility:
While it's possible to move directly to a hedge fund, the lack of modeling experience might make it more difficult. Hedge funds often prefer candidates from BB or top-tier ER firms due to their established training programs and skillsets. If you can demonstrate your ability to learn quickly and add value, you might still have a shot.
Alternative Path - BB ER:
Moving to a top-ranked analyst role at a BB could be a more strategic move. BB ER roles provide:
Networking:
Aggressively network with headhunters and professionals in the hedge fund space. Highlight your unique experience with channel checks, as this could differentiate you from other candidates. However, be prepared to address your modeling and writing gaps during conversations.
Preparation for HF Interviews:
Hedge fund interviews often test your ability to pitch investment ideas, analyze financial statements, and discuss market trends. Prepare thoroughly by:
In summary, while a direct move to a big MM hedge fund is feasible, addressing your skill gaps and leveraging networking will be critical. Alternatively, transitioning to a BB ER role first could provide a more structured path to your goal.
Sources: Breaking into buy-side equity research - my experience, Q&A: 1st year VC analyst (~750M AUM), Q&A: MD in M&A and Cap Markets (Bulge Bracket and Boutique experience), Transitioning from IB/ER to HF Series - Part 2: Where to Interview and Behaviorals, Hedge Fund Guru Answering Inbox Questions Here. Thanks Mr. Pink Money
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If you don't have the skills you need for your next job, you need to get them somehow, whether that is through hard work on your own or by moving to a real team at a real shop.
I'm not saying this to be mean, but to be realistic, coming from someone who has been in ER for a lot longer than you, and is trying to break into the buy side.
The big MM's want to interview the best of the best, because that's what they are themselves. They are interviewing from IB, PE, ER and people already on the buy-side. If you were Citadel, would you hire someone with 2 years of experience that can't model?
I'm not saying it's impossible, but it requires a lot of work. Good luck
On the contrary
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